After a meticulous two-year formulation process, Kenya is on the verge of finalizing groundbreaking pro-startup legislation. During the Kenya Innovation Week, President Williams Ruto announced on Tuesday that the Kenya Startup Bill is slated to be signed into law by April of the coming year.
The journey began in December 2021 when Senator Johnson Sakaja introduced the Kenya Startup Bill in the Senate. Notably, the Bill garnered unanimous support with 34 approvals and zero objections, underscoring its widespread backing. It awaits concurrence from the national assembly before proceeding for the presidential assent.
The primary objectives of the Startup Bill are to provide tax incentives, streamline access to credit, and establish a robust platform for startups to access essential resources and support. Beyond these immediate benefits, the legislation is poised to create a legal framework conducive to the tech sector’s growth, with the broader aim of attracting talent and capital to Kenya.
A pivotal aspect of the legislation mandates that businesses already registered with the Business Registration Service (BRS) undergo additional registration with the Kenya National Innovation Agency (Agency). The Agency is tasked with registering new businesses, formulating incubation policy frameworks, and facilitating connections between local and international business accelerators.
Empowered by the Bill, the Agency is authorized to extend crucial support to startups in their initial stages, safeguard their innovations’ intellectual property, and provide financial and non-financial assistance to startups admitted into incubation programs. This holistic approach is expected to contribute significantly to the overall growth of startups in Kenya.
Furthermore, the legislation establishes a loan guarantee mechanism to ease the launch and expansion of new businesses, thereby streamlining access to financial aid. If effectively implemented, this mechanism could enhance the availability of financial assistance for startups.
Under the provisions of the Bill, the Agency is tasked with overseeing startup registration and appointing a Startup Registrar. This Registrar will play a crucial role in maintaining a comprehensive database of registered startups, conducting assessments of their financial needs, and identifying requirements for investment assistance.
