EFFECTIVE BRAND PROTECTION STRATEGY IN THE FMCG SECTORipfnigeria.com/events/17Feb18.pdf ·...
Transcript of EFFECTIVE BRAND PROTECTION STRATEGY IN THE FMCG SECTORipfnigeria.com/events/17Feb18.pdf ·...
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EFFECTIVE BRAND PROTECTIONSTRATEGY IN THE FMCG SECTOR
Obafemi Agaba,LLM.IP (Lond.); Notary Public Sector Head, FMCG & Brand Protection
LABOUR & EMPLOYMENT RELATIONSIN NIGERIA: EMERGING TRENDS &MITIGATION STRATEGIES
Taiwo Adeshina LL.M (Dundee)Sector Head, Real Estate & Infrastructure & General Commercial Practice
MANAGING FX DENOMINATEDLIABILITIES: LEGAL ISSUES &OPTIONS
Abayomi Adebanjo LL.B; MBA (LBS)Sector Head, Financial Services
2018 © Jackson, Etti & Edu.
EFFECTIVE BRAND PROTECTION
STRATEGY IN THE FMCG SECTOR
Being a Presentation to theIndian Professionals Forum atthe Indian High Commissionon February 17, 2018
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Obafemi Agaba, LLM.IP (Lond.); Notary PublicSector Head, FMCG & Brand Protection
OBJECTIVES OF THIS PRESENTATION
� At the end of this discourse, beyond explaining the
legal and regulatory regimes, we would have
highlighted the sociological realities relating to brand
protection and enforcement in Nigeria.
� Respective Brand Protection Teams ought to be
equipped with necessary tips in entrenching a
successful anti-counterfeiting campaign/brand
protection and enforcement strategy.
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Segment ISegment I Segment IISegment II
Legal & Regulatory
Regimes for Effective
Brand Protection.
Developing effective
brand protection
strategies.
This presentation is divided into two segments:
2018 © Jackson, Etti & Edu.
INSIGHTS
UNDERSTANDING THE BASICS
The subject of your manufacture or services are ‘products’ to you... but to the market ... each of these is a is a
2018 © Jackson, Etti & Edu.
�BRANDING is the process
involved in creating a
unique name and image for
a product in the consumers’
mind, mainly through
advertising campaigns with
a consistent theme.� BRANDING aims to
establish a significant and
differentiated presence in
the market by creating an
attracting force for
customer retention.-the Business Dictionary
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�Underlying the whole concept of branding is the legal notion called trademark.
• A "trademark" could be a device, brand, heading, label, ticket, name signature, word, letter, numeral or a combination thereof, used in indicating the source of particular goods or services or that a connection exists, in the course of trade, between the goods and the proprietor of the mark.
• It is the instrumentality through which branding is achieved!
• Trademark is a type of Intellectual Property (IP)
UNDERSTANDING THE BASICS
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• Intellectual Property (IP) refers to the properties of a man which emanate from the power of his mind to reason. i.e. the “the creations of the mind.”
• They are intangible in nature, as distinguished from tangible properties, such as a car or a mobile phone which can be physically held.
INTELLECTUAL PROPERTY
WHAT IS INTELLECTUAL PROPERTY?
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Common law right of
goodwill arising from
use.
Statutory right arising
from registration.
Both forms of rights grant
exclusivity capable of legal protection and enforcement in the
event of violation.
BRANDS: OF WHAT MOMENT IN LAW?
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LEGAL AND REGULATORY REGIMES FOR BRAND PROTECTION
The legal regime for the enforcement of IPR in Nigeria is dividedinto three:
Civil Court Action
Criminal Court Action
Regulatory/Administrative Action
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LEGAL REGIME – CONT’D)
� Civil Court Action
� Infringement
� Section 5 (2) Trademarks Act creates a right of action for
infringement of trade mark
� Essential elements of this action:
� Valid and subsisting registered trademark;
� That the mark being used on the offending product is
identical or confusingly similar to your registered trademark;
and
� that the product in question is the same goods or of the same
description of goods as that in respect of which your
trademark is registered;
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LEGAL REGIME : CIVIL COURT ACTION (CONT)
�Civil Court Action
� Common Law Tort of Passing-off
� Section 3 Trade Marks Act recognizes and preserves the right of a brandowner to seek redress against violation of his mark where such is notregistered.
