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Parameters and Fiscal Assumptions

The 2022 “budget for Economic Growth and Sustainability” was signed into law by President Muhammadu Buhari on Friday, 31st December 2021, two weeks after the National Assembly passed the bill.

The allocations in the budget were guided by six strategic objectives of the National Development Plan of 2021 to 2025, which are: diversifying the economy, with robust MSME growth; investing in critical infrastructure; strengthening security and ensuring good governance; enabling a vibrant, educated, and healthy populace; reducing poverty, and minimizing regional, economic, and social disparities.

Key Elements of the Budget: Expenditure Summary

The total estimated aggregate expenditure is N17.13tn which is N735.85bn more than the initially proposed sum of N16.39tn and represents a 17.57% increase over N14.57tn for 2021. The increase in the proposed expenditure is attributed to the introduction of 6,576 new projects and the reduction of the allocation to 10,733 projects by law makers.

  • Statutory transfer
  • Recurrent (non-debt) which is the largest expenditure is estimated to amount to N6.91tn, is 40.3% of total expenditure and 17.3% higher than the 2021 Budget.
  • Debt Service
  • Aggregate Capital Expenditure of N5.47tn accounts for 31.9% of total expenditure.
  • Sinking fund

N3.61tn is estimated for debt service and this represents 22% of total expenditure. This is a 15.7% increase from the N3.12tn allotted for debt service last year. This increase in public debt is a result of borrowings to put the economy back on track after 2 recessions.

Key Elements of the Budget: Revenue Summary

The estimated aggregate revenue to fund the 2022 budget is N10.7tn which is 32% higher than the 2021 estimate of N8.1tn. The major revenue generation strategies are as follows:

  • Enhancement of tax and excise revenues through policy reforms and tax administration measures;
  • Review of the policy effectiveness of tax waivers and concessions;
  • Boost of customs revenue through the e-Customs and Single Window initiatives (implementation of the African Continental Free Trade Agreement may be a major driver for this strategy); and
  • Safeguard revenues from the oil and gas sector.

The government has also expressed its intention to strengthen the existing framework for concessions and Public Private Partnerships. There will also be a review of the Finance Act to input measures to aid the Strategic Revenue Growth Initiative (SGRI).

Key Elements of the Budget: Deficit, Financing, and Critical Ratios

The 2022 budget has a total fiscal deficit of about N6.39tn. This represents about 3.5% of the projected GDP of N184tn (this amount was stated by the Minister of Finance at the public presentation of the budget in October,2021), slightly above the 3% threshold set by the Fiscal Responsibility Act 2007 (FRA).

The President, however, insisted that this was necessary to tackle the security problems prevalent in the country.

Finance Act 2021

In order to achieve the revenue projections in the 2022 budget, the Finance Act took effect from the 1st January 2022 and introduces amendments to some tax laws.

The Finance Act amends the: Capital Gains Tax Act (CGTA); Companies Income Tax Act (CITA); Fiscal Responsibility Act (FRA); Personal Income Tax Act (PITA); Stamp Duties Act (SDA); Federal Inland Revenue Service (Establishment) Act [FIRSEA]; Tertiary Education Trust Fund (Establishment) Act [TETFEA]; National Agency for Science and Engineering Infrastructure Act (NASENI Act); Value Added Tax Act (VATA); Nigerian Police Trust Fund (Establishment) Act [NPTFEA]; Finance (Control and Management) Act [FCMA], and Insurance Act.


So, what do we expect to see this year?

  • Early passage of the budget will aid government in achieving its objectives.
  • Enforcement of amendments introduced by the Finance Act, 2021.
  • Removal of petrol and electrical tariff subsidies may contribute to inflation.
  • Government driving heavy revenue generation by paying particular attention to tax compliance and remittances.
  • There may be a downward review on tax incentives like Pioneer Status and tax incentives for petroleum companies.
  • Revenue generation from the growing investment in the Nigerian technology ecosystem by the introduction of taxes to foreign technology companies with significant economic presence in Nigeria.
  • Leveraging on implementation of the African Continental Free Trade Agreement (AfCFTA) to enhance customs revenue.
  • Focus on tackling insecurity.
  • Introduction of major projects in the education and health sectors.


Do you need to know more about the Appropriation Act? Our Finance  team is available to support you.

You may contact our team on: Email: Telephone: +234 1 4536427 or +234 9087107575

Click here to download PDF

DealHQ Partners Law Undergraduate Essay Competition 2021

The 2021 DealHQ Partners Law Undergraduate Essay Competition is now open to 300 – 500 level law undergraduates across all Nigerian Universities.

