Nigeria: Court Rules NIHOTOUR Cannot Regulate Hotels In Lagos, Awards HOMAL ₦10m

The President of the Hospitality and Tourism Management Association of Lagos [HOMAL], Chief Sam Alabi, has briefed the media that the association secured a landmark judgment at the Federal High Court declaring aspects of the National Institute for Hospitality and Tourism [NIHOTOUR] Establishment Act, 2022, relating to the regulation, registration and certification of hospitality and tourism personnel operating wholly within Lagos State, unconstitutional.

Chief Alabi disclosed this while addressing the media at a press conference in Lagos on Monday, October 19, 2026. He said the court also ordered NIHOTOUR to refund payments made by HOMAL members following its enforcement activities, restrained the institute and its agents from carrying out specified enforcement actions against the members under the contested provisions of the Act, and awarded ₦10 million in favour of HOMAL.

According to the association, the judgment arose from Suit No. FHC/L/CS/906/2025, filed at the Federal High Court following a prolonged disagreement over the implementation of the 2022 Act.

Chief Alabi described the ruling as a significant development in the dispute over the respective regulatory responsibilities of federal and state authorities in Nigeria’s hospitality and tourism industry.

The association said the court affirmed that the Lagos State Hotels Licensing Authority Law, 2010, governs tourism establishments within Lagos State and that NIHOTOUR lacks constitutional authority under the 2022 Act to regulate or revoke operating licences issued by the Lagos State Government to businesses belonging to HOMAL members.

The judgment, as reproduced in HOMAL’s press statement, also declared unconstitutional, illegal, null and void the enforcement activities undertaken by NIHOTOUR against the association’s members within Lagos State pursuant to the contested provisions.

The decision has brought renewed attention to the debate over the division of regulatory responsibilities between federal and state institutions in Nigeria’s hospitality and tourism sector.

NIHOTOUR was created in 1987 following a tripartite agreement involving the United Nations Development Programme [UNDP], the International Labour Organization [ILO] and the Nigerian Government, according to HOMAL.

The association argued that the institute operated for many years without a specific statutory foundation before legislation establishing it was eventually enacted in 2022.

HOMAL recalled that tourism stakeholders were invited to the House of Representatives in 2017 to review a proposed bill for NIHOTOUR’s establishment. At the public hearing, stakeholders reportedly objected to several provisions, arguing that they encroached on the constitutional responsibilities of state governments and the functions of other federal agencies.

According to the association, the objections centred on provisions that would give NIHOTOUR powers over the registration and certification of hospitality and tourism personnel, the grading of employees, and the determination of service and manpower standards for businesses operating within the states.

The association said the bill remained dormant for several years before the National Institute for Hospitality and Tourism [Establishment] Act was enacted in 2022.

It alleged that several provisions opposed by stakeholders during the 2017 consultations were retained in the final legislation.

Although HOMAL acknowledged that NIHOTOUR requires appropriate statutory powers to perform its functions as a federal training institution, it maintained that those powers should not extend to regulating businesses and personnel in ways that conflict with the constitutional responsibilities of state governments.

The association said it raised its concerns with the institute’s leadership in 2022, urging it to avoid implementing the disputed provisions to prevent prolonged litigation.

The disagreement reportedly intensified following the assumption of office of NIHOTOUR’s current Director-General in late 2024.

HOMAL alleged that the institute subsequently began implementing provisions of the 2022 Act that had previously not been enforced by the former leadership.

According to the association, the Director-General initially invited chief executives of its member organisations to a meeting in Abuja with less than 48 hours’ notice. HOMAL said none of its members’ representatives could attend because of the short notice.

The association said another letter was issued in March 2025 demanding the immediate registration of the chief executives of its member organisations and their heads of department.

Following legal consultations, HOMAL said it wrote to NIHOTOUR on March 10, 2026, formally objecting to the demands for the registration of its members’ businesses and principal officers.

It alleged that the institute disregarded the objection and intensified efforts to secure compliance, including engagements with the Nigerian Immigration Service and a then-Deputy Inspector-General of Police.

HOMAL maintained that its objection was not a rejection of professional training or improved standards in the hospitality industry but a challenge to what it considered an unconstitutional expansion of NIHOTOUR’s regulatory powers.

The association subsequently instituted the Lagos Federal High Court action in May 2026, seeking judicial intervention.

HOMAL further alleged that NIHOTOUR continued its enforcement activities despite the pending court proceedings.

According to the association, several members’ business premises were invaded and shut, with some businesses reopening only after payments of ₦2.5 million were made to an entity identified in its statement as “NIHOTOUR Training, Research and Consultancy”.

The association also alleged that a staff member of one of its members sustained an injury that resulted in the loss of sight in one eye during one of the enforcement operations.

HOMAL said it eventually obtained a court order that halted the enforcement activities it described as aggressive and unlawful.

The allegations contained in the press statement could not be independently verified from the material available for this report. NIHOTOUR’s response to the allegations was also not included in the statement.