� Protects a business or product from being misrepresented as another’s, byuse of a name, mark, get-up, etc., similar to an existing company/businessname or existing mark (whether registered or not).
� Essential elements:
� Goodwill
� Misrepresentation
� Damages
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LEGAL REGIME : CIVIL COURT ACTION – Cont’d
� SHORTCOMINGS/INADEQUACIES
• Snail paced – procedural technicalities/delay byopposing counsel; volume of cases;
• Poor understanding of substantive intellectualproperty laws and procedure – Judges and other Courtofficials;
• Poor funding of the judicial system;
• Possible corruption and compromises;
• Bureaucracy involved in obtaining Police protection forexecution of court orders;
• Ineffective enforcement of court orders andjudgments – Bailiffs.
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LEGAL REGIME: CRIMINAL COURT ACTION
False Trade Description
• The Merchandize Marks Act, criminalizes the following acts:
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3 4
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� Enforcement Procedure
� Recourse is made to the Police pursuant to its general duties of crime
prevention and detention under Section 4 of the Police Act. This forms the
legal basis for Police raids usually conducted in the markets.
� Advantages:
� Frequency/Nuisance effect
� Quick top organize
� Two-pronged – prelude the civil action
� Mopping up – ridding the market, periodically, of offending products.
� Criminal conviction – imprisonment and fines.
� Stigmatization
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LEGAL REGIME: CRIMINAL COURT ACTION – Cont’d
LEGAL REGIME: REGULATORY/ADMINISTRATIVE ACTIONS
� CPC
� The CPC has inter alia the responsibility of providing redressfor obnoxious practices or unscrupulous exploitation of theconsumers by companies, firms, trade associations and/orindividuals. - See Section 2 (i) of the CPC Act Cap C25 LFN,2004
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� SON
� SON is a statutory body, charged with the responsibility of registering
and regulating standard marks and specifications for products both
locally manufactured and imported products and services, throughout
Nigeria
-See Section 3 and 4 of SON Act, Cap S9, LFN, 2004.
� This forms the fulcrum upon which SON can be approached in
situations where the counterfeit products are sub-standard.
� EFCC
� Economic and Financial Crime has been defined to include ‘Theft of Intellectual property and piracy’. - See Section 46 of the EFCC Act, Cap E1, LFN 2004.
� The Commission can, based on this, carry out Intellectual Property
Right Enforcement, through criminal investigation, raids and
prosecution.
2018 © Jackson, Etti & Edu.
LEGAL REGIME: REGULATORY/ADMINISTRATIVE ACTIONS – Cont’d
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� NCS� The NCS was recently empowered under the Common
External Tariff (C.E.T) for 2008-2012 (has been extended)
Schedule 4 to treat ‘all counterfeit/pirated materials or
articles including base or counterfeit coin of any country’
as absolutely prohibited items.
� This opens a new phase for fighting counterfeits at our
various borders or port of entry.
� NCC
�This body is established to monitor, supervise and
regulate all matters affecting Copyrights in Nigeria
�See Section 34 of the Copyright Act, Cap C28, LFN
2004.
�They Guard against piracy of copyright works.
2018 © Jackson, Etti & Edu.
LEGAL REGIME: REGULATORY/ADMINISTRATIVE ACTIONS – CONT’D
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� SHORTCOMINGS
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LEGAL REGIME: REGULATORY/ADMINISTRATIVE ACTIONS – CONT’D
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‘Bureaucratic
bottlenecks’
Jurisdictional
limitations
Ineffective
prosecution;
Possible
corruption and
compromise;
Inadequate
storage facilities
for seizures;
Poor funding
Inadequate
provisions in the
existing laws
Lack of co-
operation
among the
regulatory
bodies
DEVELOPING EFFECTIVE STRATEGIES
PRIOR TO VIOLATION OF IPR
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PRODUCT IDENTIFICATION – It is imperative that you must know your product, and be familiar with all the trade marks and other intellectual property rights associated with such product.
REGISTRATION OF INTELLECTUAL PROPERTY RIGHTS –This affords the brand owner full protection under the law.
PRODUCT REGISTRATION WITH RELEVANT GOVERNMENT AGENCIES- This enables the brand owner the protection available under laws of a particular agency.
