Stark Raven

BANKING & FINANCE

CBN Opens Second Regulatory Sandbox Cohort

The Central Bank of Nigeria (CBN) has opened applications for the second cohort of its Regulatory Sandbox Programme, providing eligible innovators with an opportunity to test new financial products, services, business models and technologies within a controlled regulatory environment. Applications for the second cohort opened on 12 August 2026 and are scheduled to close on 31 August 2026.

The second cohort expands the scope of the Sandbox to innovations in areas including virtual asset services and related infrastructure, stablecoins, payments, settlement, custody and digital wallets, alongside other technology-driven financial solutions.

The Regulatory Sandbox is designed to allow the CBN to assess innovative financial solutions in a controlled environment before wider deployment. It also gives participating innovators an opportunity to engage with the regulator while testing whether their products satisfy applicable regulatory, operational and consumer-protection requirements.

The initiative is particularly relevant against the backdrop of Nigeria's expanding digital financial ecosystem and the increasing regulatory attention being given to virtual assets, fintech and technology-enabled financial services.

The CBN's continued use of a sandbox approach indicates a regulatory model that seeks to balance financial innovation with regulatory oversight and financial-system stability. Financial technology businesses considering new products or business models should therefore continue to monitor the eligibility and participation requirements applicable to the programme.

CBN Eases Discount Window Restrictions and Broadens OMO Access

The Central Bank of Nigeria has introduced changes to its framework governing access to its Discount Window and Open Market Operations (OMO).

Under the revised framework announced in August 2026, certain restrictions that previously affected financial institutions participating in the Nigerian Foreign Exchange Market and primary government securities auctions have been removed. The CBN has also reinstated tenored repurchase operations and broadened participation in OMO securities through banks.

The CBN explained that the reforms are intended to improve the effectiveness of monetary policy transmission and strengthen the functioning of the financial market. The Bank's Acting Director of Financial Markets stated that the reforms are aimed at making monetary policy transmission more effective.

The changes are relevant to banks, authorised dealers and other participants in Nigeria's financial markets because access to the CBN's liquidity facilities and OMO instruments forms part of the wider framework through which monetary policy is implemented.

The reforms also broaden opportunities for participation in OMO securities, with the revised framework allowing a wider range of investors to participate through banks.

The development forms part of the CBN's continuing reforms to Nigeria's monetary-policy and financial-market operating framework.

ENERGY

NERC Transfers Akwa Ibom Electricity Market Oversight to State Regulator

The Nigerian Electricity Regulatory Commission (NERC) has issued a Transfer Order of Regulatory Oversight to the Akwa Ibom State Electricity Regulatory Commission (AKSERC), marking another step in the decentralisation of Nigeria's electricity market. The Order was issued on 19 August 2026.

The transfer means that AKSERC will assume regulatory oversight of electricity activities occurring wholly within Akwa Ibom State, subject to the legal and institutional framework established under the Electricity Act 2023 and the state's electricity legislation.

As part of the transition, the Port Harcourt Electricity Distribution Company (PHEDC) is required to establish a separate subsidiary responsible for electricity supply and distribution within Akwa Ibom. The new entity is expected to obtain the appropriate licence from AKSERC before commencing operations within the state's intrastate electricity market.

The transition is expected to be completed within the period specified by NERC, while the Commission will retain regulatory authority over electricity activities that cross state or national boundaries, including relevant interstate and international generation, transmission, supply, trading and system operations.

The development reflects the practical implementation of the Electricity Act 2023, which provides a framework for states to establish and regulate their own electricity markets where the requisite legal and institutional structures are in place.

For electricity-sector participants, the development further demonstrates the changing regulatory landscape in Nigeria, where businesses operating across multiple states may increasingly have to consider both federal and state-level regulatory requirements.

ENERGY

NERC Places Kaduna DisCo Under Interim Board

The Nigerian Electricity Regulatory Commission (NERC) has continued its regulatory intervention in Kaduna Electricity Distribution Plc (KAEDC) following the Commission's decision to dissolve the company's existing board and establish an interim governance structure. The intervention took effect on 10 August 2026.

NERC subsequently constituted a five-member Interim Board of Special Directors to oversee the company during the intervention period. The Board has been given a 12-month period within which it is expected to work towards restoring the company's financial and operational viability.

The intervention demonstrates the Commission's use of its regulatory powers to address significant governance, operational and financial challenges within a distribution company.

The development is also relevant from a corporate-governance perspective, as it places the management and strategic direction of the distribution company under a regulator-appointed interim structure.

The Kaduna intervention forms part of the wider regulatory efforts to strengthen the performance and sustainability of electricity distribution companies and improve the reliability of electricity supply within their respective franchise areas.

ENERGY, OIL & GAS

New Deep Offshore Incentive Framework Targets Fresh Investment

The Federal Government has introduced the Deep Offshore Oil and Gas Projects Incentives (Tax Remission) Order 2026, establishing a new incentive framework for qualifying deep offshore oil and gas projects.

President Bola Tinubu signed the Order on 6 August 2026, and it was subsequently published in the Federal Gazette as S.I. No. 37 of 2026 on 10 August 2026. The Order was made pursuant to powers under the Petroleum Industry Act 2021 and the Nigeria Tax Administration Act 2025.

The framework is intended to improve the fiscal attractiveness and predictability of qualifying deep offshore developments and encourage the progression of major projects that require significant long-term capital investment.

NUPRC has stated that the new framework could unlock more than US$50 billion in investment and support the addition of approximately 1 million barrels per day of crude oil and condensate production over the next four to five years.

NNPC Limited has also described the Order as a significant upstream-sector reform that could accelerate Final Investment Decisions on major deep offshore developments. The company identified projects including Bonga South-West, Zabazaba and Owowo among developments expected to benefit from the improved investment framework.

The Order is particularly significant because it seeks to provide a more predictable fiscal environment for qualifying deep offshore projects. Fiscal certainty is a major consideration in upstream investment decisions, particularly for projects involving substantial capital expenditure and long development timelines.

The development therefore represents an important change in the government's approach to attracting investment into Nigeria's deep offshore petroleum resources and could have implications for future project development, financing, joint ventures, taxation and other upstream transactions.

TELECOMMUNICATIONS & TECHNOLOGY

Federal Government Unveils National Digital Cloud Policy

The Federal Government, through the Federal Ministry of Communications, Innovation and Digital Economy, has unveiled the National Digital Cloud Policy, establishing a national framework for the growth, governance and internationalisation of Nigeria's cloud-computing and data-infrastructure ecosystem. The policy was unveiled on 17 August 2026.

The policy forms part of the government's broader digital-economy strategy and is intended to attract investment into cloud and data-centre infrastructure, strengthen Nigeria's domestic digital capacity, support government digital transformation and position the country as a regional hub for digital services.

The framework identifies four principal priorities:

Investment and market development, including creating a predictable environment for investment in data centres, cloud infrastructure, connectivity and AI computing capacity;

Regional digital-services exports, positioning Nigeria as a hosting, processing and interconnection hub for West Africa and the wider Sub-Saharan African market;

Government cloud transformation, including a strengthened "Cloud First" approach across Federal Ministries, Departments and Agencies; and

Digital sovereignty and security, including targeted safeguards for defined categories of government and regulated data.

Importantly, the policy does not impose general data-localisation requirements on commercial data. Instead, sovereignty requirements are directed at defined categories of government and regulated data where national control is considered necessary.

The policy is intended to complement existing government digital infrastructure initiatives, including Project BRIDGE, which aims to deploy at least 90,000 kilometres of additional fibre-optic infrastructure, and the 3 Million Technical Talent (3MTT) Programme, which is developing skills in areas including cloud computing, artificial intelligence, cybersecurity and software engineering.

For technology companies, cloud-service providers, data-centre operators and businesses handling regulated or government data, the policy provides an important indication of the direction of Nigeria's digital infrastructure and data-governance landscape.

AVIATION

Government Moves to Secure New IATA Code for Osubi Airport

The Federal Government is taking steps towards securing a new International Air Transport Association (IATA) code for Osubi Airport, following efforts to clarify the airport's identity and status.

The development forms part of broader government activity around the recognition, development and positioning of airport infrastructure within Nigeria's aviation network.

An IATA airport code is used internationally to identify airports in airline schedules, ticketing, baggage systems and other aspects of commercial air transport. Securing an appropriate code is therefore relevant to an airport's integration into international airline and passenger-service systems.

The government's intervention around Osubi also highlights the continuing role of federal aviation authorities in the development and regulatory recognition of airport infrastructure.

For airport operators, airlines and aviation-sector investors, developments concerning airport designation, regulatory approvals and international aviation standards can have implications for the operation and commercial positioning of aviation facilities.