Algeria has a new decree for startup and it is not making wave, but the first wave of innovative projects, startups and incubators, benefiting from labeling issued by a multisectoral commission set up under the decree, is scheduled for the end of December-beginning of January, said Tuesday in Algiers, the Minister Delegate to the Prime Minister responsible for Knowledge economy and startups, Oualid El-Mahdi Yacine.
On the occasion of the installation of the Commission for the labeling of “Startups”, “Incubators” and “Innovative projects”, the minister considered that “the timing (of the start of labeling) is rather correct” since it will coincide with the implementation of the 2021 finance law which introduces “new tax exemptions for startups.”
Labeling will thus allow the startup to benefit from these exemptions.
The minister announced that this commission will meet periodically “on average twice a month” and will allow to study the requests which will be received “exclusively” on the portal www.startup.dz which was also launched Tuesday.
The choice of all digital in the administrative procedures for obtaining the label is motivated, according to the minister, by his determination to put an end to the “bureaucracy which has taken root in our administrations” and which is “the major obstacle which has hindered the completion of hundreds of projects “.
Obtaining the “Startup” label is conditioned by two essential factors: innovation and non-linear growth, explains Noureddine Ouaddah, an executive at the ministry.
While the granting of the “Innovative Project” label will depend essentially on “the growth of the project and its business plan”, adds. Mr. Ouaddah.
Finally, the “Incubator” label requires the presentation of services such as coaching and training, a good qualification of the team as well as convincing results as to the outcome of the projects monitored, continues the executive.
Read also: Read also: A Look At The 26-Year-old Algerian Yacine Oualid, Africa’s First Ever Minister of Startups
Algeria Startups labelling Algeria Startups labelling
Algeria Officially Launches Its First Ever Fund For Startups
In October this year, Algeria launched the country’s first ever Fund for Startups, at the International Conference Center (CIC) in Algiers during the National StartUp Conference “Algeria Disrupt 2020”.
According to the country’s Minister Delegate to the Prime Minister in charge of the knowledge economy and start-ups, Oualid El-Mahdi Yacine, the new financing mechanism, called the “Algerian start-up fund”, is based on investment in capital and not on classic financing mechanisms based on credit”, stating that investment in capital induces a notion of risk and this is a very important.”
Executive Decree 20–254 of September 15, 2020 creating the national committee for the labeling of “startups”, “innovative projects” and “incubators” was published in the last issue of the Official Journal.
During the meeting of the Council of Ministers held in January 2020, the President of the Republic ordered the development of an emergency program for startups and small and medium-sized enterprises (SMEs), in particular the creation of a special fund or a bank intended for their financing.
He also insisted on the imperative of a “deep reform” of the country’s tax system with all that follows in terms of regulations and tax incentives for the benefit of startups and SMEs.
The 2020 Finance Law provides for new measures in the form of tax incentives for the benefit of startups, in particular those who are active in the field of innovation and new technologies.
These are tax exemptions concerning taxes on profits and on value added (VAT) in order to guarantee the sustainability of these businesses and to achieve sustainable economic development in the medium term.
Customs exemptions during the operation phase and facilitated access to land as part of the extension of investment projects have also been instituted under the 2020 Finance Law.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer