Nigeria: Regulatory Framework Of The Startup Act

Introduction

A key consideration for doing business in a country is the sectoral regulatory framework. Accordingly, the recently enacted Startup Act, 2022 (the "Act"), a landmark legislation on the regulation of startups in Nigeria, seeks to create a robust legal framework for key regulatory bodies to provide support to startups in Nigeria. In this third part of our series, we consider the regulatory regime under the Act and the respective roles of the bodies created thereunder.

1. The National Council for Digital innovation and Entrepreneurship

A key body established by the Act is the National Council for Digital Innovation and Entrepreneurship (the "Council"). The Council is established as a body corporate with perpetual succession and a common seal¹ . The Council is headed by the President of the Federal Republic of Nigeria, who serves as the Chairman with the Vice President, Ministers, and other information technology experts represented on the Council.²

The Council is established to ensure the monitoring and evaluation of the regulatory framework to encourage the development of startups in Nigeria, monitor and ensure the implementation of the policies and programs of the secretariat of the Council (i.e., National Information Technology Development Agency). The Council is also designated to support digital technological development through grants to persons, research institutions, and universities pursuing postgraduate programs in the areas of science, technology, and innovation.

The Act also empowers the Council to review policies and directives of Ministries, Departments, and Agencies ("MDAs") that may affect the operation, establishment, and investments in a startup³. The Council is responsible for assisting and encouraging labeled startups that seek to list on the relevant board of Nigerian Exchange Limited or on similar stock and commodity exchanges operating in Nigeria, to meet up with the eligibility requirements for listing, and the Council may grant such labelled startups incentives that aid their growth and development.⁴

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Footnotes

1. Section 3 of the Act

2. Section 4 of the Act

3. Section 7 of the Act

4. Section 36(1) and (2) of the Act

Originally Published 07 December 2022

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