Qualified candidates are required send in their submissions on or before 6th of October, 2021 to

To participate, Candidate must:

  1. Be a law student between 300-500 level in a Nigerian university with a valid student identity card;
  2. Follow all DealHQ  Partners’ Social Media Pages (LinkedIn, Instagram, Twitter, Facebook, Youtube);
  3. Submit an essay in word and pdf format  on the topic “AFCFTA: The Role of Law and Policy in Driving Competitiveness for Nigerian Businesses
    • i.  Maximum of 2500 words (excluding infographics, graphs or charts which may be included to reinforce your thoughts or related data)
    • ii.  Font: Candara
    • iii. Font size: 12
    • iv.  Line spacing: single
    • v.   Alignment:  all text must be justified
    • vi.  Data references must be from verifiable sources
    • vii. Essay must be marked with candidates full name (as seen on Student ID Card) and Matriculation Number

4. Send entries accompanied with a scanned copy of student ID and social media handle to: on or before 11th of October, 2021.

  • -Top 20 entries will make it to the pre-qualification stage.
  • -Top 10 entries will make it to the Formal Review Stage
  • -Top 5 entries will make it to the final presentation/award stage
  • -Winners will be announced in October 2021.

*Strict adherence with submission guidelines is required, Defective submissions will be disqualified.



In response to the global rise in the use of digital payment solutions and the cryptocurrency market, the Central Bank of Nigeria (“CBN”) has created the eNaira, in a project termed “Project Giant”, which will be launched on 1st October 2021. In furtherance of this, the CBN engaged a global fintech firm Bitt Inc, as the technical partner for the development of the digital currency. The rationale behind the eNaira is to promote and facilitate the cashless culture amongst Nigerians while keeping up with contemporary economies of the world and maintaining the value of the Nigerian currency/foreign reserve. The eNaira is expected to aid financial inclusion, improve payment efficiency, improve revenue and tax collection, and aid targeted social interventions.It is noteworthy that various central banks worldwide are currently developing and issuing their central bank digital currency (CBDC). Some of these countries include China (digital yuan), Ghana (eCedi), Tunisia (eDinar) Senegal (eCfa), Tunisia (Petra), Dubai (emCash) amongst others.


Although a digital currency, the eNaira is different from other cryptocurrencies using blockchain technology, such as Bitcoin and Ethereum, in that it is issued and regulated by a sovereign authority. The eNaira users will not be anonymous, i.e., the users will undergo an onboarding exercise and will provide identifying information such as BVN or NIN, as the case may be. The personal account details and transaction activity of every user of the eNaira system will be monitored by the CBN.

In addition, the eNaira is fiat currency and is not subject to the volatility associated with the digital currency market; the value of the eNaira will be at par with the value of the Naira and will be subject to the appreciation and devaluation of the Naira currency.


In a bid to set out the eNaira as distinct, the CBN introduced certain features in the eNaira Design, these features include:

  1. It is a legal tender;
  2. It is subject to parity of value, which is pegged to the value of Naira;
  3. It operates on a tiered structure for consumers;
  4. It operates with an account-based wallet;
  5. It possesses a transaction limit for customers, determined by their applicable tier;
  6. It maintains a tiered AML/KYC approach (NIN, BVN as unique identifiers);
  7. It is a non-Interest bearing CBDC;
  8. It ensures settlement finality; and
  9. It is value-based.


As the eNaira is an electronic currency, consumers will be required to download the electronic wallet and get onboarded into the system through an invitation link received from their financial institution. Once the process has been successfully completed, users will be able to commence electronic financial transactions with the eNaira. Users can fund their eNaira wallet through their financial institution.


There are several stakeholders involved in the operation of the eNaira model which take on the following roles:

  1. Monetary Authority (CBN): The CBN has the sole responsibility to mint, issue, distribute, redeem, destroy the eNaira and act as digital currency manager by executing and managing digital currency transactions. It will also manage the storage of transaction data on the Hyperledger Fabric Blockchain, the blockchain ledger the eNaira will operate on.
  2. Financial Institutions: Financial Institutions facilitate the participation of end users in the eNaira technology. They serve digital currency managers by carrying out the following roles:
    1. Requesting eNaira from the CBN and issuing to users;
    2. Managing digital currency across branches;
    3. Conducting Know-Your-Customer (KYC) activities;
    4. Conducting identity and Anti- Money Laundering (AML) compliance activities.
  1. Government/ Government Agencies: The government and relevant government agencies are end-users of the eNaira technology and may use the platform for the following purposes:
    1. Processing out going payments such as salaries and interventions; and
    2. Receiving incoming payments from consumers.
  2. Businesses and Merchants: Merchants and business will use the eNaira technology to process potentially swifter and lower cost payments from consumers. The eNaira will support payment options such as POS, remote pay and other online payment capabilities.
  3. Consumer (Banked and Unbanked Consumer): Individual consumers whether having a bank account or not are allowed to engage in several transactions involving other consumers or directly with financial institutions using the eNaira. They will be able to send and receive eNaira in their eNaira wallets and also process payments.


