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SEC Begins Charging Regulatory Fee On Fixed Income Transactions

December 17, 2021
by
Nigerian Securities Exchange Commission

Nigeria’s apex capital market regulator, Securities and Exchange Commission (SEC), will commence charging regulatory fee on fixed income secondary market transactions with effect from January 1, 2022.

In a circular released yesterday, SEC stated that the commencement of regulatory fee on bonds and other fixed-income transactions on the secondary market, is pursuant to Section 13(u) of the Investments and Securities Act (ISA), 2007 and Schedule 1, Part D of the SEC Rules (Registration Fees, Minimum Capital Requirements, Securities and others).

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These rules empower the SEC to levy, among others, fees on transactions relating to investments and securities business in Nigeria.

The circular stated that the regulatory fee structure on secondary market transactions on bonds will take effect from January 1, 2022 and secondary market transactions on bonds shall include bond transactions executed on a securities exchange, reported by voice or by any other means to an exchange as having being transacted thereon or of which the information of the transaction details are featured on the exchange’s platform for purposes including but not limited to onward transmission to a depository for settlement, price discovery and corporate disclosure.

According to the circular, SEC will charge 0.025 per cent of the total value of all secondary market transactions on bonds, while the securities exchange on which the transaction occurs will charge an amount not exceeding 0.025 per cent of the total value of secondary market transactions on bonds while bond transactions by dealing members will attract a single regulatory fee of 0.0001 per cent of the total value of the secondary market transactions on bonds, and are exempt from the 0.025 per cent fee charge earlier stated.

The Commission stated that the circular supersedes previous directives given by it on the subject.

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