FROM POLICY TO PIPELINE: THE EVOLUTION OF NIGERIA'S GAS SECTOR IN THE DECADE OF GAS

EXECUTIVE SUMMARY

“From Policy to Pipeline: The Evolution of Nigeria's Gas Sector in the Decade of Gas” explores Nigeria's journey in harnessing its abundant natural gas resources to drive economic growth and industrialization. The article begins by highlighting Nigeria's position as a major gas producer but notes that much of its gas is still exported, pointing to the need for a comprehensive approach to domestic gas utilisation. It examines key policy, legislative, and regulatory frameworks that support the Decade of Gas initiative, including the Petroleum Industry Act, the Nigerian Energy Transition Plan, and the Nigerian Gas Flare Commercialisation Programme. These initiatives demonstrate Nigeria's commitment to prioritising gas development and utilisation. The article also delves into the critical gas infrastructure projects, such as the Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline, the Escravos-Lagos Pipeline System (ELPS), and the NLNG Train 7 project, highlighting their significance in enhancing domestic gas utilisation and supporting economic growth. Despite facing challenges such as inadequate funding and security concerns, Nigeria has significant opportunities in the commercialisation and utilisation of gas, which can improve the power sector, increase domestic consumption, and drive industrialization. By addressing these challenges and leveraging these opportunities, Nigeria can realise the benefits of the Decade of Gas initiative and transform its economy.

INTRODUCTION

Nigeria's vast natural gas reserves present a significant opportunity for the country's power sector, especially with policies aimed at boosting LPG and CNG production. However, a considerable amount of gas is still being exported, highlighting the need for a comprehensive approach to address current challenges. This article examines the Decade of Gas so far, as it relates to Policy, Legislative and Regulatory Frameworks as well as gas infrastructures in Nigeria that are advancing the course of the industrialisation and commercialisation of the economy of Nigeria in this Decade of Gas.

President Muhammadu Buhari declared the 2020s as Nigeria's “Decade of Gas” in March 2021. This initiative signifies a strategic shift towards prioritising natural gas as a critical engine for the nation's industrial development. While boasting some of the largest gas reserves in Africa, Nigeria's current production falls short compared to regional neighbours. In 2021, production stood at 1.62 trillion standard cubic feet (1.62 TSCF), lagging behind Algeria (3.56 TSCF) and Egypt (2.4 TSCF). This highlights the significant potential waiting to be unlocked through the “Decade of Gas” initiative. [1]

To fully capitalise on its gas potential, there is a need for Nigeria to focus on increasing domestic gas utilisation for power generation and other industrial applications. This requires investment in infrastructure, policy reforms, and collaboration between the government and private sector.

POLICY, LEGISLATIVE AND REGULATORY FRAMEWORKS SUPPORTING THE DECADE OF GAS

Policy and regulatory changes have significantly influenced Nigeria's gas sector, with key initiatives aimed at prioritising gas development and utilisation as a national priority. The declaration of the 2020s as the Decade of Gas by the previous administration led by President Mohammadu Buhari is dedicated to industrialising Nigeria through domestic gas utilisation. Following this, several policy and regulatory changes have been implemented to support these objectives, including the following:

1.     The Petroleum Industry Act, 2021

2. Gas Flaring, Venting And Methane Emissions (Prevention Of Waste And Pollution) Regulations, 2023

3. The Nigerian Energy Transition Plan

4. Nigerian Gas Flare Commercialization Programme

THE PETROLEUM INDUSTRY ACT, 2021

The Petroleum Industry Act, 2021 (the “PIA”) enacted in 2021, marked the culmination of a 20-year effort to reform Nigeria's oil and gas sector. This comprehensive legislation aims to address longstanding challenges and create a more efficient and competitive industry. One of its key provisions is the prohibition of natural gas flaring or venting, aligning with global efforts to reduce emissions and protect the environment.

Section 105 of the PIA prohibits gas flaring or venting, emphasising the need to conserve natural resources and minimise environmental impact. However, section 107 provides exemptions for specific situations, such as facility start-up or strategic operational reasons. This demonstrates a balanced approach to regulation, allowing for flexibility while promoting responsible gas utilisation.

GAS FLARING, VENTING AND METHANE EMISSIONS (PREVENTION OF WASTE AND POLLUTION) REGULATIONS, 2023

Regulation 6 of the Gas Flaring, Venting And Methane Emissions (Prevention Of Waste And Pollution) Regulations, 2023, (the “Regulation”) empowers the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), who is the Upstream Regulator to grant exclusive permits for accessing flare gas. These permits are granted based on specified terms and conditions, including commercialising or utilising disposed gas. This regulatory framework encourages the industrialisation and commercialisation of Nigeria's gas resources, creating opportunities for economic growth and development.

Furthermore, Regulation 10 outlines the obligations of permit holders, including the execution of milestone agreements, gas sales connection agreements, and agreements with licensees or lessees.

These requirements highlight the focus on establishing commercial relationships and infrastructure for the sale and distribution of gas, supporting industrial and commercial activities that depend on a stable and accessible gas supply. From the above, it could be inferred that the PIA and its associated regulations provide a near-comprehensive framework for the sustainable development of Nigeria's gas sector, promoting economic growth and environmental stewardship.

THE NIGERIAN ENERGY TRANSITION PLAN

The Nigerian Energy Transition Plan (ETP) was released in 2022. The ETP recognizes natural gas as a crucial transition fuel on the path to net-zero emissions. This recognition underscores the importance of gas in the nation's energy mix, which is essential for industrial and commercial activities. The plan acknowledges Nigeria's abundant gas reserves as a key factor in ensuring energy security, which is important for industrialisation and commercialisation efforts, as a reliable energy supply is essential for driving economic growth. [2]

Gas is also considered essential for stabilising the grid, which is necessary for integrating renewable energy sources at scale. This indicates that gas will not only support industrial and commercial activities directly but also enable the growth of renewable energy, which is crucial for sustainable industrialisation. The ETP also acknowledges the role of gas, particularly Liquefied Petroleum Gas (LPG), in addressing the nation's clean cooking deficit. This highlights the diverse uses of gas beyond industrial and commercial applications, showing its importance in improving the quality of life for Nigerian citizens. [3]

Moreover, the ETP emphasises the commercialization of gas as a priority for the Nigerian government. This indicates a strategic focus on leveraging gas resources for economic development, which is fundamental to industrialisation and commercialisation efforts. The ETP's recognition of the critical role of gas in Nigeria's energy transition and its emphasis on its commercialisation demonstrate a clear commitment to using gas as a driver for industrialisation and commercialisation in the country.

THE NIGERIAN GAS FLARE COMMERCIALISATION PROGRAMME (NGFCP)

The Nigerian Gas Flare Commercialisation Programme was initially launched in 2016, demonstrating the Federal Government of Nigeria's (FGN) unwavering commitment to ending the unacceptable practice of gas flaring in the country's oil fields. This commitment is further exemplified by the FGN's ratification of the Paris Climate Change Agreement and its membership in the Global Gas Flaring Reduction Partnership (GGFR), which aims for a global flare-out by 2030 and a national flare-out target by 2025. [4]

Recognising the untapped potential of flared gas, the NGFCP seeks to harness these resources to stimulate economic growth, drive investments, and create job opportunities, particularly in oil-producing communities and for Nigerians at large. The program acknowledges the importance of innovative technologies in maximising the value of flared gas. The NGFCP 2022 represents a new phase of the programme, redesigned to align with evolving market dynamics and to effectively implement the FGN's policy objectives for eliminating gas flares. This strategic approach is expected to yield significant multiplier effects and development outcomes for Nigeria. [5]

These policy, legislation and regulatory changes reflect the Nigerian government's commitment to leveraging its abundant gas resources to drive economic growth, energy security, and sustainable development. Effective implementation and monitoring will be crucial to ensure the success of these initiatives and maximise their impact on Nigeria's gas sector.

GAS INFRASTRUCTURE DEVELOPMENT IN NIGERIA

1. The Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline

The Ajaokuta-Kaduna-Kano (AKK) gas pipeline is a critical infrastructure project spearheaded by the Nigerian National Petroleum Corporation (NNPC). This 614km pipeline, valued at $2.8bn, is a vital component of Nigeria's Gas Master Plan, designed to efficiently transport natural gas from the southern region to central Nigeria. The AKK pipeline is the first phase of the larger 1,300km Trans-Nigerian Gas Pipeline (TNGP) project, aimed at leveraging Nigeria's abundant gas resources for power generation and domestic consumption. [6] Furthermore, the TNGP project is part of a larger vision that includes the proposed 4,401km-long Trans-Saharan Gas Pipeline (TSGP), which aims to export Nigerian natural gas to customers in Europe. [7] This demonstrates Nigeria's ambition to play a significant role in the global gas market and highlights its commitment to economic growth and development.

Scheduled for completion in July 2024, the AKK pipeline is projected to significantly enhance domestic and regional gas utilisation, particularly for power generation and industrial development. The project includes plans to process hydrocarbon liquids at Ajaokuta, producing LPG, while the bulk of the gas will be transported to supply feedstock for new power plants and petrochemical facilities in Abuja, Kaduna, Kano, and Katsina. This strategic infrastructure investment is poised to stimulate economic growth, improve energy access, and drive industrialisation in Nigeria. [8]

2. Escravos-Lagos Pipeline System (ELPS)

The Escravos-Lagos Pipeline System (ELPS) is a critical component of Nigeria's gas infrastructure, facilitating the transportation of natural gas from the Niger Delta to various consumption areas, including power plants in the South-West region of the country. It is operated by the Nigerian Gas Company Limited, and has a capacity of 1.1 billion standard cubic feet (1.1BSCF) of gas per day. [9]

The ELPS, a 36-inch pipeline constructed in 1989, plays a key role in supplying gas to support industrial and commercial activities. While the pipeline begins at the Nigerian Gas Company's gas treatment plant in Warri, the gas originates from Chevron's Escravos gas plant in Delta State. In addition to supplying gas to power plants in the South-West, the ELPS also feeds into the West African Gas Pipeline System, which is part of the broader Nigeria-Morocco Gas Pipeline project (which is also referred to as the Trans-Saharan Gas Pipeline). [10]

In line with Nigeria's commitment to enhancing its gas transportation infrastructure, the ELPS underwent a significant expansion. The construction of the Escravos–Lagos Pipeline System II, announced in April 2019 and completed in February 2021, effectively doubled the pipeline's production capacity to 2.2 billion standard cubic feet of gas per day (2.2BSCF/D). [11]

This infrastructure plays a vital role in supporting industries reliant on natural gas as a primary energy source, and demonstrates Nigeria's commitment to enhancing its gas transportation infrastructure, thereby contributing significantly to economic growth and industrialization.

3. Obiafu - Obrikom - Oben Gas Pipeline Project

The Obiafu-Obrikom-Oben (OB3) Gas Pipeline, also known as the East-West pipeline, stretches from the Obiafu-Obrikom gas plant near Omuku, Rivers State, to Oben, Edo State. It is owned by NNPC and operated by the Nigerian Gas Company. [12] This pipeline has the capacity to produce 2 billion standard cubic feet of gas per day (2BSCF/D). The OB3 Gas Pipeline Project stands as one of the largest gas transmission pipelines in Nigeria and Africa, distinguished by its impressive 48-inch diameter and 127-kilometre length. Additionally, the project features an associated Gas Treatment Plant (GTP) capable of producing 2 billion standard cubic feet of gas per day (2BSCF/D). [13]

The OB3 gas pipeline project is designed to supply the Assa North-Ohaji South (ANOH) gas project, a significant greenfield gas condensate development venture operated by Seplat Energy PLC. [14] The ANOH project aims to produce 300 million standard cubic feet of gas per day (300MMSCF/D), supporting the domestic market and generating an equivalent of approximately 2.4 gigawatts of electricity for the country.[15] The ANOH Project is also a key gas infrastructure in the Decade of Gas.

These strategic pipeline projects represent Nigeria's commitment to commercialising and industrialising its gas resources, as it will facilitate the transportation of natural gas essential for various industrial activities, particularly power generation, upon completion.

4. NLNG Train 7

Nigeria LNG Limited (NLNG) stands as one of the world's premier LNG suppliers, leveraging Nigeria's abundant natural gas resources. Established on May 17, 1989, NLNG was tasked with producing Liquefied Natural Gas (LNG) and Natural Gas Liquids (NGLs) for export. The NLNG Train 7 Project represents a pivotal expansion endeavour, set to augment production capacity by 35% from the current 22 Million Tonnes Per Annum (MTPA) to 30 MTPA. [16]

This expansion is poised to solidify Nigeria's position as a leading, dependable, and favoured LNG supplier in the continuously expanding energy landscape. While the Final Investment Decision was made in 2019, predating the declaration of the Decade of Gas by former President Muhammadu Buhari, it was not until June 2021, following the announcement of the Decade of Gas, that the construction of Nigeria LNG Limited's (NLNG) Train 7 project was thereafter inaugurated by him.[17]

The Train 7 project signifies substantial growth for Nigeria's oil and gas sector, with an anticipated investment exceeding $10 billion encompassing both Train 7 and the upstream segment of the LNG value chain. This initiative is expected to unlock new development prospects within the industry, bolstering Nigeria's Foreign Direct Investment (FDI) profile and instilling confidence in foreign investors.[18]

The NLNG Train 7 Project aligns perfectly with Nigeria's Decade of Gas initiative, which aims to leverage the country's abundant natural gas resources for economic development and industrialization. By increasing LNG production capacity, the project contributes directly to the goals of the Decade of Gas by promoting gas as a key driver of economic growth, diversification, and energy security.

Furthermore, the investment in the NLNG Train 7 Project demonstrates Nigeria's commitment to developing its gas sector and expanding its LNG export capabilities. This not only enhances Nigeria's position as a major LNG supplier but also supports the country's efforts to reduce gas flaring and monetize its gas resources more effectively.

It is safe to say that the NLNG Train 7 Project is a key component of Nigeria's strategy to maximise the benefits of its gas resources and drive sustainable development across various sectors of the economy, in line with the objectives of the Decade of Gas.

5. Floating Liquefied Natural Gas Project in Nigeria

A floating LNG (FLNG) is an LNG plant constructed on a ship or a barge which has LNG storage and offloading facilities.[19] FLNGs produce, liquefy, store and transfer liquefied natural gas via carrier ship to the mainland where both the market and the money is based. [20]

In 2023, the Nigerian National Petroleum Corporation (NNPC) and UTM Offshore signed a Heads of Terms (HoT) agreement for the construction of Nigeria's first indigenous floating LNG project. This agreement considered a significant step toward bolstering Nigeria's energy security and promoting the utilisation of its abundant gas resources, was signed on 20 July 2023 in Abuja. [21] Similarly, in December 2023, UTM Offshore, NNPC Limited, and the Delta State Government signed an agreement regarding Nigeria's first floating LNG (FLNG) project. The planned vessel will have a capacity to handle 1.8 billion metric tons per year for both domestic supplies and exports. The Final Investment Decision (FID) is expected to follow shortly, with construction set to begin in 2024. [22]

It is also noteworthy to highlight that Wison and NNPC signed a Memorandum of Understanding (MoU) at COP28 in Dubai on December 6, 2023. The agreement will see the two companies work together to chart a roadmap for the FLNG project development, ultimately leading to an investment decision. [23]

The agreement between NNPC and UTM Offshore for the construction of Nigeria's first indigenous floating LNG project represents a significant milestone in the country's efforts to commercialise and industrialise its gas sector. This project is in line with the goals of the Decade of Gas initiative, which seeks to leverage Nigeria's abundant gas resources for economic development and industrialization.

The floating LNG project will allow Nigeria to monetize its gas resources more effectively by converting them into LNG for both domestic use and export. This will not only help to meet the country's energy needs but also position Nigeria as a major player in the global LNG market, contributing to economic growth and job creation.

