Stark Raven

BANKING & FINANCIAL SERVICES

CBN Issues Interpretative Guidance on Qualified Financial Contracts under BOFIA

The Central Bank of Nigeria (CBN) has issued interpretative guidance clarifying the practical application of Sections 34(2)(b) and 34(3) of the Banks and Other Financial Institutions Act (BOFIA) 2020. The guidance explains how the statutory stay provisions operate where the CBN intervenes in a financial institution, particularly in relation to qualified financial contracts.

Qualified financial contracts, such as derivatives, repurchase agreements and securities lending arrangements, often contain termination and close-out provisions designed to manage counterparty risk. The CBN's guidance provides greater certainty regarding the temporary suspension of certain contractual rights during regulatory intervention, balancing financial stability objectives with the need to preserve confidence in financial markets.

The clarification is expected to assist financial institutions, counterparties and legal advisers in interpreting the statutory framework governing regulatory intervention and in reviewing contractual documentation to ensure alignment with the guidance.

ENERGY

NERC Strengthens Stakeholder Engagement Through Capacity-Building Initiative

The Nigerian Electricity Regulatory Commission (NERC) has concluded a three-day capacity-building workshop for journalists and electricity correspondents as part of its broader efforts to improve public understanding of developments within Nigeria's electricity sector.

The workshop covered key regulatory topics, including tariff methodologies, electricity market operations, consumer protection, licensing, regulatory reporting and the implementation of the Electricity Act 2023. Participants were also provided with practical guidance on interpreting electricity market data and communicating regulatory developments accurately to the public.

The initiative reflects NERC's continued commitment to promoting transparency, strengthening stakeholder engagement and supporting informed discourse on ongoing reforms within the Nigerian Electricity Supply Industry (NESI).

NERC Deepens Collaboration with State Electricity Regulators

The Nigerian Electricity Regulatory Commission (NERC) continues to strengthen collaboration with state electricity regulatory commissions established under the Electricity Act 2023. As more states assume responsibility for electricity regulation within their jurisdictions, the Commission has intensified efforts to support institutional development and ensure regulatory coordination.

Recent engagements focused on knowledge sharing, capacity building and the harmonisation of regulatory approaches to licensing, market oversight and consumer protection. These collaborative efforts are intended to facilitate the orderly development of state electricity markets while maintaining consistency with the broader objectives of Nigeria's electricity reform agenda.

Businesses operating within the electricity value chain should continue to monitor developments at both federal and state levels as the decentralised regulatory framework continues to evolve.

AVIATION

FCCPC Reaffirms Consumer Protection Oversight in the Aviation Sector

The Federal Competition and Consumer Protection Commission (FCCPC) has welcomed a Federal High Court judgment affirming its statutory authority to investigate consumer complaints and exercise its enforcement powers under the Federal Competition and Consumer Protection Act 2018.

The judgment arose from proceedings involving consumer complaints relating to airline ticket refunds and service delivery. In affirming the Commission's authority, the Court reinforced the FCCPC's mandate to receive complaints, investigate alleged breaches of consumer rights and take appropriate enforcement action where necessary.

The decision provides greater regulatory clarity for businesses operating within the aviation sector and underscores the importance of maintaining effective consumer complaint mechanisms and compliance programmes. It also reinforces the complementary roles played by sector regulators and the FCCPC in safeguarding consumer interests.

FINTECH & PAYMENTS

CBN Fraud Prevention Standards Now Operational

The Central Bank of Nigeria's enhanced Fraud Risk Management Standards have now taken effect, marking another significant step in the regulator's efforts to strengthen the integrity of Nigeria's digital financial ecosystem.

The standards require regulated financial institutions to implement enterprise-wide fraud monitoring systems, strengthen customer identity verification processes and deploy enhanced controls to reduce electronic fraud. Key operational measures include temporary transaction limits for newly activated devices, restrictions limiting mobile banking access to a single active device and strengthened customer authentication procedures.

These requirements reflect the CBN's continued emphasis on consumer protection, cybersecurity and operational resilience within the financial services sector. Financial institutions should review their internal systems, customer onboarding procedures and digital banking platforms to ensure continued compliance with the new regulatory framework.