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The Securities and Exchange Commission (SEC), Nigeria’s apex capital market regulator, has announced a new requirement for capital market operators (CMOs) renewing their registration. Effective from 2025, CMOs must submit an “annual receipt of a trade group” as part of their renewal application, emphasizing the regulator’s commitment to strengthening market governance and professionalism.
In a statement signed by Hafsat Rufai, Director of Registration, Exchanges, and Market Infrastructure (REMI) at SEC, the Commission highlighted the consequences of non-compliance.
“The annual renewal of registration for CMOs for the year 2025 will commence on January 1, 2025. All CMOs applying for renewal must include their 2025 annual receipt from their respective trade groups as part of their application,” the statement read.
SEC further clarified that all CMOs are expected to complete the renewal process by January 31, 2025. Failure to comply could result in penalties and exclusion from participating in capital market activities.
Market Response and Stakeholder Reactions
Chairman of the Association of Securities Dealing Houses of Nigeria (ASHON), Sam Onukwue, lauded the new directive, describing it as a strategic move to enhance market integrity.
“This is a welcome development, and we commend SEC for this initiative. Strengthening trade groups will enhance their advocacy efforts while promoting transparency and professionalism in the market,” Onukwue remarked.
Objective of the New Requirement
According to market analysts, SEC’s decision aims to:
- Promote accountability: Trade group receipts will serve as evidence of CMO affiliation and compliance with industry standards.
- Enhance transparency: Membership in recognized trade groups will help ensure adherence to best practices.
- Support investor protection: By fostering professionalism, the directive aligns with SEC’s broader goals of safeguarding investors and enhancing market confidence.
Impact on the Capital Market
The new rule reflects SEC’s focus on fostering a robust and transparent capital market ecosystem. Analysts believe this requirement will encourage trade groups to take on more active roles in ensuring industry discipline while aligning with global standards.
An industry expert remarked:
“This policy is a step forward in building a more accountable and professional capital market. It highlights the Commission’s dedication to protecting investors and advancing the Nigerian capital market’s development.”
Key Dates to Note
- Renewal Start Date: January 1, 2025
- Deadline for Compliance: January 31, 2025
SEC has urged CMOs to comply promptly to avoid disruptions in their operations and contribute to the overall growth and stability of Nigeria’s capital market.
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