Are Dollar Payments in Nigeria Illegal?

By Abubakar D. Sani, Esq.,


In comments widely reported last week in the media, the Chairman of the Economic and Financial Crimes, Mr. Ola Olukoyede, claimed that the practice of making payments for goods and services in Nigeria in foreign currency (usually United State Dollars) was against the law and that his Commission was planning to clamp down on it. He didn’t specify which law or laws he had in mind. Is he right? Does any law prohibit that practice? I believe the answer to both questions is ‘NO’.

These are my reasons.

Trade and Commerce under the law

To the extent that the issue revolves or the citizen’s freedom to choose a medium of payment for goods and services which he/she sells or purchases, I believe the logical starting point is the legal framework regulating trade and commerce in Nigeria. What better place to start than the Constitution? In this regard, I believe the following provisions of the 1999 Constitution are relevant: Section4 (a); Items 15, 62(a) and 68 of the Exclusive Legislative List, in Part 1 of the 2nd schedule; and Items 2(a) of the Part III of the 2nd Schedule

We treat them seriatim.

  1. Section 4(2)confers on the National Assembly the exclusive power to make laws for the peace, order and good government of the Federation or any part thereof with respect to any matter included in the Exclusive Legislative List set out in Part 1 of the 2nd Schedule to this Constitution:
  2. Item 15 of the Exclusive Legislative Listempowers the Assembly to legislate in respect ‘currency, coinage and legal tender’ ;
  • Item 62(a) of the Exclusive Legislative List empowers of the Assembly to legislate on:

trade and commerce between Nigeria and other countries including import of commodities into and export of commodities from Nigeria, and trade and commerce between States;

– establishment of a purchasing authority with power to acquire for export or sale in world markets such agricultural products as may be designated by the National Assembly;

– inspection of produce to be exported from Nigeria and the improvement of grades and standards of quality in respect of produce so inspected;

– establishment of a body to prescribe and enforce standard of goods and commodities offered for sale;

– control of the prices of goods and commodities designated by the National Assembly as essential goods or commodities; and

– registration of business names.

  1. Item 68 of the Exclusive Legislative Listempowers the Assembly to legislate on any matter incidental or supplementary to any matter contained in the List
  2. Item 2(a) of Part III of the 2ndSchedule to the Constitutiondefines reference in that Schedule to ‘incidental or supplementary matters as including” references to offences’

Before going further, it is pertinent to mention that, in ATT-GEN of OGUN STATE VS- ABERUAGBA (1985) NWLR pt.3. pg. 395, the Supreme Court held that the provisions of Item 60(a) of the 1979 Constitution (which are in pari materia with Item 62(a) of the 1999 Constitution) were words of limitation, not of emphasis. This means that any matter which was not stated therein was outside the trade and commerce remit of the National Assembly under Item 60 (a) of the Constitution. This view in further expressed in the canon of interpretation called expressio unius est exclusio alterius (the express mention of one thing in a statute implies the exclusion of others which otherwise might have been included).


Status of Non- Naira Payments for Goods and Services in Nigeria

I believe that a holistic and objective analysis of the foregoing Constitutional and judicial authorities will point to the following irresistible conclusions:

  1. The National Assembly can only control or regulate international or inter-state trade and commerce i.e; trade and commerce between Nigeria and other countries as well as trade across the borders of or between the 36 States of Nigeria;
  2. The National Assembly cannot control or dictate which currency can be used as a medium of exchange in addition to the Nigeria for the purposes of domestic and intra-State trade and commerce or trade/commerce WITHIN the individual 36 States of Nigeria;

Any such law would be ultra the Assembly and invalid.

Does Any Law Prohibit Payments In Foreign Exchange For Goods And Services In Nigeria?

This is the million naira question which, as previously observed, the EFCC Chair failed to answer in his magisterial declaration. I am certainly not aware of any, on the contrary, a plethora of laws suggest clearly and that such a practice is recognized, legitimate and valid. Just one example will suffice: the Money Laundering Act 2022 (as amended) only prohibits cash payments beyond specified thresholds in Naira “or its equivalent” unless they are done through a financial institution as defined therein (banks bureau de change, etc). it is obvious that the words “or its equivalent” mean other i.e foreign) currencies. That being the case, I humbly submit that to suggest. (as the EFCC Chair has clearly done) that it is illegal to make payments in Nigeria in foreign currencies is a fallacy which is bereft of constitutional, statutory and judicial support.

In this regards even through Section 15 of the Central Bank of Nigeria Act, 2007 provides, inter alia, that “the unit of currency in Nigeria shall be the Naira”, nevertheless I humbly submit that because the Money Laundering Act, 2022, is latter in time (by all of 15 years), its express recognition “equivalent in Naira” of the amounts stated therein as the thresholds for making cash transactions outside financial institutions, is tantamount to implied, if not express, modification or amendment of the aforesaid provisions of the CBN Act.

Yes, the Naira remains our official currency, but, to the extent that the Money Laundering Act recognizes and validates transactions conducted in the Naira’s equivalent, the only logical inference to be drawn is that the Naira no longer enjoys any monopoly which it once did, (which is doubtful – at least since the advent of money laundering legislation in Nigeria, in 1995). See FRN VS. OSAHON (2006)2 S.C. Part II pages 59  lines 30-35 and page 60, line 1-8, per Musdapher, JSC (as he then was) where he observed thus: “ the law is settled that when two statutes, though both are expressed in affirmative language are contrary in matter, the latter abrogates the former (leges posteriors priores contrarias abrogant). . . From this rule, it follows that if one statute enacts something in general terms and afterwards another statute is passed on the same subject which, although expressed in affirmative language, introduces special conditions and restrictions, the subsequent statute will usually be considered as repealing or amending by implication, the former (See Ellen Street Estates vs. Minister of Health (1934) 1.k.b. 590 @ 596)’’



The multitude of economic and financial challenges which continue to confront us has compelled many a policy-maker and others in positions of power/ authority to appear to be ‘engaged’ in proferring solutions. Regrettably, some of them have succumbed to the temptation of grand-standing and empty posturing: they appear to confuse motion with movement. I hope the EFCC’s recent ‘Dollar is illegal for payments in Nigeria’ declaration is not a manifestation of that malaise. Such transactions are perfectly normal as they are tacitly and implicitly recognized under the law. No law delegitimizes them and it is settled that no one can be condemned under a non-existent law: see Section 36 (12) of the Constitution.

Abubakar Sani, Esq. 4/9/2024

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