Finally, Nigeria Startup Bill 2021 has been recently signed into law by the President.

It is now known as Nigeria Startup Act.

As someone who is particularly interested in Startups and Startup Legal in Nigeria, you can trust that my team and I at Barinaada Legal digging deep into this Act to make sure that we understand its content and loopholes so that we can properly advise and protect our clients' interests.

Asides from the Companies and Allied Matters Act (CAMA) and the Corporate Affairs Commission (CAC) which we know to be the general legal framework and body for the formation and operation of businesses in Nigeria, the startup act is specifically designed to regulate startups and their operations in the country.

The First thing you need to know about the Startup Act is that it makes the startup space a regulated space.

This is apart from the various specific industry-based regulations that we already have.

In fact, there is now a regulatory body called the NATIONAL COUNCIL FOR DIGITAL INNOVATION AND ENTREPRENEURSHIP established by the Startup Act which will administer the provisions of the Act. 

So, this regulatory body is to the Startup Act, what the CAC is to the CAMA.

The main purpose of the Act as a regulatory framework is to create and provide an enabling environment for Startups to operate in Nigeria. 

The act seeks to promote the development of startups and to remove regulatory barriers that might hinder startups in Nigeria.

Recall that in 2020, there was a ban on 2 wheel ride-hailing startups, and all the startups in that particular space suffered the consequences of that unfavorable regulatory policy.

Some either pivoted while others completely packed up not minding the huge investments that have gone in from VC firms and other investors.

Recall also that in 2021, the CBN banned the trading of cryptocurrency, very recently, many Fintech Startups canceled their virtual Dollar Card Service to their users.

For those who were not outrightly banned, the regulations were so stiff that they could hardly Comply.

This was the case with Startups in the logistics and transport space.

A particular business model could be legit today and the next morning you could wake to the ban of that particular business with strict penalties for flaunting the rules.

All of these factors did not make for a safe environment for startups in Nigeria to actually thrive.

So for the first time, an Act or a Law promises to provide a safe and enabling environment (ease of doing business) in Nigeria and even goes ahead to set up an institution for that purpose.

We hope to share more on this with time.

But for now, let us rejoice and hope that the promises are made true.

-Barinaada Legal