The Startup Bill Senate Bill no14 of 2022

REPUBLICOFKENYA

PARLIAMENT

SENATEBILLS

(Bill No. 14 of 2022)

THE STARTUP BILL, 2022

(A Bill published in the Kenya Gazette Supplement No. 207 of 30th December, 2022 and passed by the Senate, with amendments on 21st February,2024)

PARTI-PRELIMINARY

• Short Title.

• 2—- Interpretation.

• 3— Object.

PARTII-ESTABLISHMENTOFINCUBATIONPROGRAMMES

• 4 Role of National and county governments.

5. Establishment ofincubation programmes.

PARTIII-REGISTRAROFSTARTUPSANDADMISSIONINTOANINCUBATION PROGRAMME

• —9 Appointment andfunctions of Registrar and other officers.

• 7— Functions of the registrars.

• 8—— Eligibility for admission into incubation programme.

• 9- Applicationfor admissioninto anincubationprogramme.

• 10— Consideration of application and registration.

• 11-- Certificate of registration.

• 12- Effect of admission into incubation programme.

• 13 Refusal toadmit an entityinto anincubationprogramme.

• 14- Grounds for de-registration.

• 15- Notice of non-compliance.

• 16- De-registration.

• 17- Application from an order of refusal or de-registration.

• 18- Register of startups.

• 19- Alteration of register.

• 20- False statements.

THESTARTUPBILL,2022

ARRANGEMENTOFCLAUSES

• 21— Change of particulars.
• 22Obligations ofrcgistered startups.

PARTIVCERTIFICATIONOFINCUBATORS

• 23—— Eligibility for admission into an incubation programme.
• 24 Certification of incubators.
• 25Withdrawal from an incubation programme.
• 26Obligationsof anincubator.

PARTV-INCENTIVESFORSTARTUPS

• 27Support to startups.
• 28 Credit Guarantee Scheme.
• 29Training and capacity building.
• 30Application for grant or revocation of patents.
• 31-Fiscal incentives.
• 32— Growth objectives.

PARTVI-MISCELLANEOUSPROVISIONS

• 33Regulations.
• 34 Amendment ofNo.28of2013.

THESTARTUPBILL,2022

A Bill for

AN ACT of Parliament to: provide a framework to cncourage growth and sustainable technological devclopmcnt,newcntreprencurship cmployment;crcatca morc favourablecnvironmentforinnovation; attractKenyan talents and capital;and for connectcd purposes.

ENACTED by theParliament of Kenya, as follows--

PARTI-PRELIMINARY

Short title.

• This Act may be cited as the Startup Act, 2022.

Interpretation.

• 2.In this Act-

"Agency”means the Kenya National Innovation Agency established under No.28of 2013. scction 28 of the Science,Technology and Innovation Act;

"Cabinct Secrctary” mcans the Cabinct Secrctary responsible for matters relating to science, technology and innovation;

"county executive committee mcmber” mcans the county executive committeemcmberresponsiblefor matters relatingtoscience,technology and innovation;

"credit guarantee" mcans the guarantee of monetary liabilities, excluding technology guarantee, borne by an enterprise;

"Fund” mcans the National Research Fund established under scction 32 of

No. 28 of the Scicnce, Technology and Innovation Act; 2013.

"incubation" has the meaning assigned to it under section 2 of the Scicnce,

No. 28 of Technology and Innovation Act; 2013.

"incubator" means a company, partnership, non- governmental organization or limited liability partnership, whose principal object is the support for the birth and development of start-ups, innovation, and related activities related to the transfer technological and research,development and innovation processes, through the offer of dedicated physical spaces and services advice;

No.28of 2013.

"innovation" has the mcaning assigned to it under section 2 of the Science, Technology andInnovation Act;

• No.19 of "non-governmental organization" has the mcaning assigned to it under 1990. section 2 of the Non-Governmental Organizations Co-ordination Act;

"Registrar" mcans a person appointed as a registrar under section 6(2) of this Act:

"startup" includes a technology based innovative entity, legally recognized by the laws of Kenya, with strong growth potential intended to develop and deliver innovative productsorscrvices thatsolve aspecificproblemorfulfil a market need

"startup incubator" means a company, partnership, non-governmental organization or limited liability partnership, whose principal object is the support of the birth and development of start-ups, innovation, and related activities related to the transfer of technological and rescarch,and development and innovation processes, through the offer of dedicated physical spaces and services advice; and

No.28of "technology" has the meaning assigned to it under section 2 of the Science, 2013. TechnologyandInnovationAct.

Object.

3. The object of this Act is toprovide a framework- 2. (a) that fostcrs a culture of innovative thinking and entrepreneurship; 3. (b)fortheregistrationof startups and thelinkage ofsuchstartupswith financial institutions,the private sector research institutions and suchotherinstitutions attheNationalandcountylevelof government; 4. ()tofacilitate investments in and the provision of fiscal and non-fiscal support to startups inKenya; 5. (d) that promotes an enabling environment for theestablishment, development, conduct of business and regulation of startups; 6. (e)for the establishment of incubationfacilitics attheNational and cstablishmentofstartups;and

Role of Nationaland county governments.

• (f) for the monitoring and evaluation of the legal and regulatory frameworkandthemcchanismsputinplacetoencourage the development ofstartups.
• (g) to ensure that all persons, irrespective oftheir gender, status or ethnicity, are afforded an equal opportunity to establish and benefit from their innovations.

PARTII-ESTABLISHMENTOFINCUBATIONPROGRAMMES

• (1) The National and county governmcnts shall --

2. (a) promote innovation; 3. (b)facilitatethetransferoftechnologyinnovationbetwecncntities registered under this Act to achieve increased innovation, economic growth and better access to new technologies; 4. (c) crcate and develop a sustainable, globally competitive technology innovationsector thatcontributestowardsthe acceleratedgrowthof the economy; 5. (d)promote the crcation of cmployment and wealth creation; and 6. (e)promote thelinkages betwcenuniversities andresearch institutions andthebusinesscommunity. 7. (2)TheAgency and the county executive committee members shall,for purposes of subsection (1) -- 8. (a) put in place a national and county incubation policy framework for the development of thebusiness incubation scctor and start-ups system; 9. (b) enter intopartnerships withlocalandinternationalbusiness incubatorsin order topromote thecstablishment andgrowthof startups in Kenya; 10. (t) establish programmes for the certification and admission of startups into the incubation programmes;

Establishment ofincubation programmes.

• (d) put in placc mcchanisms that promote the devclopment of business incubation programmes and create an enabling environment for the promotion of business incubators including fiscal and non-fiscal incentives toincubators and startups;
• (e)establishonlineandotherplatformsforaccesstoinformation including the establishment and development of startups,existing incubation programmes, access to fiscal and non-fiscal support and for this purpose, kcep and maintain a directory of startups and incubator;
• (f)support anyrescarch anddevelopment activitiesundertakenby startups;
• (g)putin placemechanismsfor pre-incubation of entities andfor this purpose, provide training and capacity building programmes to startups registered under this Act;
• (h) putinplacemechanismstocnableaccesstoincubation programmes by marginalized groups through the use of quotas or mechanisms that match them to unused capacity in existing programmes;and
• (i)putinplacefacilitative structuresthatcnsure theprotection of the innovationsofstartupsatthenationalandinternationallevelforthe protection of the intellectual property.

5. (1) The Agency and the county executive committee members shall, in realising the objectives of this Act and ensuring that the National and county govcrnments fulfil their roles under section 4, establish incubation programmes.

• (2) The Agency and the county executive committee members shall, for purposes of subsection (1), —
• (a)develop standards and guidelines to regulate the relationship betwcen an incubator and a startup under this Act;
• (b) establish an online platform setting out information on cxisting incubator programmes,incubators and startups and the process of registration and admission into the programmes; and
• (c)prescribe a criteria for the evaluation ofstartups,incubation programmes and structures set up for the purposes of implementing this Act.

Appointment andfunctions ofRegistrar and other officers.

Functionsof the registrars.

PARTIII-REGISTRAROFSTARTUPSANDADMISSIONINTOAN INCUBATIONPROGRAMME

6. (1) The Agency shall be responsible for the registration of startups under this Act.

• (2) There shall, for purposes of subsection (1),be a Registrar who shall be competitivelyrccruited bythePublicServiceCommission and appointedbythe Agency on such terms and conditions as the Agency may, in consultation with the Salaries and Remuneration Commission, determine.

• (3) The Agency may, in consultation with the Public Service Commission, appoint a Deputy Registrar and such number of county registrars in the counties as shall be necessaryfor theperformanceofthefunctions of the Registrar and who shall be subject to the directions of theRegistrar.

• 7.(1) The Registrar shall --

• (a) keep an updatcd database of all registcred startups and startups under review indicating-

• (i) business development stage;

• (ii) ownership;

• (ii)description of the innovative aspects of the company, includingintellectual propertyrights;

• (iv)products and services offered;

• (v)investment supportreccived;

• (vi)financial needs; and

• (vii)targetmarket;

• (b) register, inspect, regulate, monitor, investigate and supervise startups rcgistered under this Act to ensure compliance with the provisions of this Act;

• (c) issue, renew and cancel, with the approval of the Board of the Agency,certificates ofregistrations issued under this Act;

• (d) maintain a register of all registered startups in the country;

• (e)kecp all documents and records of registered startups;

• (f) enforce the decisions ofthe Board of the Agency with respect to the registration, regulation and supervision of startups under this Act;

• (g) co-ordinate the functions of county registrars under this Act;

• (h)performsuchotherfunctionsasmaybenccessaryforthe implementation of this Act or as may be specified under any other law.

• (2) The Dcputy Registrar shall deputise the Registrar and shall perform such duties as may be assigned tohim or her by the Registrar.

• (3) The county registrars and assistant registrars shall --

• (a)facilitate the registration and development of startups under this Act;

• b receive applications for registration, vet and process applications of startups;

• monitor and evaluate startup projects; and

• (d)carry out such duties as maybe delegatedfrom time to time.

Eligibilityfor admissioninto incubation programme.

• 8.(1) An entity shall be eligible to be registered as a startup and for admission into an incubation programme if the entity —

• (a)is registered in Kenya as a--

No. 17 of 2015.

• (i) private limited company under the Companies Act; or

No. 16 Jo 2012.

• (ii) partnership firm under the Partnership Act; or

No. 42 of 2011.

• (i) limited liability partnership under the Limited Liability Partnership Act; or

No.19of 1990.

• (iv)non-governmental organization under the Non-Governmental Organizations Co-ordination Act;

• (b) is newly registered or has been in existence for a period of not more thanfiveyears from the date of itsincorporation or registration;

• (C) has as its objects the innovation, development, production or improvement and commercialisation of innovative products, processes or services or ifit is a scalable business model;

• (d) has human resources, total asscts,and annual turnover number shall not excced an amount prescribed by the Cabinct Secretary;

• (e) has its headquarters is in Kenya;

• (±) does not distribute profits;

• (g) has at least ninety percent of its shares owned by one or more citizens of Kenya;

• (h) at leastfiftecn perccnt the entity's expenses can be attributed to research and developmcnt activities; and

• (2) This Act shall not apply to an cntity which is -

• (a) established or formed as a result of the split, reconstruction, merger or reconstitution of an existing business; or

• (b) a holding company or subsidiary of an existing cntity which is not registered as a startup.

• (3) The registrar or county exccutive committee mcmber, as the case may be, may waive the requirement for registration under subsection (1)(a) wherc —-

• (a) that person has an innovative product or service;

• (b) that person exhibits that they do not have the financial capability to register an cntity in compliance with subsection (1)(a); and

• (c) the registrar is satisfied that the innovation is suitable for

registration as a startup and will benefit from admission into an incubation programme.

Application 9.(1)An cntity that qualifies for admission into an incubation foradmission programme under section 8 may submit an application, in the prescribed form, -- into an incubation programme.

• (a) in the case of an incubation programme managed by the Agency, Ministry or any other entity on behalf of the National Government, to the Agency; or

• (b) in the case of an incubation programme managed by a county

• (2)An applicant for admission under subsection (1) shall submit the application together with-

• (a)a statement settingout thefollowing information —

• (i) the name of the entity;

• (i) the general nature of the proposcd business of the cntity;

• (iii) a declaration form stating whether an cntity has complied with section 8;

• (iv) the proposed registered office of the entity;

• (v) the entity's place of incorporation or registration;

• (vi) the entity's registration number; and

• (vii) theregistercd office of the entitytowhichall communications maybe addressed;

• (b) a letterof recommendation orsupportwhich mayinclude aletter-

• (i) a patent or trademark registered in Kenya;

• (ii) statement on information regarding the elements inherent in the economic model of said entity including--

• (A) innovation aspects;

• (B) factors differentiating the factors of realization of the strong potential of economic developmcnt;

• (C)scientific and technical qualifications and the experience of the project team;

• (D)a prize or reward obtained and any patent for invention filed;

• () the certificate of incorporation or registration of the cntity;

• (d)a brief description of the innovative nature of the product or service; and

• (e)such other information concerning the proposed startup as the Cabinet Secretary or county executive committee member may prescribe.

• (3) A person eligible for admission into an incubation programme pursuant to section 8(3) shall not be requircd to provide the information under subsection (2)(a)(iv), (v), (vi) and (vii) and (2)(c).

• (4) The Registrar or county executive committce mcmber, as the case may be, may require the applicant to submit to the registrar such further information as may be considered nccessary for the purpose of determining the application for admission.

• (5) The Agency and the county exccutive committce members shall put in place mechanisms to ensure that the admission proccss of an cntity under this section is simple, efficient, accurate and transparent and shall, for this purposc

• (a) establish an online platform for the submission of the documents and information specified under subsection (1); and

• (b) devolve and decentralize the registration process to the lowest devolved unitandmay establishsuchregistration desks asmaybenecessary to enable accesstoregistration.

Consideration 10. (1) The Registrar or the county cxecutivc committee member, as the ofapplication case may be shall, within thirty days upon receipt of an application under section and registration. 9—

• (a)examine the application together with the documents; and

Certificateof Registration.

Effect of admissioninto incubation programme.

Refusal to admitanentity into an incubation programme.

• (b) if the Registrar considers it necessary, call for such further information or carry out such inspections as he or she may consider necessary for the determination of the application.
• satisfied that an applicant meetstherequirementsfor registration under thisAct, the Rcgistrar or the county cxecutive committee member shall, subject to the provisions of this Act, enter the name and particulars of the applicant in the register of startupskept for that purpose.

11. The Registrar or county cxecutive committee member, as the case may be, shall, upon entering the name of the applicant in the register, issue to the entity a certificateintheprescribedform.

• 12.The certificate of registration issued by the Registrar or county executive committeemember under section 11shallbeconclusive evidencethat the startup--
• (a) has met all the requirements for registration specified under this Act; and
• (b)has bccn duly registcred in accordance with this Act unless it is proved that the registration of the startup has been cancelled.

13. (1) The Registrar or county cxccutive committee member may reject an application for the admission of an entity where--

• (a) the cntityhas submitted false ormisleading information in its application;
• (b) the application docs not comply with the provisions of thisAct;
• (C) the entity does not meet the criteria specified under thisAct for the registration of a startup; or
• p the objects of the cntity are likely to be pursued for a purpose contrarytoanywrittenlaw.

Groundsfor deregistration.

• (2) The Registrar or county executive committee mcmber, as the case may be, shall notify the applicant, in writing, of the decision to reject an application for admission withinfourteendays of such rejection.

2. 14.(1) The Registrar or county executive committce member, as the casc may be, may, subject to the provisions of section 15, de-register a startup registered underthisActwhere-- 3. (a)the Registrar or countyexccutive committeemcmber has reasonablecausetobelievethat thestartuphas amongits objects the pursuit of an unlawful cause or purpose prejudicial to public interest; 4. (b)thestartupfailstocomplywith anydirectiveissuedbythe registrar to ensure compliance with the provisions of this Act; 5. (c)the members of the startup fail to comply with thc provisions of their constitution orrules or theprovisions of thisAct; 6. (d)the startup fails to submit any information required under this Act or requested by the Registrar in order to ensure compliance with this Act; or 7. (e)the Rcgistrar determincs that the startup submitted false information or statements at the time of registration of the startup. 8. (2)The Registrar shall de-register a startup which has ccased to be a startup under this Act.

Notice of non15. (1) The Registrar shall, before de-registering a startup under section 14 compliance. issue to the entity a compliance notice in the prescribed form.

• (2)A compliance noticc specified under subsection (1) shall---
• (a) be in writing;
• (b) notify the startup of the noncompliance and the steps it is required to takein orderto cnsurecompliance;and
• (c) inform the cntity of the period within which it is required to comply with the notice.

