Capital market reforms gain momentum as Tinubu signs investments, securities bill into law
Onome Amuge
President Ahmed Bola Tinubu has signed the Investments and Securities Bill (ISB) 2025,into law, a development considered a major boost to capital market regulation in Nigeria.
The Securities and Exchange Commission (SEC), made the disclosure in a statement dated March 29th 2025, signed by Efe Ebelo, head of SEC’s external relations department.
According to the SEC, the ISB 2025 repeals the Investments and Securities Act No. 29 of 2007 and enacts the Investments and Securities Act 2025.
The landmark legislation, the commission noted, strengthens the legal framework of the Nigerian capital market, enhances investor protection, and introduces critical reforms to promote market integrity, transparency, and sustainable growth.
“The enactment of the ISA 2025 reaffirms the authority of the SEC as the apex regulatory authority of the Nigerian Capital Market as well as to regulate the market to ensure capital formation, the protection of investors, and maintenance of fair, efficient and transparent market and reduction of systemic risks.
“The Act also introduces transformative provisions to further align Nigeria’s market operations with international best practice,” Ebelo stated.
Speaking on key highlights of the Act, Emomoitimi Agama, director general, SEC, explained that the Act enhances the regulatory powers of the SEC in a manner comparable with benchmark global securities regulators.
According to Agama, the enhanced powers and functions ensure full conformity with the requirements of IOSCO’s Enhanced Multilateral Memorandum of Understanding (EMMoU), enabling the SEC retain its “Signatory A” status and enhancing the overall attractiveness of the Nigerian capital market.
He said other notable provisions of the ISA 2025 include: Classification of Exchanges and inclusion of provisions on Financial Market Infrastructures- The Act classifies Securities Exchanges into Composite and Non-composite Exchanges.
The SEC DG noted further that a Composite Exchange is one in which all categories of securities and products can be listed and traded, while a Non-composite Exchange focuses on a singular type of security or product. He added that there are also new provisions on Financial Market Infrastructures such as Central Counterparties’, Clearing Houses and Trade Depositories.
Other highlights of the Act, as outlined by Agama includes Expansion of the definition and Understanding of Securities. The Act, he noted, explicitly recognises virtual/digital assets and investment contracts as securities and brings Virtual Asset Service Providers (VASPs), Digital Asset Operators (DAOPs) and Digital Asset Exchanges under the SEC’s regulatory purview.
Agama mentioned further that the act contains comprehensive insolvency provisions for financial market infrastructures and also introduces provisions for the monitoring, management and mitigation of systemic risk in the Nigerian capital market.
Concerning expansion of the category of issuers to the public, Agama explained that the Act expands the categories of issuers, as a key step towards the introduction of a wide range of innovative products and offerings as well as the facilitation of “commercial and investment business activities”, subject to the approval of the Commission and other controls stipulated in the Act.
The SEC DG disclosed that the Act contains a new part which provides for the regulation of Commodities Exchanges and Warehouse Receipts, essential to allow for the development of the entire gamut of the Commodities ecosystem.
On the issuance of securities by sub-nationals and their agencies, Agama noted that salient provisions of the Act addressed existing restrictions in respect of raising of funds from the capital market by sub-nationals to allow for greater flexibility in this regard.
He said that The Act introduces the mandatory use of Legal Entity Identifiers (LEIs) by participants in capital market transactions. This stipulation is designed to improve transparency in the conduct of securities transactions and expressly prohibits Ponzi Schemes and other unlawful investment schemes, while prescribing stringent jail terms and other sanctions for the promoters of such schemes.
Meanwhile, in a bid to strengthening the Investments and Securities Tribunal, the Act amends some key provisions in the repealed ISA 2007 pertaining to the Composition of the Tribunal, constitution of the Tribunal, qualification and appointment of the Chief Registrar as well as the jurisdiction of the Tribunal to enhance the ability of the Tribunal to optimally discharge its mandate.
Agama lauded the president’s assent as a transformative step for the capital market saying that the ISA 2025 reflects a commitment to building a dynamic, inclusive, and resilient capital market.
Agama stated: “By addressing regulatory gaps and introducing forward-looking provisions, the new Act empowers the SEC to foster innovation, protect investors more efficiently and reposition Nigeria as a competitive destination for local and foreign investments.
“We commend all stakeholders within and outside the capital market community for their unwavering solidarity towards the achievement of this historic milestone and solicit their continued collaboration in respect of the effective implementation of the ISA 2025 for the benefit of our economy.”
The SEC acknowledged the National Assembly for its patriotism and dedication in enacting this new legal framework for the Nigerian capital market. It noted that the meticulous deliberations, extensive stakeholder engagements, and bi-partisan support demonstrated throughout the legislative process highlight the National Assembly’s resolve to foster economic growth and enhance investor confidence.
The commission also commended Wale Edun,minister of Finance and Coordinating Minister of the Economy of Nigeria as well as Doris Uzoka-Anite, the minister of State for Finance for their invaluable contributions to the realisation of this groundbreaking project.
“Their strategic guidance, policy expertise, and steadfast support have ensured that the ISA 2025 aligns with Nigeria’s broader economic objectives,” the commission concluded.