The Nigeria Start-up Bill 2022 was passed by the Senate on July 27 and the House of Representatives on July 28, and President Muhammadu Buhari signed it into law on October 19, 2022, after it had been proposed in May by the President through the office of his Chief of Staff in coordination with the Ministry of Communications and Digital Economy.
The new law will now offer the legal and strategic foundation for the expansion of the digital economy sector, and will bring about many advantages for the nation, according to Isa Pantami, Minister of Communications and Digital Economy.
This bill is anticipated to address issues that young innovators confront, such as how simple it is to start business in Nigeria. A clear and comprehensive framework for the regulation of the startup environment is another goal of the bill.
5 Important Details In The Nigeria Start-Up Act 2022
- The National Council for Digital Innovation and Entrepreneurship is a self-regulatory body established by the Nigeria Start-Up Act with the mission to develop and provide general policy guidelines for the realization of the Bill’s objectives, provide comprehensive directions for the harmonization of laws and regulations that affect startups, monitor the regulatory framework for the development of startups, approve the Secretariat programs, and implement the Secretariat policies.
To be eligible for any of the advantages provided by this Act, you must first get a certificate from the Secretariat of the Nigerian Startup Act, which will designate your business as a “startup.” You must be a registered Limited Liability Company that has been in operation for no longer than 10 years in order to qualify for this certification. You’ll undoubtedly use technology to address a problem in Nigeria, but you must at least have one Nigerian co-founder.
2. Seed Funding For Start-ups
The act contains provisions for its establishment. The Nigeria Sovereign Investment Authority will oversee the fund (NSIA). On the advice of the Fund Manager (NSIA), the organization will start providing early-stage funding for entrepreneurs and relief to technology labs, accelerators, incubators, and hubs.
3. Fiscal incentives
Labeled startups may apply to the Nigerian Investment Promotion Commission (NIPC) for tax reliefs and incentives in recognition of the significance of tax incentives to the development of startups, provided that such startups operate within the industries covered by the Pioneer Status Incentives (PSI) Scheme. Under fiscal incentives, the federal government may provide further tax reduction. For the growth and development of startups, access to export amenities, government subsidies, loans, and facilities, as well as the Credit Guarantee Scheme, should be made available.
The federal government will establish and implement a national strategy to provide tax credits as an incentive to people who participate in startups or the startup ecosystem, including individuals, investors, capitalists, funds, companies, accelerators, and incubators.
4. Regulatory Support
The NSB council will develop a startup site to assist entrepreneurs in collaborating with pertinent governmental organizations such the Securities and Exchange Commission, the Central Bank of Nigeria, and the Corporate Affairs Commission (SEC).
The difficulties associated with obtaining licenses from pertinent organizations like the CBN and the SEC are a big source of pain for fintech firms. Young, aspiring fintech business owners will have the chance to communicate with these organizations to streamline the registration procedure.
5. Training, Capacity Building and Talent Development
According to the proposed Act, the Secretariat must develop and carry out startup portal-based training and capacity-building programs for start-ups.
The Bill gives the Secretariat the authority to establish digital technology acquisition centers throughout the nation, work with the National Universities Commission and Nigeria’s tertiary institutions to develop modules, programs, and support academic research aimed at influencing the knowledge of the industry, and work with pertinent agencies and sectors to promote the use of digital technology and strengthen digital technology management capability.