Senate rejects bill seeking new law for FX transaction

The Senate on Thursday rejected a bill seeking to enact new legislation for the control, monitoring and supervision of transactions conducted in the foreign exchange market.

The bill aimed to repeal the Foreign Exchange (Monitoring and Miscellaneous Provision) Act, Cap 2024.

It was sponsored by Sani Musa (APC, Niger East) during the plenary.

Mr Musa, the Chairperson of the Senate Committee on Finance, in the lead debate, said the bill would help the government to regulate and supervise transactions conducted in the foreign exchange market.
He also said the bill would help to stabilise the naira in the FX market.

“The Bill seeks to stabilise the value of the currency by ensuring the liberalisation of foreign exchange transactions to maintain an equilibrium of balance of International payments.

“It will also stabilise the value of currency by ensuring the liberalisation of foreign exchange transactions and other foreign transactions by revitalising market functionality,” he said.

Mr Musa further explained that the bill would expand Section (1) of the existing Act to empower the Central Bank of Nigeria (CBN) to manage all dealings in the FX transactions.

“The Bill attempts to expand Section (1) of the existing Act to incorporate three new provisions to make for clarity and to empower the Central Bank of Nigeria to administer, control and manage all dealings and transactions in relation to foreign exchange matters.

“The newly introduced clauses will enable the CBN to determine the basic exchange rate of purchase and sale of foreign exchange,” he said.

Contributions

Many senators who contributed to the bill expressed fear of repealing the existing legislation and submitted that the consequences may be unproductive.

Ibrahim Dankwambo (PDP, Gombe North), said if the bill is passed, the clauses would confuse Nigerians.

Mr Dankwambo, a former accountant general of the federation, suggested that the bill ought to have emanated from the presidency to avoid conflict of interest.

Adams Oshiomhole (APC, Edo North) urged members of the senate to study the bill carefully before passing it.

Mr Oshiomhole proposed that the bill should be rejected on the grounds that it may generate confusion.

“We have to be careful because we cannot speculate. Anything done in this house, Nigerians will take it very seriously, because we have the power to make laws.

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“Senators who have spoken had summarised and amplified meticulously, the contradictions and negative implications of passing the law.

“I believe that the bill should not attract further hearing because we are trying to take over the monetary policy regulations of the CBN if we go ahead with it.

“If the executive arm of government likes, let them bring a bill to further strengthen the regulatory powers of the CBN. It is not our work,” Mr Oshiomhole said.

The Senate President, Godswill Akpabio, thereafter, put the bill to a voice vote and many of the lawmakers voted against it.