The process of establishing a national Startup Act in Rwanda has evolved to the point that the Ministry of ICT and Innovation has stated that it “must” be completed this year. The project, which aims to boost the country’s entrepreneurial and business environment, was first launched last year, but operations were paused due to the pandemic’s onset. The Rwandan government appears to be taking a more aggressive role in driving startup growth with the passage of the Startup Act, which lays out the government’s policies for startup growth. The country expects that the Startup Act would promote the development of the tech-based services industry.

“The law is being finalized at the Ministry level, before it can undergo the normal procedure by the end of this year,” said Angellos Munezero, Director-General of Innovation and Business Development at the Ministry of ICT and Innovation. 

Despite the pandemic’s effects, Munezero ascribed the delay to a lack of faith that the national startup act is a tool that will combine incentives for businesses that require a thorough ecosystem analysis. He mentioned that some of the incentives that have previously been considered include tax exemptions and government support for being labeled as a startup, among others.

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“We are still in talks with all associated stakeholders to negotiate and agree on incentives for our startups to make sure that we develop our ecosystem,” he added, “We have also been engaging local startups, to come up with that an ecosystem assessment report that entails all proposals.”

The Era of Startup Act

The first specific startup law globally was passed in Italy in 2012, and Africa is increasingly catching on. Tunisia and Senegal are the only countries in Africa that have passed the Act, although plans are also being mulled by Kenya, Ethiopia, Mali to follow suit.

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: 4 Tunisian Startups Form The First Cohort Of The Central Bank Of Tunisia’s Regulatory “Sandbox”

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 has launched funds in support of startups, recently.

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What Difference Have Startup Acts Made In African Countries Where They Exist?

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