Nigeria updates

Banking & Financial Services

Contributed by Aluko & Oyebode
Stamp duty reform under Finance Act: market update on impact of cross-border transactions
  • Nigeria
  • 15 December 2020

The Finance Act's enactment in January 2020 was heralded as a milestone event due to the far-reaching amendments that it made to several tax statutes. The main amendments to the Stamp Duties Act are the introduction of electronic documents as chargeable instruments and provision for electronic receipts and stamping, which demonstrate the government's aim of increasing government revenue by considering the impact of technological advancements on commercial transactions.

How should Nigeria regulate its fintech industry?
  • Nigeria
  • 29 November 2019

The financial services and products offered in Nigeria have changed significantly in recent years as a result of scientific and technological innovation and ever-evolving consumer behaviour and needs. In turn, this has resulted in a proliferation of new fintech companies. Due to the value of the fintech sector and the impact that fintech companies and products have had on society, financial services regulators have been left to determine how best to regulate this industry.

Legality of foreign currency-denominated loans by Nigerian banks
  • Nigeria
  • 26 July 2019

A recent Federal High Court decision has raised doubts as to the legality of foreign currency-denominated facilities. The Central Bank of Nigeria Act makes it clear that the naira is the currency of payment for the domestic supply of goods and services in Nigeria. However, the designation of the naira as legal tender in Nigeria does not suggest that the use of any other currency as a medium of exchange within Nigeria is prohibited.

Financial inclusion: Central Bank of Nigeria introduces payment service banks
  • Nigeria
  • 22 March 2019

In a bid to promote a sound financial system and enhance access to financial services for low-income earners and the unbanked segments of the Nigerian population, the Central Bank of Nigeria recently issued the Guidelines for Licensing and Regulation of Payment Service Banks (PSBs) in Nigeria. The main objective of establishing PSBs is to enable high-volume, low-value transactions in remittance, micro-saving and withdrawal services in a secured technology-driven environment.

CBN issues draft guidelines to address cybersecurity in financial sector
  • Nigeria
  • 30 November 2018

In view of the increasing focus on cybersecurity worldwide and the rise in cyber threats both in and outside Nigeria, the Central Bank of Nigeria recently issued a draft risk-based framework and guidelines on cybersecurity for deposit money banks and payment service providers. The draft guidelines aim to complement and build on the Cybercrimes (Prohibition, Prevention) Act 2015 by promoting cybersecurity and protecting computer systems and networks and electronic communications.

Employment & Immigration

Legality of retaining travellers' passports on arrival in Nigeria amid COVID-19 pandemic
  • Nigeria
  • 22 July 2020

The Federal Airports Authority of Nigeria and the Presidential Task Force on COVID-19 have issued guidelines and directives to curtail the further spread of COVID-19 and protect airport users. Notably, on arrival in Nigeria, passengers cleared through the Nigeria Immigration System's Migrants Identification Data Analysis System will have their passports retained until they have successfully completed 14 days' self-quarantine. This article outlines the legality of this requirement.

New visa policy introduced
  • Nigeria
  • 10 June 2020

In early 2020 President Muhammadu Buhari introduced the new Nigeria Visa Policy 2020. According to the president, the policy is intended to attract innovation, specialised skills and knowledge to complement and improve the country's local capacity in order to support the attainment of a globally competitive economy and reflect international best practices. This article provides a summary of the various visa categories.

Immigration permits and COVID-19
  • Nigeria
  • 29 April 2020

This article outlines the potential impact of the COVID-19 pandemic on immigration permits as employers apply to expatriate workers in Nigeria. Immigration permits are time bound and for a definite period. Thus, one key question remains: if the lockdown is extended for several months beyond the initial 14-day period, will it be necessary to extend the tenure of the expatriate quota to cover the lockdown period in affected states?

