Nigeria: Issued SEC framework on accelerated regulatory incubation program (ARIP) for the onboarding of Virtual Assets Service Providers (VASPs) and other Digital Investments Service Providers (DISPs)

On 3 July 2024, the Nigeria Securities and Exchange Commission (SEC) issued its framework for an accelerated regulatory incubation program (ARIP) for the onboarding of Virtual Assets Service Providers (VASPs) and other Digital Investments Service Providers (DISPs). The framework is designed to accelerate the registration process for entities engaged in virtual asset activities, enabling them to receive preliminary approval from the SEC while awaiting the implementation of Digital Assets Rules. Eligibility criteria for ARIP include incorporation and physical presence in Nigeria, the performance of investment and securities business, and pending or new virtual asset-related applications with the SEC. The application process involves an initial assessment phase and an application phase, with entities required to submit various corporate documents and operational plans. Participants in the ARIP must comply with specific controls, conditions, and reporting requirements, including maintaining records, submitting regular financial and compliance reports, and adhering to AML/CFT/CPF laws. Finally, the program outlines penalties for non-compliance, including significant fines and potential suspension from market activities.