In a bid to safeguard the eNaira and for convenience, a special feature is being introduced, which is the eNaira wallet, a virtual enclosure where every consumer or user of the eNaira platform can comfortably track and manage available eNaira funds. It is expected that there will be no service charge for wallet-to-wallet transactions.

It is important to note that the licensed Financial Institutions shall be responsible for providing their customers with their eNaira Wallets.


Users will be able to engage in a number of payment transactions with the eNaira, including:

  1. E-Naira wallet to eNaira wallet payments;
  2. E-naira wallet to bank account payments;
  3. Bank account to eNaira wallet payments;
  4. User E-naira wallet to Ministry, Departments and Agency (MDA) eNaira wallet payments;
  5. MDA eNaira wallet to user eNaira wallet payments;
  6. E-Naira to cash conversion;
  7. cash to eNaira conversions;
  8. FX to eNaira conversion (through the Central Bank); and
  9. FX to eNaira Wallet payment (through International Monet Transfer Operators).


As a way of popularizing the eNaira initiative within the Nigerian citizenry, the several financial institutions, particularly banks, are directed to encourage the participation of their customers in the eNaira service and send out invitation codes to verified and validated customers. This makes the process easier as customers with already generated codes have a rather seamless onboarding.


Under the eNaira system, existing infrastructure for electronic settlement systems such as the NIBSS and other switching platforms will be retained and integrated into the implementation of the eNaira.


Although the eNaira project is novel and still budding, it is interestingly one project that appears promising especially for the Nigerian economy. There are a number of obvious challenges to its widespread acceptance such as the high rate of technology illiteracy amongst the citizenry, the unrestrained monitoring of transaction activities in the eNaira system, which almost defeats the point of digital currency as is widely accepted, and lack of access by users to the ledger records. There are however some positives. Other than ensuring potentially swifter and cheaper payments, the eNaira provides relative value stability (subject always to the inflationary nature of the Naira), will be an officially accepted legal tender, and possesses an anti-fraud management system for the protection of users.



Do you need to know more about the eNaira? Our Technovation team is available to support you. You may contact our team on: Email: Telephone: +234 1 4536427 or +234 9087107575

Click here to download PDF


Season 1 Episode 2 – AFCFTA: Leveraging Technology to achieve regional competitiveness

Simply is the sponsored Podcast of DealHQ Partners, where we engage thought leaders on trending issues around law and business in the most simplistic manner.

Our Tosin Ajose joins Mrs. Nkemdilim Uwaje Begho, the CEO of Future Software Resources Limited and a Non-Executive Director in Stanbic IBTC Bank who is recognized as a  seasoned digital transformation executive and one of Forbes top 10 female tech founder in Africa in conversations around the Africa Continental Free Trade Agreement and the role of technology in achieving competitiveness in Africa’s new borderless and integrated market.

This episode examines the role of digital in fast-tracking the gains of AFCFTA, how technology and innovation will facilitate connectedness and a truly homogeneous market, big data, data share, and regional collaboration, and how Nigeria can position itself for competitive advantage in the free zone


Listen here:






Non-Fungible Tokens are cryptographic tokens created using blockchain technology. They represent and uniquely describe a valuable digital asset with special distinct features that allow for traceability and identification of the underlying asset which it represents (this underlying asset could be digital or a tangible real-life asset such as a vehicle, a gadget, a literal work or real estate).
The non-fungibility of these cryptographic tokens distinguishes them from other common cryptocurrencies such as bitcoin or ethereum which are created in multiples, each having the same features as all the others in circulation and each coin being of equal value. An NFT is encoded with an “indivisibility feature” i.e. the token cannot be broken into smaller elements of a whole such as you would a bitcoin (which can be broken into 100,000,000 satoshis) with each bearing a corresponding value of the fraction of a bitcoin. Each NFT is unique, exclusive and can only be transferred as a whole. a website that tracks NFT marketplaces represents that the current NFT Market is worth over USD250 Million. For a market that was completely non-existent before 2017, it is expected that the market will balloon in geometric progression because of the boundless opportunity it opens for the trade of digital assets in a secure and efficient manner. Especially the possibility of easily converting all forms of assets into NFTs.


i. Uniqueness
The metadata attached to an NFT allows it to be defined by its unique features such that it can be clearly distinguished from other assets.

ii. Rarity
For NFTs it is impossible to create or reproduce the subject asset (there will always, only be a single version of the asset on the blockchain). This specifically is what influences the value of NFTs and makes them desirable to collectors.

iii. Indivisibility
An NFT cannot be split into smaller units of a whole. An NFT can only be held or transferred as a whole.

iv. Value
Only assets likely to be deemed valuable in the NFT marketplace may be converted to NFTs.


