Pursuant to earlier articles published on Bureaux De Change in Nigeria, this particular article will be looking at the most relevant regulatory operational requirements provided by the Central Bank of Nigeria Guidelines For Bureaux De Change in Nigeria.
These regulatory provisions will be focused on the topics of :-
– Management staff requirements.
Tekedia Mini-MBA edition 16 (Feb 10 – May 3, 2025) opens registrations; register today for early bird discounts.
Tekedia AI in Business Masterclass opens registrations here.
Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.
– Disqualification of certain individuals from BDC management in Nigeria.
– Operations.
– Revocation of BDC licenses.
– Effecting additions or changes in BDC management or the board of directors of a BDC in Nigeria.
What are the provisions of the CBN Guidelines on BDC management?
The guidelines provide that a managing director of a Bureau De Change must have at least 3 years postgraduate experience while other BDC management staff must have at least 2 years postgraduate experience.
The compliance officer of a BDC must be selected from among its management staff.
What are the grounds for the disqualification of certain individuals from BDC management in Nigeria?
All the stipulated conditions for the exclusion of certain individuals from the management of banks as stated in the Banks and Other Financial Institutions Act (BOFIA) shall apply to the management of BDCs except with the written permission of the CBN Governor.
However, a BDC director whose license is revoked as a result of the breach of any condition upon which the license was granted shall not be eligible to apply for a BDC license as well.
What are the provisions of the CBN Guidelines on the operations of BDCs in Nigeria?
A customer of a BDC wishing to sell foreign exchange above $10,000 or its equivalent shall be required to disclose his source of the foreign exchange.
Maximum values for each Personal Travel Allowance and Business Travel Allowance are not to exceed $4,000 and $5,000 respectively.
Also, purchases of foreign exchange by intending travelers shall be supported by their Bank Verification Numbers (BVNs) as well as validly issued and genuine travelling documents (tickets, passports and visas) along with a signed sales receipt.
Are BDCs required to keep documents obtained from customers in support of transactions?
Yes, a BDC is required to keep its copies of documents obtained from customers for a period of at least 6 years after the severance of relations with the customer or completion of the transaction.
What are the grounds for the revocation of a BDC license?
The grounds for revoking a BDC license include :-
– Multiple BDC ownerships.
– Obtaining foreign exchange from ineligible sources.
– Street trading of foreign exchange.
– National interest (public policy) considerations.
Setting up a Corporate Trustee Company in Nigeria
A Corporate Trustee can be defined as a company licensed to render fiduciary services to companies and corporate customers in respect of debt capital & loan trust assets as well as Collective Investment scheme management and remedial services.
This article will be looking mainly at the topics of how Corporate Trustees are regulated as well as the licensing requirements for corporate trustees in Nigeria.
What constitutes the major Regulatory Framework governing Corporate Trustees in Nigeria?
Corporate Trustees in Nigeria are licensed by the Securities and Exchange Commission SEC through the SEC rules 2013.
What is the required minimum share capital for Corporate Trustees in Nigeria?
Corporate Trustees are required to have a minimum share capital of 300 Million Naira.
What is the minimum required number of directors for Corporate Trustees in Nigeria?
There is no limitation on the number of directors for a Corporate Trustee, but a Corporate Trustee must have at least 3 sponsored individuals, one of whom must be a designated compliance officer and the other must be the managing director of the trustee.
What are the requirements for licensing of Corporate trustees in Nigeria?
The requirements for the licensing of corporate trustees in Nigeria by SEC include the following :-
– A paid application fee of 50 Thousand Naira.
– A paid processing fee of 200 Thousand Naira.
– Evidence of payment of a processing fee of 500 Thousand Naira.
– A duly executed Form SEC 4A for the company.
– Form SEC 2 & 2D for each of the 3 sponsored individuals of the Corporate Trustee. One of these individuals must be a lawyer experienced in trusteeship practice.
– A completed Form SEC 2 & 2D for the directors of the company
– Proof of the minimum share capital of 300 Million Naira in cash, fixed assets or quoted security investments.
– A current fidelity insurance bond covering at least 10% of the minimum paid-up capital as stipulated by the SEC rules and regulations.
– A profile of the company including its brief history, organizational and shareholding structure, principal officers as well as details of its past and current activities.
– A 6 month bank account statement of the company.
– Police clearance reports for each sponsored individual with each sponsored individual required to report at the SEC head office in Abuja or Lagos zonal office with 2 recent passport photographs.
– A copy of a valid means of identification of each of the directors and sponsored individuals of the company.