Furthermore, the signing of the above agreements demonstrate the commitment of the Nigerian government and NNPC to developing the country's gas sector and attracting investment in the industry. By partnering with UTM Offshore and other stakeholders, Nigeria is taking concrete steps towards realising the objectives of the Decade of Gas and unlocking the full potential of its gas resources for the benefit of its economy and people.

6. The Maiduguri Emergency Power Project (MEPP)

The Maiduguri Emergency Power Project represents a crucial initiative aimed at providing reliable and sustainable electricity to Maiduguri, the capital of Borno State, and its surrounding areas. This project is not only essential for meeting the energy needs of the region but also aligns with the Federal Government's commitment to deepening gas utilisation in Nigeria's domestic markets, as outlined in the "Decade of Gas" (2021-2030) declaration. By leveraging domestic gas resources for power generation, the MEPP contributes to the overall goal of improving access to electricity and stimulating economic activities in Maiduguri and across Borno State. [24][25]

The MEPP's significance extends beyond electricity provision, as it is part of a broader strategy to enhance domestic gas utilisation, reduce gas flaring, and promote economic development in the region. This project exemplifies the government's proactive approach to addressing energy challenges while supporting sustainable development goals. As the MEPP progresses, it is expected to have a positive impact on the socio-economic landscape of Maiduguri and Borno State, demonstrating the transformative potential of strategic energy infrastructure projects in Nigeria.

CHALLENGES AND OPPORTUNITIES

The development of gas infrastructure in Nigeria, despite its potential impact, has faced several challenges that have hindered progress. These challenges include inadequate funding, which has resulted in delays and multiple missed deadlines for gas infrastructure projects. Additionally, the country's security concerns, including pipeline vandalism and attacks on infrastructure, have contributed to the slow development of gas infrastructure.

Furthermore, while the Petroleum Industry Act prohibits gas flaring, there is still a limited gas gathering and distribution network in Nigeria. This limitation is primarily due to the high cost of gas infrastructure projects and the need for significant investment in infrastructure development. Additionally, the lack of adequate infrastructure has led to inefficiencies in the gas supply chain, hindering the country's ability to fully utilise its gas resources, especially in addressing its energy poverty.

Despite these challenges, there are significant opportunities for Nigeria in the commercialization and utilisation of gas, as outlined in the Decade of Gas initiative. Utilising gas in the economy can improve the power sector, increase domestic gas consumption for cooking and transportation, and provide industries with a reliable and cost-effective energy source. By addressing these challenges and leveraging these opportunities, Nigeria can further develop its gas sector and realise the benefits of the Decade of Gas initiative.

CONCLUSION

In the journey from policy to pipeline, Nigeria's gas sector has witnessed a transformative decade marked by significant strides in policy, legislation, and infrastructure development. The declaration of the 2020s as Nigeria's Decade of Gas set the stage for a renewed focus on gas as a catalyst for industrial growth, underscored by key initiatives such as the Petroleum Industry Act and the Nigerian Energy Transition Plan. These policy and regulatory changes have laid a solid foundation for advancing the industrialisation and commercialisation of Nigeria's economy through the sustainable development of its gas resources.

The implementation of major gas infrastructure projects like the AKK Gas Pipeline, ELPS, and NLNG Train 7 reflects Nigeria's commitment to expanding its gas sector and enhancing energy security. Despite facing challenges such as funding constraints and security risks, Nigeria has positioned itself as a key player in the global gas market. Looking ahead, sustained investment in infrastructure, continued policy support, and collaboration between the public and private sectors will be crucial in realising the full potential of Nigeria's gas sector, driving economic growth, and ensuring a sustainable energy future.

REFERENCES

1. https://energy-utilities.com/assessing-the-first-years-of-nigeria-s-decade-of-news122255.html accessed on 19 February, 2024

2. https://www.energytransition.gov.ng/natural-gas/ accessed on 19 February, 2024.

3. Ibid

4. https://ngfcp.nuprc.gov.ng/about-ngfcp/ accessed on 19 February, 2024.

5. Ibid

6. https://pemedianetwork.com/petroleum-economist/articles/midstream-downstream/2024/nigeria-s-biggest-gas-pipeline-advances/ accessed on 19 February, 2024.

7. https://www.nsenergybusiness.com/projects/ajaokuta-kaduna-kano-akk-gas-pipeline/ accessed on 19 February, 2024.

8. Supra

9. https://www.gem.wiki/Escravos%E2%80%93Lagos_Pipeline_System

10. Ibid

11. Ibid

12. https://nairametrics.com/2023/09/29/nnpcl-gas-petroleum-ministers-assure-of-ob3-gas-pipeline-completion/#:~:text=The%20Obiafu%2FObrikom%2FOben%20 accessed on 20 February, 2024.

13. https://www.gem.wiki/Obiafu-Obrikom-Oben_Gas_Pipeline accessed on 18 February, 2024.

14. https://www.seplatenergy.com/our-company/our-operations/midstream-gas/anoh-gas-processing-plant/ accessed on 20 February, 2024.

15. https://anohgas.com/anoh-field/ accessed on 20 February, 2024.

16. https://www.nigerialng.com/Train7-Project/Pages/Background.aspx accessed on 21 February, 2024.

17. Ibid

18. Ibid

19. https://www.chiyodacorp.com/en/service/offshore/ accessed on 20 February, 2024.

20. https://www.oilandgasiq.com/fpso-flng/articles/guide-to-flng accessed on 20 February, 2024.

21. https://www.offshore-energy.biz/nnpc-and-utm-offshore-ink-deal-on-nigerias-first-indigenous-floating-lng-project/ accessed on February, 2024.

22. https://www.offshore-mag.com/vessels/article/14303007/nigerias-first-flng-project-close-to-fid accessed on 20 February, 2024.

23. https://www.offshore-energy.biz/nnpc-teams-up-with-wison-for-floating-lng-project-in-nigeria/ accessed on 20 February, 2024.

24. https://nnpcgroup.com/ accessed on 20 February, 2024

25. https://x.com/nnpclimited/status/1631353485504524290?s=46&t=y0lLsWAKUISw-yzLf93qSQ accessed on 19 February, 2024.

ENERGY LAW NEWSLETTER

As April comes to an end, we are thrilled to unveil our quarterly newsletter, marking its inaugural edition. As We have curated an array of exciting updates on some of our latest work and insights on the latest

developments in the energy landscape.

So, grab your favourite drink, settle in, and let's delve into the latest happenings!

Click on the link above to read.

NIGERIA INTERNATIONAL ENERGY SUMMIT (NIES)

At the recently concluded Nigeria International Energy Summit (NIES), themed, “From Blueprint to Reality: Navigating Nigeria's Gas Decade and Balanced Narrative on Energy Transition,” our Managing Partner, Ms. Chinenye Uwanaka, who participated as a panellist, emphasised the following points:

1. Implementation is key! Despite having several blueprints such as the Gas Masterplan and Energy Transition Plan, Nigeria struggles with execution. We need the right people in the right roles and stakeholders to drive change.  It is time for a private sector-led approach to ensure Nigeria's decade of gas becomes a reality. 

The process must be private sector-led. Everyone is a key player in ensuring that Nigeria’s decade of gas moves from blueprint to reality. 

Without a clear vision, industrialisation becomes a challenge. Nigeria's path to industrialisation hinges on clear energy goals as well as the need for coordination in our laws and policies. We need to decide if gas is our destination fuel. 

Do we want gas to be our destination fuel? What do we want to achieve in the short/medium term?

The issue is not the inadequacies of laws and policies, but rather the challenges in Nigeria's rule of law, enforcement of contracts, and access to justice. She stressed the need for effective enforcement to attract investors. To leapfrog, we must rethink our approach to energy, enforcement of contracts and industrialisation.

Do you agree that the state of Nigeria’s rule of law, enforcement of contracts, and access to justice has stalled its energy sector from leapfrogging into a dominant position in the global energy market?

NIGERIA INTERNATIONAL ENERGY SUMMIT (NIES)

At the recently concluded Nigeria International Energy Summit (NIES), themed, “From Blueprint to Reality: Navigating Nigeria's Gas Decade and Balanced Narrative on Energy Transition,” our Managing Partner, Ms. Chinenye Uwanaka, who participated as a panellist, emphasised the following points:

1. Implementation is key! Despite having several blueprints such as the Gas Masterplan and Energy Transition Plan, Nigeria struggles with execution. We need the right people in the right roles and stakeholders to drive change.  It is time for a private sector-led approach to ensure Nigeria's decade of gas becomes a reality. 

The process must be private sector-led. Everyone is a key player in ensuring that Nigeria’s decade of gas moves from blueprint to reality. 

Without a clear vision, industrialisation becomes a challenge. Nigeria's path to industrialisation hinges on clear energy goals as well as the need for coordination in our laws and policies. We need to decide if gas is our destination fuel. 

Do we want gas to be our destination fuel? What do we want to achieve in the short/medium term?

The issue is not the inadequacies of laws and policies, but rather the challenges in Nigeria's rule of law, enforcement of contracts, and access to justice. She stressed the need for effective enforcement to attract investors. To leapfrog, we must rethink our approach to energy, enforcement of contracts and industrialisation.

Do you agree that the state of Nigeria’s rule of law, enforcement of contracts, and access to justice has stalled its energy sector from leapfrogging into a dominant position in the global energy market?

THE BINDING NATURE OF EXECUTIVE ORDERS ON SUCCESSIVE GOVERNMENTS IN NIGERIA

INTRODUCTION

Leadership in Nigeria takes place within the framework of a Federal Presidential republic and representative democracy where the executive power is held by the president. The 1999 constitution of the Federal Republic of Nigeria vests all the executive powers of the federation in the person of the president which can be exercised directly by him or his vice president or members of his cabinet. In the dynamic landscape of Nigerian politics, the question of an outgoing administration's executive orders binding a succeeding government arises frequently. As a democratic nation, Nigeria upholds the principle of continuous governance, but transitions can create uncertainties around inherited policies and directives. In carrying out the administrative functions of the office, the President in a presidential system may issue orders to ministries and agencies setting out government policies, issuing directives or command actions relating to functions of the executive arm. For the purpose of continuity of good governance, the coming into power of a new administration does not expressly terminate an existing executive order made by the outgone administration except where that order is ultra vires, unconstitutional and illegal. This is because executive orders are often grounded in the constitutional authority of the President and are considered part of the institutional memory and continuity of government operations. Abruptly nullifying all previous executive orders could disrupt ongoing policies and initiatives, leading to inefficiencies and uncertainty. Instead, the new administration typically evaluates existing executive orders on a case-by-case basis, considering their legality, effectiveness, and alignment with the administration's priorities. This approach allows for a smooth transition while ensuring that governance remains consistent and responsive to evolving needs and circumstances. However, an executive order issued by the President becomes rather controversial when it appears ultra vires. This is because law-making is ordinarily within the remit of the legislature while the President is empowered to execute laws made by the legislature. Moreover, the 1999 Constitution does not set out to make the Presidency a lawmaking body working in competition against the Legislature. 

 DEFINITION AND NATURE OF EXECUTIVE ORDERS

The expression, “executive order”, is neither defined in the 1999 Constitution nor is it interpreted in any legislation of the National Assembly or House of Assembly of any State. However, the very few Acts of the Legislature that contain the expression ‘executive order’ do not define nor interpret it. The Interpretation Act also does not contain any definition of the expression.  In situations like this where there is no executive, legislative or judicial definition, the enquirer has to turn to the academia for an unofficial but weighty clarification. The American author, K. R. Mayer, defines an executive order as “a presidential directive that requires or authorizes some action within the executive branch. The 10th Edition of the Black’s Law Dictionary defines an Executive Order as “An order issued by or on behalf of the president, intended to direct or instruct the actions of executive agencies or government officials, or to set policies for the executive branch to follow.” Executive orders are basically directed at the executive branch of government and its agencies. It is not and should not be directed at individuals, although individuals would be invariably affected by it.

THE LEGALITY AND USE OF EXECUTIVE ORDERS

The 1999 Constitution provides for the powers of the president. Where the constitution sets limits to the powers of the President, any executive order outside the express instructions of enabling law will be adjudged invalid. Although executive orders serve essentially as administrative tools, they serve as legislative tools where they create rules, modify laws or set out the parameters for their implementation. It is usually argued that executive orders violate the doctrine of separation of powers which may result in the creation of a monstrous executive. Legal scholars have however justified the use of executive orders in Nigeria by reference to section 5 of the Constitution of the Federal Republic of Nigerian, 1999 (as amended) (“the Constitution”) which vests the executive powers of the Federation and the States on the President and Governors respectively, and extends same to the “execution and maintenance” of the Constitution and all laws made by the national and state legislatures. Section 130(2) of the Constitution further provides “The President shall be the Head of State, the Chief Executive of the Federation and Commander in Chief of the Armed Forces of the Federation.” It is submitted with respect that inherent in the powers of the President (as Chief Executive of the Federation) includes the power to issue orders and provide policy guidelines to officials under his control as well as ensure the execution and maintenance of the Constitution, all laws made by the National Assembly and all matters with respect to which the National Assembly can legislate on.

Executive law-making has also been justified by reference to section 315 (2) of the Constitution which empowers the President or the Governor to, modify any existing law to bring it into conformity with the Constitution by an order. This provision was held to be valid in A.G Abia State v A.G Federation (2003) where the Supreme Court held that the powers given under Section 315 (2) of the Constitution “is not an abuse of the principle of the doctrine of separation of powers” but rather “it is essential to giving meaning to an existing law so that the Constitution itself is not abused.” The Supreme Court stated that the two tests for determining the constitutionality of modification to an existing law are: whether the modification order brings the relevant Act into conformity with the provisions of the Constitution; and whether there has been an infraction of the Constitution by the order.

THE BINDING NATURE OF EXECUTIVE ORDERS

The Nigerian Constitution empowers the President to issue executive orders, but their precise legal weight remains a subject of ongoing debate and interpretation. While they hold some authority, they operate within specific boundaries. Primarily, they cannot contradict existing legislation or overstep the executive's constitutional powers. The binding nature of executive orders is hinged on the following;

• The subject matter of the executive order greatly influences its binding nature. Policy-oriented orders addressing general administrative matters typically hold less legal weight and can be readily modified by the incoming government. Take for instance the subsidy removal, this can be altered/changed by a new administration. Quasi-legislative orders, however, implementing existing laws or filling regulatory gaps, might hold more force. Yet, their validity can be challenged in court if deemed to exceed the executive's legal authority. 

• Contractual orders, creating agreements with third parties (e.g other countries), carry more weight due to contractual obligations. However, the incoming administration still holds the power to renegotiate or revoke them on legal grounds or based on national interest.

• Procedural hurdles also play a role. If the outgoing administration followed proper legal procedures and adhered to their authorized powers while issuing the order, it strengthens its validity and reduce the chance of easy reversal.

• Ultimately, the courts stand as arbiters in disputes concerning executive orders. The incoming administration or affected parties can challenge the order's legality, potentially leading to its nullification or modification. This judicial review process adds another layer of complexity to the question of binding nature.

• Beyond legal intricacies, political realities also influence the fate of executive orders. The incoming administration's stance towards the previous government's policies and priorities significantly impacts the order's longevity. If the order aligns with its objectives, it might remain in effect even without strong legal grounding. Conversely, a stark ideological shift could lead to swift changes, regardless of the order's legal merits.

LIMITATIONS OF EXECUTIVE ORDERS

• Executive orders cannot purport to enact a law or create a right and/or a duty which is not backed up by an enabling law validly enacted by the legislature. Where they do this, such right and/or duty is only valid until properly challenged in court.

• Executive orders cannot override the Constitution or Acts of the National Assembly and are subject to whether or not the National Assembly has legislative authority over the subject matter and has delegated relevant law-making powers to the President, laws of States’ Houses of Assembly.

• It cannot restrict the power of the (future) President to amend its provisions. Thus, they can be amended, or repealed by future occupants (or even the same occupant) of the office. However, in order to show political willingness to see the implementation of the Order through and to assure the organised private sector that the word of the President will be his bond, the President especially if the same President or one sponsored under the platform of the same political party may choose not to without reasonable cause amend an Executive Order.

