Nigeria Moves to Regulate AI with New Slate of Legislation
Nigeria is on the verge of establishing a pioneering law that could position it as a leader in artificial intelligence (AI) regulation within Africa. This initiative aims to create a structured framework for overseeing the rapidly expanding digital platforms in one of the continent’s fastest-growing markets, which often operate without significant legal oversight.
Overview of the Proposed Legislation
The proposed National Digital Economy and E-Governance Bill is set to empower regulators with enhanced authority over data usage, algorithms, and digital services. This legislation aims to address a persistent regulatory gap that has existed since Nigeria introduced its draft AI strategy in 2024. Lawmakers anticipate that the bill will receive approval by the end of March.
Key Focus Areas
A significant emphasis of the bill is the increased scrutiny of higher-risk AI systems used in various sectors, including finance, public administration, surveillance, and automated decision-making. These systems can considerably impact access to essential services and opportunities, with errors or biases potentially leading to harmful outcomes. To ensure accountability, developers will be mandated to submit annual impact assessments that detail risks, mitigation strategies, and performance, allowing regulators to effectively monitor AI behaviors post-deployment.
Regulatory Powers
The bill also grants regulators enhanced authority to demand information from AI providers and issue enforcement directives, including the ability to suspend unsafe or non-compliant AI systems. This marks a significant transition for Nigeria, moving from informal technology adoption to a more structured regulatory environment where AI developers and digital platforms will face increased scrutiny.
Compliance and Penalties
Moreover, the legislation allows regulators to impose fines of up to approximately $7,000 or 2% of an AI provider’s annual gross revenue derived from Nigeria. Although the specifics of penalty assessment remain unclear, these compliance obligations present a meaningful risk for companies operating in the country, especially those deploying large-scale AI solutions.
Emphasis on Proactive Regulation
Kashifu Abdullahi, the Director General of the National Information Technology Development Agency, underscored the necessity for proactive regulation as AI adoption accelerates across various sectors. If enacted, this law would position Nigeria among the first African nations to establish a comprehensive AI regulatory framework, setting ethical standards regarding transparency, fairness, and accountability.
Supporting Innovation through Regulatory Supervision
Additionally, the bill includes provisions for controlled AI environments, enabling startups and institutions to test new technologies under regulatory supervision. This approach supports innovation while implementing necessary safeguards against misuse.
