President Bola Tinubu has officially signed the Investments and Securities Bill into law, marking a significant step toward enhancing the regulatory framework of Nigeria’s capital market.
According to a statement released by the Securities and Exchange Commission (SEC) on Saturday, the newly enacted Investments and Securities Act (ISA) 2025 repeals the ISA 2007 and introduces comprehensive reforms designed to bolster investor confidence, improve market oversight, and align Nigeria’s financial markets with international best practices.
A Milestone for Market Development
The Director-General of the SEC, Dr. Emomotimi Agama, described the signing of the ISA 2025 as a transformative milestone for Nigeria’s capital market.
“The ISA 2025 reflects our commitment to building a dynamic, inclusive, and resilient capital market. By addressing regulatory gaps and introducing forward-looking provisions, the new Act empowers the SEC to foster innovation, enhance investor protection, and reposition Nigeria as an attractive destination for both local and foreign investments,” Agama stated.
He also commended the collaborative efforts of stakeholders in achieving this landmark reform and urged continued cooperation for the effective implementation of the new regulatory framework.
Key Reforms Under the ISA 2025
The ISA 2025 introduces several critical reforms to modernize Nigeria’s capital market, including:
- Regulation of Virtual Assets: The Act formally recognizes virtual assets, such as cryptocurrencies, as securities, bringing them under SEC’s regulatory oversight to ensure investor protection and market stability.
- Expanded Definition of Securities: The new law broadens the classification of securities to include investment contracts, ensuring digital asset operators, exchanges, and service providers adhere to regulatory standards.
- Classification of Securities Exchanges: Securities exchanges are now categorized into Composite and Non-Composite Exchanges, with Composite Exchanges facilitating all types of securities, while Non-Composite Exchanges focus on specific financial instruments.
- Stronger Measures Against Fraudulent Investment Schemes: The law introduces stringent penalties for individuals and entities promoting Ponzi schemes and other fraudulent investment activities, reinforcing investor protection.
- Enhanced Enforcement Powers for SEC: The Act strengthens SEC’s authority by aligning its regulatory framework with International Organization of Securities Commissions (IOSCO) standards, elevating Nigeria’s position in the global financial ecosystem.
- Development of Commodities Exchanges and Warehouse Receipt Systems: The new framework promotes the growth of commodities exchanges and warehouse receipt systems, facilitating broader investment opportunities and economic diversification.
Market Reactions and Implementation Strategy
Market analysts have welcomed the new law, highlighting its potential to provide greater clarity for investors, deepen Nigeria’s capital market, and drive economic growth. The Act is also expected to facilitate a seamless transition from the previous regulatory framework, ensuring minimal disruption to market operations.
The SEC has assured stakeholders of comprehensive engagements to support the smooth implementation of the ISA 2025, emphasizing its commitment to market integrity, systemic risk management, and sustainable financial sector expansion.
Appreciation for Legislative and Ministerial Support
The SEC extended its appreciation to the National Assembly for its dedication to strengthening Nigeria’s capital market through the enactment of this critical legislation.
“The meticulous deliberations, extensive stakeholder engagements, and bipartisan support demonstrated throughout the legislative process reflect the National Assembly’s commitment to fostering economic growth and enhancing investor confidence,” the SEC stated.
The Commission also acknowledged the contributions of the Minister of Finance and Coordinating Minister of the Economy and the Minister of State for Finance, whose strategic leadership ensured that the ISA 2025 aligns with Nigeria’s broader economic objectives.
This landmark legislation is expected to reinforce investor confidence, attract new investments, and position Nigeria’s capital market for long-term growth and global competitiveness.