• Where an EO is an exercise of delegated power, the delegate must act in accordance with the terms of the delegation. For instance, where power is delegated by the legislators to the President, his Attorney General, cannot purport to act under this power and vice versa.

CONCLUSION

The binding nature of an executive order in the Nigerian context cannot be determined with a blanket statement. Each case demands a thorough examination considering the subject matter of the specific order, procedural compliance, potential for judicial review, and the incoming administration's political position. Executive orders form an integral part of the Presidential System of Government operating in Nigeria, however, what is required in making executive orders effective tool for positive change, is to ensure that the Executive stays within its range of responsibilities and does not attempt to cross into regions which have been constitutionally delimited to the legislative arm of government and/or other levels of government. The 1999 Constitution does not set out to make the Presidency a law-making body working in competition with the Legislature, but it rather vests the legislative powers of the Federal Republic of Nigeria in the National Assembly to make laws. The Constitution further vests the executive powers in the President to implement these laws. This demarcation of powers reflects the traditional idea that each arm of government is separate and co-equal.

BRIEF OVERVIEW OF THE LAW MAKING PROCESS IN NIGERIA

INTRODUCTION

Nigeria is governed under a three-arm structure; the executive, legislative and judiciary. Each arm of government is tasked with fulfilling specified obligations as contained in the 1999 Constitution of the Federal Republic of Nigeria (“Constitution”). Ideally, the executive and judiciary are saddled with the responsibility of enforcing and interpreting laws respectively; whereas, the legislature is recognized for its law making powers, and responsible for enacting laws that govern Nigeria. Our focus is on the legislature; particularly, the processes involved in making laws in Nigeria.

Nigeria operates a bicameral legislature, which means that there are two primary law making bodies or chambers; the Senate and the House of Representatives (the ‘house’). Both chambers make up what is referred to as the National Assembly, which is empowered by the provisions of section 4(1) of the Constitution to make laws for the peace, order and good government of the federation. In performing its law making obligations, the senate and house must comply with laid down law making procedure.

STAGES IN THE LAW MAKING PROCESS

Stage 1; Presentation of the Bill

Before any document can be recognized as law, it must be tabled as a bill before the National Assembly. A bill is a draft of a proposed law which is presented before the senate and house for deliberation. Such bill can be presented by a member of the senate (or a ‘senator’), the public or a member of the house, and in certain instances, a member of the executive arm of government. Where a bill is proposed by a senator, it is usually presented before the presiding officer, in the person of the senate president. The senate president then forwards the proposed bill to the speaker of the house (or ‘speaker’) for consideration. The speaker is responsible for presiding over the proceedings of the house and where a member of the house presents a bill, the speaker must follow the same procedure employed by the senate president. In the case of an executive proposing a bill, such document is often referred to as an executive bill and presented through the office of the president to the senate president and speaker of the house.

Stage 2; First Review of the Bill

Upon receipt of the bill by the senate or house as the case may be, the bill is forwarded to relevant committees for review. The senate and house have established committees responsible for reviewing bills to ensure that they meet the required standard. One of these committees is the Rules and Business Committee and the Committee on the Rules and Procedure for the house and the senate respectively. In the event that the bill falls below the required standard, the respective chamber committee must send the bill to the legal department of the National Assembly for redrafting. After which, the bill is sent out for gazetting and a date and time for the first reading of the bill is scheduled.

Stage 3; Gazetting of the Bill

Gazetting of the bill involves officially informing the public that the National Assembly is considering a proposed law, and inviting them to make their presentations for or against such bill. The clerk of the appropriate chamber is usually saddled with the responsibility of obtaining a copy of the bill and publishing same in the official gazette (similar to a publication), however where the bill emanates from a member of either the senate or house of representatives, permission must be granted by the appropriate chamber leader before the member sponsoring such bill can publish same in two successive issues of the official gazette.

Stage 4; First Reading

The first reading is done to introduce the bill to members of the appropriate chamber. At this stage the clerk must have distributed copies of the published bill to the members, before proceeding to read out the short title of the bill ( an example of a short title is ‘the constitution of the Federal Republic of Nigeria). The bill is then tabled before the presiding officer and members of either the senate or house are precluded from discussing or debating the contents of such bill until its second reading.

Stage 5; Second Reading

Here, the legislators proceed to debate the bill in their chambers. To begin, a motion to discuss the bill must be moved by a member of the appropriate chamber, and seconded by another member. Where the motion is not seconded, that bill is considered rejected; whereas, a seconded motion will open the floor for debate. Members will be given the opportunity to make presentations for or against the bill, stating reasons why it should be considered or not. Thereafter, the bill will be put to vote and if a simple majority of members vote in favor of the bill, it will proceed to the next stage. It is imperative to note that a motion to commence debate for an executive bill is moved by the presiding officer and must be seconded by another member.

Stage 6; Committee stage

A further review of the bill is conducted by two special committees, namely; the Standing Committee and the Committee of the Whole House. The House and the Senate have the two types of committees charged with the responsibility of examining the bill and making necessary adjustments. The process of analyzing the bill may involve inviting members of the public to make contributions to the bill through a public hearing, and putting such observations into consideration. After which, a report is made and presented together with printed copies of any adjustments to the bill to members of the appropriate chamber. Thereafter, a motion to proceed with the amended bill must be moved by a member before the commencement of the next stage of the law making process.

Stage 7; Third & Final Reading

At this stage, there are no debates or discussions concerning the bill. The clerk reads the long title of the bill and members are only required to study the bill for any mistakes or errors. Where there are none, the bill is accepted and passed into law by the appropriate chamber. Any amendments to the bill made by a member at this stage must be by motion, which must be approved by the presiding officer. In such case, the bill will revert to the Committees discussed earlier for re-evaluation.

Stage 8; Signing of the Bill

After the bill is passed into law, the clerk will print a final copy of the bill and sign same. The bill is thereafter forwarded to the appropriate presiding officer to append his signature and later sent to the other chamber for deliberation and passage. As Nigeria operates a bicameral legislature, a bill which has been passed by the senate must be forwarded to the house of representative for concurrence, and vice versa. Thus, upon receipt of such bill, the receiving chamber must initiate the same law making process as highlighted above and make a decision to pass the bill, reject it in its entirety or make adjustments to it. Where the decision is to make adjustments to the bill, a committee comprising of members of both chambers is formed to deliberate on the amendments and reach a compromise. Such compromise is presented as a report to both chambers for consideration and approval. Upon approval by both chambers, a copy of the updated version of the bill is sent by the clerk of the receiving chamber to that of the originating chamber to produce a final copy of the bill for the president’s assent. However, where the committee fails to reach a compromise, the initial bill will be presented to and passed by the National Assembly before it is sent to the president.

Stage 9; President’s Assent/Signature

The final copy as approved by both chambers is presented to the president for his signature. The signature of the president is required to convert a bill into law and section 58(4) of the Constitution requires the president to append his signature on the bill within 30 days of receipt. Where the president withholds his signature and proposes some amendments to the bill, the National Assembly will consider such amendments and agree to incorporate same into the bill. However, where the president rejects the whole bill, the National Assembly is empowered by the provisions of section 59(4) off the constitution to recall the bill and re-pass it into law by a two-third majority vote in both chambers. Thereafter, such bill will be regarded as law, regardless of the absence of the president’s signature.

This sums up the law making process in Nigeria.

CLASSIFICATION OF DATA CONTROLLERS AND PROCESSORS OF MAJOR IMPORTANCE UNDER THE NDPC GUIDANCE NOTICE

The Nigeria Data Protection Act, 2023 ("the Act") establishes a requirement for a specific category of data controllers and processors to mandatorily register with the Nigerian Data Protection Commission (NDPC). This mandatory registration serves as a crucial compliance measure, considering the heightened risks associated with mishandling or breaching data security in their operations. The criteria for this category, designated as data controllers and processors of major importance, are to be determined and outlined by the NDPC. In a Guidance Notice issued by the NDPC in February 14, 2024, the following criteria have been established for such a designation:

A data controller or processor is considered of major importance if it:

1. Keeps or has access to a system for processing personal data (like a database), whether it is physical or digital, and meets one of the following conditions:

• Processes personal data of more than 200 individuals within six months.

• Provides commercial Information Communication Technology (ICT) services on digital devices owned by others, with storage capacity.

• Operates in specific sectors such as finance, communication, health, education, insurance, export and import, aviation, tourism, oil and gas, or electric power.

2. Is in a fiduciary relationship with a data subject, meaning it holds confidential information on behalf of the data subject. This is particularly significant because of the potential harm to the data subject if the controller or processor fails to protect their data properly.

For the purpose of registration, data controllers and processors of major significance are further classified into 3 levels:

(a) Major Data Processing-Ultra High Level (MDP-UHL)

(b) Major Data Processing-Extra High Level (MDP-EHL)

(c) Major Data Processing-Ordinary High Level (MDP-OHL)

Implications of Registrations

1. Compliance with the Act

2. Publication on the NDPC website for being in compliance.

3. Close monitoring by the NDPC as data controllers or processors are required to notify the Commission of any significant changes to the information provided during registration. This ensures that the Commission remains informed about developments in data processing activities and can assess their compliance with regulatory requirements.

4. Although there is no requirement for incorporation in Nigeria, registration mandates providing the name and address of the data processor or its representative, whether operating directly or indirectly, acting on behalf of a data controller. Additionally, it is required to specify the country to which the data controller or processor intends to transfer the personal data, either directly or indirectly.

Finally, data controllers and processors are mandated to finalise their registration within the designated period, which commences on January 30th, 2024, and concludes on June 30th, 2024. Neglecting to register within this timeframe or registering after the designated deadline will constitute a breach of the Act. Furthermore, data controllers or processors found to be in default of this obligation will be subject to penalties as outlined in the Act. Notably, data controllers and processors of major importance may face penalties at the maximum amount of Ten Million Naira or 2% of their annual gross revenue for the preceding financial year, whichever is higher.

THE FIGHT FOR SOCIAL JUSTICE: TALES FROM NIGERIAN CORRECTIONAL SERVICE, KUJE.

Today, February 20th, is World Social Justice Day, and we would like to share an experience that profoundly impacted some of us as we reflect on social justice. November 27, 2023, was a sunny Monday, and though the day was beautiful, the lessons it brought have forever changed our outlook on life.

At around 10 AM that day, some of my colleagues and volunteers from the Access to Justice Initiative, the social justice advocacy and Corporate Social Responsibility arm of The Firma Advisory, embarked on a journey to the Nigerian Correctional Service, Kuje Command (“Facility”) for the "Prison Decongestion" program. The journey from Wuse to Kuje felt lengthy by Abuja standards. However, upon arrival and after passing through the security checks, we were ushered into a neat and well-maintained facility. Thereafter, we were granted access to interact with some of the inmates and get a first-hand account of their experiences there.

Kuje Correctional Centre is a male detention facility. Upon entering, we were introduced to some of the inmates, some of whom had been incarcerated for what lay people would consider "minor offences." Despite having a capacity for 500 persons, the facility housed 692 inmates at the time of our visit. During our conversations with them, some inmates mentioned that their families were unaware of their whereabouts, and this violates Section 6 of the Administration of Criminal Justice Act, 2015, which provides that “the authority having custody of the suspect shall have the responsibility of notifying the next of kin or relative of the suspect of the arrest at no cost to the suspect.” Some purposely kept their families uninformed to spare them worry. One inmate, whom we will refer to as Kay (not his real name), shared that neither his family nor his employer knew he was there, except the Complainant, even his mother was unaware as well. This made me contemplate how individuals can be in detention facilities without their families' knowledge, contributing to the issue of missing persons and overcrowded correctional facilities.

Akpos (not his real name) had a different situation. His family was aware of his incarceration; in fact, his father is a lawyer and a religious leader. However, when Akpos reached out to his father for assistance, his father informed him that he could not attend to him. Akpos had come to Abuja to work and support his family back in his home state. Despite holding two informal jobs, one of which was a security guard, he struggled to make ends meet, including finding accommodation. While on guard duty, he was arrested and charged with wandering. Unable to secure his bail, Akpos did not receive aid from his father.

We also inquired about the access to healthcare in the facility from the Chief Warder of the facility. He informed us that the facility has only one doctor which is worrisome how one doctor can efficiently attend to 692 inmates, excluding staff. However, it is crucial to note that since there is a state of emergency in our health system, these people will also be affected.

Our interest in healthcare access stemmed from the condition of one of the inmates, whom we will call Abu (not his real name). Abu had a swollen and red eye, with both eyes visibly injured. He also appeared to be on the autism spectrum. Abu was arrested for pickpocketing. As we are aware, jungle justice is still prevalent in Nigeria. Abu was severely beaten before his arrest by law enforcement agents. He did not understand English, so Danladi (another inmate) had to translate for him. Abu was homeless but informally employed. He worked offloading vehicles transporting fruits in one of Abuja's markets but barely earned enough. He lacked skills, but we learned that he was learning furniture making in the correctional facility, which was a positive development.

Kay, Akpos, Abu, and Danladi were not the only inmates we counselled or helped secure bail for. Their stories highlight the need for improved social justice in Nigeria. For some of these inmates, their bail was set at ₦20,000 (Twenty Thousand Naira) equivalent to $12.5 (Twelve Dollars, Five Cents), but neither they nor their families could afford it as some of them slept on the streets while free, and others could barely make enough to live by. Now incarcerated, it is more difficult for them and their families to pay the bail sum themselves. As the United Nations emphasises, "World Day of Social Justice reminds us each year of the need to build fairer, more equitable societies." A fairer and more equitable society means access to healthcare regardless of circumstances, access to education, and access to justice.

It is important to note that Kay and others whose whereabouts are unknown are not isolated cases. Every other day, people go missing in Nigeria. While some of their family members and good neighbours may post on social media asking for help in locating them, they may be languishing in prison or even in police detention cells because the database management system is not digitised and cannot be accessed from any of their facilities across the country. It is worth considering that even if some people wanted to inform their families about their whereabouts, they may not have access to their phones due to various reasons and may not even have anyone's phone number memorised. Danladi's (not his real name) case exemplifies this. Neither his wife nor friends knew where he was not because he did not want them to know but because he lacked the means.

On a positive note, we were able to secure bail for a few of the inmates, including covering their transportation expenses home, and their joy knew no bounds.

So, how can the government and good people help build a fairer and more equitable society? - Pay living wages. - Improve the healthcare system. - Digitise the justice system, including police and correctional services facilities records.

“Until we are all free, none of us are free.” - Emma Lazarus

To learn more about the Access to Justice Initiative and how you too can be a part financially or by volunteering, please contact +234-810-584-7051.

THE CONCEPT OF “NO RETURNS, NO REFUNDS” IN E-COMMERCE AND CONSUMER RIGHTS UNDER THE FEDERAL COMPETITION AND CONSUMER PROTECTION ACT (FCCPA) 2018

EXECUTIVE SUMMARY

It is a fact that e-commerce has revolutionized business transactions by leveraging technology and the internet, enabling broader and streamlined customer access and interactions. This shift which spawned a surge in online marketplaces, nonetheless still adopts conventional business practices with the inclusion of terms, both express and implied, to govern transactions. In Nigeria, a prevalent term often seen in receipts or other documentary proofs of payment is "Goods sold in good condition cannot be returned or refunded." More sophisticated organizations encapsulate this in a formal Return Policy to inform customers of their stance on returns and refunds.

It is on this premise that this article discusses the legality of such "no returns, no refunds" policies in the context of Nigerian consumer protection law.

INTRODUCTION

*Madeline (not her real name) was excited to receive her pair of beautiful white sneakers which matched with the pair her husband *Benjamin (not his real name) got for their Valentine's getaway trip. While excitedly trying on her gorgeous pair in the bathroom of the executive suite of the five (5) star hotel where they lodged, she discovered a shocking problem in paradise: Neither sneaker foot fit her feet!