MARKET SURVEY – This connotes that a system of routine checks of the market should be carried out to ascertain the existence of counterfeits.
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DEVELOPING EFFECTIVE BRAND PROTECTION STRATEGIES
�POST VIOLATION OF IPR –
� INVESTIGATIONS – The overall objective of investigation is to
ascertain all necessary details and evidence of the offending acts.
�Methodology
� Market search
� Corporate search
� On-site investigations
� Trademark searches
� On-line searches
�Reconcile the applicable laws with the findings and peculiar
facts of the matter – no one size fits all!
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SOCIOLOGY OF ENFORCEMENT
� The Harsh Reality!
� The harsh reality that brand owners are faced with is that irrespective of
the foregoing shortcomings and inadequacies associated with the various
options available under the legal regime, the brand owner has no choice
but to protect its IPR and combat counterfeiting, and unfortunately, only
within the ambits of the afore-mentioned legal options.
� The Challenge!
� The challenge, therefore, is how does the brand owner work within the
ambit of the existing legal regime, with its many shortcomings, and yet,
achieve its goal of ridding the markets of counterfeits and reaping home
commercial success.
� A critical analysis of the shortcomings highlighted above, as well reasons
why counterfeiting thrives in the country reveals that the shortcomings, as
well as the reasons, are in the main, factors borne out of societalbehavioural patterns. They are sociological in nature!
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DEVELOPING EFFECTIVE BRAND PROTECTION STRATEGY
Sociological initiatives� Re-cycling of defendants within one civil action;
� Effective public relations with the regulators;
� Choice of personnel;
� Strategic persuasion;
� Public enlightenment;
� Mixed grill of firmness and benevolence in enforcementteams;
� Swiftness in carrying out enforcement actions;
� Training program for judicial and regulatory officers;
� Institutional support;
� Flexibility;
� Multi-pronged approach
� Once you seize, tie seizure down with some judicialprocess.
� Swift instigation of criminal prosecution from theFederal Ministry of Justice where police or a regulatoryauthority becomes ineffective or compromised.
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CONCLUSION
�It is imperative to note that counterfeiting is a dreadeddisease that has eaten deep into the commercial nervesof many businesses. Thus, combating it requires clearlyarticulated sociological strategies, incorporating thelegal and regulatory regimes.
�However, it should be noted that strategies should notbe cast in stone. The use of one, or combination of twoor more largely depends on the peculiar circumstanceof each case.
2018 © Jackson, Etti & Edu. 23
RCO Court 3-5, Sinari Daranijo Street, Victoria Island, Lagos, Nigeria.
t: +234 (1) 4626841/3, +234 (1) 2716889
e: [email protected] w: www.jacksonettiandedu.com
…THANK YOU
2018 © Jackson, Etti & Edu. 24
LABOUR & EMPLOYMENT RELATIONS
IN NIGERIA A Presentation to the Indian
Professionals Forum at the
Indian High Commission
Taiwo Adeshina, LL.M (Dundee)Sector Head, Real Estate & Infrastructure & General Commercial Practice
February 17, 2018
EMERGING TRENDS & MITIGATION STRATEGIES
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LEGAL FRAMEWORK
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THE CONSTITUTION (1999) THIRD ALTERATION ACT
2 THE NATIONAL INDUSTRIAL COURT ACT
THE LABOUR ACT
IMMIGRATION ACT
INDUSTRIAL TRAINING FUND ACT
EMPLOYEES COMPENSATION ACT
NIGERIA SOCIAL INSURANCE TRUST FUND ACT
NATIONAL HOUSING FUND ACT
NATIONAL HEALTH INSURANCE ACT
PENSION REFORM ACT
NATIONAL MINIMUM WAGE ACT
HIV/AIDS ANTI-DISCRIMINATION ACT
JUDICIAL PRECEDENTS/CASE LAW
CONTRACTUAL DOCUMENTATION BETWEEN EMPLOYERS & EMPLOYEES
NATIONAL INDUSTRIAL COURT – THE INFLUENCER
THE CONSTITUTION OF THE FEDERAL REPUBLIC OF NIGERIA (THIRDALTERATION ACT) 2010
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Section 254 of the 1999 Constitution (as altered) grants the NIC exclusive jurisdiction (Civil & Criminal matters) on labour and employment relations.
Section 7 NIC ACT/Section 254(C)1999 Constitution (as altered) vsSection 12 1999 Constitution.
The Supreme Court has held that there is noconstitutional provision divesting the Court ofAppeal of jurisdiction to hear appeals emanatingfrom the National Industrial Court of Nigeria (NICN)and that the right of appeal is not limited tofundamental rights cases.
Appeals will lie as of right from the decision of the National Industrial Court to the Court of Appeal only on questions of fundamental right and Criminal matters
� Coca-Cola v Titilayo Akinsanya
� Triangular employment maylead to co-employment in asituation where an employeewould be regarded as beingemployed by two employersany one of which may be boundby the terms of the contract ofemployment.
� Determinants of Co-employment� Recruitment� Termination� Direction� Supervision� Remuneration
EMERGING TRENDS - TRIANGULAR EMPLOYMENT/CO-EMPLOYMENT
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RECOGNISED
BY LAW
EMPLOYEE
END USEREMPLOYER
EMERGING TRENDS - TERMINATION OF EMPLOYMENT
� Reasons for termination of Contracts ofEmployment
� Termination of employment for good reason, bad
reason or no reason at all.
� In a recent decision of the NIC, it was held that
where the contract of employment contains
grounds upon which the employment can be
terminated, then termination must fall under
any of the agreed grounds and same must be
stated when the employment is being
terminated.
� The NIC has also stated that termination of
employment without reason is no longer tenable
in line with international best practices.
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EMERGING TRENDS - TERMINATION OF EMPLOYMENT
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� Redundancy
� Entities with Unionised employees
� Redundancy is carried out based on
any existing collective agreements
negotiated between the employees
and the union.
� Entities with Non-unionised employees/ParentCompany Policy (2017 Experience)
� The provisions of the Labour Act (Section 20)provide for the applicable steps:� inform the workers concerned of the
reasons for and extent of the anticipatedredundancy;
� apply the principle of last in, first out inthe discharge of the worker subject tofactors like relative merit, including skill,ability and reliability;
� Use best endeavours to negotiateredundancy payments to any dischargedemployees.
� Resignation
� Can an Employer reject a resignation?
� No. A notice of resignation of an appointmentbecomes effective and valid the moment it isreceived by the employer.
� Options available to an employer whereresignation is tendered prior to commencementof investigation for disciplinary actions
� Where the resignation is with immediateeffect, that is, payment in lieu of notice, theemployer’s only relief might lie in an actionfor breach of contract.
� Where the resignation gives notice, theemployer may summarily dismiss theemployee provided that the investigation hascommenced and same is concluded beforethe end of the notice period.
EMERGING TRENDS - TERMINATION OF EMPLOYMENT
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� Termination by Notice
� Usually done in accordance with notice
requirements whether as prescribed in
the Labour Act (for workers governed by
the Act) or in the contract of
employment.
� Payment in lieu of Notice
� Either party reserves the right to accept
payment in lieu of notice in this regard.� Must be made simultaneously with the
proposed termination.
� Payment in lieu of notice is the basic
salary.
EMERGING TRENDS - TERMINATION OF EMPLOYMENT
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DATA PROTECTION
� Transfer of Employees’ Data outside Nigeria
�NITDA Guidelines applies to organisations based outside
Nigeria that process personal data of Nigerian residents.
�Consent of employees required pursuant to NITDA
Guidelines.
�Data can only be transferred to countries that have an
adequate level of protection pursuant to the Guidelines
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EMPLOYMENT TRAINING BOND
� As a general rule, employment contracts that act as
restraint of trade are unenforceable unless it can
be proven that it is reasonable as it affects the
interest of the parties concerned (the employer and
the employee), the public and does not amount to
unfair labour practice.
� Employment bonds are however enforceable against
the parties who executes them and a breach by the
employee is treated as a breach of contract.
� Where damages are stipulated for breach of the
contract, the employee must pay the named
damages in case of breach.
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INTELLECTUAL PROPERTY RIGHTS
� Copyright
� Copyright belongs in the first instance to the
author, unless otherwise stipulated in writing
by contract.
� Exceptions
� Where literary, musical or artistic work is made
in the course of employment with a newspaper,
magazine or similar periodical for the purpose
of being published in that newspaper,
magazine or periodical.
� Patents & Designs
� Where invention occurs in the course of
employment, the right to the patent is vested
in the employer (statutory inventor).