• (3) The Registrar may, upon request by the startup and where there are sufficient groundsshownby thestartup,cxtcnd theperiod ofcompliancefor such period as the Rcgistrar may consider necessary to ensure compliance.

De-

16.(1) Where a startup which receives a notice under section 15 fails to comply with such notice, the Registrar shall de-register that startup by—-

registration.

• (a) cancelling its certificate of registration;

• (b)notifying thestartupinwriting of

• (i) the cancellation and the reasons for it; and

• (ii) the date on which the certificatc of registration was cancelled; and

• (c) amcnd the register accordingly.

• (2) Where a startup is de-rcgistcred under subsection (1), all the rights and benefits that accrue to it by virtuc of being registered shall cease to accrue to the startup.

• (3)For purposes of this Act, de-registration of a startup under this section takes cffect onthe date onwhich the certificateof rcgistration is cancelled by the Registrar.

Application fromanorder ofrefusalor de- registration.

• 17.(1) A person who is aggrieved by the decision of the Registrar under this Part may, within thirty days of being notified of the decision, apply to the CabinetSecrctaryfor areview of the decision.

• (2) An application for revicw shall be in such form as the Cabinet Secretary shall prescribe.

• (3) The Cabinct Secretary shall determine an application under subsection (1) within sixty days of receipt of the application under subsection (1) and may confirm,vary or reverse the decision underreview.

Register of startups.

18. (1) The Registrar shall keep and maintain a register of --

• (a) all startups registered under this Act specifying

• (i) the name of the startup;

• (ii) the members of the startup;

• (iii) the address of the startup; and

• (iv) such other particulars as the Rcgistrar may from time to time determine;

• (b) allde-registeredstartups;and

• (c) allstartupswhichhavevoluntarilydercgisteredunderthisAct.

• (2)Any person may inspect the register and obtain a copy of, or an extract from the Registrar upon payment of such fee as the registrar shall determine.

• Alterationof 19. (1) The Registrar or county executive committec member, as the casc register. may be, may, from time to time, make changes or corrections in the register relating to any entry.

• (2)Any changc or correction in relation to an cntry made pursuant to a noticeissucdbya startupshall bemade to thercgistrar assoon as it ispracticablc after receipt of an authenticated notification thereof.

False 20.If an application made under scction 8 contains any matter which is statements. false in any material fact known to any person signing it, that person commits an offence.

• Change of 21.(1) A startup that makes a change to any of its particulars shall, within particulars. thirty days of such change submit to the Registrar information rcgarding the change.

• (2)Upon rcccipt of the information under subsection(1)and where the Registrar is satisfied that the change does not affect its status of registration as a startup, enter the changes in the register kept by the registrar under this Act.

Obligationsof registered startups.

• 22.A startupregistered under this Act shall-

• (a) achieve growth goals related to the number of human resources, total assets and the annual turnover set by a regulations;

• (b)maintain financial rccords in accordance with the legislation and arrangcmentsinplacefor thework and submit its annual financial

Eligibility for admissioninto an incubation programme.

records and annual financial budgets to theAgencynolater than thirtyfirstday of March in cachfinancialyear; and

• (c) inform the Agency of a change in its structure, composition or object within a period of one month from the date of the change.

PARTIV-CERTIFICATIONOFINCUBATORS

23. An entity may be certified as an incubator, if the entity—- 2. (a) is registered as a public limited company, a non-governmental organization, a private limited company,a limited liability partnership or a partnership; 3. (b) has as its principal object the delivery of services to support establishment and development of innovative start-ups; 4. (c)has in placc 5. (i) physical and virtual facilitics, suitable to accommodate innovative startups,such as reserved spaces to be able to install test,test, verification or research equipment; and 6. (ii) adequate cquipment for startup activities innovation, such as ultrawideband network access systems internet, meeting rooms, machineryfor testing,testing or prototyping; 7. (d) is administered or dirccted by persons of recognised competence on business and innovation and has a structure at its disposalfor permanent technical and managerial consulting; 8. (e)has regular collaborative relationships with universities,centres of rescarch,public institutions and financial partners that carry out activities and projects relatcd to innovative startups; 9. (f)has experience in supporting innovative start-ups with such indicators as maybeprescribed by theAgencyin consultation with countyexecutive committee members including- 10. (i) numberofapplicationsforestablishmentorincubation projects innovativestart-upsreceived and evaluated during the year;