An NFT is usually backed by an underlying asset which could be digital (such as digital art) or tangible real-life assets (such as an automobile or real estate). As previously explained the distinctive information relating to the asset is encoded into metadata on a blockchain platform. It is important for a buyer to understand the exact nature of the asset that is being acquired and to ensure that the smart contract purchased actually transfers legal and beneficial interest in the intended underlying asset and that the metadata are not a mere description of the same. It has been the case that some undiscerning buyers have acquired a mere description of an asset rather than the asset itself


The Buyer of an NFT often expects to acquire the original, rare, and unique form of the underlying asset which the cryptotoken represents (if it is an artwork the original copy as digitally signed by the artist with a digital proof of authenticity and uniqueness in the form of metadata). The asset itself may not always be encoded into the Ethereum blockchain itself.
In simple terms, the NFT buyer acquires simply a smart contract on blockchain which contains metadata with the name of the asset, description of the asset, and a URI (Uniform Resource Identifier which provides technical details about how the asset works and in some cases link to an IPFS (InterPlanetary File System) a protocol that allows for the creation of permanent, immutable links to the blockchain where the asset is emplaced.


An NFT’s value is driven by demand and the value placed on it by potential buyers. There is therefore no empirical basis for determining its value, it remains very speculative. Offer prices are often driven by sentiments and its inherent features of rarity and uniqueness. A popular example is a digital collage created by the artist Beeple which after being converted to an NFT was traded for USD69Million at a public auction that started with a usd100 bid called the beginning of the Digital Collectibles craze. Or Jack Dorsey’s (Founder of Twitter) first tweet which he converted to an NFT and sold for USD2.9Million.


The NFT Marketplace is a virtual platform/website where NFTs can be traded, and where market participants take a sell or buy position and transact with each other via their digital wallets using cryptocurrencies as the medium of exchange. Whilst most marketplaces will trade a wide range of NFTs some operate as niche markets trading only one homogeneous category of NFTs a good example is Looking Glass Factory, a site that trades only digital holograms.

Some of the most common NFT marketplaces are:
i. Opensea, which is acclaimed as the largest NFT marketplace trading a variety of NFTs including art, virtual worlds, sports, trading cards, and other forms of collectibles. On Opensea, collectibles can be listed at a fixed price or for auction;
ii. Rarible, another popular marketplace that is community owned. It trades several categories of NFTs including art, photography, games, metaverses, music, domains, and memes amongst others;
iii. SuperRare is a marketplace for people to buy and sell unique, single-edition digital artworks. Each artwork is authentically created by an artist in the network and tokenized as a crypto-collectible digital item that you can own and trade;
iv. Atomic Market another popular platform is a shared liquidity marketplace that feeds other marketplaces. It allows its users to tokenize and create the digital asset and thereafter sell or auction the asset;                                         v. Another common platform “valuables” is a niche market solely for trading tweets.

NFT marketplaces have become mainstream in the crypto space whilst NFTs have become the most trending asset class of 2021, sparking the interest of traditional investors and several high net worth individuals.


The subject of the classification of NFTs remains quite unsettled, however as the market deepens we expect more clarity around their classification. A school of thought argues that NFTs are securities in respect of which local securities law should apply, others argue that they are simply a digital identifier of any form of asset whose legal title is transferrable. The test of whether an NFT will be classified as security will depend on:
i. The purpose for which it was created: If the NFT is being created and sold as a way for members of the public to earn investment returns with a line of recourse to the issuer it will be more likely to be considered a security. Especially if the smart contract has features of an investment contract.
ii. How it is traded: where an NFT is traded on a marketplace that operates similarly to exchanges and capital trade points shares where other securities or commodities are traded, it is likely to be classified as security especially where there exists is a secondary market feature on the trading platform.


The storage of NFTs on a blockchain ledger provides a way for asset holders to establish proof of ownership and possession with the innate benefit of immutability and security. It is important to understand the bundle of intellectual property rights which may be applicable NFTs or transferrable to a buyer.

Patent: Where the mining of an NFT or the cryptotoken involves innovation that solves a technical problem, it may be possible to patent the innovation subject to meeting the applicable registration criteria. The patent right is likely to remain proprietary to the creator.

Copyright: In relation to copyright, the metadata related to an NFT are by themselves a creative expression over which the creator automatically acquires exclusive copyright. There is a marked distinction between ownership of the NFT and ownership of the content in the metadata. Where not expressly assigned in the ‘smart contract’ between the creator and the buyer, any incidental copyright remains with the owner. The owner of the copyright remains the only party who can reproduce, make derivative works of, perform, display or distribute copies of the content. Where an NFT relates to artistic or literary work, it is curious what nature of interest is transferred to a buyer if he is not granted the intellectual property right in the work whether in form of a full assignment or a license to use.
Trademarks: In relation to trademarks, NFT creators may protect the name or other graphic property in the work by registering the name or the visual representation.

