BICAM REPORT ON PROPOSED INNOVATIVE STARTUP ACT RATIFIED
The Philippine startup ecosystem is poised to enjoy a much-needed boost with the ratification by the House of Representatives of the bicameral conference committee report on the "Innovative Startup Act" proposals of the House and the Senate.
The bicam report reconciled House Bill 8862 authored by Rep. Luis Raymund Villafuerte (2nd District, Camarines Sur) and Senate Bill 1532 by Sen. Paolo Benigno Aquino.
The bills propose the Innovative Startup Act which seeks to grant incentives and remove constraints aimed at encouraging the establishment and operation of innovative new businesses and businesses crucial to growth and expansion.
The Act aims to strengthen, promote, and develop an ecosystem of businesses and non-government institutions that foster an innovative entrepreneurial culture in the Philippines.
It provides for the establishment of the Philippine Startup Development Program that will develop and unify programs, benefits, and incentives for startups and startup enablers. The program will be spearheaded by national agencies and non-government organizations.
The Department of Science and Technology (DOST), Department of Information and Communications Technology (DICT), and Department of Trade and Industry (DTI) are tapped as the lead agencies to assess, monitor, develop, and expand the Philippine Startup Development Program.
To this end, the three agencies shall consult with government and non-government organizations to set the key metrics to track the impact and development of the program.
Meanwhile, the DTI shall promulgate the rules for the efficient registration and assessment of startup enablers to be registered under the program.
The DTI, in coordination with the DICT, DOST, and Board of Investments (BOI), will also create the Startup Investment Development Plan which will spearhead initiatives to develop the short, medium, and long-term strategies to spur investment in and promote the growth and development of startup and startup enablers in the country.
The DTI and BOI will promote and facilitate the provision of applicable benefits to current and prospective investors of startups and startup enablers.
Moreover, the BOI will assist the DTI, DICT, DOST, and other host agencies in training their personnel tasked with assisting current and prospective startups and startup enablers to access and maximize benefits and incentives.
The DOST, DICT, and DTI will each be provided a Startup Grant Fund (SGF) for initial and supplemental grants-in-aid to startups and startup enablers. Each agency will propose in its respective budget under the annual General Appropriations Act the initial and succeeding appropriations for the creation and replenishment of its SGF.
Also to be created under the DTI is the Startup Venture Fund (SVF) which will be used to match investments by selected investors in startups based in the Philippines. The SVF will be jointly administered in coordination with the National Development Company (NDC).
Moreover, the Department of Foreign Affairs (DFA) is mandated to create Startup Visas for prospective or current foreign owners, employees, and investors of a startup or startup enabler registered in the Philippines.
The visas will have an initial validity of five years and may be renewed or extended for another three years.
Multiple-entry interim Startup Visas valid for six months to one year will be issued for free to prospective startup owners, investors, or enablers upon the endorsement of the appropriate host agency.
Bearers of the Visa will be exempt from securing an Alien Employment Permit issued by the Department of Labor and Employment (DOLE). The DFA, Bureau of Immigration (BI), and DOLE will promulgate the implementing rules of this exemption.
In addition, the DICT, in consultation with the DTI and DOST, is tasked with the development and maintenance of a website that will serve as the primary source of information on statistics, events, programs, and benefits for startups and startup enablers and related enterprises in the Philippines. This will involve the integration of any existing websites and content on programs for startups and startup enablers by the government.
The website will feature an online database of startups and startup enablers, indicating basic information such as business address, founders, contact information, and funding received; online inquiry, registration, application, and release of results for endorsements; and applications for programs, benefits, and incentives; and statistical information, annual reports, and studies pertinent to the implementation of the measure and other content in line with the measure's goals and objectives.
The Department of Education (DepEd), Commission on Higher Education (CHED), and Technical Education and Skills Development Authority (TESDA) are also mandated to contribute by developing and integrating in their respective curricula entrepreneurial programs that will foster an environment conducive to innovation and extending incentives to academic institutions that provide funds and/or grants for the research of their students and faculty.