SERAP, BudgIT, others sue CBN over cybersecurity levy

The Socio-Economic Rights and Accountability Project; a not-for-profit organisation, BudgIT, and 136 concerned Nigerians have filed a lawsuit against the Central Bank of Nigeria “over its failure” to withdraw the cybersecurity levy.

In what was described as an “unlawful circular,” the plaintiffs in the suit number FHC/L/CS/822/2024 filed last Friday at the Federal High Court, Lagos State,  asked the court to determine “whether the CBN circular dated 6th May 2024, directing financial institutions to deduct from customers’ accounts a cybersecurity levy is unlawful and therefore ultra vires the CBN.”

This is contained in a statement issued by SERAP’s Deputy Director, Kolawole Oluwadare, made available to PUNCH Online on Sunday.

Last Monday, through a circular, the apex bank ordered all commercial, merchant, non-interest, and payment service banks, among others. operating in the country to start charging a cybersecurity levy on transactions.

The CBN noted that, in compliance with the enactment of the Cybercrime (Prohibition, Prevention, etc.) (Amendment) Act 2024 and under the provision of Section 44 (2)(a) of the Act, a levy of 0.5 per cent (0.005) equivalent to a half per cent of all electronic transactions value by the business specified in the Second Schedule of the Act, is to be remitted to the National Cybersecurity Fund which shall be administered by the Office of  the National Security Adviser.

“The levy shall be applied at the point of electronic transfer origination, then deducted and remitted by the financial institution. The deducted amount shall be reflected in the customer’s account with the narration, ‘Cybersecurity Levy.” the circular stated.

Although, PUNCH Online had reported that President Bola Tinubu had asked the CBN to suspend the implementation of the controversial cybersecurity levy policy and ordered a review, the plaintiffs asked the court to determine whether the apex bank’s directive “are not in breach of sections 14(2), 44(1) and 162(1) of the Nigerian Constitution 1999 [as amended], and therefore unconstitutional, null, and void.

They also demanded that the “CBN, its office, agents, privies, assigns, or any other persons acting on its instructions from enforcing the circular dated 6th May 2024, pending the hearing and determination of the motion on notice filed contemporaneously in this suit,” be restrained.

The suit filed on behalf of the plaintiffs by their lawyer, Ebun-Olu Adegboruwa, SAN, read in part, “The CBN circular is unlawful and an outright violation of the provisions of the Nigerian Constitution and the country’s international obligations.

Click here to continue reading on Punch