In a recent development, the president of Nigeria, Muhammadu Buhari, has assented the Nigeria Start-Up Bill into law, now called the Nigeria Start-Up Act, 2022. This was disclosed by The Minister of Communications and Digital Economy, Isa Pantami, in a tweet on Twitter. The Nigeria Start-Up Bill is a joint initiative by Nigeria’s tech startup ecosystem, several government bodies and the presidency to harness the potential of the digital economy through co-created regulations and provide an institutional framework.
Nigeria Start-Up Bill was drafted to create an enabling environment for tech startups in Nigeria to launch and scale their products and prevent the reoccurrence of earlier tribulations, such as the ban on two-wheeler vehicles and cryptocurrencies. The bill will ensure that Nigeria’s laws and regulations are clear, planned and work for the tech ecosystem, which is projected to contribute to establishing, growing, attracting and defining a clear regulatory framework and protecting investment in tech startups in the country and to provide tax breaks.
An organized council will govern the start-up bill.
Pantami said the startup law, which holds vast benefits for the Nigerian economy, adopted an approach to allow startups to identify business challenges and engage in them. Based on the provisions of the law, to unlock the full potential of the Nigerian ecosystem, the Start-Up Bill will cater to areas including training, capacity building and development, startup label, tax and fiscal incentives, accelerators and incubators, and regulation support, among others. The Federal Government also plans to set up an N10 billion fund for tech startups in the country.
The bill will be overseen by the Council for Digital Innovation and Entrepreneurship, which encompasses the President, the governor of Nigeria’s Central Bank, representatives of the Startup Consultative Forum, the Director-General of Nigeria’s information and technology regulator and other key government officials. They will be in authority of policy guidelines and the realization of the bill’s goals, which include encouraging cooperation between startups and policymakers and ensuring that Nigeria’s rules and regulations are beneficial to the digital sector.
Stakeholders from different backgrounds and regions within the country.
Since its introduction in 2021 following President Mohammadu Buhari’s speech, there have been several focus groups and townhalls across different regions, learning series engagements, state rallies, and roundtable discussions all aimed at getting the inputs of stakeholders from different backgrounds and regions within the country. Several African countries have launched similar bills over the last couple of years with the same objectives. They include Tunisia, Kenya, Senegal and Ethiopia.
This Start-Up Act went through various readings since its draft was submitted to the Presidency and the country’s Federal Executive Council (FEC) last October before it was enacted. It was first approved by the FEC, then approved by the National Assembly and currently with the Senate providing this support months after. The Nigerian Start-Up Bill Secretariat is located at the HQ of the Nigerian Technology Development Agency (NITDA). To be eligible for this certification, the startup company must be a registered Limited Liability Company running for not more than 10 years with at least one Nigerian co-founder.
Digital sector contributions to the country’s economy.
The minister noted that the digital economy sector had contributed a lot to the Nigerian economy, adding that in the first quarter of 2020, the ICT sector contributed 14.72 percent to the nation’s GDP. In 2021, a new record was set, contributing 17.92 percent to the country’s GDP. Ultimately, another record was set in the second quarter of 2022, with the ICT contributing 18.44 percent to the GDP. He stressed that these contributions are all outstanding. The new law will boost the legal and strategic framework for the growth of the sector.