Securities and Exchange Commission
In 1962, a year after the establishment of the Lagos Stock Exchange, an ad hoc consultative establishment and advisory body known as the capital issues committee was established under the aegis of the Central Bank of Nigeria, CBN. Its mandate was to examine applications from companies seeking to raise capital from the market consultative and advisory body within the central bank of Nigeria.
An increase in the level of economic activities, and consequently capital market activities after cessation of the civil war hostilities, coupled with the promulgation of the Nigerian Enterprises Promotion Decree in 1972, necessitated the creation of another body the Capital Issues Commission in March 1973 to take over the activities of the capital issues committee.
The new body was statutorily-backed by the Capital Issues Decree of 1973 which established a board of nine members, including a representative of the CBN, serving as chairman; while the other eight members were drawn from some Federal Ministries, the industrial and finance sectors.
Following the acceptance of the recommendation of the Financial Review Committee in 1976, the federal government endorsed the establishment of the Securities and Exchange Commission, SEC, to supercede the CIC.
Consequently, the SEC Decree No 71 of 1979 was promulgated, effective retrospectively April 1, 1978, thus establishing the Commission and vesting it with power to regulate and develop the Nigerian capital Market. This is in addition to determining the prices of issues and setting the basis of allotment of securities. Unlike its two predecessors, the commission at this stage was excised from the CBN, although it continued to receive further funding from the apex bank.
It also had an enlarged 12-member board with CBN representative as its chairman. Other board members were drawn from the Ministries of Finance, Trade and Industries, the Nigerian Stock Exchange and the Nigerian Enterprises Promotion Board. Other members were nominated on basis of personal merit.
The commission, however, took off effectively on January 1, 1980 with a staff strength of 51. Nine years after the establishment of the Securities and Exchange Commission (SEC). The enabling law decree, Decree No 71 of 1979 was enacted as SEC Decree of 1988 with additional provisions to address observed lapses in the previous arrangements and to enable the commission pursue its functions more effectively.
To further enhance the commissions pursuit of its objectives of investor protection and capital market development, a comprehensive review of the capital market was carried out in 1996 by a seven-man panel, headed by chief Dennis Odife. Based on the panels recommendation, a new decree known as The Investments and Securities Decree No. 45 of 1999 was promulgated on May 26, 1999. The Decree repealed the SEC Decree of 1988. The new decree is expected to promote a more efficient and virile capital market, pivotal to meeting the nations economic and developmental aspirations in this new millennium.