The Securities and Exchange Commission (SEC) has proposed a new regulatory framework for online forex trading and Contracts for Difference (CFDs), setting minimum capital requirements of up to N5 billion for operators seeking to participate in Nigeria’s retail forex market.
The proposed rules, issued under the Investments and Securities Act (ISA) No. 2, 2025, are contained in the draft Rules on Online Forex Trading and Contracts for Difference published by the capital market regulator on Tuesday, September 1.
They seek to bring both domestic and offshore operators that target Nigerian residents into a formal licensing and supervisory framework, alongside a proposed 30% minimum local ownership requirement for licensed brokers.
In other words, the proposed rules are designed to apply not only to operators incorporated in Nigeria but also to offshore entities that target Nigerian residents.
The draft framework creates three licence categories — Online Forex Broker/Broker Dealer, Introducing Broker, and Technology/Platform Provider — each with its own capital threshold.
The proposed rules also introduce a minimum Nigerian ownership requirement for licensed entities.
Under the draft framework, at least 30% of a broker’s issued and paid-up share capital would have to be held directly and continuously by Nigerian citizens who serve as directors of the company, with at least two directors — including the Managing Director/Chief Executive Officer — required to be resident in Nigeria.
The Commission has stipulated that this ownership cannot be routed through nominees, trusts or other arrangements designed to circumvent the requirement, meaning offshore brokers may not be able to satisfy the rule by simply setting up a Nigerian subsidiary.
A key feature of the proposed framework is its explicit reach into offshore platforms serving Nigerian residents. A foreign broker could fall within the SEC’s regulatory perimeter where it lists Nigeria as a supported country, allows Nigerians to open trading accounts, markets to Nigerian residents using local affiliates or influencers, or maintains representatives or customer-support channels in the country.
The draft rules carry several other provisions aimed at tightening the retail forex market:
A Daily Price Spread Report would be required from every CFD broker by 10:00 a.m. WAT (West African Time) the next business day (T+1), and all regulated entities would jointly fund an Investor Protection Fund in line with the ISA 2025.
Existing and informal operators would be given three months to submit a complete registration application once the rules take effect, and six months to fully comply with registration requirements.
SEC DG Emomotimi Agama had earlier stated plainly that any digital asset or forex trading platform that is not registered is illegal.
The proposed forex rules also arrive as the SEC pursues a broader push to deepen market participation.
The SEC would also retain powers to suspend or revoke a licence where an entity obtains registration through fraud, commits a serious regulatory breach, becomes insolvent, is convicted of a financial crime, or fails to pay regulatory fees — with an emergency suspension option available where there is a public-interest or systemic-risk concern.