Quickly, Benjamin called and sent direct messages to the online vendor he bought the undersized sneakers from; requesting a replacement or a full refund, in hopes of comforting his beautiful Madeline who was now upset that her dreams of a photo shoot by the clear blue sea around the hotel, in matching outfits and footwear, were about to be ruined, all to no avail.

Several calls and messages later, the vendor responds the following week with this text: “PLEASE REFER TO REFUND POLICY ON OUR WEBSITE WHICH SPECIFICALLY STATES THAT THERE SHALL BE NO REFUND OR RETURNS FOR ITEMS SOLD IN GOOD CONDITION”, At this point, Benjamin and Madeline are stunned and confused, especially after confirming this policy on the vendor’s website and like many customers are on the brink of resigning to their fate.

This scenario is not uncommon with business transactions (online and offline) in Nigeria and a good number of buyers find themselves in circumstances like this so it begs the question: “What can they do when faced with this situation?”

PRELIMINARIES

To get the appropriate context for this conversation, a few questions may arise:

What is a Refund and Return Policy? A Return and Refund Policy is a statement that describes a business's process, policies and requirements for accepting returns.[1] or making refunds to their customers.

Why are such policies used? Retailers usually make use of "no refund/return" policies to reduce costs and risks associated with returns, as some sellers argue returns can be exploited by dishonest buyers at the company's expense and where such instances of returns are on the rise, it may cast a negative light on the business therefore occasioning reputational damage and loss of business.

Is there a standard format for such? A “No refund policy” or clause varies between vendors. Some allow exchanging the purchased item for a similar product while others refuse any returns or exchanges under a strict "no refunds" rule. Some others may permit cancellations for a fee while refunding the remaining prepaid balance while in other cases, refunds are made for defective goods within a short window after purchase.

It is pertinent at this juncture to consider the position of Nigerian Law as it relates to this practice to ascertain if there are reliefs available to customers like Madeline and Benjamin following their ordeal.

THE REGIME OF CONSUMER PROTECTION LAW IN NIGERIA

The good news is that the predicament of our fictional couple is not without a remedy under Nigerian Law as they can seek redress primarily under Nigeria’s principal legislation on competition and consumer protection, which is a Federal law applicable in all states of the Federation, known as the Federal Competition and Consumer Protection Act (FCCPA) 2018.

Before the enactment of the FCCPA, the Consumer Protection Act [2] was the primary legislation on consumer protection in Nigeria which, amongst other things, established a Council “to provide speedy redress to consumers' complaints through negotiation, mediation and conciliation.”[3]

However, as the awareness of the importance of providing a more robust protection of consumer rights grew, it became evident that the existing Act needed to expand its scope of operations and be more efficient in line with modern approaches of Consumerism - a vibrant movement for the protection of the consumer against useless, inferior, or dangerous products, misleading advertising, unfair pricing, etc.[4]

This led to the repealing of the Consumer Protection Act and the enactment of the Federal Competition and Consumer Protection Act in 2018 as the supreme legislation on matters of competition and consumer protection in Nigeria, to the exclusion of any other law on such matters[5].

The FCCPA, has among its objectives, to protect and promote the interests and welfare of consumers by providing consumers with wider variety of quality products at competitive prices, and prohibit restrictive or unfair business practices which prevent, restrict, or distort competition or constitute an abuse of a dominant position of market power in Nigeria [6]. These objectives it achieves through the establishment of the Federal Competition and Consumer Protection Commission (FCCPC) [7] and the Competition and Consumer Protection Tribunal (CCPT) [8]

On the specific consumer rights protected under the FCCPA, Part XV of the Act which comprises Sections 114-131 provides for the following:

• Right to be given information in a plain and understandable language;

• Disclosure of the prices of goods and services;

• Disclosure of second hand or reconditioned goods;

• Right to sales records;

• Right to select suppliers

• Right to adequate trade description and to have products labelled;

• Right to cancel reservations, bookings or orders made in advance;

• Right to choose or examine goods;

• Right to return goods;

• General standards for marketing of goods and services;

• Right to fair dealings;

• Right against goods with false, misleading, and deceptive representations;

• Representation test and publication testimonials;

• Rights against unfair, unreasonable or unjust contract terms;

• Notice required for certain terms and conditions;

• Prohibited Transactions, agreements, terms or conditions

• Rights pertaining to the quality and safety of goods and services;

• Right to safe, good quality goods.

The essence of these rights under the FCCPA is to create a legal, protective ambit within which customers as consumers can hold vendors and service providers accountable and ensure there is greater satisfaction and value for the goods or services paid for by them.

Consequently, given the provisions of Sections 122 (Consumers right to return goods) and 129(1)(b)(1) (Prohibited Transactions, agreements, terms or conditions) of the FCCPA, it is safe to conclude that Madeline and Benjamin have a justiciable right to return the undersized sneakers and request a refund of the full price paid by them to the vendor within a reasonable period [9], as the Refund Policy on the online vendor’s website violates these express provisions of the FCCPA and is therefore, illegal, null and void.[10]

Additionally, where the online vendor is unwilling or uncooperative to their demands, Madeline and Benjamin can thereafter explore any of the following options:

• Approach the regulators of the online vendor, if such vendor operates within the organised sector [11] for redress;

• Approach the FCCPC by filing a complaint before it outlining the violation/breach and providing supporting documents to that effect.[12] It is noteworthy to state that where any party is aggrieved with the decision of the FCCPC, it may apply to the Competition and Consumer Protection Tribunal (CCPT). Following the decision of the CCPT, if either party is still aggrieved, it may within 30 days of the judgment/order/decision of the CCPT appeal to the Court of Appeal for Judicial Review;[13]

• Seek relief before a court of competent jurisdiction, in addition to any redress the FCCPC may impose.

Notwithstanding the obvious position of the FCCPA vis-a-vis Refund Policies in commercial contracts in Nigeria, there may be instances where it might be difficult or impracticable to refund a consumer who is dissatisfied with a purchase or service, such as:

• Where the product was not returned to the vendor within a reasonable period after being found unsuitable by the consumer;

• where a product or service has been customized or personalized to meet the specific needs or preferences of the customer,

• where the product or service is a digital product, such as software or a downloadable file, it may be difficult to verify whether the product has been used or copied;

• where the customer has used the product or service in an unauthorized manner or has abused it, then the seller or vendor may have grounds to refuse a refund upon return of such product;

• where the product or service is perishable or time-sensitive. In this instance, the product or service may be said to be already utilised by the customer, making it difficult to return the product in its original form and as purchased.[14]

RECOMMENDATION

The FCCPC should organise periodic awareness campaigns to educate members of the public about these specific rights and the available mechanisms for remedying violations of these rights by unscrupulous vendors.

There should be in place practice directions and the establishment of specialized courts to aid the accelerated hearing of consumer rights violation cases in courts of competent jurisdiction to encourage victims of such actions to approach the judicial system with the assurance of speedy dispensation of justice.

The FCCPC should foster dialogue between policymakers, stakeholders in the e-commerce industry and consumer groups to address gaps that may exist as matters of consumer protection in business transactions continue to evolve.

CONCLUSION

It is apparent that the Federal Competition and Consumer Protection Act (FCCPA) 2018 has advanced the frontiers of consumer rights protection beyond the province of merchantability of goods and services to the suitability and fitness for purpose which is one of the major cornerstones of Consumerism globally. By proscribing no refund policies in the main, vendors, online and offline, will be held to a higher standard of customer service and consumer satisfaction, which will in turn strengthen brand reputation and inspire more confidence in consumers who patronise their organisations regardless of the platform.

REFERENCES

https://www.termsfeed.com/blog/sample-return-policy-ecommerce-stores/ accessed 13th February 2024

CAP C25 LFN 2004

Ibid, Section 2

https://www.dictionary.com/browse/consumerism accessed 13th February 2024

Section 104, FCCPA 2018

Ibid, Section 1 (c) and (d)

Ibid, Section 3

Ibid, Section 39

Ibid, Sections 122 (a) and 146 (a) FCCPA 2018

Ibid, Section 129

Ibid, Sections 146 (b) and 147

Ibid, Sections 146 (c) and 148

Ibid, Sections 38, 47 and 55 of the FCCPA

https://www.mondaq.com/nigeria/dodd-frank-consumer-protection-act/1305004/the-legality-of-no-refund-policies-adopted-by-online-vendors-in-nigeria accessed 13th February 2024

UNDERSTANDING THE DESIGNATION - "DATA CONTROLLERS AND PROCESSORS OF MAJOR IMPORTANCE"

The Nigerian Data Protection Commission (the “Commission”) is an independent regulatory body created by the Nigeria Data Protection Act, 2023 (the “Act”) to regulate the processing of personal information in Nigeria. The primary mandate of the Commission is to regulate the processing of personal data within the territorial boundaries of Nigeria. Recently, the Commission issued a directive mandating "ALL entities" that collect personal data of individuals in Nigeria to undergo compulsory registration. The deadline for this mandatory registration has been set for June 30th, 2024. In support of its position on the mandatory registration of all data controllers and processors handling the personal data of individuals in Nigeria, the Commission has cited Section 5(d) of the Act.

However, it is our firm belief that this interpretation of Section 5(d) of the Act is erroneous. The aforementioned section stipulates that "The Commission shall register data controllers and processors of major importance."

According to Section 65, the definition section of the Act, a data controller and processor of major importance “means a data controller or data processor that is domiciled, resident in, or operating in Nigeria and processes or intends to process personal data of more than such number of data subjects who are within Nigeria, as the Commission may prescribe, or such other class of data controller or data processor that is processing personal data of particular value or significance to the economy, society, or security of Nigeria as the Commission may designate.” The interpretation of this section is as follows:

The Act intends for the Commission to stipulate a specific threshold of data subjects, the processing of which would qualify a data controller or processor to be considered of major importance.

Alternatively, the Act intends that the Commission designate a class of data controllers and processors as such of major importance because they process data that is of particular value or significance to Nigeria’s economy, society, or security. For instance, the EU Digital Markets Act 2022, introduced the classification of certain players as "Gatekeepers" owing to their substantial influence and dominance within their respective markets.

The Act does not imply that all data controllers and processors should be automatically regarded as being of major importance. If such were the intention, the Act would have explicitly stated so.

While it is acknowledged that the Commission is, by Section 7 of the Act, independent in the performance of its functions, this independence should not be construed as the ability to import a meaning that is at variance with the intent of the draftsmen. The Supreme Court in Ugo-Ngadi v. F.R.N (2018) 8 NWLR (Pt.1620) 29 SC remarked that “it is a cardinal principle of interpretation that the words of a statute that are unambiguous must be given their ordinary grammatical meaning.” Consequently, the Commission is bound by the literal definition of "data controllers and processors of major importance" as provided in the Act, necessitating the creation of specific designations rather than the indiscriminate inclusion of every data controller and processor into this special category. The approach the Commission wants to adopt would require every business, regardless of the volume of personal data collected, to register for a fee, thereby introducing an additional layer of obligation not envisaged by the Act.

It is pertinent to note that as of 2020, Nigeria's Ease of Doing Business (EDB) ranking stood at 131 out of 190 countries, with a general score of 56.9. In light of the country's current economic challenges, the government's focus should be on reducing barriers and fostering a conducive environment for businesses, particularly small and medium-sized enterprises (SMEs), to thrive and grow. It is worth recalling that the primary objective of the Business Facilitation Act, 2023, is to streamline business operations in Nigeria by eliminating administrative obstacles. By imposing an additional obligation on SMEs, instead of concentrating on the entities that the phrase "data controllers and processors of major importance" was intended to encompass, the Commission may inadvertently hinder the creation of a conducive environment for all businesses.

Conclusion

The recent directive issued by the Nigerian Data Protection Commission, mandating compulsory registration for all entities engaged in the collection of personal data within the Nigerian jurisdiction, necessitates a thorough reevaluation. While the Commission's intention to safeguard the privacy of personal data is undoubtedly commendable, it is essential to address the apparent deviation from the legislative intent behind the Nigeria Data Protection Act.

It is imperative that the Commission prioritise the designation of data controllers and processors of major importance, as outlined in the Nigeria Data Protection Act. This designation should be based on clearly defined criteria stipulated within the Act, ensuring that only entities meeting these specified criteria are subject to mandatory registration.

To uphold the principles enshrined in the Act and foster a conducive environment for business operations, it is crucial for the Commission to reconsider its approach. Rather than imposing additional burdens on all businesses, including small and medium-sized enterprises (SMEs), the Commission should strategically focus its regulatory efforts on entities that meet the criteria outlined in the Act. This targeted approach would not only ensure adherence to the law but also align with the government's broader objectives of promoting economic growth and facilitating seamless business operations.

GRID TO GREEN: NIGERIA'S TRANSITION TO RENEWABLE ENERGY FOR ELECTRICITY SUPPLY

EXECUTIVE SUMMARY

"Grid to Green: Nigeria's Transition to Renewable Energy for Electricity Supply'' delves into the global shift towards sustainable energy sources, emphasizing the urgent need to address climate change and reduce greenhouse gas emissions. The article highlights the significance of renewable energy due to its clean and environmentally friendly attributes. Nigeria's current energy landscape, dominated by thermal and hydroelectric power, is concisely discussed, along with efforts to diversify energy sources through privatization and concession structures. Legislative frameworks supporting renewable energy development, such as the Electricity Act 2023 and the Petroleum Industry Act 2021 are examined, alongside challenges like high initial costs and inadequate infrastructure hindering widespread adoption of renewable energy technologies. Overall, the article underscores Nigeria's strides towards a greener energy future and identifies opportunities for investment and policy intervention to accelerate this transition, emphasizing the importance of leveraging renewable energy potential and implementing supportive policies for a sustainable energy sector.

INTRODUCTION

In recent years, there has been notable global conversation and concerted action towards transitioning from fossil fuels to sustainable energy sources. This shift is primarily driven by the urgent need to address the climate change crisis exacerbated by greenhouse gas emissions. Across the globe, countries are enacting legislation to protect the environment, while companies and individuals are increasingly embracing renewable energy technologies. 

UNDERSTANDING RENEWABLE ENERGY AND ITS SIGNIFICANCE

Renewable energy originates from sources or processes that are constantly replenished. These energy sources include solar energy, wind energy, geothermal energy, and hydroelectric power[1]. Renewable sources are often synonymous with green and clean energy. Renewable sources are recyclable, clean energy does not release pollutants like carbon dioxide, and green energy is derived from natural sources.[2] Renewable energy is derived from natural resources capable of replenishing themselves within a human lifetime without depleting the planet's resources.[3] 

From the above, it is evident that renewable energy, as the name suggests, is energy derived from natural resources that can be renewed and/or recycled. Additionally, it produces minimal to no carbon emissions, thereby posing less risk of ozone layer depletion that could further harm the environment.

GLOBAL SHIFT TOWARDS SUSTAINABLE ENERGY SOURCES

The world's population is steadily increasing[4], leading to a heightened demand for electricity. However, in response to the climate change crisis and the rising cost of fossil fuels, there is a growing emphasis on decarbonization through the utilization of sustainable energy resources to power the electricity sector. Recent policy initiatives further underscore the global commitment to transitioning towards sustainable energy sources.

In 2019, the State of California, United States of America enacted legislation mandating that new residential constructions up to three stories high include rooftop solar panels, demonstrating a proactive dedication to advancing sustainable and renewable energy practices within the state's residential sector.[5] This move aims to enhance energy efficiency, reduce reliance on traditional power sources, and contribute to broadening environmental mitigation goals. It aligns with California's overarching efforts to lead in renewable energy adoption, reflecting a commitment to fostering a greener and more sustainable future in the construction and housing sector.

