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Highlights of the Start Up Bill, 2020 in the Senate

The Start Up Bill is a bill sponsored by Nairobi Senator Johnson Sakaja and it will provide a framework to encourage growth, sustainable technological development and new entrepreneurship employment. The Act will also create a more favourable environment for innovation to enable Kenya to attract talents and capital.

  • The objectives of the Bill are to provide a legal framework:
  • That spurs and fosters a culture of innovative thinking and entrepreneurship;
  • For the registration of startups;
  • For linkage of startups with private investors, financial institutions among others;
  • To facilitate investments in startups;
  • To facilitate the provision of fiscal and non-fiscal support to startups in Kenya
  • That promotes an enabling environment for the establishment, development, conduct of business and regulation of startups;
  • For the establishment of incubation facilities at the National and county levels of government;
  • To establish an environment that promotes the establishment of startups; and
  • For the monitoring and evaluation of the legal and regulatory framework to encourage the development of startups in Kenya.

The Bill proposes that the National government and counties promote innovation and facilitate the transfer of technology innovation. It proposes that the Kenya National Innovation Agency and the county executive committee members shall put in place a national and county incubation policy framework for the development of the business incubation sector and startup systems.

The Bill contains a criterion for eligibility to be registered as a startup and for admission into an incubation programme. Startups have to be registered in Kenya as a company, partnership, limited liability partnership or a non-governmental organization.

Incubators also have to be registered according to the proposed law, as a public limited company, a non-governmental organization, a private limited company, a limited liability partnership or a partnership. The principal object of the incubators has to be the delivery of services that support the establishment and development of innovative start-ups

The Incentives
Support: This will be through subsidies, facilitation of the protection of the intellectual property, fiscal and non-fiscal support and support in the form of research and development activities.

Credit Guarantee Scheme: This will be for the provision of accessible financial support, a framework for credit guarantee, guarantee for investors in startups and capacity building on financial and risk management.
Other incentives are training and capacity building, legal assistance for intellectual property issues and fiscal incentives.

The Bill also amends the Science, Technology and Innovation Act, 2013 by mandating the Kenya National Innovation Agency and the National Research Fund to financially support technological innovations.

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