March Regulatory Roundup

Navigating Nigeria's regulatory seas is like steering a ship through a storm.

With the Securities and Exchange Commission (SEC) proposing amendments and the Central Bank of Nigeria (CBN) raising capital requirements, financial institutions should brace up to adapt to significant changes ahead. And let's not forget the legal squabbles - like the Nigerian government taking on Binance.

It's a regulatory rollercoaster!

News in Nigeria

SEC Releases Proposed Amended Rules

The SEC has recently released its proposed major amendments to the rules on Issuance, Offering Platforms, and Custody of Digital Assets. The? proposed amended rules? aim? to seal the loopholes in the regulatory landscape -such as pegging stablecoins rates to CBN rates, increasing financials aspect, among others. If you are interested, you can read our review of the rules here.

CBN Increases Capital Base for Mega Banks up to N500 billion, Smaller banks, N200 billion

On 28 March, the Central Bank of Nigeria (CBN) issued a circular stating that banks in Nigeria are now required to increase their capital on or before 30 April 2024 . This means that banks will have to either recapitalize, merge with other banks, or raise additional capital. They can also upgrade or downgrade their licence to meet the new requirements.?

CBN Guidelines on BDC

The Central Bank of Nigeria's (CBN) proposed guidelines for bureaux de change (BDCs) have introduced a tiered licensing system with minimum capital requirements, restricted ownership to one BDC per shareholder, allowed BDCs to serve as International Money Transfer Operators (IMTO) agents and required digital integration for reporting and Anti-Money Laundering (AML) purposes.? If you are interested, you can read our TLDR on this topic? here.

Nigeria vs. Binance

The Nigerian government has initiated legal action against Binance and its employees? for allegedly evading tax payments and violating existing tax regulations in Nigeria after alleging the transfer of the sum of N26 billion out of the country. Is this a good step in protecting national interests, or does it risk constraint innovation and investment in the crypto sector? Is Binance the cause of the currency's decline, or does the fault stem from the volatile nature of cryptocurrencies themselves?

On the other hand, It is important that companies comply with all regulatory requirements and not just focus on specific aspects of compliance when providing services.

Global News

TikTok launches a data portability API for compliance purposes

TikTok, the popular social media app, announced the launch of a new data portability API to comply with the new European regulations under the Digital Markets Act (DMA). The GDPR and DMA both requires tech companies to offer data portability and interoperability as significant requirements, which has prompted TikTok to enhance its capabilities in this area. Previously, TikTok allowed users to download their posts and request data copies for external use, but this process didn't accommodate dynamic data changes. The newly introduced data portability API addresses this limitation by allowing third-party developers to create channels for data transfer from TikTok to other applications with user consent.

Major Act to Regulate AI has been Passed by European Union (EU) Lawmakers

The EU lawmakers have passed the world's first major set of rules to regulate artificial intelligence, known as the AI Act. This framework, proposed by the European Commission in 2021 and finalised by the European Parliament, categorises AI uses by risk levels, from "unacceptable" to low risk. The law bans certain AI applications that threaten citizens' rights, such as biometric scanning and categorization, untargeted scraping of facial images for recognition databases, emotion recognition, social scoring, predictive policing, and any AI that manipulates human behaviour.

Mastercard and First Abu Dhabi Bank in a long-term global partnership

Mastercard and First Abu Dhabi Bank have entered into an exclusive, long-term global partnership to redefine the payments landscape in the region. The collaboration aims to leverage their collective strengths, resources, and capabilities for mutual benefit and sustainable growth.

Mergers and Acquisitions

• Access Bank Pcs is set to acquire National Bank of Kenya from KCB Group Plc. This is the second Nigeria-Kenya acquisition. It is a good strategy for Access to expand its operations.
• Carbon acquires Vella Finance, a Nigerian fintech company with a focus on small and medium-sized enterprises.

Crypto Scoop

UK Allows Professional Investors to Use Crypto Exchange-Traded Notes

Britain's financial regulator, the FCA gave the green light for the introduction of crypto-backed exchange-traded notes (ETNs) limited to professional investors. These ETNs, which are bonds issued by financial institutions to mirror the performance of underlying assets, will be exclusively accessible to approved investment firms and credit institutions operating within financial markets.

Moving Forward

Have questions or insights about the regulatory landscape in your region? Reach out to us on any of our social media handles, or email and we would be available to help.

Also, share your thoughts in the comments below and let's continue the conversation!