The Implementation Level of the Nigeria Startup Act, 2022 at a Glance
By Ater, Solomon Vendaga
- Introduction
Nigeria has remained a breeding ground for startup funding in Africa despite an inadequate regulatory framework. To provide a legal framework for the development of startups in Nigeria as well as an enabling environment that ensures certainty and hitch-free operation, President Muhammadu Buhari, on the 19th of October 2022, signed the Startup Act into law. The Nigerian Startup Act is a joint initiative by Nigeria’s tech startup ecosystem and the Presidency to harness the potential of our digital economy through co-created regulations. It is about four months since it has been passed into law and only 8 states out of 36 have adopted it. This is not a good percentage as such there is a call for full adoption of the law by all the states in the country. This work looks at the Act in a brief, and crusade for its adoption by all states in the country as a necessity for an efficient and timely implementation of the law.
- Aim and Objectives of the Nigeria Startup Act, 2022
The Act aims to provide a legal and institutional framework, particularly for the development of fintech startups in Nigeria. The other objectives of the Act include”:
- providing an enabling environment for the establishment, development, and operation of startups in Nigeria;
- fostering the development and growth of technology–related talent; and
- Position Nigeria’s start-up ecosystem as the leading digital technology hub in Africa, having excellent innovators with cutting-edge skills and exportable capacity.
- Key Provisions of the NSA
The Act makes provisions from the:
Establishment of a Startup Secretariat that houses the Startup directory monitors activities of startups and grants licenses. NITDA is the designated Secretariat.
National Council of Innovation and Entrepreneurship whose job is to ensure the formulation and provision of general policy guidelines; giving overall direction for the harmonization of laws and regulations that affect startups; Monitoring and evaluating the regulatory framework
to encourage the development of startups in Nigeria.
In addition, the Act applies to companies incorporated under the Companies and Allied Matters Act, 2020 and other organizations that create or develop products that conform to startup labeling. The Act also provides for Crowdfunding, startup fund, startup portal for the certainty of startups, and tax incentives, as well as the protection of the intellectual property rights of the startups.
- Implementation Level
The Nigerian Startup Act Project Team, a body employed to ensure the implementation of the Act noted that a framework for implementation of the Act has been approved by President Muhammadu Buhari and that the next step is to set up the Council for Digital Innovation and Entrepreneurship. The group also noted that this will be followed by the setting up of the startup support and engagement portal; the startup investment seed fund; and the Consultative Forum. Interestingly, the implementation framework also provided guidelines for states to adopt the Act. This is also expected to usher in a new dawn for the startup ecosystem and inject more investments into the ecosystem.
- Comments and Conclusion
The overall interest of the Act is to provide a certain and accommodating regulatory framework for the operation of startups in Nigeria. It hopes to make the environment favourable for them to strive by providing incentives and support for growth and development.
For this piece of legislation should be implemented in its entirety, it should not be avoided by any state in Nigeria. It is the commitment of all stakeholders inclusive of states that will make the provisions of the Act attainable. Hence, states in Nigeria must rise to domesticate the Act as this is believed to be a factor for the successful implementation of the Act. States in Nigeria must rise to domesticate the Act as this is believed to be a factor for the successful implementation of the Act. Currently, only Osun, Kaduna, Edo, Yobe, Zamfara, Ekiti, Anambra, and Lagos have adopted the Act. Others should do so to avoid the incidence of being left behind in the train of the current trends.
References
- Group Highlights next steps in Nigeria Startup Act implementation, https://www.google.com/amp/s/nairametrics.com/2023/02/13/group-highlights-next-steps-in-nigeria-startup-act-implementation/%3famp=1 accessed 21st February 2023
- Nigeria Startup Act, Implementation of the Nigeria Startup Act: What to Expect, (Feb 12, 2023) https://nigeriastartupact.substack.com/p/implementation-of-the-nigeria-startup?utm_source=substack&utm_medium=email accessed 21st February 2023
- https://nairametrics.com/2023/02/21/only-8-states-have-adopted-nigeria-startup-act-so-far-project-team/
- The Nigeria Startup Act, 2022
About the Author
Ater, Solomon Vendaga is a penultimate Law undergraduate at the University of Abuja Nigeria. He has keen interest in Taxation Law, Tech Law, IP Law, and Public Policy. He can be reached on +234(0)8025263078 and soloater12@gmail.com
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