Similarly, on February 7, 2023, Minnesota Gov. Tim Walz signed a clean energy bill into law, requiring the state's utilities to derive 100% of their electricity from carbon-free energy sources by 2040.[6]

According to the World Economic Forum[7], Europe has made substantial progress in transitioning towards renewable energy sources for electricity generation over the last decade. In 2011, fossil fuels accounted for just under half of the EU's electricity production, with renewable energy sources contributing only 18%. Fast-forward to 2022, and wind and solar power alone generated 22% of EU electricity, surpassing natural gas at 20% and coal at 16%. Hydro and nuclear power still constitute the primary sources of electricity production at around 32%. This significant shift highlights a growing recognition of the importance of clean energy in mitigating environmental impact and fostering a more sustainable future on both regional and global scales.

CURRENT ENERGY LANDSCAPE IN NIGERIA

Nigeria predominantly relies on thermal and hydroelectric power for its electricity generation, boasting an installed capacity of about 12,522 MW.[8] According to data from the Nigerian Electricity Regulatory Commission (NERC)[9], the unbundling of the Power Holding Company of Nigeria (PHCN) has led to a diverse energy mix in the country. Generation companies resulting from this process, such as Afam, Sapele, Egbin, Ughelli (gas-powered plants), and Kainji, Jebba, Shiroro (hydroelectric facilities), contribute a total of 5,048 MW. While gas-based plants are fully privatized, hydroelectric ones operate under long-term concessions, showcasing varied ownership and management approaches. This diverse landscape reflects Nigeria's commitment to harnessing different energy sources for electricity generation, with the involvement of private entities expected to enhance efficiency, foster innovation, and promote sustainable energy practices.

In the current Nigerian electricity generation sub-sector, 23 grid-connected generating plants collectively offer an installed capacity of 10,396 MW. The available capacity is 6,056 MW, with thermal-based generation contributing significantly, boasting an installed capacity of 8,457.6 MW (available capacity of 4,996 MW). Hydropower also plays a vital role, with a total installed capacity of 1,938.4 MW (available capacity of 1,060 MW). This framework incorporates a mix of privatized Generation Companies (GenCos), Independent Power Producers (IPPs), and generating stations under the National Integrated Power Project (NIPP).[10]

Furthermore, the NERC has introduced a Regulation on embedded generation, enabling power generation plants, including those utilizing renewable energy sources, to connect directly to and evacuate through a distribution network.[11]

The above highlights Nigeria's current electricity sources, emphasizing the diverse energy mix resulting from the unbundling of PHCN. The presence of gas-powered and hydroelectric plants, each with distinct privatization or concession structures, underscores the nation's commitment to utilizing varied energy sources. The inclusion of thermal-based generation and hydropower, contributing significantly to the total installed capacity, illustrates the multifaceted nature of the electricity generation sector in Nigeria. The integration of private entities and regulatory support for embedded generation indicates a strategic and evolving transition toward a resilient and diversified energy sector, aligning with both immediate electricity needs and long-term sustainability goals.

LEGISLATION AND FRAMEWORK SUPPORTING RENEWABLE ENERGY DEVELOPMENT IN NIGERIA

As Nigeria actively seeks to enhance its renewable energy sector, several laws and policies have been enacted to facilitate its growth.

THE ELECTRICITY ACT 2023

The Electricity Act (“The Act”) outlines various objectives, one of which is to establish a framework that stimulates the development and utilization of renewable energy sources. The Act aims to create an enabling environment to attract investments in renewable energy, with the ultimate goal of increasing the contribution of renewable energy to the overall energy mix.[12] Section 80 of the Act specifically emphasizes the "promotion of generation from renewable energy," showcasing a strong commitment to fostering the use of renewable energy sources. The Act imposes an ongoing obligation on the Commission and Promotion of the Independent System Operator (ISO) to actively encourage and promote electricity generation from renewable sources.

When issuing generating licenses, the Commission (NERC) is mandated to promote various forms of renewable energy generation, including embedded generation, hybridized generation, co-generation, and electricity generation from sources like solar energy, wind, small hydro, biomass, and other renewables defined in the Act or that may be developed in the future. This legislative provision underscores a proactive stance towards diversifying the energy mix and integrating sustainable practices into the electricity generation sector in Nigeria.

Furthermore, the Act[13] outlines the establishment of an Integrated National Electricity Implementation Plan Policy and Strategic Implementation Plan. This plan, currently underway[14], aims to optimize the utilization of renewable energy sources such as solar, wind, hydro, hydrogen, and other renewable sources of energy. By incorporating these sources into the national plan, Nigeria demonstrates a commitment to the comprehensive integration of renewable energy and aligning its policies with the global transition towards sustainable practices in the energy sector.

PETROLEUM INDUSTRY ACT 2021

The Petroleum Industry Act (PIA), designed for the oil and gas industry, also addresses the crucial issue of gas flaring. Section 105 of the PIA explicitly prohibits the flaring or venting of natural gas, underscoring the commitment to environmental responsibility. Section 104 of the PIA establishes penalties for gas flaring, except as provided in section 104(1)(a), (b), (c) of the PIA. It is noteworthy that these provisions mark a significant step forward for the electricity sector.

The significance of this for the electricity sector lies in the acknowledgment that gas is a cleaner source of energy. Burning natural gas for energy results in fewer emissions of various air pollutants and carbon dioxide (CO2) compared to burning coal or petroleum products for an equivalent amount of energy.[15] This recognition aligns with global efforts to transition towards cleaner energy sources and reduce environmental impact.

The PIA, through penalties and the Nigerian Gas Flare Commercialisation Programme (NGFCP), imposes obligations on oil exploration companies to responsibly dispose of associated gas. This can be achieved through compliant methods, such as entering into a Gas Supply and Purchase Agreement, facilitating the lawful disposal of gas. Such agreements, when established with entities, can contribute to the production of energy for the electricity sector, promoting sustainable practices and aligning with environmental goals. The intersection of the PIA, penalties, and the NGFCP underscores the government's commitment to reducing gas flaring and advancing cleaner energy alternatives in the electricity sector.

THE NIGERIA ENERGY TRANSITION PLAN 

The Nigeria Energy Transition Plan (ETP) represents a crucial initiative by the government to reduce carbon emissions within the country. The ETP [16] acknowledges that emissions in the energy sector are predominantly driven by off-grid diesel/petrol generator use and on-grid gas combustion in power plants, attributed to insufficient generation capacity and grid constraints. The overarching goal of the ETP is to enhance the utilization of renewable energy sources, primarily focusing on solar energy, to address these challenges.

The key strategies outlined in the ETP include the complete elimination of diesel/petrol generators (decarbonization) and a substantial expansion of generation capacity through renewables, particularly solar energy. The plan recognizes that during the transitional phase, there will be an initial increase in gas generation to establish baseload capacity and facilitate the integration of renewable energy sources. This transitional approach is essential for meeting the energy demands while simultaneously working towards a future where renewable energy becomes the primary source.

The ETP envisions significant upgrades to central generation capacity, targeting an operational capacity of 42 GW by 2030. The plan outlines an annual increase of approximately 3 GW, including 1 GW/year for natural gas revamping, 0.8 GW/yr for new solar PV, and 0.3 GW/yr for biomass. This phased approach ensures a gradual transition to renewable energy sources while addressing the immediate need for enhanced generation capacity.

Post-2030, the ETP anticipates the deployment of centralized renewable energy (RE) solutions, with a focus on solar PV and corresponding storage, incorporating hydrogen starting in 2040. The plan outlines an ambitious target of approximately 7 GW/year by 2050 and 5 GW/year between 2050 and 2060, demonstrating a long-term commitment to sustainable and renewable energy development.

In essence, the ETP provides a comprehensive legal framework that aligns with global efforts to reduce carbon emissions, enhance renewable energy integration, and establish a sustainable energy landscape for the future.

RENEWABLE ENERGY POTENTIAL IN NIGERIA

Hydropower Potential

Nigeria's vast hydro potential remains largely untapped, with significant opportunities for development.

Assessment and Current Status

Nigeria boasts a vast untapped hydro potential of approximately 24 GW, along with a smaller hydro potential of around 3.5 GW. However, to date, the exploitation of these resources remains limited. As of 2015, the installed capacity for large hydro was only 1.9 GW, with small hydro accounting for a mere 60 megawatts.[17]

Wind Energy Potential

Nigeria possesses moderate wind potential, with notable variances across different regions.

Assessment and Current Status

Moderate wind potential exists in Nigeria, with average wind speeds ranging from 2.1 m/s to 8 m/s at a height of 10 meters. The northern region displays the highest wind speeds, exceeding 7 m/s. The International Renewable Energy Agency (“IRENA”) estimates the technical potential for wind energy at 3.2 GW, considering the utilization of only 1% of suitable land for project development. While the coastal and offshore areas remain unexplored, the southern region experiences lower wind speeds compared to the wind-rich northern region. The Federal Ministry of Power is conducting offshore wind mapping, National Renewable Energy Action Plan (“NREAP”) targets include achieving 0.17 GW of grid-connected wind capacity by 2020 and 0.8 GW by 2030.[18]

Solar Energy Potential and Challenges

Nigeria boasts abundant solar resources, offering significant opportunities for solar energy development.

Assessment and Current Status

Nigeria exhibits a high solar resource potential, with average annual global horizontal irradiation ranging between 1,600 kWh/m2 and 2,200 kWh/m2. The northern region records the highest solar irradiation, exceeding 2,000 kWh/m2. IRENA estimates the technical potential for solar photovoltaic (PV) energy at an impressive 210 GW, assuming the utilization of only 1% of suitable land for project development. Furthermore, concentrated solar power (CSP) holds substantial promise, with a potential of approximately 88.7 GW, predominantly concentrated in the northern region due to the availability of higher direct normal irradiance.[19]

Challenge [20]

Solar energy faces several challenges in Nigeria, primarily due to high initial investment costs, limited access to financing and infrastructure, inadequate policy and regulatory frameworks, and a maintenance and technical skills gap. The expensive nature of solar equipment inhibits widespread adoption, particularly in low-income areas, necessitating the development of financing mechanisms and partnerships to make solar energy more accessible. Additionally, the lack of financing options and infrastructure hampers project implementation, highlighting the need for specialized loan programs and investment in grid connectivity. Moreover, the absence of a supportive regulatory environment poses hurdles for investors, emphasizing the importance of clear policies to incentivize renewable energy and streamline operations. Lastly, addressing the technical skills gap through training programs and collaboration is crucial for the effective deployment and maintenance of solar energy systems Nigeria.[21]

Natural Gas Reserves

Nigeria's proven reserves of natural gas totalled an estimated 206.5 trillion cubic feet (Tcf) at the onset of 2023. Over the period spanning from 2012 to 2021, the average dry natural gas production in Nigeria amounted to approximately 1.5 Tcf, while dry natural gas consumption averaged 649 billion cubic feet (Bcf) within the same timeframe.[22] Despite the substantial abundance of natural gas resources in Nigeria, the efficient exploitation and application of these reserves in both industrial and domestic spheres continue to present challenges, including but not limited to: limited numbers of appropriate reservoirs conducive for gas re-injection and storage and the economics of the process, the financial commitment required for developing a major and interconnecting network of gas pipelines, and the low technology and industrial base for energy consumption in the country.

If flared gas is properly harnessed, Nigeria can produce 600,000 MT of LPG per year and generate 2.5 GW of power from new and existing Independent Power Plants to power the economy.[23] 

CONCLUSION

In conclusion, this article explores the global momentum towards sustainable energy sources, emphasizing the urgency driven by climate change concerns and the imperative to reduce greenhouse gas emissions. It provides an overview of Nigeria's current energy landscape, primarily reliant on thermal and hydroelectric power, and discusses efforts to diversify energy sources through privatization and concession structures. Legislative frameworks supporting renewable energy development, such as the Electricity Act of 2023 and the Petroleum Industry Act, are examined, alongside challenges hindering the widespread adoption of renewable energy technologies. Despite promising prospects, including vast renewable energy potential in hydropower, wind, and solar energy, Nigeria must overcome obstacles such as high initial costs and inadequate infrastructure to fully embrace these alternatives. Nevertheless, with continued focus on harnessing these resources, Nigeria is poised to make significant strides towards a greener energy future.

REFERENCES

1.  https://www.twi-global.com/technical-knowledge/faqs/renewable-energy accessed on 4 February, 2024.

2.  https://www.twi-global.com/technical-knowledge/faqs/renewable-energy accessed on 4 February, 2024. 

3.  https://www.ren21.net/why-is-renewable-energy-important/ accessed on 4 February, 2024.

4.  The current world population of 7.6 billion is expected to reach 8.6 billion in 2030, 9.8 billion in 2050 and 11.2 billion in 2100. https://www.un.org/en/desa/world-population-projected-reach-98-billion-2050-and-112-billion-2100 accessed on 6 February, 2024. 

5. https://unboundsolar.com/blog/8-facts-about-renewable-energy-mandates-by-state accessed on 4 February, 2024.

6. https://environmentamerica.org/updates/minnesota-governor-signs-100-clean-electricity-bill/ accessed on 5 February, 2024. 

7. https://www.weforum.org/agenda/2024/01/renewable-energy-transition-generation-eu/ accessed on 4 February, 2024.

8. https://www.trade.gov/country-commercial-guides/electricity-power-systems-and-renewable-energy accessed on 4 February, 2024.

9.  https://nerc.gov.ng/index.php/home/nesi/403-generation accessed on 4 February, 2024.

10.  Ibid 

11.  Ibid  

12.  Section 1(l) of the Electricity Act. 

13.  Section 3 of the Electricity Act.

14. https://independent.ng/plan-for-integrated-national-electricity-policy-underway/ accessed on 4 February, 2024.

15. https://www.eia.gov/energyexplained/natural-gas/natural-gas-and-the-environment.php#:~:text=Natural%20gas%20is%20a%20relatively,an%20equal%20amount%20of%20energy accessed on 5 February, 2024.

16.  https://energytransition.gov.ng/power/ accessed on 5 February, 2024.

17. .https://www.nigeria-energy.com/content/dam/markets/emea/nigeria-energy/en/2023/docs/NE23-NigeriaEnergyRoadmap-Report.pdf accessed on 26 September, 2023.

18. Ibid 

19.  Supra

20.  This is highlighted because solar has the highest level of user penetration in Nigeria, given the aggressive development of solar energy installation -https://link.springer.com/article/10.1007/s10668-022-02308-4  accessed on 8 February, 2024.

21. https://energymall.ng/challenges-of-solar-energy-in-nigeria-overcoming-barriers-to-sustainable-power/ accessed on 6 February, 2024. 

22.  https://www.eia.gov/international/analysis/country/NGA accessed on 23 September, 2023.

23. https://www.linkedin.com/pulse/gas-to-power-nexus-nigeria-challenges-prospects-outlook-ivie-ehanmo?utm_source=share&utm_medium=member_ios&utm_campaign=share_via accessed 6 February, 2024.

CLAIMING FINANCIAL COMPENSATION FOR DATA BREACH IN NIGERIA

Executive Summary:

The protection of personal data is one of the guarantees of a progressive and potentially successful digital economy. This is because data is the fuel that powers the digital economy. Organisations and governments collect and process data to create value, improve efficiency, and solve problems in various sectors of the economy. In the wrong hands, however, data can be weaponised and used for malicious and illegal purposes. The Nigeria Data Protection Act, 2023 (the “Act”) aims to safeguard the privacy and rights of individuals resident in Nigeria, whose data is collected, processed, or stored by various entities. The Act also provides remedies for data breaches, which are incidents where personal data is compromised, exposed, or stolen. One of the remedies available under the Act is financial compensation though it is a discretionary power of the Nigeria Data Protection Commission (the “Commission”).[1] This means that individuals who suffer losses, harm, or injuries due to data breaches can claim money from the responsible parties. However, this is not an automatic right. The Commission has the power to decide whether to award you compensation or not. This article explains how the Commission makes this decision and what factors it considers. This article also references the Nigeria Data Protection Regulation 2019 (“NDPR”) and the NDPR Implementation Framework (“Implementation Framework”). The NDPR, along with other related rules, guidelines, and frameworks made by the National Information Technology Development Agency (NITDA), is still valid and effective pursuant to Section 64 of the Act. The Article finally makes policy recommendations to the Commission.  

