EXISTING LEGAL & REGULATORY FRAMEWORK FOR SOVEREIGN SUKUK IN NIGERIA
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Date
2026
Journal Title
Journal ISSN
Volume Title
Publisher
Global Islamic Research Journal (GIRJ)
Abstract
This paper critically examines the existing legal and regulatory framework governing
sovereign Sukuk issuance in Nigeria, assessing its adequacy in supporting a robust and
sustainable Islamic finance sector. The analysis identifies that Nigeria’s framework is not
underpinned by a standalone, comprehensive Islamic finance law. Instead, it is a hybrid
structure built upon the amendments to conventional statutes, notably the Investments and
Securities Act (ISA) 2007, alongside guidelines issued by the Securities and Exchange
Commission (SEC), particularly the Rules on Sukuk Issuance (2013). The research
employs a doctrinal legal methodology, analysing primary legislation, regulatory guidelines,
and offering circulars for Nigeria’s landmark sovereign Sukuk issuances. The study finds
that while this adaptive framework has demonstrably facilitated successful issuances, it
presents inherent challenges. Key issues include potential legal ambiguities in asset ownership
and transfer central to Sukuk structures, the reliance on regulatory discretion rather than
entrenched statutory provisions, and the absence of a dedicated dispute resolution mechanism
for Islamic finance. The paper concludes that the current model, though pragmatically
effective for kick-starting the market, may pose long-term constraints on depth, innovation,
and investor confidence. It recommends the development of a more coherent and consolidated
legal architecture, potentially through a dedicated Islamic Finance Act, to provide greater
clarity, enhance the enforceability of investor rights, and ensure the framework’s alignment
with both global Shari’ah principles and Nigeria’s unique socio-economic context. This
evolution is crucial for positioning Nigeria as a regional hub for Islamic finance and
leveraging Sukuk as a stable instrument for infrastructure development.