To follow up on the passage to the Council of Ministers of the law promoting startups, we deemed it necessary to make a brief summary of the flagship measures that will await those concerned from January 2020.
In order to establish an incentive framework for the creation and promotion of the startup in Senegal, the bill provides:
- the creation of a specific support and governance framework for startups under Senegalese law;
- the establishment of a suitable legal regime for the registration and labeling of Senegalese startups;
- the creation of a resource center dedicated to Senegalese startups, with a view in particular to facilitating the labeling procedures as well as the effectiveness of the support mechanisms put in place;
The purpose of this law is to establish an incentive framework for the creation and development of startups in Senegal based on creativity, innovation, the use of new technologies, the achievement of high added value as well national and international competitiveness.
It applies to any startup created on Senegalese territory whose capital is held at least one-third (1/3) by natural persons of Senegalese nationality or resident in Senegal, or by legal persons having their head office in Senegal.
It also applies to any startup created by Senegalese established abroad, the capital of which is at least 50% owned by them.
For the purposes of this law, the following definitions apply:
Startup promoter : Any natural person carrying an innovative project with very high potential and whose realization intervenes within the framework of a company of Senegalese law legally constituted;
Startup : Innovative and agile company, legally constituted for less than eight years, with a strong growth potential in search of a disruptive economic model and financing mechanisms adapted to its specificity in order to deploy its exceptional capacity for value creation .
Registered startup : The startup that registers with an approved or public private support structure;
Labeled startup : The startup to which the competent body issues the label referred to in article 7 of this law.
II: Institutional and organizational framework of the support, regulation and promotion system for startups
An evaluation, support and coordination commission is set up for the development of start-ups whose form, missions, organization and operation are fixed by the general provisions. This commission will be responsible for setting up an online platform allowing start-ups to complete the formalities related to registration and labeling.
Public or private support structures whose role is to help the creation, promotion and development of startups can benefit from incentive measures to facilitate support for startups.
These structures are approved by the evaluation, support and coordination committee.
The registration of startups that meet the criteria of article 3 is done with approved support structures;
The labeling of startups may be required from the support and coordination committee.
III: Incentives granted to startups
Any registered or labeled startup benefits from incentives, under the conditions provided for by this law such as:
- customs, social, tax, financial benefits, according to conditions to be defined.
- providing guarantees for obtaining credit;
- the implementation of measures favorable to investment;
- facilitating access to public procurement;
- the implementation of support, facilitation, development and capacity-building measures for the startup;
The legally registered startup benefits from:
- subsidies and support for formalization with the State;
- assumption of contributions and other social charges legally due under his status as an employer;
- special tax advantages as provided for in the general tax code.
- facilitation measures and customs procedures;
- training and capacity building through the platform set up by the support and coordination committee;
Labeled start-ups will benefit from:
- funds, of public and private origin, intended to directly finance the eligible startups and to guarantee, the execution of contracts, the loans, financing or participations in the capital of startups, granted or made by investment companies, institutions of loans and other financial institutions up to a limit;
customs advantages during the period of validity of the label;
- a preferential regime for access to public procurement.
The support and coordination committee for startups, in collaboration with all stakeholders in the startup ecosystem, set up alternative strategies and mechanisms for funding startups in compliance with applicable laws and regulations
IV: Responsibility and sanctions of startups
Any legally registered or labeled startup that benefits from the incentives provided by this law is bound by a number of obligations specified by decree.
In case of default, the label is withdrawn from the startup which no longer meets the eligibility criteria.
The situation can be regularized if it makes a request and obtains from the support and coordination committee a deadline for its regularization.