21 new startup labels have just been awarded by the Tunisian Ministry of Communication Technologies, bringing the overall number of awarded labels to 400 under the “Startup Act” program. Awarding the startup label is part of the “Startup Act” program, which has as its main objective, the promotion of those starting businesses in Tunisia or foreign businesses which are settling there.
The Tunisian Startup Act Has Given Startups In The Country A Voice
Unarguably, Tunisia leads other African countries in bold startup legislations. The Tunisian Startup Act, passed in May, 2018, puts in place the following measures in favour of startups:
- Tunisian Startup Act defines startups as an entity having legal existence not exceeding eight (08) years from the date of its constitution.
- More than two-thirds (2/3) of Tunisian startups’ capital must be natural persons, venture capital investment companies, collective investment funds, investment, seed money and any other investment body according to the legislation in force or by foreign Startups to qualify as startups under the Act.
- The business model envisaged by the Tunisian Startup Act is one that is highly innovative, utilizing cutting-edge technology.
- Under the Act, any individual promoter of a Startup, public agent or employee of a private company, may benefit from the right to Startup Leave for creation of a Startup for a period of one year renewable once
- Any promoter of a Startup may benefit from a Startup scholarship for a duration of one (01) year. Only three (03) shareholders and full-time employees in the relevant Startup may however benefit from the scholarship awarded.
- Young graduates who create startups are free from taxation for three years.
- The profits from the sale of the securities relating to the shares in the Startups are exempt from the capital gains tax.
- Startup labels are also part of the innovations Tunisia’ s Startup Act has introduced.
Tunisia startup label Tunisia startup label
Read also: What Difference Have Startup Acts Made In African Countries Where They Exist?
Lessons from Tunisia’s seeming success with its Startup Act
Tunisia’s Startup Act has largely succeeded because of a collaboration between the public and private sectors. For instance, Smart Capital, the company in charge of administering the Tunisian Startup Act is privately managed, although with public shareholding. The company was approved by the Tunisian Financial Markets Council, and works with the country’s Ministry of Communication Technologies and Digital Economy and the Ministry of Finance. Smart Capital’s mission is simple and straight-forward: design and implement the Startup Tunisia initiative (including among others, the Startup Act and the Fund of Funds ANAVA), in order to make Tunisia a country of startups at the crossroads of the Mediterranean, MENA region and Africa.
Read also:How Small Businesses Can Get Maximum Value From Mobile
Thus, handing over the administration of the Act to a private entity has saved the Act from the bugs of bureaucracy and inefficiencies that eat up most government commissions and agencies in Africa. The company has been promoting Tunisian startups and planning several launches of funds in support of startups, recently.
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