Nigeria Set to Pass Sweeping AI Rules for Digital Economy
Nigeria is on the verge of enacting a law that positions it among the first African nations to regulate artificial intelligence. This legislative move aims to tighten oversight of one of the continent’s fastest-growing digital markets, especially after years of largely unchecked expansion by global technology firms.
The National Digital Economy and E-Governance Bill
The forthcoming National Digital Economy and E-Governance Bill is set to empower regulators with new authorities over data, algorithms, and digital platforms. This initiative seeks to fill a regulatory vacuum that has persisted since Nigeria published its draft AI strategy in 2024.
Lawmakers anticipate approval of the bill by the end of March, which will introduce stringent scrutiny for higher-risk AI systems—particularly those deployed in finance, public administration, surveillance, and automated decision-making. Developers will be required to file annual impact assessments detailing risks, mitigation measures, and performance evaluations.
Penalties and Compliance
The proposed legislation grants regulators the authority to impose fines up to 10 million naira (approximately $7,000) or 2% of an AI provider’s annual gross revenue derived from Nigerian operations. However, the specifics regarding how these penalties will be assessed remain unclear.
Early Regulation for Accelerating AI Adoption
This legislation emphasizes the need for early regulation as AI adoption accelerates across various sectors including finance, public services, and the private sector. According to the director general of the National Information Technology Development Agency, this proactive approach could solidify Nigeria’s position as a leader in AI governance within Africa.
While countries like Mauritius, Egypt, and Benin have developed AI strategies, they currently lack comprehensive legislative frameworks. If passed, Nigeria will join the ranks of these pioneering nations in adopting a holistic regulatory regime for AI.
Ethical Standards and a Risk-Based Approach
The law is also poised to establish ethical standards focused on transparency, fairness, and accountability. It will implement a risk-based approach, similar to emerging frameworks in Europe and parts of Asia, potentially reshaping the operational landscape for companies, from Google to Chinese cloud providers, within Nigeria.
“In the area of governance, we need to put the safeguards and guardrails in place to ensure that the AI we are building operates within those boundaries,” the director general emphasized. This regulatory framework is intended to facilitate the detection and containment of any bad actors.
Regulatory Powers and Innovation Promotion
The proposed law equips regulators with the authority to demand information, issue enforcement directives, and suspend or restrict AI systems deemed unsafe or non-compliant. Moreover, it allows for the establishment of controlled AI environments where startups and institutions can test new technologies under regulatory supervision, thereby fostering innovation.
“You cannot be ahead of innovation,” the director general remarked, “but regulation is not merely about giving commands. It’s about influencing market, economic, and societal behavior to encourage the development of AI for good.”