Understanding Personal Data Breach

Under the Act personal data breach occurs when there is a breach of security by a data controller or data processor that leads to or is likely to lead to the accidental or unlawful destruction, loss, alteration, unauthorised disclosure of, or access to personal data transmitted, stored, or otherwise processed. According to an entry[2] in the US National Vulnerability Database, in 2021, a researcher discovered and disclosed an 8.8-severity data breach involving the personal information of Konga customers in Nigeria. Another outlet[3] reported in 2022 that over 500 e-commerce platforms in Nigeria have been targeted by malicious actors using Magecart, a general term given to crime syndicates that contaminate e-commerce sites with skimmers.[4] These are all examples of a data breach.

Seeking Financial Redress for Data Breaches

With data breaches comes the possibility that accessed data can be used for nefarious activities, not limited to identity theft,[5] spamming,[6] doxing,[7] phishing[8] and blackmailing,[9] all of which can cause actual and legal damage. If you are a victim of a data breach, you may be entitled to financial compensation from the responsible parties. The combined  reading of the Act, the NDPR, and other subsidiary legislation provides relief to affected persons in the following ways:

1. The affected person should file a complaint against the data controller or processor with the Nigerian Data Protection Commission (“Commission”).  See Section 46 of the Act. The person can also bypass the Commission and file a civil action in the High Court. See Section 51 of the Act.

2. The complaint to the Commission should cite in what ways the data controller or processor has violated the Act or any subsidiary legislation to the Act. Because there has been a breach, the net should be cast wide. For example, consider:

1. Whether the data controller or processor has the basis for collecting or carrying out specific processing activities which might have caused the breach, See Section 25 of the Act;

2. Whether the data controller or processor has appropriate technical measures to ensure the security, integrity, and confidentiality of personal data; See Section 29 of the Act;

3. Whether the data controller or processor files its data protection audit as and when due. Such audit must also comply with the NDPR and the Implementation Framework;

4. Whether the organisational policies and procedures of the organisation for monitoring and reporting violations of privacy are compatible with industry standards;

5. Whether the data controller or processor complies with the Act on procedures for cross-border data transfer. See Sections 41, 42 and 43 of the Act; and

6. Whether a Data Privacy Impact Assessment (“DPIA”) was conducted before the processing of data that resulted in a breach. See Section 28 of the Act. When an organisation plans to undertake a project that requires extensive use of personal data, a DPIA should be carried out to find potential breach points and develop a plan for mitigating those risks. Section 3.2 (viii) of the Implementation Framework also requires organisations to conduct a DPIA on their processes, services, and technology periodically to ensure continuous compliance.

3. The complaint should detail the emotional and financial costs suffered as a result of the data breach.

4. The Commission may initiate an investigation if it satisfies itself that the complaint has merit. See Section 46 of the Act.

5. If the investigation reveals that the data controller or processor violated the Act or any subsidiary legislation, the Commission may, among other things, order the erring data controller or processor to pay compensation to the data subject who has suffered loss, injury, or harm as a result of the violation. This is without prejudice to the power of the Commission to prosecute such data controllers or processors. See Section 48 of the Act.

Conclusion

Given the persistent increase in data breaches and the sophistication of the technology used by these bad-faith actors, there is a need to highlight the potential harm caused by data breaches to individuals. Granted, the Commission is commendably going after errant data controllers or processors.  According to Dr. Vincent Olatunji, the National Commissioner of the Commission, in 2023, an undisclosed number of banks and institutions in Nigeria paid over N200 million to the Federal Government as penalties for violating the data privacy of Nigerian citizens. While this is commendable, Nigerians need to know that beyond the fines, the Act entitles them to financial compensation for their loss. Although this is a discretionary power exercisable by the Commission, this power should be exercised more rigorously when a fault is found on the part of a data controller.

Policy Recommendations:

1. In light of the escalating threat landscape, the Commission should consider adopting a specific security standard as a minimum technical requirement for data controllers or processors. Alternatively, a review of the security standard ISO 27001:2013 prescribed under the Implementation Framework could provide a more robust foundation. The Commission should also monitor the changing threats to information security systems and adjust the standards accordingly.

2. The Commission should, by Regulations, require data controllers and processors to obtain cyber insurance.  This would mitigate the impact of data breaches on both data subjects, data controllers, and processors by paying for the costs and liabilities associated with data breaches.

[1] See Section 48 of the Act

[2] https://nvd.nist.gov/vuln/detail/CVE-2021-42192

[3] https://brandnewsday.com/2022/02/16/jumia-konga-customers-in-trouble-as-hackers-now-extract-e-commerce-site-payment-details/

[4] Skimmers are tiny, malicious card readers hidden within legitimate card readers that harvest data from every person who swipes their cards.

[5] The hackers can use the names, email addresses, phone numbers, and order details to impersonate the customers and access their online accounts, such as banking, social media, or e-commerce.

[6] The hackers can use the email addresses and phone numbers to send unsolicited or unwanted messages or calls to the customers, advertising products or services, promoting scams, or spreading propaganda.

[7] The hackers can use the personal information to publicly expose or publish the customers’ identities, locations, or other details, without their consent or knowledge.

[8] The hackers can use the email addresses and phone numbers to send fake messages or calls to the customers, pretending to be a legitimate entity and trick them into revealing more sensitive information, such as passwords, payment details, or security codes.

[9] The hackers can use the personal information to threaten or extort the customers, demanding money or other favours in exchange for not exposing or misusing their data.

[10] A standard template for the audit report is included in Annexure A of the Implementation Framework (Section 6.6.2 of the Implementation Framework)

THE RIGHTS OF DATA SUBJECTS UNDER THE NIGERIA DATA PROTECTION ACT: EMPOWERING INDIVIDUALS IN THE DIGITAL AGE

In an increasingly data-driven world, the protection of personal information has become a paramount concern. Recognizing the need to safeguard the privacy and rights of individuals, President Bola Ahmed Tinubu signed into law, the Data Protection Act, 2023, thereby establishing by statute, the Nigerian Data Protection Commission; which is entrusted with the power to make and enforce regulations for the protection and security of the personal data of Data Subjects in Nigeria. The objective of this groundbreaking legislation amongst others, not only establishes a comprehensive framework for data protection but also grants significant rights to data subjects. As the custodians of their data, individuals in Nigeria now have the power to control how their information is collected, processed, and shared. 

Who is a Data Subject?

In the context of data protection and privacy regulation, a data subject is a person whose personal information is being collected, processed, or stored by an organization or entity. This can include customers, employees, website users, or any individual whose personal data is being handled by an organization.

Data Subject Rights and the need for Protection

Data Subject Rights (DSR) are the legal rights created by data protection laws that individuals possess over their data usage. They guarantee individuals' control over the processing of their data. These rights are found under Part VI of the Nigeria Data Protection Act. They include:

• The right to be informed: Data subjects have the right to know how much of their data is being held by an organization and for what purpose. This is why most organizations have privacy policies that outline the type of data they collect, why they collect it, how long they keep it, how they handle it, and so on. Data subjects have the right to access this information and know what data is being collected about them. This right also comes into play if the organization wants to use the data for additional purposes beyond the original reason for collecting it. In such cases, the data subject can enforce their right to be informed and have control over how their data is used.

• The right to access: Data subjects have the right to reach out to any organization that is handling their personal information and ask for essential details. This includes finding out if the organization processes their data and getting information about how the data is being processed. This information can include the purpose for processing, the types of data being processed, who the data is being shared with, how long the data will be stored, the rights that data subjects have regarding their data, and the measures in place to protect the data if it is transferred to another country. Essentially, data subjects have the right to be fully informed about how their personal information is being handled by an organization.

• The right to rectification: If a data subject finds out that the information an organization has about them is incorrect or missing important details, they have the right to ask the organization to fix or update their data. This right is crucial because accuracy can be both subjective and objective. For instance, if a data subject gets married or changes their name, they can request the organization to update their records accordingly. This right holds the same level of importance as other rights under the Nigeria Data Protection Act (NDPA). In situations where it's not possible to correct inaccurate, incomplete, or misleading data, the NDPA allows for the data to be deleted instead.

• The right to erasure:  Individuals have the right to ask organizations to delete their data from their systems under certain circumstances. This can be when the data is no longer needed when it was processed unlawfully, or when it no longer serves the original purpose for which it was collected. This applies to both physical and digital storage of data, and organizations are required by law to comply with such requests within a specific timeframe. However, it's important to note that the right to data erasure is not absolute. Organizations can refuse the request on various grounds, including if there is a legal obligation to retain the data for a specific period. For instance, financial service providers may need to retain transaction data for a certain period of time as mandated by Anti-Money Laundering Laws.

• The right to restrict processing: Individuals can request that organisations limit the way their personal data is used. It’s an alternative to requesting the erasure of data, and might be used when the individual contests the accuracy of their personal data or when the individual no longer needs the information but the organisation requires it to establish, exercise or defend a legal claim. 

• The right to data portability: The right to data portability comprises three separate requests. First, the data subject has the right to request that their data be given to them in a structured, commonly used, and machine-readable format without undue delay. Second, the data subject can transmit the data obtained in a readable format to another organisation without any hindrance. Lastly, the data subject can request for the data to be transmitted directly to another organisation where it is technically possible to do so. The Nigeria Data Protection Commission (NDPC) is empowered under the Act to prescribe conditions and circumstances under which the right to data portability may be exercised and obligations to be imposed on data controllers or data processors in relation to costs and timing. 

• The right to object: Individuals can object to the processing of personal data that is collected on the grounds of legitimate interests or the performance of a task in the interest/exercise of official authority. Organisations must stop processing information unless they can demonstrate compelling legitimate grounds for the processing that overrides the interests, rights and freedoms of the individual or if the processing is for the establishment or exercise of defense of legal claims. The NDPA also allows a data subject to object to the processing of personal data for marketing purposes at any time, and such an objection is absolute.

• Rights related to automated decision-making including profiling: This right is new under the NDPA. The NDPR only provided that notice of the use of automated decision-making should be given to the data subject and also as a basis for invoking the right to data portability. The NDPA provides that individuals now have the power to object to decisions that are made solely based on automated processing of their personal data, such as profiling, without any human intervention, if these decisions have a legal effect on them. For instance, if a bank uses automated algorithms to determine creditworthiness and denies a loan application solely based on this automated decision, the data subject has the right to object. However, it's important to note that automated decision-making is permissible if it is necessary for fulfilling a contract between the data controller and the data subject. In this case, the data subject's rights and interests must be protected by laws or written rules, and their explicit permission should be obtained for such automated decisions to be made.

• Right to lodge a complaint: Where a data subject is dissatisfied with the decision, action, or inaction of a data controller or data processor, they have the right to lodge a complaint with the Nigeria Data Protection Commission (NDPC)  for remedial action. Data subjects may also institute civil proceedings for damages against a data controller or data processor for any wrong or loss suffered by a data subject as a result of the violation of the Act. In addition, the NDPA includes the right to receive compensation for breaches of any of the rights provided by law.

• Right to withdraw consent: Where consent is the legal basis for processing personal data, the NDPA empowers the data subject to withdraw such consent at any time. The Act also requires an organisation to make the withdrawal of consent as easy as when it is obtained. In other words, where the data subject has given consent in a simple format, the data controller must ensure the withdrawal of consent is equally easy without additional barriers. It is important to note that withdrawal of consent does not affect the lawfulness of processing by a data controller undertaken on the basis of consent before the data subject withdrew his consent.

• Right to Erasure or Deletion: Also termed the right to be forgotten or right to de-referencing, it relates to a data subject’s right to demand erasure or deletion of personal data from a controller. This right is exercisable where:

1. the data is no longer necessary in relation to the purpose for which it was collected;

2. the data subject withdraws the consent upon which the processing is based;

3. the personal data have been unlawfully processed and the data subject objects to continued processing of such data

4. the data controller processes data without lawful basis.

Responding to data subject rights requests is not just a legal obligation, it is absolutely crucial for organizations to establish and maintain an effective procedure for handling these requests. It is essential to provide specific role training for all staff members involved in processing data, as they are often the first point of contact for data subjects. While waiting for the Commission to develop an implementation framework for the NDPA, which will provide further guidance, following the steps discussed in this article can greatly benefit your organization. Building an effective system requires constant practice and experience.

However, navigating the complexities of data subject rights requests can be challenging. If you ever find yourself unsure or if you want to improve your current processes, seeking guidance from professionals in the field is a wise choice. Their expertise can bring clarity, efficiency, and assurance of compliance, ensuring that your practices align with the highest standards of data protection.

Written By:

Iquo Essien

Associate Technology, Creativity & Innovation Practice

DATA PRIVACY WEEK 2024: TAKE CONTROL OF YOUR DATA

Have you ever experienced the mind-boggling phenomenon of brainstorming an idea or discussing a product with a friend, only to hop online and stumble upon that exact idea or product? It's like the digital world has a sneaky way of eavesdropping on our conversations!  While it may seem like a magical coincidence, it's actually a result of the intricate web of data and algorithms that shape our online world.

As we celebrate Data Protection Week under the theme: Take Control of your Data, it behoves us to remind ourselves of the power we hold in protecting our own information and the impact it can have on our lives. Although You cannot really control how the tiniest piece of data about you is collected, you can help manage your own data with a few repeatable behaviours like the following:

• Take control of your digital footprint: Reflect on the information you share online and consider its long-term implications. Remember, every piece of data contributes to your digital footprint.

• Adjust your privacy settings to your comfort level: Many web browsers, computers, and devices will often ask you if you want to share certain types of data with a new app or website. Strike up a habit of paying attention to these requests and actually thinking about your answers. Some common types of data you might be asked for include your location, your contacts, your photos and camera, and data about your behaviour and use of service. 

• Create Unique Passwords: Create long (at least 12 characters) unique passwords for your account and device.  Include a combination of uppercase and lowercase letters, numbers, and special characters. Avoid using easily guessable information like birthdays or pet names. Use a password manager to store each password. 

• Turn off default settings: Here are some default settings you should usually turn off unless you need them for the app to function and you trust the app: camera, microphone, location and sync contacts.

• Foster a data-conscious mindset: Develop a habit of regularly reviewing and updating your privacy settings on social media platforms and other online services. Turn on automatic device, software, and browser updates, or make sure you install updates as soon as they are available. Software updates often include security patches that address vulnerabilities and protect against potential threats.

• Enable multi-factor authentication (MFA): Activate MFA whenever possible. This adds an extra layer of security by requiring an extra form of verification, such as a code sent to your phone or email, in addition to your password. This keeps your data safe even if your password is compromised.

• Be cautious of phishing attempts: Stay vigilant against phishing emails, messages, and calls. Be skeptical of unsolicited requests for personal information or financial details. Avoid clicking on suspicious links or downloading attachments from unknown sources. Verify the authenticity of any communication by contacting the organization directly through official channels.

• Be mindful of public Wi-Fi: Exercise caution when using public Wi-Fi networks. Avoid accessing sensitive information, such as online banking or personal accounts, when connected to unsecured networks. Use a virtual private network (VPN) to encrypt your data and ensure a secure connection if necessary.

• Back up your data: Regularly back up your important data to an external hard drive, cloud storage, or another secure location. This ensures that even if your device is compromised, you can still access and recover your valuable information.

• Dispose of data securely: When disposing of old devices or physical documents containing personal information, ensure they are properly wiped or destroyed. 

Unlocking Economic Prosperity in Emerging Countries Using Local Currency Guarantees

INTRODUCTION:

Emerging markets are home to some of the most vibrant and quickly expanding economies in the world. However, these countries also face several challenges, such as limited access to financing, restricted access to funding, lack/poor infrastructure, and high levels of poverty.  