The controversy has raised concerns about the conduct of regulatory enforcement, the legal basis for collecting fees from private businesses and the need to ensure that regulatory agencies operate within their lawful mandates.

Beyond the enforcement dispute, HOMAL accused NIHOTOUR of attempting to undermine its legal standing by asking the Corporate Affairs Commission [CAC] to withdraw the association’s registration certificate, which it said was obtained in 2018.

According to HOMAL, NIHOTOUR alleged that the association was being used to divert revenue meant for the Federal Government into its own accounts. The association also said a similar letter was sent to the Economic and Financial Crimes Commission [EFCC].

HOMAL maintained that it challenged the attempt to withdraw its registration and suggested that the move was intended to weaken its ability to represent its members in court.

The association argued that, regardless of its formal registration status, individuals and businesses could still pursue collective legal action where the law permits.

The press statement did not provide the outcome of any separate CAC or EFCC investigation into the allegations reportedly raised by NIHOTOUR.

HOMAL also disclosed that six of its members were served with court papers earlier in 2026 in connection with a separate case brought by NIHOTOUR against 16 hotels in Abuja.

The association said it was defending the interests of the affected members in the Abuja proceedings and expressed confidence that the courts would resolve the matter fairly.

The Abuja case is distinct from the Lagos action and should not be confused with the judgment announced by HOMAL at Monday’s press conference. The outcome of the separate proceedings was not stated.

According to the judgment reproduced in HOMAL’s press statement, the court granted the association seven principal reliefs.

First, it declared that provisions of the NIHOTOUR Establishment Act, 2022, dealing with the standardisation, registration and certification of hospitality and tourism manpower, the imposition of minimum manpower requirements, the specification of skills and the certification or registration of qualified personnel are unconstitutional and beyond NIHOTOUR’s powers insofar as they apply to establishments wholly situated and operating within Lagos State.

Second, it declared that the Lagos State Hotels Licensing Authority Law, 2010, regulates tourism within the state.

Third, it held that NIHOTOUR lacked constitutional authority under the 2022 Act to regulate or revoke operating licences issued by the Lagos State Government to the claimants’ members.

Fourth, it declared NIHOTOUR’s regulations and enforcement activities against HOMAL members within Lagos State under the contested provisions unconstitutional, illegal, null and void.

Fifth, it issued a mandatory order requiring NIHOTOUR to refund payments made by HOMAL members pursuant to the institute’s enforcement operations.

Sixth, it granted a perpetual injunction restraining NIHOTOUR and its agents from carrying out the specified acts of forceful enforcement, arrest, detention and collection of money or fees under the contested provisions of the Act.

Finally, the court awarded ₦10 million against NIHOTOUR in favour of HOMAL.

The precise scope and practical implementation of the orders will depend on the terms of the court’s enrolled judgment. The full judgment was not reproduced in the material supplied for this report, and the institute’s position on the ruling was not available.

HOMAL said the judgment provides protection for its members against what it described as physical harassment and improper revenue collection by NIHOTOUR.

The association maintained that the decision clarifies the regulatory relationship between its members and the federal institute, at least in respect of the issues and geographical scope addressed by the court.

It also acknowledged that the parties against whom the judgment was entered may exercise their legal right to appeal.

HOMAL nevertheless argued that the judgment remains operative unless and until it is set aside or otherwise affected by a competent appellate court.

For hotels, hospitality businesses and tourism operators in Lagos, the dispute raises questions about compliance requirements, licensing responsibilities, professional certification and the limits of federal regulatory authority.

The judgment, as described by HOMAL, specifically concerns establishments wholly situated and operating within Lagos State. It should not automatically be interpreted as resolving every question concerning NIHOTOUR’s powers elsewhere in Nigeria or invalidating all the institute’s statutory functions.

In particular, the dispute does not necessarily remove NIHOTOUR’s role in training, capacity development or other lawful activities within its statutory mandate.

In his address, Chief Alabi sought to distinguish the association’s legal challenge from opposition to improving professional standards.

HOMAL said its members comprise individuals and corporate organisations that have invested their resources in developing hospitality and tourism businesses and have an interest in improving their facilities, services and operating practices.

The association argued that the development of manpower and professional competence should not be used to justify regulatory powers that conflict with the constitutional division of responsibilities between the federal and state governments.

It questioned the basis for a federal agency to exercise the contested regulatory powers over tourism establishments operating entirely within Lagos State, insisting that state licensing arrangements must be respected.

The position places HOMAL’s argument within a broader policy debate about how Nigeria can improve the quality and professionalism of its hospitality industry while avoiding overlapping mandates, duplicative fees and conflicting enforcement requirements.

Chief Alabi assured HOMAL members that the association would defend the judgment against any appeal and urged them to continue their lawful business operations without fear of unlawful harassment.

HOMAL said it remained prepared to pursue further legal action where necessary to protect its members’ interests.

By Dr. Lucky George