Impact of COVID-19 on employment law
  • Nigeria
  • 22 April 2020

The world economy has come to a halt due to the COVID-19 pandemic, with many countries having implemented stay-at-home or social distancing policies to curtail the spread of the virus. On 27 February 2020 Nigeria recorded its first case of COVID-19 and since then, the number of cases has increased drastically and shows no sign of slowing. This article considers the impact of COVID-19 on Nigerian labour law.

Ministerial consent for release of oil and gas workers: unwarranted interference in employment contracts
  • Nigeria
  • 04 December 2019

The Department of Petroleum Resources (DPR) recently issued guidelines in order to establish procedures for obtaining the consent of the minister of petroleum resources before releasing Nigerian workers in the oil and gas industry. The guidelines have been met with widespread criticism, mainly with regard to the DPR's legal right to issue regulations which not only interfere with, but also call into question the sanctity of, employer-employee contractual relationships.

Energy & Natural Resources

Contributed by Streamsowers & Köhn
Local Content Development and Enforcement Bill 2020 undergoes second reading
  • Nigeria
  • 03 August 2020

The Local Content Development and Enforcement Bill 2020 recently passed its second reading in the House of Representatives and was subsequently referred to the Committee on Nigerian Content Development and Monitoring for further consideration. The bill seeks to amend the Oil and Gas Industry Content Development Act by expanding its scope to capture changes in the industry.

New bill seeks to align Oil and Gas Industry Content Development Act with industry best practices
  • Nigeria
  • 27 July 2020

The Oil and Gas Industry Content Development Bill 2020 recently passed its second reading in the Senate and was subsequently referred to the Committee on Local Content for further consideration. The bill seeks to amend existing sections of, and introduce new sections to, the extant Oil and Gas Industry Content Development Act with the aim of aligning the act with industry best practices.

Gas Flaring and Minerals and Mining Bills undergo second reading
  • Nigeria
  • 06 July 2020

Two bills relating to the oil and gas industry recently passed their second reading in the Senate and the House of Representatives, respectfully. The Gas Flaring Bill seeks to prohibit gas flaring in Nigeria, while the Minerals and Mining Bill seeks to establish a regulatory framework for the Nigerian mining industry in line with international best practices and create a regulatory authority which will be responsible for ensuring fair competition and encouraging investments in the mining sector.

DPR issues COVID-19 circular and declares pandemic event of force majeure
  • Nigeria
  • 11 May 2020

After the president issued regulations directing a lockdown of areas where oil and gas companies' head offices are located, the Department of Petroleum Resources issued a circular to ensure the safety and welfare of all personnel and contain the spread of COVID-19, directing that all operators and their contractors must comply with the directives of government authorities on measures such as social distancing, curfews and lockdowns and that the current situation constitutes force majeure.

Deep Offshore and Inland Basin Production Sharing Contracts (Amendment) Bill submitted to National Assembly
  • Nigeria
  • 23 July 2018

The president recently submitted the Deep Offshore and Inland Basin Production Sharing Contracts (Amendment) Bill 2018 to the National Assembly for consideration and passage. The bill seeks to amend Section 16 of the Deep Offshore and Inland Basin Production Sharing Contracts Act, which was promulgated in 1999. If passed, it will alter the economic dynamics of production sharing contracts.

Shipping & Transport

Shipping loans and collateral damage
  • Nigeria
  • 21 October 2020

Shipping finance transactions are characterised by peculiar risk factors principally on account of shipping assets' transient operations. The applicable rules and mercantile uses – reflective of this reality themselves – must therefore be adequately factored into financiers' lending procedures and loan recovery strategies, whether they be banks or private investors. This article offers helpful guidance to such lenders.

Judicial saga of crew wage claims
  • Nigeria
  • 24 June 2020

In a recent ruling concerning a claim for crew wages, the National Industrial Court held that Section 254C(1)(a) of the Constitution clearly vests the court with the exclusive jurisdiction to hear and determine civil causes and matters relating to or connected with labour, employment, trade unions or industrial relations and matters arising from the workplace. The claim in question was for N500 million in compensation for the defendant's failure to observe safety standards and procedures during a fumigation exercise.

