Nigeria’s Startup Act signed into law
The Nigeria Startup Bill (NSB) has been signed into law by President Muhammadu Buhari, bringing “excitement and renewed hope that the country’s tech ecosystem can grow in leaps and bounds, ushering it to new heights”, according to the NSB website.
The NSB, henceforth to be known as the Nigeria Startup Act, began its progress in June 2021 and was passed by the country’s National Assembly in July. It has been a joint initiative by Nigeria’s tech startup ecosystem and the presidency aimed at harnessing the potential of the country’s digital economy through co-created regulations.
The adoption of a “big tent” approach sought to involve all relevant stakeholders including the industry, regional and federal government, the executive and judiciary in a process of co-creation. The process included harmonising the legislation with existing laws and identifying laws that would need to be updated.
Focus on growth
“The bill is being proposed to provide an enabling environment for the growth of startups and to guard against different challenges, such as seemingly disruptive regulations, lack of regulatory certainty, and weak infrastructure like broadband, open data, and digital platforms that limit the optimisation of the many benefits of the digital economy,” Kola Aina, founder and general partner of Ventures Platform Fund, told African Business during the passage of the bill.
The legislation seeks to ensure that Nigeria’s laws and regulations are clear, planned and work for the tech ecosystem. This should improve the ease of doing business in the Nigerian tech industry and encourage domestic and foreign investment.
The provisions of the Act include:
- The setting up of a National Council for Digital Innovation and Entrepreneurship.
- The creation of a labelling process, so that firms can be correctly identified as startups and benefit from the Act.
- A Startup Investment Seed Fund that will be accessible exclusively to startups, making it easier to fund their operations by capitalising on the grants and loans that will be available to them.
- Tax relief for startups.
- Provisions for accelerator and incubator programmes.