One way to address the challenges faced by emerging markets listed above is the use of Local Currency Guarantees (LCGs). Local currency guarantees can be a valuable tool for addressing these challenges and unlocking economic prosperity in emerging countries. It can be seen as a form of risk mitigation that can help reduce the cost of borrowing for businesses and governments in emerging markets. This article explores the potential of local currency guarantees as a catalyst for unlocking economic prosperity in emerging countries.

What are Local Currency Guarantees?

Local currency guarantees are guarantees that protect lenders and investors providing debt in the event of a loan default caused by the borrower.  Local currency guarantees are a type of financial instrument that protects against exchange rate fluctuations. They are typically used to support infrastructure projects, as these projects are often financed in foreign currency but generate revenue in local currency. By providing a guarantee, local currency guarantees can help reduce the risk of exchange rate fluctuations and make infrastructure projects more attractive to investors.

LCGs can be provided by a variety of sources, including governments, development banks, and private sector institutions. They typically involve a guarantee from the guarantor to repay a loan in local currency if the borrower defaults.  LCGs have been used successfully in several emerging countries, including Nigeria. 

In Nigeria, LCGs have been used to support a variety of sectors, including infrastructure, agriculture, and manufacturing. They have also been used to support small and medium-sized enterprises (SMEs). One example of the use of LCGs in Nigeria is the InfraCredit program. InfraCredit is a private-sector credit enhancement institution that provides LCGs for infrastructure projects. The program has been successful in attracting private capital to infrastructure projects in Nigeria.

How can local currency guarantees be used to unlock economic prosperity in emerging countries?

Local currency guarantees can be used to unlock economic prosperity in emerging countries in several ways. They can help to:

• Increase access to financing for infrastructure projects: By reducing the risk of exchange rate fluctuations, local currency guarantees can make infrastructure projects more attractive to investors, leading to increased investment in infrastructure.

• Promote economic growth: Infrastructure investment is a key driver of economic growth. By increasing access to financing for infrastructure projects, local currency guarantees can help to promote economic growth in emerging countries.

• Create jobs: Infrastructure projects create jobs, both during construction and in operation. Local currency guarantees can help to create jobs in emerging countries by increasing investment in infrastructure.

• Reduce poverty: Infrastructure investment can help to reduce poverty by providing access to essential services such as transportation, electricity, and water. Local currency guarantees can help to reduce poverty in emerging countries by increasing investment in infrastructure.

• Sustainable development: Sustainable development requires investment in infrastructure that is environmentally and socially responsible. Local currency guarantees can help to promote sustainable development in emerging countries by supporting investment in green infrastructure.

• Reduced cost of borrowing: LCGs can help to reduce the cost of borrowing for businesses and governments in emerging markets. This is because lenders are willing to accept a lower interest rate in exchange for the guarantee from the guarantor.

• Reduced risk of exchange rate fluctuations: LCGs can help to protect lenders from the risk of exchange rate fluctuations. This is because the guarantor is responsible for repaying the loan in local currency, even if the currency depreciates.

There are also several challenges associated with using local currency guarantees, including:

• Cost of guarantees: LCGs can be expensive to provide. This is because the guarantor must be able to cover the potential losses if the borrower defaults.

• Limited availability: LCGs are not always available in all emerging markets. This is because there may not be enough demand for LCGs, or there may not be enough capacity to provide them.

• Risk of moral hazard: LCGs can create a risk of moral hazard, where borrowers may be more likely to default because they know that the guarantor will repay the loan.

The Function of Legal Practitioner in Local Currency Guarantee

A legal practitioner can play a crucial role in ensuring the effectiveness and security of LCG. They contribute through various stages, depending on the nature of the guarantee, the parties involved, and the applicable legal framework. from structuring the agreement to managing potential disputes.

However, here are some general areas where legal personnel can play a crucial role:

1. Drafting and reviewing guarantee agreements:

• Negotiate key terms: Legal personnel can assist in negotiating and drafting the local currency guarantee agreement, ensuring it clearly defines the rights and obligations of each party, including the scope of the guarantee, conditions for payment, and dispute resolution mechanisms.

• Compliance with legal requirements: They can ensure the agreement complies with all relevant laws and regulations governing local currency guarantees, including foreign exchange controls and banking regulations.

• Minimize risks: They can identify and mitigate potential legal risks associated with the guarantee, including issues related to currency fluctuations, default, and fraud.

2. Advising on legal and regulatory issues:

• Foreign currency regulations: Legal personnel can advise on the implications of foreign currency regulations on the guarantee, including any limitations on payments or repatriation of funds.

• Tax implications: They can advise on the tax implications of the guarantee for both the guarantor and the beneficiary, including withholding taxes and potential tax treaties.

• Compliance with international law: They can advise on compliance with relevant international law principles, such as the UNIDROIT Principles for International Commercial Contracts.

3. Conducting legal due diligence:

• Due diligence on the guarantor: Legal personnel can conduct due diligence on the guarantor to assess its financial strength, creditworthiness, and ability to meet its obligations under the guarantee.

• Due diligence on the underlying transaction: They can review the underlying transaction for which the guarantee is being provided to identify any legal risks or potential disputes.

4. Representation in case of disputes:

• Dispute resolution: In the event of a dispute regarding the interpretation or performance of the guarantee agreement, legal personnel can represent the guarantor or the beneficiary in negotiations or legal proceedings.

• Litigation and arbitration: They can handle any litigation or arbitration arising from the guarantee, including representing their client in court and defending their interests.

5. Ongoing monitoring and compliance:

• Monitor legal and regulatory changes: Legal personnel can monitor changes in legal and regulatory requirements that may affect the guarantee and advise on necessary adjustments.

• Ensure compliance with the agreement: They can help ensure that all parties comply with the terms of the guarantee agreement and address any potential issues or breaches.

In addition to the roles mentioned above, legal personnel may also be involved in other aspects of local currency guarantees, such as:

• Structuring the guarantee: Legal personnel can advise on the most appropriate structure for the guarantee, taking into account the specific needs and risks of the transaction.

• Obtaining regulatory approvals: They can assist in obtaining any necessary regulatory approvals for the guarantee, such as approvals from central banks or foreign exchange authorities.

• Liaising with government agencies: They can liaise with government agencies on behalf of the guarantor or the beneficiary regarding the guarantee.

By understanding the legal and regulatory framework surrounding local currency guarantees, legal personnel can play a vital role in ensuring the smooth operation and effectiveness of these arrangements.

Specific Contributions of Legal Personnel:

• Expertise in contract law: They ensure the LCG agreement is legally binding and enforceable.

• Knowledge of financial regulations: They understand the legal framework governing financial transactions, including currency exchange and guarantees.

• Experience in dispute resolution: They can effectively handle legal disputes arising from the LCG.

• Attention to detail and risk management: They identify potential risks and implement safeguards to protect the interests of their clients.

Overall, legal personnel play a critical role in ensuring the success and security of Local Currency Guarantees. Their expertise and experience contribute significantly to mitigating risks, resolving disputes, and protecting the interests of all parties involved.

Conclusion

Local currency guarantees can be a valuable tool for unlocking economic prosperity in emerging countries. They can help to address several challenges faced by these countries, including limited access to financing, infrastructure bottlenecks, and high levels of poverty. In the case of Nigeria, Local Currency Guarantees can be used effectively to support infrastructure projects and promote economic growth.

Comprehensive Analysis of the Nigerian Upstream Petroleum Sector: Provisions and Implications of the Petroleum Industry Act 2021

The Petroleum Industry Act 2021 (PIA) is a landmark piece of legislation that establishes a comprehensive and balanced regulatory framework for the Nigerian upstream petroleum sector. The Act addresses a wide range of issues, including ownership, licensing, transparency, environmental responsibility, and market dynamics. In this article, we will provide an overview of the PIA and discuss its implications for the Nigerian upstream petroleum sector.

Ownership and Acreage Management:

The Petroleum Industry Act 2021 (PIA) provides the foundation for the administration of the Nigerian upstream petroleum sector by establishing the government's ownership of data related to operations. Section 68 of the PIA is pivotal in this regard, granting the Government of the Federation of Nigeria authority over the interpretation of upstream petroleum data. In addition, the PIA designates the Commission as the entity responsible for the administration of acreage for upstream petroleum operations. The Minister is granted the power to reclassify areas based on significant petroleum discoveries, subject to the Commission's recommendations, and may apply fiscal terms applicable to onshore operations in the event of such reclassification.

National Grid System

Section 69 of the Petroleum Industry Act (PIA) introduces a significant organizational tool for the sector—the adoption of a national grid system for acreage management. The requirement for the Commission to collaborate with the Surveyor-General of the Federation underscores the importance of precision and efficiency in the administrative aspects of upstream petroleum operations. The national grid system is expected to simplify processes related to licensing, relinquishments, bid procedures, well locations, and regulatory processes.

The national grid system is a geographic information system (GIS) that will provide a centralized, digital repository of all data related to upstream petroleum operations in Nigeria. The system will be used to manage all aspects of acreage management, from licensing and relinquishments to bid procedures and well locations. The system will also be used to facilitate regulatory compliance and improve the efficiency of upstream petroleum operations.

The national grid system will be a valuable tool for the Commission and the upstream petroleum industry. The system will provide a single, authoritative source of information on all upstream petroleum operations in Nigeria. This will help to improve efficiency and reduce the risk of errors. The system will also make it easier for the Commission to monitor and regulate upstream petroleum operations.

The national grid system is a significant step forward for the upstream petroleum industry in Nigeria. The system will help to improve efficiency, reduce risk, and facilitate regulatory compliance. This will create a more attractive investment climate for the upstream petroleum industry and help to boost economic growth in Nigeria.

Licensing and Leasing

Section 70 lays the groundwork for the issuance of licenses and leases for upstream petroleum operations, limiting eligibility to companies incorporated and validly existing in Nigeria. Sections 71 to 76 then elaborate on the Commission's responsibilities in the licensing and leasing process, emphasizing fairness, transparency, and competitiveness. The Act outlines the non-exclusive rights for exploration operations, specifying key parameters for competitive bidding, and establishes the conditions for the granting of various licenses and leases.

Transparency and Reporting

Sections 83 and 101 introduce a transparency framework within the petroleum sector. Licensees and lessees are required to submit to the Commission annual summaries of royalties, fees, taxes and other payments made to the government. The Act further underscores the importance of environmental responsibility by making information on existing contracts, licenses, amendments or side letters with the Nigerian National Petroleum Corporation (NNPC) non-confidential and subject to publication on the Commission's website.

Model Licenses and Leases

Section 85 of the Act emphasizes the need for standardization by requiring the Commission to develop model licenses and leases. These models are expected to adhere to the fiscal provisions outlined in the Act, ensuring consistency across different types of contracts, such as production sharing, profit sharing, risk service, and concession agreements.

Duration and Renewal

Sections 86 to 89 of the Act provide a clear framework for the duration and renewal of petroleum mining leases. The Act sets the maximum initial duration at 20 years, inclusive of the development period. This ensures that lessees have sufficient time to explore and develop their leases, while also providing the government with a mechanism to ensure that leases are not held for speculative purposes.

Renewal of a lease is contingent upon the lessee fulfilling their obligations under the lease, including making timely payments and complying with Commission-determined terms. This ensures that lessees are held accountable for their actions and that the government can protect the public interest.

The balance between industry sustainability and regulatory oversight is achieved through the Commission's ability to determine the terms of lease renewal. The Commission can consider a variety of factors when making this determination, including the lessee's performance, the state of the market, and the environmental impact of the lease. This ensures that leases are renewed in a way that is fair to both the lessee and the government.

The provisions in Sections 86 to 89 of the Act provide a clear and transparent framework for the duration and renewal of petroleum mining leases. This framework ensures that lessees have sufficient time to explore and develop their leases, while also protecting the public interest.

Infrastructure and Rights of Way

Sections 90 and 91 respond to the critical issue of infrastructure development by providing holders of licenses or leases with the right to obtain rights-of-way. While lessees may pursue infrastructure development, the Commission retains the authority to reserve rights-of-way for essential infrastructure, demonstrating a balanced approach that considers both industry needs and regulatory control.

Conversion and Marginal Fields

Sections 92 to 94 provide a structured approach to the conversion of existing licenses and leases. The Act outlines the process for converting oil prospecting licenses and oil mining leases into the new licensing framework established by the Petroleum Industry Act. It also addresses the treatment of marginal fields, providing a pathway for the conversion of existing producing marginal fields into petroleum mining leases.

Transfer of Interests

Sections 95 and 99 establish rules and processes for the transfer of interests in petroleum licenses or leases. The consent of the Minister and recommendations from the Commission are mandatory for such transfers. The Act also addresses defaults, outlining processes for revocation and imposing penalties on defaulting holders while allowing non-defaulting holders to continue.

Domestic Market Obligations

Sections 109 and 110 delve into the obligations related to crude oil and condensates supply and domestic gas delivery. The Act promotes a market-based approach, emphasizing willing buyer and willing supplier dynamics. It allows for the imposition of domestic crude oil supply obligations, with prices negotiated commercially between lessees and licensees. This approach ensures flexibility while maintaining regulatory oversight.

Environmental Management

Sections 102 to 107 underscore the commitment to environmental responsibility within the petroleum sector. The Act addresses various aspects of environmental management and introduces penalties for gas flaring, aligning with global efforts to mitigate environmental impact.

Market Mechanisms and Flexibility

Section 110 allows lessees flexibility in fulfilling domestic gas delivery obligations through voluntary contracts. The Act accommodates exceptions to penalties, recognizing uncontrollable circumstances such as force majeure or inability of purchasers to accept allocated gas volumes. This approach encourages market-driven mechanisms while maintaining regulatory control.

Regulatory Oversight

The paragraphs above collectively highlight the central role of the Commission in overseeing the various aspects of licensing, environmental compliance, and market dynamics within the upstream petroleum sector. The Act entrusts the Commission with creating guidelines, models, and ensuring compliance with the provisions outlined in the Act, ensuring a robust regulatory framework.

Penalties and Sanctions

The Act incorporates various penalties and sanctions for non-compliance, emphasizing the importance of adhering to regulatory requirements. These measures are designed to enforce accountability within the industry, ensuring that companies adhere to their obligations and responsibilities.

Overall Implications

In conclusion, the Petroleum Industry Act 2021 establishes a comprehensive and balanced regulatory framework for the Nigerian upstream petroleum sector. By addressing ownership, licensing, transparency, environmental responsibility, and market dynamics, the Act seeks to create an environment that fosters sustainable development while ensuring regulatory oversight and accountability. It reflects a careful consideration of industry needs, environmental concerns, and the broader economic context within which the sector operates.

BEYOND STITCHES AND DESIGN: UNDERSTANDING THE LEGAL, IP, AND FUNDING OPPORTUNITIES IN THE BUSINESS OF FASHION IN NIGERIA.

Introduction

Nigeria boasts a dynamic creative market, with a notable presence in the fashion sector. According to Euromonitor, the Nigerian fashion market is valued at an impressive $4.7 billion. To put this into perspective, some of the most prominent French companies primarily operate in the cosmetics and fashion domains. Among them, LVMH stands out with a staggering valuation of $500 billion, followed by L’Oreal at $238.98 billion, Hermes at $212.88 billion, and Dior at $157.69 billion. These figures highlight the substantial economic impact and value within the global fashion landscape, showcasing the significance of the Nigerian fashion market. In recent times, there seems to be a growing demand for Nigerian fashion globally, both by international stars and with demands comes compliance. In this article, we will explore the legal considerations for starting a fashion business in Nigeria, intellectual property protection for fashion entrepreneurs, and funding and investment strategies for fashion entrepreneurs in Nigeria.

Legal Considerations for Starting a Fashion Business in Nigeria

In Nigeria, every individual, firm, or company is required to register with the Corporate Affairs Commission within 28 days after the commencement of business. There are a number of options available for fashion entrepreneurs to register their business in Nigeria, which are:

1. Business name for sole proprietorship and partnership

2. Limited Partnership

3. Limited Liability Partnership

4. Private company limited by shares

5. Public Company

6. Unlimited Company

Registration/incorporation with the Corporate Affairs Commission gives legal status to the business, and most people, including but not limited to customers and investors, have more trust in buying or investing in a duly registered business than one that is not registered. Upon incorporation with the Corporate Affairs Commission (CAC), the business proprietor or company, as the case may be, is required to register with the relevant tax authorities, which are the Federal Inland Revenue Service and the State Inland Revenue Services Offices. The purpose of registration with the tax authorities is for the remittance of taxes such as Personal Income Tax and Value Added Tax.

