An Original Contribution to Understanding Regulatory Competition and Convergence in African Business Law Systems

Regulatory competition theory predicts that jurisdictional competition for foreign investment and business registration will drive convergence toward investor-friendly legal standards, yet the empirical trajectory of African business law convergence, and Nigeria's strategic position within the competitive landscape of African business law, has not been examined through an original theoretical and empirical framework. This study makes an original contribution to understanding regulatory competition and convergence in African business law by developing an African Business Law Competitiveness Index (ABLCI) and testing regulatory competition and convergence hypotheses using legal and economic data across 15 African jurisdictions from 2010 to 2023. The ABLCI measures business law competitiveness across eight dimensions: company formation efficiency, contract enforcement quality, intellectual property protection, competition law effectiveness, investor protection standards, insolvency resolution quality, dispute resolution accessibility, and regulatory predictability. The index is constructed using original primary data collection (surveys of 200 businesses across 5 key African markets), secondary institutional quality indicators, and expert legal assessments. Panel data regression tests whether legal quality improvements are associated with FDI attraction and business activity. Regulatory convergence is measured using beta convergence methodology adapted from economic growth literature. Results indicate that African business law systems show partial convergence driven by World Bank Doing Business incentives but diverge on substantive investor protection and insolvency quality. Nigeria shows above-average competitiveness in company formation and dispute resolution but below-average performance in insolvency and intellectual property quality. The study constitutes an original methodological and theoretical contribution to comparative African business law scholarship.

Keywords: regulatory competition, business law convergence, Africa, FDI, business law index