THE PROPOSED NITDA BILL MAY CREATE AMBIGUITY FOR ICT

 Sonny Aragba-Akpore argues that the proposed bill should be streamlined

If the plan of the federal government to rejig the National Information Technology Development Agency (NITDA) created under the NITDA Act 2007 sails through, then the country will have a super regulator which is amorphous for the Information and Communications Technology (ICT) industry.

Originally the Act was created for NITDA to implement “the Nigerian Information Technology Policy and coordinate general Information Technology development in Nigeria.” But NITDA, recently sent a proposed bill to the National Assembly and shared same with stakeholders that it wants a new bill to replace the National Information Technology Development Agency Act 2007.

The new bill seeks to establish a framework for mandatory licenses to be obtained by technology companies from NITDA. It also seeks to expand the regulatory oversight of NITDA; and generally, foster the development of the Nigerian ICT sector.

NITDA wants an overriding power to regulate the ICT sector including but not limited to telecommunications, National identify management, banking, among others.

“The bill proposes power to NITDA to regulate and license companies involved in digital services, products and platforms including companies that use any digitally enabled system in the provision of service or products; and companies that carry out a business within the information and communications technology space in Nigeria.”

The bill proposes that mandatory licenses should be obtained by companies regulated by it adding that operators within the information and communications technology and digital economy sector are to apply and obtain licences and authorisation from NITDA to operate. Furthermore, it provides that companies that fail to obtain the requisite license may be guilty of an offence and subject to a fine of N30,000,000 or imprisonment of its principal officers.

If this bill sails through, the NCC Act of 2003 may have been overtaken by the proposed NITDA Bill as the bill seeks to create three categories of licenses namely: (i) Product Licence, (ii) Service Provider Licence; and (iii) Platform Provider Licence even though the bill does not categorically state the considerations that would be put in place by NITDA in determining which of the licenses a company is to obtain.

The bill also seeks to empower NITDA to maintain a register of operators within the information and communications technology and digital economy sector and publish the register for the general public’s information. Also proposed in the bill is the establishment of the National Information Technology Development Fund (NITDF) for the advancement of the nation’s digital economy objectives and related purposes. The NITDF will be funded by a levy of 1% of the profit before tax of regulated companies, amongst other funding sources set out in the bill.

As it stands, the existing Act already requires certain companies to pay a similar levy to NITDA which was however limited. The bill now seeks to extend the list of the companies required to pay levies as follows: mobile and fixed telecommunications companies; information technology, e-commerce companies; digital platform operators and providers; foreign digital platforms targeting the Nigerian market; pensions managers and pension-related companies; banks, financial institutions and companies providing financial services using information technology tools; insurance companies; and

such other companies and enterprises as determined by regulations from time to time by the Agency.

“The Bill seeks to empower the NITDA, with support from the Standard Organisation of Nigeria, to develop standard requirements for operators within the information technology space. The Bill also confers a duty on NITDA to regulate amongst other things, the use of digital signature and digital contracts; and the use of data for business analytics and intelligence.”

“The proposed Act seeks to uniformly and fairly regulate the technology sector and startup space in Nigeria. The Bill appears to be an attempt to create uniform platform to regulate telecommunications, banking, e-commerce and others. This, however, will become standalone and amorphous regulation to manage an already structured regulatory environment and thereby creating multiple regulation for companies in the tech space in Nigeria.

This over-regulation will weigh down to excessive levies and licensing requirements because NITDA activities will dovetail into other regulators such as the Central Bank of Nigeria, the Securities and Exchange Commission, the Nigerian Communications Commission, and the National Insurance Commission to streamline licences, levies and develop regulations that adequately govern the activities of tech companies without stifling their growth.

Some of the noticeable ambiguities include that “operators within the information technology and digital economy”, “foreign digital platforms targeting the Nigerian market” and “digital economy” become clear licensing categories to be established by the bill.

These and many other reasons inform why industry players think the proposed NITDA bill should be revisited.

At a stakeholders meeting recently, the Computer Professionals (Registration Council of Nigeria) (CPN) condemned the proposed NITDA Bill 2021 in its entirety.

President and chairman of Council, of CPN, Mr.Kola Jagun spoke at the stakeholders engagement recently organised by the NITDA to consider the proposed NITDA Bill 2021 which, among other things, aims at changing NITDA from an IT development agency, to a regulator of the ICT sector in general.

The CPN statement was clear on the proposed bill, “it was obvious from the comments, suggestions and opinions expressed by all other stakeholders, at the meeting which held in Abuja on Friday February 18, 2022 that the NITDA Bill 2021 arrogates powers of several other regulatory agencies to NITDA, which is an infringement on the statutory powers of other agencies of government like CPN, NCC, Galaxy backbone, Office of the National Security Adviser (ONSA), the National Universities Commission (NUC), among others.

“Stakeholders who attended the meeting were unanimous in their opinions that several sections in the proposed NITDA Bill amount to usurpation of the statutory powers of other agencies of government that had been in existence before NITDA, and who have been performing their statutory roles accordingly.”

CPN statement said, for instance, Section 6, 13, 20, 21, and 22, which talked about NITDA’s power, licensing and authorizations, and offences and penalties, among others, raised some pertinent issues. Section 6 arrogated new powers to NITDA, which included the ability to fix licensing and authorization charges, collect fees and penalties and issue contravention notices and non-compliance with the Act.

“All the agencies present during the stakeholders’ engagement were unanimous in their opinion that all the offending sections of the proposed NITDA Bill should be expunged.

It further stated that “CPN strongly believes that NITDA should stick to its role as an IT development agency and stop seeking regulatory roles since there is so much that is yet to be done under Information technology development in the country.”

As the agency of the federal government saddled with the responsibility of developing and regulating Information Technology in Nigeria, the National Information Technology Development Agency is empowered by its enabling Act to create a framework for the planning, research, development, standardization, application, coordination, monitoring, evaluation and regulation of Information Technology practices in Nigeria by developing standards, guidelines and regulations for that purpose. 

In general terms, the sector is already plagued by multiple taxes and levies which have not been sufficiently addressed and now we are gradually moving to a more amorphous aspect: multiple regulations. What do the proponents of the NITDA Bill hope to achieve? This is a fight of many elephants and the grass will inevitably suffer.

Aragba-Akpore is a Member of THISDAY Editorial Board