Nigeria’s Anticipated Startup Bill Enters A Crucial Stage After Key Step
The Nigeria Startup Bill (NSB), a joint initiative by Nigeria’s tech startup ecosystem and the Presidency to harness the potential of the country’s booming digital economy through co-created regulations, has made a significant step towards actualisation.
A fresh wave of optimism permeated through the Nigerian startup ecosystem on Wednesday, July 20, as the anticipated NSB passed its third reading at the Senate.
The NSB, which took an “open tent” approach when being drafted, ensuring input from all stakeholders (both public and private), was created to provide a clear regulatory framework for all startups in the Nigerian tech industry. Local tech stakeholders including Ventures Platform founder Kola Aina and Future Africa’s Iyin Aboyeji, are among 30 tech industry leaders who have played a part in the process.
The NSB makes provisions to promote local content and provide the proper infrastructure needed for the growth of startups, all in an effort to position Nigeria as a leader in the African tech space given the flurry of activity the local ecosystem continues to attract.
Nigerian startups drew in well over USD 1 B in funding last year, significantly more than any other country on the continent. More than 300 investors (individual and institutions) participated in the funding rounds of over 100 Nigerian tech startups in 2021 as the country accounted for around 30 percent of African tech funding.
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Nigeria also hosts more unicorns than any other country in Africa, and some of the most exciting startups, hottest markets, and relevant operators on the continent. Its buzzing tech ecosystem could use a more supportive and less-antagonistic environment, which seems to be a goal the NSB has its sights on.
Oswald Osaretin Guobadia, the Senior Special Assistant to the President on Digital Transformation, said the legislature is “excited about the Bill” as they understand that ultimately the tech ecosystem is critical in the future of Nigeria. “We look to conclude in the National assembly soon,” he said.
On the question of what would be next for the Bill after it is passed into law, Guobadia added: “Implementation and state adoption of this Bill will require that we continue to engage and collaborate on execution. Its success is dependent on the participation of all stakeholders of the ecosystem which includes lawmakers, policymakers and practitioners.”
Since its inception in June 2021, the bill has been received with open arms and has seen wide collaboration from all ministries, departments and agencies involved, as well as from both chambers of the National House of Assembly.
It is understood that 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.
Having been passed by the Senate, the Bill will now make its way to the House of Representatives where it will pass through 3 readings.
If the House concurs with the contents of the Bill, the Bill will then be sent to the president for his assent, and will thus become law – similar to how Startup Acts have been formally adopted in two African countries such as Tunisia and Senegal, bringing about notable impact.
A few other countries, including Mali, Ghana, Ivory Coast, the Democratic Republic of Congo (DRC), Rwanda and Kenya, are either at varying stages of enactment or still going through the early parliamentary motions.
The need for more supportive and structured startup regulation in Nigeria’s attractive digital ecosystem is epitomised by notable instances in the recent past where regulatory uncertainty, inadequate structures, or stiff calls by the authorities have destabilised the local tech ecosystem and jeopardised investments. Episodes like the ban on bike-hailing and the obstruction of crypto startups come to mind.
The NSB aims to address the lingering concerns. The Bill will ensure that Nigeria’s laws and regulations are clear, planned and work for the tech ecosystem. This, it is hoped, will contribute to the creation of an enabling environment for growth, attraction and protection of investment in tech startups.
The new policy framework comes with provisions that cater to: Startup labelling, incubators/accelerators, startup investment funds, training/upskilling, and tax incentives, among other things.
The full NSB document will be released publicly following its passage by the National Assembly. However, a summary [PDF] of the Bill is currently available to the public.
Feature Image Credits: Startups Magazine