Even though Non-Fungible Tokens are gaining popularity and momentum as a digital asset class, it is no gain saying that the market is new and evolving. Market regulations are therefore still at infancy. At best, the law and regulation applicable to the class of underlying asset will apply to all related transactions. It remains important to exercise caution and seek professional advise when dealing in NFTs especially to guarantee that a buyer of an NFT actually acquires the intended interest in the subject underlying asset.



Do you need to know more about NFTs? Our Technovation team is available to support you.
You may contact our team on: Email: Telephone: +234 1 4536427 or +234 9087107575

Click here to download PDF


Simply by DealHQ Podcast – Cryptocurrencies and the Nigerian Financial Market

Simply is the sponsored Podcast of DealHQ Partners, where we engage thought leaders on trending issues around law and business in the most simplistic manner.

In this maiden episode, Our Lead Advisor, Tosin Ajose is in conversation with Mr. Michael Ugwu, the Founder and CEO of Freeme Digital Limited and pioneer General Manager for Sony Music Entertainment West Africa, a venture capital investor and cryptocurrency enthusiast discussing issues bothering on cryptocurrency adoption, market trends, trading, counterparty risks and regulations from a Nigerian perspective and from a broader Africa wide view.

The whole world acknowledges the unprecedented growth in the global cryptocurrencies MARKET with Nigeria recording over $400 million traded in 2020 alone inspite of its low internet penetration. Statistics show a high level of enthusiasm around the adoption of cryptocurrencies, especially amongst the youth. This episode examines the cryptocurrency market in Nigeria from an investor’s perspective, opportunities in Decentralised Financing (DeFI), lessons, and opportunities for new adoptors.

Listen here:



In June 2020, the Central Bank of Nigeria (CBN) released the exposure draft of its Framework for Regulatory Sandbox Operations which set out the rules, processes and guidelines for participation in the CBN regulatory sandbox in a bid to get stakeholder input ahead of its adoption. Following the exposure, on the 13th of January 2021, the Apex Bank published the final version of the Framework which establishes the CBN regulatory sandbox – a controlled facility where fintech developers/innovators can test new and innovative services under the Supervision of CBN. This will enable safe and reliable deployment of innovative fintech solutions without compromising the integrity of the financial system or the experience of the consumers.


In simple terms, a sandbox is an isolated, safe, testing environment where developers/innovators can test new programmes or software applications under a system that promptly identifies and quarantines malware or other zero-day vulnerabilities without compromising the host device(s). These tests are typically conducted prior to go-live.


The Apex Bank, has recognized that the introduction of the CBN regulatory sandbox will:

  1. Reduce time to market for innovative products by allowing developers and the CBN to simultaneously monitor the pre go-live product testing in the sandbox thereby shortening approval timeline.
  2. Ensure customer protection safeguards as prescribed by CBN are adhered to;
  3. Promote adequate regulation and an enabling environment for innovation without compromising consumer safety;
  4. Encourage innovative solutions that will advance financial inclusion; competition and ultimately lower cost to consumer;
  5. Define the roles of different stakeholders within the sandbox ecosystem and the bigger payment systems industry.
  6. Provide a communal environment for continuous engagement between fintech innovators/developers and the CBN.


The Sandbox application process is open to both existing CBN licensees (financial institutions regulated by the CBN) and other Nigerian Companies or Enterprises not regulated by the CBN but who wish to test innovative payment products deemed acceptable by the CBN. Innovators whose proposed solution involves technologies which are not covered under existing CBN regulations may also apply to the CBN for special consideration to participate.

Apart from the Applicant’s eligibility, the underlisted are additional criteria for selection to participate:

  1. The product or service must be innovative and show potential to improve efficiency, security and quality of services in the overall financial market or enhance risk management amongst financial institutions;
  2. The proposed project must fall within prescribed value and volume for effective risk management and mitigation;
  3. The product or service must clearly demonstrate usefulness and functionality;
  4. The applicant must have all resources required for testing in the sandbox;
  5. The applicant must have a business plan showing how the product is to be deployed to market after testing is completed.


CBN will make a call for applications once in each calendar year via its website and local newspapers. The advertisement will include minimum eligibility criteria, interested participants are to address their application to the Director, Payments System Management Department and submit same through the CBN official email address: Successful applicants will be issued a letter of approval within 45days from close of application.  Upon the issuance of the letter of approval, the applicant is required to comply with all necessary documentary filings prescribed in the framework.  Upon entry into the Sandbox, Applicants are additionally required to comply with the operational and reporting requirement prescribed in the framework.


At any time before the end of the prescribed testing period, CBN may review or withdraw an approval granted to any participant who:

  1. Fails to comply with prescribed safeguards;
  2. Submits misleading information conceals or fails to disclose material information;
  3. Contravenes any applicable law which impacts directly on applicants integrity or reputation;
  4. Goes into liquidation;
  5. Breaches data security or confidentiality requirement;
  6. Compromises consumer safety;
  7. Fails to address identified risks, technical flaws or vulnerabilities.