Vessel delays due to COVID-19: who bears the costs?
  • Nigeria
  • 10 June 2020

The president recently announced that only cargo vessels which have been at sea for more than 14 days can dock in Nigerian ports. The 14 days referred to by the president will start from the last port of call, which means that vessels trans-shipping in Tema or Cotonou before arriving in Nigeria will be subject to delays of at least 12 days before berthing. However, most shipowners have drafted clauses to excuse themselves and their ship from any liability arising from delays caused by COVID-19.

Demystifying ship arrests in Nigeria
  • Nigeria
  • 29 January 2020

Persons claiming against ships should be careful to comply with the detailed procedural requirements, otherwise valid claims may be compromised by the additional possibility of liability in damages. Ship interests equally need not go into panic mode on the arrest of the ship. A detailed review of the processes filed for compliance or non-compliance with arrest procedures should be the first step, possibly coupled with other extenuating measures.

What do caveats have to do with ships?
  • Nigeria
  • 06 November 2019

A caveat registered in the courts serves to prevent a ship's arrest by committing to pay a bond for any sum claimed against the ship which is equal to or less than the amount stated in the caveat. Entering a caveat against release does not automatically entitle the caveator to the security flowing from a ship in respect of which a caveat has been entered. A request for security can be made only when there is a subsisting claim against the ship in respect of which the caveat is entered.

White Collar Crime

Contributed by Sofunde Osakwe Ogundipe & Belgore
Lagos Division of the Court of Appeal rules that ex parte disclosure orders are constitutional
  • Nigeria
  • 14 December 2020

The Lagos Division of the Court of Appeal recently confirmed the constitutionality and validity of the Lagos High Court's granting of a proprietary injunction along with orders directing the defendants to swear to and file affidavits stating the location, nature and value of all assets that represented or were derived from the proceeds or fruits of certain transactions. The court pointed out that the rights guaranteed in the Constitution are not absolute and can be curtailed to protect the rights of other persons.

Yet another anti-corruption agency?
  • Nigeria
  • 19 October 2020

The federal government recently announced its intention to establish yet another anti-corruption agency. Given the ongoing accounting and management controversies surrounding assets which have reportedly been recovered by the existing agencies, there is reason to view this announcement with a degree of suspicion. If there is one thing that Nigeria does not need, it is another bureaucratic organ dealing with these matters.

Court issues forfeiture orders against property belonging to alleged corrupt public official
  • Nigeria
  • 05 October 2020

In July 2020 the Federal High Court ordered the interim forfeiture of assets allegedly belonging to former Nigerian Social Insurance Trust Fund (NSITF) Chair Ngozi Olejeme. Despite this recovery step, the question remains as to why it took the Economic and Financial Crimes Commission so long to discover Olejeme's alleged connection to these particular assets. Since she left office, the NSITF has allegedly been deprived of more than N69 billion that could have been invested for the benefit of insured employees.

War against corruption in public sector
  • Nigeria
  • 13 July 2020

In June 2019 the Economic and Financial Crimes Commission (EFCC), as part of its investigation into the affairs of a former state governor, reported that it had frozen a number of bank accounts alleged to belong to the former governor which contained suspected public funds. In 2020 the EFCC reported that, to date, a total of N7.9 billion had been recovered from these accounts and more than N5.7 billion had been returned to the state government.

Possible fallout from Obinwanne Okeke's guilty plea to US charges
  • Nigeria
  • 06 July 2020

Nigerian entrepreneur Obinwanne Okeke has pleaded guilty to a computer-based intrusion fraud scheme. More than $11 million is said to have been traced to the ring, and it has been claimed that Okeke used proceeds from these activities to establish legitimate business enterprises in Nigeria. This follows from reports in 2019 that the Federal High Court in Lagos ordered that N280,500,000 in two bank accounts in Okeke's name be forfeited to the Nigerian government.