As technology continues to reshape the global economy, more governments are introducing Start-Up Acts—legislative frameworks designed to promote innovation ecosystem for entrepreneurs to thrive.
This article provides an overview of Start-Up Acts, why they matter, and a summary of the countries where such legislation has been enacted.
What is a Start-up Act?
A Start-Up Act is a national policy or piece of legislation that aims to make it easy for entrepreneurs to establish, grow, and scale their businesses.
While each country tailors its start-up legislation to suit its unique economic and entrepreneurial landscape several common themes are easily evident as outlined below:
- Defining a start-up: Clear criteria of what a start-up is to ensure that benefits of the legislation are directed toward the right businesses.
- Simplified business registration: Measures to reduce the bureaucracy and costs for new company registration.
- Tax incentives: Offering tax breaks or exemptions that allow reinvesting of profits during the crucial early stages.
- Intellectual property rights: Simplifying and strengthening the process of obtaining patents, and trademarks.
- Access to venture capital and public funding: Making it easy for start-ups to access venture capital and public funding.
- Support research and development: Providing grants and tax credits to promote innovation.
- Networking and mentorship programs: Connecting entrepreneurs with experts and investors through incubators, accelerators, and public-private partnerships partnerships.
Why Start-up Acts Matter
The innovations of people like Thomas Edison, Patricia Bath, Elon Musk, Henry Ford, Shirley Ann Jackson, and Bill Gates didn’t just revolutionize industries—they created millions of jobs and solved real-world problems.
By enacting Start-Up Acts, governments ensure that the next generation of innovations is nurtured, providing entrepreneurs with a supportive ecosystem needed to bring their ideas to life.
Countries with Start-up Acts
There are currently nine (9) countries with national start-up legislation. Italy was the first to introduce a Start-Up Act in 2012, followed by Argentina in 2017, and Tunisia in 2018, the first in Africa.
Below is a summary of the countries that have enacted Start-Up Acts:
Country | Year enacted | |
---|---|---|
Italy | Italian Start-up Act | 18 October 2012 |
Argentina | Argentina’s Law 27349 (Entrepreneurial Capital Support Law) | 29 March 2017 |
Tunisia | Startup Act Tunisia | 17 April 2018 |
Philippines | Phillipines Innovative Startup Act (Republic Act No. 11337) | 6 August 2019 |
Senegal | Senegalese Startup Act | 27 December 2019 |
Brazil | The Marco Legal das Startups (Complementary Law 182/2021) | 1 June 2021 |
Nigeria | Nigeria Startup Act | 19 October 2022 |
Democratic Republic of Congo (DRC) | DRC Start-Up Act | 2 November 2022 |
Spain | Startup Ecosystem Encouragement Act (Ley de Fomento del Ecosistema de Empresas Emergentes) | 1 January 2023 |
Portugal | Startups Law (Law 21/2023) | 25 May 2023 |
Whats’ Next for Start-up Acts
We’re seeing a growing trend where entrepreneurs are flocking start-up friendly countries in search of access to funding, tax breaks, less beauracracy and a stable banking system.
For investors, nations with a high concentration of innovators and entrepreneur-friendly policies, such as Start-Up Acts, provide fertile ground for the next big thing to emerge.
Countries embracing start-up legislation are positioning themselves as leaders in the new economy by laying the groundwork for innovations that will shape the future.
However, it’s important to note that top-ranked countries in global innovation indices—like the United States, Switzerland, and Sweden—do not have formal Start-Up Acts.
Does this mean that Start-Up Acts aren’t important? Not at all. It simply highlights that Start-Up Acts are not the only way to promote national innovation.
A Start-Up Act formalizes key aspects of any innovation ecosystem such as strong IP protection, high R&D investment, and access to funding—elements that well-established economies often have through other frameworks already in place.