— The Nigeria Start-up Act was signed on October 19 2022.
— It will oversee startup registrations in the country, provide funding, and more.
— The act was made necessary to ensure that the erupting tech scene in Nigeria is under the government’s supervision.
President Muhammadu Buhari signed the Nigeria Start-up Bill into law on October 19, 2022, making it the Nigeria Start-up Act officially.
The bill was introduced in May 2021 and the Federal Executive Council (FEC) approved it in December after it received the draft in October. Nigeria’s Senate approved it in July 2022 and everything was set for the tech-motivated bill to become law.
According to TechCrunch, the bill was similar to the ones launched by several other African countries like Tunisia, Kenya, Senegal and Ethiopia. Here are some of the details you need to know about the act.
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11 important details you should know about the Nigeria Start-up Act
1. The act included involvement from executive and stakeholders in the startup ecosystem in Nigeria and its aim is to ensure that they succeed. It is put in place to avoid the loss that motorcycle ride-hailing startups like Gokada, ORide, MaxNG and others suffered the last time.
2. The Nigeria Start-up Act makes it mandatory that all startups must obtain a Startup Label Certificate, which will be displayed on the Federal Ministry of Communication and Digital Economy website.
3. Startups must be a registered liability company of up to 10 years to qualify for the certificate they need to be recognised.
4. Also, startups must have at least one Nigerian as a founder or co-founder with right to profit or revenue from the sale of shares.
5. The startups must have among its objectives, the following: innovation, development, production, improvement, and commercialisation of a digital technology innovative product or process.
6. Holding companies or subsidiaries of an existing company that is not registered cannot be recognised as startups.
7. The Nigeria Start-up Act creates a National Council for Digital Innovation and Entrepreneurship, which will be in charge of formulating and providing general policy guidelines towards reaching objectives of the Act.
8. Companies can confirm their eligibility for startup status by submitting an application on the Startup Portal.
9. Recognised startups are eligible for a Startup Investment Seed Fund which is under the Nigerian Sovereign Investment Authority management.
10. The act makes it possible for startups to be properly taxed by the authorities.
11. Regulators are mandated by law to deal with labelled startups, making it easier for them to conduct their business within the confines of regulations guiding them.
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