English
In this Proclamation, unless the context
requires otherwise:
1/ “Startup” means a person or a group,
with no or limited business history who
is engaged in creating economic value
through the introduction, creation,
transplantation, or reverse engineering of
a product, service, or process that
implements innovation, technology, or
technology enabled scalable, and market-
changing;
2/ “Accelerator” means a person, or a
program hosted by an entity that provides
an intensive, time-bound program
designed to support the establishment,
growth, and development of Startups;
3/ “Council” means the national digital
economy council established by
electronic transaction Proclamation No.
1205/2020 Article 6;
4/ “Economic Value” means a
demonstrably positive impact on the
growth of the economy, measurable
through one or a combination of
economic factors provided under Sub-
Article
(5) of this Article;
5/ “Economic Factors” means factors that
helps to measure the economic value of
Startups and includes increased
efficiency and productivity, job creation,
export growth and diversification,
innovation, and social welfare
enhancement;
6/ “Foreign Investor” means any one of
the following who has invested foreign
capital in Ethiopia:
a) A Foreign national;
b) An enterprise in which a foreign
national has an ownership stake;
c) An enterprise incorporated outside of
Ethiopia by any investor;
d) An enterprise established jointly by
any of the investors specified under
Sub-Article
(6) paragraph (a),
(b) or
(c) of this article; or
e) An Ethiopian permanently residing
abroad and preferring treatment as a
foreign investor.
7/ “Foreign Startup” means a Startup that
is designated as a startup under this
Proclamation and which is fully owned
by a foreign national or jointly owned
more than half of its capital between
foreigner and Ethiopian national;
8/ “Incubator” means a person that
provides a supportive environment and
resources for Startups to foster their
growth and development;
9/ “Angel Investor” means a person who
invests his own capital in startups;
10/ “Grant” means capital provided to a
designated startup in the early stages of
development to cover costs associated
with the development and business
process of the startup;
11/ “Venture Capital” means a person
who invests in startups with financial,
technical, or managerial expertise that
have the potential to grow;
12/ “Innovation” means the creation,
development, and implementation of a
new product, service or process; or an
action that represents new solutions or a
significant improvement over existing
solutions;
13/ “Investor” means a person who invests
capital whether in cash or in kind in a
Designated Startup or a Designated
Startup Ecosystem Builder;
14/ “Ministry” or “Minister” means the
Ministry or Minister of Innovation and
Technology;
15/ “Public Company” means a share
company, whether listed on a securities
exchange or not, whose shares of stock
are traded on a securities exchange or
over-the-counter markets;
16/ “Regulatory Sandbox” means a
regulatory framework that allows for a
testing process of new products,
services, or processes of Startups under
the regulatory authority’s control and
oversight, prior to their introduction to
the Market;
17/ “Scalability” means the ability of a
startup to increase its market share at
low cost by adapting the quality,
efficiency, and performance of its
product, service, or process to
withstand market demand;
18/ “Startup Designation” means the
startup designated by the ministry in
accordance with this proclamation;
19/ “Startup Ecosystem” means the
interconnected network of actors and
organizations that provide resources,
knowledge, and support necessary to
foster the creation, development, and
growth of Startups;
20/ “Startup Ecosystem Builder” means a
person that actively contributes to the
establishment, development, and
sustainability of Startups and it includes
Incubators, Accelerators, Co-Working
Spaces, Private Equity Funds, Venture
Capitals, Angel Investors, Financial and
higher education institutions, technical
and vocational education and training
institutions, research and development
agencies, non-governmental
organizations;
21/ “Tech-Enabled” means the utilization,
adoption, transplantation, or integration
of technology to innovate, enhance,
optimize, or transform processes,
products, services, or business models,
leading to improved efficiency,
outcomes, and innovation;
22/ “Region” means the regions established
under Article 47 of the Constitution of
the Federal Democratic Republic of
Ethiopia and newly organized in
accordance with Article 47, Sub-Article
(3) Letter (e), and the Addis Ababa and
Dire Dawa City Administrations;
23/ “Startup fund of funds” means an
investment fund that invests in startups
through other fund managers, which are
named after the fund, by holding shares
in other investment funds, either jointly
or separately, with individuals,
institutions or governments;
24/ “Person” means a physical or juridical
person;
25/ Any expression in the masculine gender
includes the feminine.
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