Before withdrawing its approval, CBN will give the defaulting Participant 45days prior notice and the opportunity to respond to the grounds of the withdrawal. In cases where delay is deemed detrimental to consumers or the Financial System generally, CBN may proceed to withdraw the approval without notice. Once approval is withdrawn, the affected Participant must immediately implement its planned exit from the Sandbox and desist from promoting or taking its product/service to market. It must also comply with other obligations imposed by CBN regarding disposal of confidential information and mandatory post-exit reporting.


Whilst in the Sandbox, Participants are required to promptly identify all potential risks to consumers, financial institutions or the financial systems generally and to develop appropriate safeguards to respond to/address the risks in ways that demonstrate;- sound financial practices, fair and equal treatment of all consumers, compliance with anti-money laundry regulations, preserves confidentiality of consumer information and encourages healthy competition amongst similar financial products or services.


The number of applicants admitted will be pre-determined by the CBN based on available resources and capacity at the given time. Each group of innovators admitted into the Sandbox at a given time will be referred to as a “Cohort”. It is expected that CBN will admit one cohort per calendar year. Selection will be based on the Sandbox’s strategic objectives and CBN’s prescribed eligibility criteria.


When a Participant has completed its product testing in the Sandbox, the result will be benchmarked against the product objectives and the CBN will determine whether the product or service is suitable to be deployed to the market. Deployment could be direct by the Participant to the market or by licensing the product to another firm to take to market or taken to market in partnership with other CBN regulated firms. Where CBN deems the test as failed either on account of sub-optimal output or unintended negative consequence on the public CBN will prohibit the deployment of the product. A participant may on its own elect to discontinue testing in the sandbox in such case it shall seek the consent of the CBN which may be granted subject to satisfactory performance of all prescribed regulatory obligations. For successfully tested products, participants may proceed to apply for the requisite license to deploy the Product. CBN will typically support successful participants in addressing risks and vulnerabilities detected during the testing phase.


Typically, applications from participants would indicate proposed testing timeline. Each cohort however will generally run for 6 months. Where a participant feels that it is expedient to extend the testing period, an application shall be made to the CBN at least 30days before the end of the initial testing timeline stating the additional time required and the reason for the application. CBN will not permit frivolous or protracted extensions. Where a general positive outcome has been recorded and extension is only required to respond adequately to risks or vulnerabilities identified during initial testing CBN will be most inclined to grant the requested extension.


The CBN sandbox provides the needed anchored support for fintech innovators by reducing the cost and time to completion of new products, more importantly the sandbox will be a major repository for market data whilst also providing the regulator with wider coverage and more intimate interaction with innovators and their products. It is expected that the regulatory sandbox will provide a good foundation for the wider adoption of open banking systems in Nigeria.


Do you need more about the CBN Regulatory Sandbox? Our Finance and Technovation team is available to support you. You may contact our team on: Email: Telephone: +234 1 4536427 or +234 9087107575

Click here to download PDF



The Nigerian apex bank on the 13th of January 2021 released its framework for Quick Response (QR) Code payments in Nigeria. The framework amongst other things seeks to:

  1. Prescribe standards for implementing QR Payments in Nigeria;
  2. Guarantee Interoperability of QR Payments systems with the bigger payment system infrastructure;
  3. define the Roles and Responsibilities of Participants within the QR Payments architecture;
  4. Prescribe risk management principles that assure market integrity and promote user confidence.

QR Code payment system is a simple and contactless payment model conducted by scanning quick response codes from a mobile application (usually via a smartphone) by another device and having payments transferred directly from the user’s account to the merchant, without the need for a POS terminal or any other hardware.

The Covid 19 Pandemic has given a rise to the adoption of QR Payment systems as merchants, retailers and consumers continue to seek/drive contactless service adoption to minimise the risk of infections at points of trade. It is projected that over 2.2Bn users will have embraced the QR Payment Systems by 2025. It is important to note that some countries such as India have mandated the introduction of QR Payment solutions for retailers falling within a prescribed turnover threshold.

The CBN Framework prescribes the acceptable QR Code specification for Nigeria – all QR Code payment systems are required to be based on theEMV® QR Code Specification for Payment Systems (or such other standards which may also be prescribed by the CBN which meet the security requirements in the framework). Further, the framework prescribes rules around activations, compliance with card scheme rules, transaction limits for users, transaction fees, user risk profile assessment parameters, settlement timelines, requirements around training, support and security guidelines for merchants, mandatory requirement for interoperability of QR Payment systems.