• (ii) number ofinnovative start-ups launched and hosted during the year;
• (iii) number ofinnovative start-ups that exitcd during the ycar;
• (iv) totalnumber ofcollaborators andhostedstaff;
• (V) percentage of variation in the total number of cmployecs compared to the previous year;
• (vi) averagc growth rate of thc production value of start-ups innovativeincubated;
• (vii) venture capital or financing rcceivcd for innovative incubated start-ups; and
• (vii)the number of patents registered byincubated innovative startups, taking into account the relevant product sector;
• (g)mcctstheprescribedoccupationalsafetyconditionsunder the Occupational Safety and Health Act; and
• (h) has no history of violation of human rights.
• (a) in the case of an incubator programme managed by the Agency, to the registrar; and
• (b) in the case of a programme managed by the county government, to the county exccutive committee member.
• (2) A statement complies with this subscction if it contains the following information relating to the incubator-
• (a)address of the incubator;
• (b) principal objcct;
• (t) brief description of the projects carricd out;

Certification 24.(1) An entity that meets the criteria specified under section 23 may of incubators. apply for admission as an incubator by submitting an application together with a statement setting out information under subsection (2) -—-

Withdrawal from an incubation programme.

Obligations of an incubator.

• (d) cxpenditure on research and development;
• (e) list of shareholders;
• (f) list of investor companies;
• (g) educational qualifications and professional expericnces of members and staff;
• (h) the existence of professional relationships,of collaboration or commercial with other incubators,investors institutional and professional, universities and rescarch centres;
• (i)lastfinancialstatementsfiled;and
• owned by theincubator and thestartups admitted to its incubation programme.

25. (1) The Agency shall, in consultation with the county executive committce members,prescribe standards and guidelines to be adhered to by a startup or an incubator that intends to withdraw from an incubation programme establishedpursuant tothisAct.

• (2) The Agency or a county executive committee member may, where an incubator fails to adhere to or mect therequirements under thisAct,revoke the admission of theincubator in accordance with the guidelines prescribed by the Agency under subsection (1).
• 26.An incubator registered under this Act shall-
• (a)supportstartupsthat aredevelopingor deliveringinnovativeproducts or services that solve a specific problem or fulfil a market need;
• (b) have a defined minimum and maximum technological innovation projects it can handle simultancously;
• (t) facilitatc tcchnological innovators to implement their ideas and form newbusinessventures;
• (d) determine the tcchnological and marketing applicability of a tcchnological innovation idea;

• (e) have a viable research and development plan and expertise;
• (f) equip startups with skills in raising capital and marketing their products;
• (g) provide secretarial and administrative services to startups;
• (h) create investment opportunitics for the private sector,including for venture capitalists;
• (i) support and facilitate the transfer of tcchnology from rescarch institutions and totherelevant startups;
• G)provide remote support services to startups;
• (k) enhance cntrepreneurship in Kenya.

PARTVINCENTIVESFORSTARTUPS

• Support to 27.(1) The Agency and the county cxccutive committee members shall put startups. in place measures to support the establishment and development of startups and shall, for this purpose --
• (a) subsidise the formalisation of startups;
• (b) facilitate the protection of the intellectual propcrty of innovations by startups in Kenya and with international organisations;
• programmes under this Act;
• (d) provide support in the form of research and development activities;
• (e) provide such othcr support to cnable the devclopment and growth of startups registered under this Act;
• (f) Implement fiscal and non-fiscal incentives that target women, persons with disability and marginalised groups.
• (2) The Cabinct Secretary responsible for finance shall, in consultation with the Cabinet Secretary, prescribe a mechanism for the provision and administration of fiscal and non-fiscal incentives under subsection (1) within oneyearfrom thecommencement of thisAct.

Credit Guarantee Scheme.

• 28.(1) The Cabinet Secrctary may, in consultation with Board of Trustees of the Fund and where necessary for the development and growth of startups under this Act, establish a credit guarantee scheme.

