On 12th May, 2022, President Muhammadu Buhari passed the Terrorism (Prevention and Prohibition) Act, 2022 (TPPA) into law and on the same day, the Attorney-General of the Federation issued a Regulation for the Implementation of Targeted Financial Sanctions Related to Terrorism, Terrorism Financing and Other Related Matters, 2022. The law gave Nigeria a legal framework for the implementation of United Nations Security Council Resolutions (UNSCRs) related to counter-financing of terrorism and counter-proliferation financing as well as in line with the Financial Action Task Force (FATF) Recommendations. The TPPA incorporated the Nigeria Sanctions Committee (NSC) which was earlier established by the Terrorism Prevention (Freezing of International Terrorist Funds and Other Related Measures) Regulations, 2013 (TPR). The TPPA also expanded the functions of the NSC by identifying it as the body responsible for the implementation of UNSCRs related to proliferation financing.
Obligations on All Natural and Legal Persons
By virtue of section 54 of the TPPA and Regulation 12 of the TFS Regulation, all natural and legal persons in Nigeria have an obligation including Financial Institution and Designated Non-financial Businesses and Professions to:
a. identify and freeze, without prior notice, all funds, assets, and any other economic resources belonging to the designated person or entity in their possession and report same to the Sanctions Committee;
b. report to the Sanctions Committee any assets frozen or actions taken in compliance with the prohibition requirements of the relevant UNSCRs, including attempted transactions;
c. immediately file a Suspicious Transactions Report to the NFIU for further analysis on the financial activities of such an individual or entity; and
d. report as a Suspicious Transactions Report to the NFIU, all cases of name matching in financial transactions prior to or after receipt of the Nigerian Sanctions List.
All natural and legal persons who are either Nationals, resident or have physical presence within Nigeria have an obligation to update themselves with the UN Consolidated List and the Nigerian List through the websites of the United Nations and the National Sanctions Committee respectively (Regulation 8(3) of the TFS Regulation).
The funds required to be frozen include:
a. all funds or other assets that are owned or controlled by the designated person or entity, and not just those that can be tied to a particular act, plot, or threat of terrorism or terrorism financing;
b. those funds or other assets that are wholly or jointly owned or controlled, directly or indirectly, by designated persons or entities;
c. the funds or other assets derived or generated from funds or other assets owned or controlled directly or indirectly by designated persons or entities; and
d. funds or other assets of persons and entities acting on behalf of, or at the direction of designated persons or entities.
All designations under Nigeria Sanctions List are available on the NSC website (NSC Link). Also published on the NSC website are guidance documents which guide persons on implementation of TFS and applications for delisting, unfreezing of funds where frozen in error and utilization of frozen funds. The links are provided below: