Festus Akanbi in Lagos and Ndubuisi Francis in Abuja

President Ahmed Bola Tinubu has assented to the Investments and Securities Bill (ISB) 2025, which effectively repeals the Investments and Securities Act No. 29 of 2007 and enacts the Investments and Securities Act (ISA) 2025.
This landmark legislation, which has been hailed by stakeholders as a major boost to the capital market, strengthens the legal framework of the Nigerian capital market, enhances investor protection, and introduces critical reforms to promote market integrity, transparency, and sustainable growth.

The enactment of the ISA 2025 reaffirms the authority of the Securities and Exchange Commission (SEC) as the apex regulatory authority of the Nigerian capital market.
The new Act empowers the SEC to regulate the market to ensure capital formation, the protection of investors, maintenance of a fair, efficient and transparent market and reduction of systemic risks.
The Act also introduces transformative provisions to further align Nigeria’s market operations with international best practice.

Some of the salient provisions of the Act is that it expressly prohibits Ponzi, and other unlawful investment schemes and also prescribes stringent jail terms for promoters of such schemes.
The new law equally addressed existing restrictions vis-a-vis raising of funds from the capital market by states to allow for greater flexibility in this regard.

It also clearly recognises virtual/digital assets such as cryptos and investment contracts as securities.
Among others, the SEC Director-General, Dr. Emomotimi Agama; and the Director of the Institute of Capital Market Studies, Nasarawa State University and President of the Capital Market Academics of Nigeria (CMAN), Prof. Uche Uwaleke, have applauded the new law.

Speaking on the key highlights of the Act, Agama said: “The Act enhances the regulatory powers of the SEC in a manner comparable with benchmark global securities regulators.
“These enhanced powers and functions ensure full conformity with the requirements of IOSCO’s Enhanced Multilateral Memorandum of Understanding (EMMoU), enabling the SEC retain its ‘Signatory A’ status and enhancing the overall attractiveness of the Nigerian capital market.”

He cited other notable provisions of the ISA 2025, such as the Classification of Exchanges and inclusion of provisions on Financial Market Infrastructure, adding that the Act classifies Securities Exchanges into Composite and Non-composite Exchanges.

He explained that a Composite Exchange is one in which all categories of securities and products can be listed and traded, while a Non-composite Exchange focuses on a singular type of security or product.
Agama noted that there are also new provisions on Financial Market Infrastructure such as Central Counterparties’, Clearing Houses and Trade Depositories.

The Act also expanded the definition and understanding of Securities, and explicitly recognises virtual/digital assets and investment contracts as securities and brings Virtual Asset Service Providers (VASPs), Digital Asset Operators (DAOPs) and Digital Asset Exchanges under the SEC’s regulatory purview.
According to Agama, ISA 2025 equally has “Comprehensive Insolvency Provisions for Financial Market Infrastructure,” which introduces provisions that exempt transactions facilitated through or otherwise involving financial market infrastructure from the application of general insolvency laws.

There is also Management of Systemic Risk which introduces provisions for the monitoring, management and mitigation of systemic risk in the Nigerian capital market.
Also incorporated in the Act, he said, is the “Expansion of the Category of Issuers to the Public.”
According to him, the Act expands the categories of issuers, as a key step towards the introduction of a wide range of innovative products and offerings as well as the facilitation of “commercial and investment business activities”, subject to the approval of the Commission and other controls stipulated in the Act.

The SEC DG disclosed that the Act contains a new part which provides for the regulation of Commodities Exchanges and Warehouse Receipts, adding that these provisions are essential to allow for the development of the entire gamut of the commodities ecosystem.

On the issuance of securities by sub-nationals and their agencies, salient provisions of the Act addressed existing restrictions in respect of raising of funds from the capital market by states to allow for greater flexibility in this regard.
Agama noted that the Act introduced the mandatory use of Legal Entity Identifiers (LEIs) by participants in capital market transactions.

This stipulation is designed to improve transparency in the conduct of securities transactions and expressly prohibits Ponzi schemes and other unlawful investment schemes, while prescribing stringent jail terms and other sanctions for the promoters of such schemes.

In a bid to strengthen the Investments and Securities Tribunal, the Act amended some key provisions in the repealed ISA 2007 pertaining to the composition of the Tribunal, constitution of the Tribunal, qualification and appointment of the Chief Registrar as well as the jurisdiction of the Tribunal to enhance the ability of the Tribunal to optimally discharge its mandate.
Agama praised Tinubu for his assent as a transformative step for the capital market, saying that the ISA 2025 reflects a commitment to building a dynamic, inclusive, and resilient capital market.

“By addressing regulatory gaps and introducing forward-looking provisions, the new Act empowers the SEC to foster innovation, protect investors more efficiently and reposition Nigeria as a competitive destination for local and foreign investments.

“We commend all stakeholders within and outside the capital market community for their unwavering solidarity towards the achievement of this historic milestone and solicit their continued collaboration in respect of the effective implementation of the ISA 2025 for the benefit of our economy.”
Agama lauded the roles of the National Assembly and the Minister of Finance and Coordinating Minister of the Economy of Nigeria, as well as the Minister of State for Finance for their invaluable contributions to the realisation of this groundbreaking project.

Also reacting to the new law, Uwaleke said it will spur capital market growth in the country, describing it as a welcome development that promises to modernise Nigeria’s investment and securities laws, improve regulatory oversight, protect investors, and support emerging financial technologies.
He recalled that the replacement of ISA 2007 with the ISA 2024 had taken several years primarily on account of legislative, political, and economic factors.

“Notwithstanding the long delay, Nigeria can now boast of a modernised and globally aligned regulatory framework, which has addressed key issues such as digital assets, investor protection, and financial market infrastructure, all geared towards boosting investor confidence and strengthening the capital market in Nigeria,” Uwaleke said.

​