E-COMMERCE, CYBERCRIME, CYBERSECURITY AND CYBERSECURITY LEVY – NIGERIA PERSPECTIVE (PART 1)

The Central Bank of Nigeria (CBN) in a circular PSM/DIR/PUB/017/004 dated May 6, 2024 directed all commercial, merchant, non-interest and payment service banks, other financial institutions, mobile money operators and payment service providers to deduct from all electronic transactions a levy of 0.5% (0.005) equivalent to a half percent of the amount of the electronic transaction and to remit same to the National Cybersecurity Fund (NCF) which shall be administered by the Office of the National Security Adviser (ONSA). The directive was to implement the provisions of the Cybercrime (Prohibition, Prevention, etc) (amendment) Act 2024 which amended the provisions of Section 44 (2) (a) of the Cybercrimes (Prohibitions, Prevention etc) Act 2015.
The levy is intended to fund national cybersecurity efforts managed by the Office of the National Security Adviser. The deduction from electronic transactions is expected to commence within two weeks from the date of the circular that is by May 20, 2024, while remittance of the levies collected in bulk to the National Cybersecurity Fund account domiciled at the Central Bank of Nigeria (CBN) shall be by the 5th business day of very subsequent month.
This write up is not to join in the controversies surrounding the cybersecurity levy but to provide general information on cybersecurity and the need for greater interests in cybersecurity.
1 The emergence of e-commerce E-commerce is said to have started in the 1960s. It progressed in the 1980s and 1990s when e-bay and Amazon revolutionized the e-commerce industry. Ecommerce is the use of electronic technology to conduct commerce such as sales, purchase, transfer, exchange of products and services. The advantages of ecommerce include giving businesses the opportunity to adapt effectively to changes in customer expectations: reducing business cost, providing competitive edge, enjoying global reach as well as presenting opportunity for non-stop business operations that can run 24/7. E-commerce is in various forms like Eshops; E-Banking; E-Finance, Point of Sales (POS) terminals, as well as Automated Teller Machines (ATM). E-commerce can be business to business (B2B); customer to customer (C2C); business to customer (B2C) or business to government (B2G).
E-commerce is conducted over the internet and involves the use of computers and computer networks to conduct business. Computer is any electronic device that manipulates information or data. The Nigeria’s Evidence Act 2011 (as amended to date) in Section 258 (1) defines computer as any electronic device for storing and processing of information. This means that any electronic device that accepts data

(input); process data, produce data (output) as well as stores data (storage) is a computer. Apart from the traditional computers, and networks, mobile phones, smart televisions, photocopying machines, vehicles, and any electronic device may be a computer along as it processes and stores information and data.
2 E-commerce and cybercrimes
E-commerce encourages cybercrimes. It could be likened to the attraction of ants to sugar and honey. Cybercrime is any act committed from or against a computer or network. The Encyclopedia Britannica defines cybercrime as “any crime that is committed by means of special knowledge or expert use of computer technology”. Cybercrime is a crime that involves a computer and a network. The computer may have been used in the commission of the crime or it may be the target of the crime. It is very easy to learn and commit cybercrimes. They require few resources relative to the damage they cause. Cybercrimes can be committed in a jurisdiction without being physically present in the area. Cybercrime often are not clearly illegal to an uninformed observer at first.
Some examples of cybercrimes are interception; impersonation, masquerading; eavesdropping, message delay, denial of service; packet/message relay attack, packet modification, virus/worms. Trojans, malware, cyber threats. Examples of cyber threats include cyber terrorism, cyber espionage, cyberstalking or bullying as well as cyberwarfare.
Since e-commerce relies on the efficient workability of the computer and computer networks, e-commerce is constantly under cyber-attacks. A cyber-attack is any attack on a computer that undermines the integrity, confidentiality, reliability of the computer or information resident in it.
3 Why the need for Cybersecurity?
Cybersecurity refers to the body of knowledge, technologies, processes, and practices designed to protect computer systems, network devices, programs and data from attack, theft, damage, or unauthorized access. The global cybersecurity market is estimated to be about 170 billion US dollars. The growth and urgent need for cybersecurity is accelerated by various initiatives such as BYOD (Bring your own device); IOT (internet of things), cloud computing, as well as the stringent data protection mandates of countries such as the European Union etc. The core functionality of cybersecurity involves protecting data and systems from any form of cyber-attacks.
If e-commerce is to flourish and be sustained, various cybersecurity measures had to be put in place though it involves huge resources.

In Part 2 of this write up, we shall discuss Nigeria’s legal framework on cybersecurity as well as the newly introduced cybersecurity levy etc