Intellectual Property Protection for Fashion Entrepreneurs:

Fashion entrepreneurs in Nigeria can explore a number of intellectual property protections for the product of their creativity. Some of which are:

1. Trademarks: 

A trademark is an intellectual property that is used to distinguish the goods or services of one business from those of another. A trademark can take many forms, including a logo, a word or phrase, or slogan (wordmark), the shape of goods, their packaging, and a combination of colours. However, note that whatever marks that are sought to be registered must be distinctive and must not interfere with the registered trademark of another. A registered trademark in respect of goods gives the proprietor of a trademark the exclusive right to the use of the trademark in relation to those goods. What this means for fashion entrepreneurs is that they can register their distinctive name, for instance, the brand name or the name of any fashion item they have produced for sale. For instance, Hermes registered the mark "Birkin," which is the name of their popular bag.

      2. Industrial Design:

Under the Patents and Designs Act, any combination of lines or colours or both, and any three-dimensional form, whether or not associated with colours, is an industrial design if it is intended by the creator to be used as a model or pattern to be multiplied by industrial processes and is not intended solely to obtain a technical result. This implies that in the context of fashion designing, this definition highlights that aspects such as the combination of lines, colours, and three-dimensional forms are considered part of industrial design.  Fashion designers often create patterns, shapes, and colour combinations that may be intended for mass production in the fashion industry. If a designer intends their clothing design to be replicated through industrial processes, the design or sketch could be regarded as an industrial design under this definition. It underscores the intersection of creativity and mass production within the realm of fashion design. It is, however, important to note that registrable designs under this Act must be new and not contrary to public order or morality.

     3. Copyright:

Under the Copyright Act, artistic works enjoy eligibility for copyright protection. This copyright status bestows upon the owner exclusive rights to both undertake and authorise various acts, including the reproduction, communication to the public, and adaptation of the work. For entrepreneurs in the fashion industry, this signifies that their design sketches hold the potential for robust protection under the Copyright Act, securing their creative endeavours.

It is crucial to emphasize that the protection of these designs, logos, and wordmarks pertains specifically to distinctive designs and words. These protections afford owners exclusive and proprietary rights over their creative work, empowering them to enforce these rights and prevent unauthorised use by others. 

Funding and Investment Opportunities for Fashion Entrepreneurs in Nigeria

Funding is a key part of any business, and this includes fashion businesses. There are a few organisations that make funds available for fashion entrepreneurs to support their businesses. Some of which are:

1. Small & Medium Enterprises Development Agency of Nigeria (SMEDAN): The Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) was established by the SMEDAN Act of 2003 to promote the development of the MSME sector of the Nigerian economy. The Agency positions itself as a one-Stop-Shop for MSME Development. Micro Enterprises are included in the clientele of the Agency since they form the bedrock for SMEs. SMEDAN provides funding for medium and small enterprises in Nigeria; however, in addition to CAC registration, the business must be registered with SMEDAN.

2. Tony Elumelu Foundation: Tony Elumelu Foundation is the leading philanthropy empowering a new generation of African entrepreneurs, driving poverty eradication, catalysing job creation across all 54 African countries, and increasing women's economic empowerment. Since the launch of the TEF Entrepreneurship Programme in 2015, the Foundation has trained over 1.5 million young Africans on its digital hub, TEFConnect, and disbursed up to USD$100 million in direct funding to 18,000 African women and men, who have collectively created over 400,000 direct and indirect jobs. Tony Elumelu Foundation offers a successful applicant a grant of $5,000. It is important to note that the application for this grant opens on 1 January and closes on 31st March every year.

3. Others include loans from foreign investors and financial institutions such as the Development Bank of Africa, Bank of Industry, Afrexim Bank, fashion competitions, private investors such as angel investors, family members, and friends.

How can The Firma Advisory help?

The Firma Advisory can help fashion entrepreneurs seeking to establish themselves within this ecosystem to register their businesses, facilitate intellectual property protection, provide legal advisory services and prepare compliance documentation.

THE FIRMA NEWSLETTER 2023

We are excited to reflect on our year of great achievements, year 2023. Explore our comprehensive recap of the successes and milestones we achieved in 2023 in our exclusive end-of-year newsletter.

Click the link above for an in-depth review of the highlights that shaped our organization. Wishing you a prosperous New Year.

NAVIGATING REGULATORY COMPLIANCE: THE CRUCIAL ROLE OF A COMPANY SECRETARY IN NIGERIA

INTRODUCTION: 

In the complex landscape of corporate governance and regulatory compliance in Nigeria, the role of company secretaries is often underestimated or overlooked. However, these professionals play a critical role in ensuring that businesses adhere to the ever-evolving legal and regulatory framework. In this article, we will explore the indispensable role of company secretaries in upholding corporate compliance standards in Nigeria. 

Corporate governance is the system by which companies are directed and controlled.

The recent instances of corporate failure involving Nigerian companies and banks have shed light on pervasive corporate fraud, inadequate internal control mechanisms, regulatory oversights, and a prevailing lack of adherence to established corporate governance standards. It underscores the essential need for every company to establish a robust corporate governance framework, with a particular emphasis on appointing a dedicated individual responsible for overseeing the proper implementation of this structure. This pivotal role is typically filled by a company secretary. 

WHO IS A COMPANY SECRETARY? 

A company secretary is a corporate professional who is responsible for ensuring that a company complies with all applicable laws and regulations. They also play a key role in corporate governance, providing advice and support to the board of directors.  A company secretary is a highly specialised and regulated role in Nigeria, required by law for most companies. It is compulsory for a public company to appoint a secretary, but it is not compulsory for small companies to have a secretary according to Section 330(1) of the CAMA 2020. The company secretary serves as a link between the company's board of directors, management, and regulatory bodies. 

A company secretary is charged with the duty of ensuring the effective administration of a company. He or she also makes sure that the firm complies with all legal and regulatory requirements and that the board of directors' decisions are carried out.

REQUIREMENTS FOR BECOMING A COMPANY SECRETARY 

Normally, a private company's qualification for a company secretary differs from that of a public company. According to Section 332 of the CAMA 2020, in order to qualify to become a secretary in a public company, an individual must be: 

• A member of the Institute of Chartered Secretaries and Administrators

• A legal practitioner within the meaning of the Legal Practitioners Act

• A member of any professional body of accountants established from time to time by an Act of the National Assembly 

• Any person who has held the office of the secretary of a public company for at least three years of the five years immediately preceding his appointment in a public company 

• A body corporate or firm consisting of members each of whom is qualified under (a), (b), or (c).

  It is the duty of the directors to take reasonable steps to ensure that the company secretary has the necessary skills and experience to perform their duties effectively. 

MANDATORY RESPONSIBILITIES OF A COMPANY SECRETARY ACCORDING TO SECTION 335 OF CAMA 2020

• Duties to the board of directors 

- Advise the board on compliance with applicable laws, rules, and regulations. The company secretary advises the board on legal and regulatory compliance, encompassing corporate governance, risk management, internal controls, and adherence to the company's articles and memorandum of association. They ensure the company aligns with evolving laws and industry standards, fostering transparency and accountability. 

- Provide support to the board in its decision-making process 

The secretary supports the board's decision-making by preparing reports, drafting resolutions, and coordinating meetings. Their role streamlines the decision-making process and maintains the official record of board actions. 

- Act as a confidential advisor to the board 

Serving as a confidential advisor, the secretary leverages their deep knowledge of the organisation to offer impartial insights to the board. This role encompasses strategic guidance, adherence to governance documents, and legal compliance. 

• Duties to the company 

  - Maintain the company's statutory registers and other records 

The company secretary is responsible for the maintenance of vital statutory registers and records, which encompass registers of members, directors, shareholders, and loans. These records serve as a legal foundation for the company's operations and decision-making. 

- Filing statutory returns with the CAC 

They oversee the timely and accurate filing of statutory returns with the Corporate Affairs Commission (CAC). These filings encompass the annual return, financial statements, and other required documents, ensuring that the company meets its legal obligations. 

- Overseeing the company's compliance with all applicable laws, rules, and regulations 

The company secretary plays a central role in ensuring adherence to all applicable laws, rules, and regulations. This involves contract review, risk mitigation, and active communication with regulatory authorities, maintaining the company's legal and operational compliance. 

• Duties to shareholders and other stakeholders 

  - Communicate with shareholders and other stakeholders on behalf of the board of directors 

The company secretary serves as the primary liaison between the board of directors, shareholders, and other stakeholders. They are responsible for tasks such as preparing and

disseminating annual reports, addressing inquiries from shareholders, and participating in shareholder meetings. 

- Promote good corporate governance and ethical conduct within the company The secretary plays a key role in fostering good corporate governance and ethical conduct within the company. This includes the development and implementation of governance policies and procedures and the provision of staff training on corporate governance matters. 

The company secretary also plays a vital role in ensuring that meeting notices are sent to the appropriate recipients. This duty involves sending notices to the board of directors, shareholders, and other relevant meeting participants. The notices inform recipients about essential meeting details, including the agenda, date, time, and location, while complying with legal requirements and the company's governing documents. This responsibility helps maintain transparency, compliance, and effective organisational communication. 

CONSEQUENCES OF FAILING TO APPOINT A COMPANY SECRETARY

According to Section 330(4) of CAMA 2020, if a public company fails to appoint a secretary, both the company and its directors will be liable to fines as specified by the commission. In cases of continued contravention, daily penalties will also be imposed. This underscores the seriousness of not having a company secretary as required by CAMA, with potential financial penalties for both the company and its directors for non-compliance. 

In addition to these legal consequences, it is highly recommended that all companies in Nigeria appoint a company secretary to ensure compliance with legal requirements, effective corporate governance, and improved operational efficiency. 

CONCLUSION 

Navigating regulatory compliance is a complicated and ever-changing task, but it is essential for all businesses. A company secretary plays a crucial role in helping businesses comply with their regulatory obligations. By providing expert guidance and support, company secretaries can help businesses avoid costly fines and penalties, protect their reputations, and maintain a competitive advantage. 

By ensuring that businesses adhere to the highest standards of transparency, accountability, and fairness, company secretaries can help to build trust with stakeholders and create a more sustainable and ethical business environment. 

In the increasingly complex and regulated world of today, the role of the company secretary is more important than ever. By working with company secretaries, businesses can meet their regulatory obligations and promote good corporate governance practices. This can help them avoid costly fines and penalties, mitigate reputational risks, and maintain a competitive advantage.

CYBERSECURITY LEGAL TOOLKIT FOR BUSINESSES IN NIGERIA

Cyberattacks are a common and growing threat to businesses, especially ones that use the internet and social media. A report by Sophos reveals that 86% of Nigerian businesses suffer from cybersecurity breaches, mainly in the public cloud. The report also stated that Nigeria recorded 82,000 cases of data breaches in the first quarter of 2023, up from 50,000 recorded in Q4 2022. This is especially worrisome because cyberattacks damage a business’s reputation, finances, and legal standing.

One of the main techniques of cybercriminals is social engineering, which exploits human psychology to trick employees into revealing data or clicking malicious links. Cybercriminals often impersonate trusted contacts or authorities to manipulate their targets through emails, phone calls, or online platforms. Although data shows that many Nigerians lack basic knowledge and skills for online safety, business owners in Nigeria have a legal obligation to secure their critical IT infrastructure from cyberattacks. They must thus train their employees on online safety and protect their customers’ data and assets from cyberattacks, as these could be misused, exposed, or stolen, exposing the business to administrative sanctions and loss of reputation.

This legal obligation is enshrined in Section 24(1) and (2) of the Nigeria Data Protection Act 2023, which provides that: “A data controller and data processor shall use appropriate technical and organisational measures to ensure confidentiality, integrity, and availability of personal data. Notwithstanding anything to the contrary in this Act or any other law, a data controller or data processor owes a duty of care, in respect of data processing, and shall demonstrate accountability, in respect of the principles contained in this Act.”

The data controller is the person or organization that decides what personal data is collected, how it is used, and who it is shared with. They are ultimately responsible for protecting the privacy of the data and ensuring that it is processed in accordance with the law. While the data processor is the person or organization that processes personal data on behalf of the data controller. This could include storing the data, analyzing it, or sending it to other organizations. The data processor is required to follow the instructions of the data controller and to take appropriate security measures to protect the data.

To assist Nigerian businesses in fending off the incessant cyberattacks, the Office of the National Security Adviser (ONSA), the National Information Technology Development Agency (NITDA), and the UK Foreign Commonwealth and Development Office (FCDO) collaborated to develop a cybersecurity toolkit for SMEs which can be assessed for free on: https://gcatoolkit.org/small- business-dapnigeria/. The toolkit is part of the Digital Access Programme (DAP), which aims to promote digital inclusion and economic growth in Nigeria. The toolkit covers various topics such as cyber risk assessment, data protection, phishing, ransomware, password management, device security, network security, cloud security, incident response, and cyber insurance. The toolkit also includes self-assessment tools, checklists, templates, videos, podcasts, webinars, and case studies to help SMEs implement the recommended actions.

In addition to implementing the tips contained in the cybersecurity toolkit as provided above, we have developed a legal toolkit for Nigerian businesses to go with:

1. Understand that complying with the Nigeria Data Protection Act, Cybercrimes (Prohibition, Prevention, etc) Act and sector-specific laws on cybersecurity, is mandatory. Non-compliance, therefore, can expose your business to prosecution or heavy sanctions as high as 2% of the organisation’s annual gross revenue of the preceding year or payment of the sum of 2 million Naira, whichever is greater.

2. To help you comply with the law, hire an in-house data protection officer or consult experienced law firms like The Firma Advisory. Some data controllers (data controllers and processors of major importance) must have a data protection officer, but the Nigerian Data Protection Commission (NDPC) has not designated them yet.

3. Establish and enforce organisational measures of cybersecurity, compliant with your sector's regulation, and if unregulated, the Nigerian Data Protection Act and the Cybercrimes Act.

4. Use the technical data security standards recommended by your sector regulator or the Nigeria Data Protection Act if your sector is unregulated. The law sets minimum or best practices for security, but you can use higher levels of security to prevent cyberattacks. Section 39(1) of the Nigeria Data Protection Act requires that “Data Controller and Data Processor to implement appropriate technical and organisational measures to ensure the security, integrity and confidentiality of Personal Data in its possession.”

5. All businesses are encouraged to file a data audit report, however, if you handle the data of more than 2000 persons in a period of 12 months, you must file a data audit report with the Nigerian Data Protection Commission.

6. In the event of a cyberattack, report the incident to your customer, your sector regulator and the Nigerian Data Protection Commission. The timeline within which to report varies across sectors, but the Nigerian Data Protection Act requires that a breach be reported within 72 hours of you becoming aware of it.

Conclusion:

Cybersecurity is a vital aspect of any business that operates online, especially in Nigeria, where cyberattacks are prevalent and costly. Nigerian businesses should comply with the cybersecurity legal requirements and endeavour to implement and enforce the cybersecurity toolkit as developed under the DAP initiative. The toolkit provides practical guidance and resources for SMEs to improve their cybersecurity awareness, practices, and resilience. By using the toolkit, SMEs can reduce their exposure to cyber risks, protect their customers' data and assets, and increase their trust and reputation in the digital market. October is cybersecurity awareness month and there is a need for Nigerian businesses to build a culture of vigilance to cyber issues. Cybersecurity is not only a technical issue but also a business issue that affects the bottom line and the reputation of any organization. Therefore, Nigerian businesses should take proactive steps to secure their online presence and operations from cyber threats.