The Framework also prescribes elaborate/mandatory risk management principles which are intended to guide in achieving market integrity and promote user adoption. These principles include adoption and implementation of mandatory risk management guidelines by all participants within the value QR payment value chain, compliance with mandatory code encryption standards, certificate of compliance for all QR Code applications, updates and patches to be issued by the Payment Terminal Service Aggregator (PTSA), KYC requirement for merchants onboarding. It further prescribes for dispute resolution in line with the CBN Consumer Protection Regulation and sanctions for infractions/infringements.


Do you need more information on QR Code payments? Our Technovation team is available to support you. You may contact our team on: Email: Telephone: +234 1 4536427 or +234 9087107575

Click here to download PDF



In a bid to cater to innovators seeking legitimacy and relevance as well as enhance investor protection, the Securities and Exchange Commission (“SEC”) issued a statement on the 14th of September, 2020, indicating its intention to commence the regulation of Digital Assets and Initial Offering of Digital Assets which qualify as securities under the Nigerian Securities Law.

The participation of the apex regulator of the Nigerian capital market is expected to bolster market confidence, establish standards of operations and encourage ethical practices that will protect the investor community whilst entrenching fair market practices.Categories of Digital Assets falling within the SEC’s regulatory purview
The SEC has broadly defined Digital assets as any digital representation of value capable of being traded virtually and which functions as either a medium of exchange or a unit of account; or a store of value, which does not have legal tender status neither is it guaranteed or backed by the Government of any specific jurisdiction. Its operations are backed primarily by a subsisting agreement within the community of users and is clearly distinguished from Fiat Currency and E-money.


The implication is that the SEC has now categorized all Digital Assets as securities over which it exercises regulatory oversight by virtue of Section 15 of the Investment and Securities Act except where the Issuer or Sponsor is able to prove otherwise to the satisfaction of the commission.
The 4 categories of digital assets/instruments which have now been classified as securities by the SEC include:
1. Crypto Assets (non fiat virtual currencies): will qualify securities if issued as an investment or as commodities if traded on an exchange or capital trade point;
2. Utility Tokens or Non-Security Tokens (tied to the provision of an underlying product or service); will be treated as commodities or as securities if traded on an exchange or capital trade point. Spot trades of utility tokens are however excluded.
3. Security Tokens (which gives participation in a tangible underlying assets or its receivables in the form of distributions) will be treated as securities
4. Derivatives and Collective Investment Funds of Crypto Assets (any derivative or fund which underlying asset is a digital asset falling under the Purview of SEC Regulation) will be classified as securities under the relevant rules.
Registration of Digital Asset and Offerings to the Public:
Sponsors or creators of Digital Assets are required to apply to the SEC for an initial assessment via an initial assessment filing. Through this filing the Sponsor will provide information required to establish whether or not the asset qualifies as securities registrable with SEC. Without clearly stating the criteria for exemption the SEC has hinted that assets issued via a crowd funding portal will be exempt. It is expected also that where issuance will be by other means than an invitation to the public, such would also be exempt. Once the SEC determines that an asset is not exempt, the sponsors shall proceed with an Initial Asset Registration.
All Digital Assets Token Offering (DATOs), Initial Coin Offerings (ICOs), Security Token ICOs and other block chain based offers within Nigeria or by Nigerian issuers or sponsors or by foreign issuers targeting Nigerian investors will now fall under the SEC’s jurisdiction. Consequently, Sponsors or promoters of new issues will require registration whilst Sponsors/Issuers of already issued but qualifying Digital Assets now have 3 months to either submit the initial assessment filing or documents for actual registration.
HOW TO GET STARTED Do you require further information on the registration of Digital Assets in Nigeria? Our capital markets team is available to support to you. You may contact our team on: Email: Telephone: +234 1 4536427 or +234 9087107575

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  1. A. What is a Patent?
    A patent is a right granted to an inventor, which allows the inventor to exploit the full rights and benefits from
    their invention/work (including the right to use, sell, produce, mass-produce) to the exclusion of all other users
    for a period of about 20 years. A registered patent gives protection against third party exploitation within the
    country where the right is obtained. B. What law guides the registration of patents and where do I apply for the
    registration of a patent? The registration of Patents in Nigeria is governed by the Patents and Design Acts Cap.
    344, Laws of the Federation of Nigeria 1990 (Act of 1970) administered by the Registrar of Trademarks, Patents
    and Designs, Trademarks Registry, Federal Ministry of Industry, Trade and Investment, FCT, Nigeria.
  2. B. What law guides the registration of patents and where do I apply for the registration of a patent?
    The registration of Patents in Nigeria is governed by the Patents and Design Acts Cap. 344, Laws
    of the Federation of Nigeria 1990 (Act of 1970) administered by the Registrar of Trademarks, Patents and
    Designs, Trademarks Registry, Federal Ministry of Industry, Trade and Investment, FCT, Nigeria.
  3. C. How do I know if my work/invention qualifies for registration of a patent?
    A patent may be granted for any work/invention that:

    1. is new (novel); the invention must be substantially different from anything else that is within public knowledge
    2. involves an inventive step; must not be obvious to a person skilled in the art of the invention and must not make reference to any matter that forms part of the prior existing invention
    3. is capable of industrial application; (useful)
    4. is not specifically excluded in the Act; (e.g. inventions which encourage immoral and offensive behavior)
    5. has an address for service in Nigeria (if the applicant’s address is outside Nigeria arrangement must be made for a verifiable delivery address in Nigeria).

