The Nigerian Government has plans to introduce a series of strict obligations for stakeholders in the tech sector, including new licences, levies and sanctions for digital companies, while a freeze on fintech bank accounts has also been implemented.
In March, Nigeria’s technology regulator, the Information and Technology Development Agency (NITDA), proposed amendments to the Nigerian Information Technology and Development Act (2007). According to sources, the proposed amendments to the Act include new licensing requirements for digital service companies. The licenses are classified into three categories: product, service provider and platform provider. Further amendments cover levies; all companies with an annual turnover equal to and above USD 243,831 would be required to pay 1% of their profit before tax as levies. Note that the levy must be paid in addition to the 30% company income tax all profit-earning companies have to pay. Failure to adhere to directives issued by the agency also attracts a fine of USD 73,149.
Contraventions of the Act by individuals can result in fines or police custody for a year or more. Companies can be fined USD 60,000 for contraventions, while the “principal officers” of the companies may also serve a prison sentence for two years or more.
Furthermore, the Amendment Act proposes the establishment of a National Information Technology Development Fund to promote the country’s digital economy. The fund will be financed by grants-in-aid, fees, accrued money under administrative payments and levies charged from tech companies.
In another event, yesterday, the Central Bank of Nigeria froze the bank accounts of Nigerian fintech platforms Risevest, Bamboo, Trove and Chaka for the next six months. The Central Bank stated that these companies were operating without the required asset management licenses. At court, the Central Bank noted that “the foreign exchange deals done with the defendants were making the Naira weaker to the United States dollar, hence the need to block 15 of their accounts for about 180 days.” So far, none of the affected companies has come out to refute this claim.
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