� The employee (true inventor) must be named
in the patent.
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MITIGATION STRATEGIES
� EMPLOYMENT AUDIT
� REDRAFTING
� STANDARDISING
� HARMONISING
� PERIODIC TRAINING ON EMPLOYMENT
RELATIONS IN NIGERIA
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RCO Court 3-5, Sinari Daranijo Street, Victoria Island, Lagos, Nigeria.
t: +234 (1) 4626841/3, +234 (1) 2716889
e: [email protected] w: www.jacksonettiandedu.com
…THANK YOU
2018 © Jackson, Etti & Edu. 37
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MANAGING FX DENOMINATED LIABILITIES
A Presentation to the Indian
Professionals Forum at the
Indian High CommissionAbayomi Adebanjo
February 17, 2018
LEGAL ISSUES AND OPTION:
OUTLINE
Understanding Nigeria’s FX Dynamics
Architecture of Foreign Exchange Market
Legal Issues Underpinning the FX Market
Options
Conclusion
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UNDERSTANDING NIGERIA’S FX DYNAMICS
‘For years, the dollar’s role as the major global currency has been termed
an “exorbitant privilege and now it may be becoming an extravagant
curse’
• Framework of FX market principally based on the Foreign
Exchange (Monitoring and Miscellaneous Provisions) Act - A
legislation passed on 1995 that gives the CBN the
supervisory mandate to regulate and oversee; and Foreign
Exchange Manual . However this legislation currently
under review through the Foreign Exchange (Control and
Monitoring) Bill 2016
• Nigeria is a structurally concentrated economy dominated
by six sectors which account for 75% of GDP but Oil
accounts for over 93% of FX earnings and over 63% of
revenues over the past five years
• Strong correlative relationship between Oil Prices,
Exchange Rate and Inflation
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2018 © Jackson, Etti & Edu.
UNDERSTANDING NIGERIA’S FX DYNAMICS
Strong policy regulation of FXMarket through CBN circulars,guidelines and directives - over 40circulars in 24months targeteddirectly at the FX Market
Transitioned from a PeggedRate Regime established andoperational over 40 years to aManaged Float Regime in 2016
Significant dollarization ofeconomy driven by strongdemands for importedproducts, dollar as betterstore of value and insatiableappetite for luxury
Highly speculative FXmarket characterisedby lack of transparencyand significantarbitrage opportunities
Weak Infrastructure
meaning significant
under-manufacturing
capacity
inability to exploit
comparative advantages
e.g. raw materials and
processing41
2018 © Jackson, Etti & Edu.
ARCHITECTURE OF EXCHANGE RATE MARKET
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Central Bank of Nigeria Rate (CBN Rate)
Nigerian Autonomous Foreign Exchange Fixing (NAFEX)
Nigerian Interbank Foreign Exchange Market (NIFEX)
Multiple Exchange Rate Regime comprising
Bureau De Change Rate (BDC Rate)
Pilgrim Rate
Parallel Market Rate (Black Market)
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NIFEX RATE CHARACTERISTICS
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Underpinned by the ‘Revised Guidelines for Operation of Nigerian Interbank Foreign Exchange Market’ issued in June 2016
Introduction of FX Primary Dealers – authorised dealers designed
to deal in large trade sizes and provided 2 ways quotes for
standard amounts and spreads– together with participation of Oil
Companies, End-Users, Authorised Dealers etc
IFEX based on two way order quotes with agreed spreads and use
of CBN approved derivatives products – FX Options, Forwards
(Outright and Non- Deliverable), FX Swaps and Cross-Currency
Interest Rate Swaps
Addition of OTX FX Futures - Naira-settled non-deliverable
forward contracts where parties agree to an exchange rate for a
predetermined date in the future, without the obligation to
deliver the underlying currencies (US Dollar and Nigerian Naira)
on the maturity/settlement date.