    NOTE: Each application must relate only to one invention but may cover claims for multiple numbers of products or processes i.e. an invention can be a modification or novation of one or more existing inventions in the market

  4. D. What are the practical steps for registering a patent in Nigeria?Step 1: Fill Application Form together with written declaration
    There are two classes of application forms available for patent registration;

    1. Form 1A: being the application form for the registration of a conventional/local patent; and
    2. Form 1B: being application form for the registration of a non-conventional/international patent.

    I. Filling of Form 1A (Local Application)

    Form 1A is the applicable form for local applications for works created and originating in
    Nigeria. The name, address, email address and contact number of the applicant is required to
    be provided and in cases of multiple/joint inventors or inventors under the employ of a
    company, the name, address, email and contact number of a representative of the company
    or the joint inventors will be appropriate.

    A declaration by the true inventor will be required to be submitted alongside the application
    form and Form 3. The true inventor is the individual responsible for the ideation of the

    II. Filling of Form 1B (Foreign Application)

    Form 1B is the applicable form for applicant seeking foreign priority for works or inventions
    which did not originate from Nigeria and which is already registered in another foreign
    jurisdiction. The application will be accompanied by a written declaration consisting of:

    1. The date and the number of the earlier application:
    2. The country in which such application was made; and
    3. The name of the inventor who made it.

    The applicant will also fill a Form 3 as detailed below, to accompany the Form 1B and the
    written declaration. Not more than 3 months after filing the application, the applicant will be
    required to furnish the Registrar with a copy of the earlier application certified by the
    appropriate industrial property office of the foreign convention country.

    Step 2: Fill the Specification Form (Form 3)

    All Applicants (Local or Foreign) are required to fill Form 3 – Complete Specification Form.
    Form 3 is very crucial to any Patent application; it contains a detailed description of the
    invention and its claims (a claim is any information detailing the innovation of the invention
    provided by the applicant in hopes of creating an extent/scope of protection for the said
    invention from infringement by a subsequent invention). The applicant would have to explain
    in the technical terms what makes the invention different from what already exists in the
    market in hopes to protect it from subsequent inventions.

    The contents of Form 3 would include;
    1. The title of the invention;
    2. An abstract on the functionality of the invention;
    3. Background and History of the Invention;
    4. Detailed description of the invention supported with diagrams and illustrations;
    5. Claims (starting from general claims to specific ones):
    6. Summary of what society/ mankind stands to gain from the invention

    Step 3: Submit application to the Registry and pay of application fees

    The Applicant will pay the application fee as may from time to time be advised by the Registrar
    and submit application forms together with evidence of payment of the prescribed fees.

    Step 4: Application is granted and patent is valid for 20 years

    After submission, the patent application is examined by the Registrar merely to ascertain
    formal compliance, the Registrar assumes regularity. Once the application satisfies the
    statutory requirements as to the completion of form, payment of appropriate fees amongst
    others, the Registrar is likely to grant the patent without enquiries into its novelty,
    inventiveness and industrial applicability or sufficiency of disclosures in Form 3.

    Patents are granted at the risk of the patentee and without guarantee as to their validity. Once
    granted, a patent is valid for 20 years.

  5. E. Can a foreigner register a patent in Nigeria?
    A foreigner or a foreign corporation can seek foreign priority in Nigeria if it has a subsisting
    local application which has been admitted for registration by the approving authority in its
    own home country. Upon application for foreign registration such will be admitted for
    registration by virtue of the Nigeria Patent and Designs Convention Order 1971. The Convention
    provides that if a Nigerian application is made within 12 months of the making of the earlier
    application in the foreign country, such application will be treated as having been made on
    the same date on which the foreign application was made.
  6. F. What Legal Rights do I have as Patent holder?
    As a patent holder under Nigerian Law:

    • You have a valid cause of action against anyone who infringes on your right to the
      Patent during its subsistence;
    • You have the legal and beneficial right over the patent which may be sold, assigned
      or granted for the use of others in the form of a license.


    Are you interested in registering a patent for your invention? Our corporate services team is
    available to provide registration and start up support to you. You may contact our team on:
    Email: Telephone: +234 1 4536427 or +234 9087107575

    A patent holder may consider the option of applying to have his patent registered under the
    World International Property Organization (WIPO) which currently has over 189 member
    states including Nigeria.

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