The Central Bank of Nigeria (CBN) has issued a directive mandating all foreign exchange (FX) market participants to undertake a self-assessment and submit a compliance report detailing their adherence to the newly introduced Nigerian FX Code by January 31, 2025.
This initiative aims to enhance ethical conduct and strengthen governance within the Nigerian FX market.
Under the compliance requirements, market participants must evaluate their adherence to the FX Code and submit a comprehensive report to the CBN. This report should outline an implementation plan to address any identified compliance gaps and must be endorsed by the institution’s board of directors.
Additionally, participants are required to provide extracts from the relevant board meeting minutes to demonstrate adequate oversight.
After the initial submission, participants must file quarterly compliance reports with the CBN’s Financial Markets Department (FMD). These reports are due within 14 days following the end of each quarter, with the first report expected by March 31, 2025.
To ensure rigorous adherence to the FX Code, the CBN has established enforcement mechanisms, including monetary penalties as stipulated under the CBN Act 2007 and the Banks and Other Financial Institutions Act (BOFIA) 2020. Non-compliant participants may face administrative sanctions, highlighting the necessity of compliance with the FX Code.
The Nigerian FX Code aims to provide ethical guidelines for authorised dealers in the Nigerian FX market, fostering responsible market conduct.
The CBN has scheduled the official launch of the FX Code for January 28, 2025, at its head office auditorium in Abuja.