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� End-users can execute OTC FX Futures withpreferred DMBS instead of DMB with tradesupporting documents
� Margin requirements to mitigate counterpartyrisk subject to requirements set by FMDQ andNIBBS – Clearing Agent
� CBN interventions either directly through theIFEX by buying or selling FX spots, FX Forwardsor offering OTC FX Futures
� CBN Secondary intervention through theSecondary Market Intervention Sales on awholesale (authorised dealers) or retail (end-users) basis
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NIFEX RATE CHARACTERISTICS – CONT’D
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� The OTC FX Futures contract is aneffective exchange rate management toolsupported by a transparent price driventwo-way quote (2WQ) market
� Transactions underlying derivativescontracts must be trade backed (visible/invisible) including – Foreign currencyloans, FDI, Dividend Repayments, Importtransactions, Fixed Income Securities,Quoted Securities et
� Minimum transaction that can beexecuted between counterparties set at$500k
• Creation of the Investors and Exporters Window as a special window by CBN to accommodate FX obligations
• Permissible transactions eligible to access window include:
• Trade related payment obligations
• Bills for Collection
• Invisible Transactions (excluding Airline International Ticket Sales)
• Opportunity to hedge FX exposure through CBN approved hedging mechanisms including OTC FX Futures
• Holders of Legacy OTC FX Futures Contracts ( April 2017 – March 2018) with option to have settlements based on either NIFEX rates or NAFEX rates
• Nafex fixing methodology based on a polled rate based on the submissions of ten(10) contributing banks and calculated using a trimmed arithmetic mean. Uponreceipt of quotes, the individual contributing banks’ submission is ranked indescending order. The lowest and highest two (2) quotes are eliminated from theranked rates leaving only the middle six (6) rates. The arithmetic mean of theremaining rates are then calculated to two (2) decimal places and disseminatedas the NAFEX Spot Rate.
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NAFEX RATE CHARACTERISTICS – CONT’D
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LEGAL ISSUES UNDERPINNING THE FX MARKET
Erosion of Value Currency Mismatch
Increased costs of capital Convertibility/Repatriation
of Capital
Increased contractual delinquency ratio
Regulatory Issues - 41 items Not Valid for Forex,
loans to Non-dollar generating business
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OPTIONS
Key Advantages
� Prevention of Loan default
� Preservation of Security
� Realignment of facility with
more predictable cashflows
2018 © Jackson, Etti & Edu.
Redenomination and Refinancing:
� Naira debt instrument will be
used to purchase USD at the FX
market to prepay the USD
facility.
� FX conversion mechanism will be
given elaborate consideration
� Structure of
conversion/repayment process
� Revision of existing security
documents to incorporate the
Naira facility.
� Consideration of insolvency
hardening period triggers for the
existing security interests under
the USD facility can be a major
factor in the structuring.
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�Derivatives/ Hedging Mechanisms
A derivative is a financial instrument whose value derives from the value ofsomething else and which entitles the holder to buy or sell a commodity atsome future date for a predetermined price.
Based on Nigerian Master FX Agreement and ISDA documentation
� FX Derivatives
• FX Forwards: The maximum tenor allowed for FX Forwards and byimplication FX Swaps and Cross-Currency Interest Rate Swaps is nowextended to five (5) years.
• Cross Currency Interest Rate Swap: Used to support projects withlong-term foreign exchange exposure and shall therefore be projectbacked.
• OTC FX Futures: Non-deliverable Forwards traded on FMDQ Platformand settled based on NAFEX rates
2018 © Jackson, Etti & Edu.
OPTIONS
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Improve the business planning practice ofend-users and FX sellers, as the futureexchange rate is guaranteed through thederivatives market
Eradicate the constant front-loading of FX
requirements and minimize the
disequilibrium in the Spot FX market.
Useful in attracting significant capital
flows to the Nigerian fixed income and
equity markets as returns can now be
enhanced as FX exposures are hedged.
Key Advantages
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OPTIONS
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CONCLUSION
• Documentation should always anticipate and provide mitigants for fxrelated risks
• Standard clauses are not sacrosanct – parties can always innovate tomeet intervening realities
• Ensure alignment between loan amount and underlying denominationof repayments
• Consider on-lending mechanisms using ECA’s and DFIs to reduce cost ofcapital
• GET A GREAT COMMERCIAL COUNSEL
2018 © Jackson, Etti & Edu. 50
RCO Court 3-5, Sinari Daranijo Street, Victoria Island, Lagos, Nigeria.
t: +234 (1) 4626841/3, +234 (1) 2716889
e: [email protected] w: www.jacksonettiandedu.com
THANK YOU
for the audience!
2018 © Jackson, Etti & Edu. 51