Nigeria's President Signs Transformative Investment Act
Nigeria's President Bola Ahmed Tinubu has signed the Investment and Securities Act (ISA) 2024 into law, marking a significant step in fortifying the legal and regulatory framework for investment basics and capital market activities in the country. The new Act, which repeals the former Investments and Securities Act No. 29 of 2007, introduces several structural reforms and aligns Nigeria's regulatory framework with global standards set by institutions like the International Organization of Securities Commissions (IOSCO).
The ISA 2024 introduces a range of reforms, including the establishment of a framework for regulating clearinghouses, trade depositories, and central counterparties. For the first time, virtual assets and investment contracts are formally classified as securities under the Act. The law also categorizes exchanges into Composite and Non-composite types, with Composite exchanges able to list and trade all securities and products. Legal provisions for commodity exchanges and warehouse receipts have been introduced, expected to boost sectors such as agriculture and mining.
The Act expands the regulatory authority of the Securities and Exchange Commission (SEC) Nigeria to align with global standards. This process often involves collaboration with various organizations and interest groups, including the Nigerian Stock Exchange (NSE), Financial Services Regulation Coordinating Committee (FSRCC), Bureau for Public Enterprises (BPE), Nigerian Economic Summit Group (NESG), Nigerian Bar Association (NBA), Central Bank of Nigeria (CBN), Nigerian Institute of Chartered Accountants (ICAN), and Association of National Accountants of Nigeria (ANAN).
The SEC Nigeria describes the presidential assent of the ISA 2024 as a 'transformative step' for investor protection, market transparency, and sustainable growth. The new Act aims to strengthen Nigeria's investment landscape, attract more fidelity investments, and boost economic growth.
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