• (2)Where the Cabinet Secretary establishes a credit guarantce scheme under subsection (1), it shall have as its objectives -

• (a) the provision of accessible financial support to startups;

• (b) availing of financial and credit information to startups;

• (c) capacity building on financial and risk management to startups; and

• (d) the prioritisation of women, marginalised groups and rural populations in the provision of financial support.

• (3) Where acrcditguaranteeschemeisestablishedpursuant tosubsection (1), the Cabinet Secretary shall ensure that there is in place -

• (a)a strategy and operational goals that are aligned to the objectives under subscction (2);

• (b) a criteria for cligibility and qualification for recipients of funding under the Scheme;

• (c) criteria for the monitoring and cvaluation of projects undertaken under the Schcme and the efficiency of the operations of the Scheme; and

• (d) mcchanism for transparency, accountability and reporting on the activities oftheScheme.

Trainingand 29.The Agency shall put in place a programme for the training and capacity capacity building of startups under this Act and shall, for this purpose establish a platform building. setting out information at the national and county level of government, on --

• (a) cxisting incubators;

• (b) available trainingprogrammcs;

• (c)mentors and resource persons;

• (d) projccts under existing incubation programmes;

• availablefiscal and non-fiscal support services;

• (f)business information necessary for the management and development ofstartups; and

• (g) such other information as the agency shall, in consultation with thc county executive committee member consider necessary.

Application forgrantor revocationof patents.

• 30.(1) The Agency shall facilitate the startups in the application for grant or revocation of patents and institution of legal action for infringement of any intellectual propertyrightsrelatingtothestartup's product or service.

• (2)TheAgcncy shall facilitate thestartups tofile and register patents at the internationallevel.

Fiscal incentives.

31. The Cabinet Secretary shall, in accordance with the appropriate law, and in consultation with the Cabinet Secretary responsible for finance, put in place measures for the granting of fiscal incentivesincluding taxincentives as shall be considered necessary for the development startups in the country.

Growth objectives

32. (1) A startup shall, during the period of validity of the registration, cumulatively achieve growth objectives inherent to the workforce, the total balance shcet and the annual turnover as set out by the Cabinct Sccretaryinresolutions.

• (2) The annual turnovcr or the total balance shcct shall be calculated taking intoaccount thefinancial statements ofthe startupforthepast ycar and morereccnt reports, if any.

• (3)The Cabinet Secretary shall publish the resolutions under subsection (1) within oneyearfrom the date of commencement of theAct.

PARTVI-MISCELLANEOUSPROVISIONS

Regulations.

• 33.(1) The Cabinet Secrctary may make rcgulations generally for the better carrying out of the provisions of this Act.

• (2) Without prejudice to the gcnerality of subscction (1),the Cabinet Secretary may make regulations--

• (a) to excmpt startups from registration fees;

Amendment ofNo.28of 2013.

• (b) contractors,and service providers;
• C on commcrcial transactions,including product development, production, corporate partnering, advertising, marketing, and sales;
• (d) oncmployeebenefits and compensation;
• (c) on protection of intellectual property rights;
• (f) ontherelationshipbetwcenfounders and employees;
• (g) for the reporting and accountability by startups under this Act, of the funds utilised by them;
• (h) to attractforeignstartupsinto the country;
• (i)to promote national awareness of startups;
• G)for advertising and impact assessment of the measures of startups;
• (k)forincentives to invest in innovative startups; and
• (l)for registration of entitics and admission into incubation programmes.
• 34.The Science, Technology and Innovation Act is amended -
• (a) in subsection (1) of section 29 by inserting the following new paragraph immediately after paragraph (p)-
• (pa) provide financial support to technological innovations registered under the Startups Act;
• (b)insubscction(4)ofsection32byinsertingthefollowingnew paragraphs immediately aftcr paragraph (e)-
• (ca) two people with knowledge and cxperience in the fields of innovation, technology and entrepreneurship;

• (eb) one person representing startups in the country nominated by an organisation representing startups;
• (c) in subsection (2) of section 33 by inserting the following new paragraph immediately after paragraph (b)-
• (ba) financial support to technological innovations;
• ( paragraph immediately after paragraph (g)--
• (ga) provide financial support to technological innovations;

I certify that this printed impression is a true copy of the Bill as passed by the Senate on 21st February, 2024.

Endorsed for presentation to the National Assembly in accordance with the provisions of standing order161oftheSenateStandingOrders.

Speaker of Me Senate