Section 9

Section 9 of Bihar Startup Policy 2022. cfoi-den ode 1. 2. 3. 4. 5. 6. 7. 8. 1. 2.

cfoi-den ode 1. 2. 3. 4. 5. 6. 7. 8. 1. 2. 3. 4. Code b. 852 27/6/22 27/6/22 27/6/22 IndiaCode IndiaCode Government of Bihar Department of Industries Resolution Subject :- Bihar Start-up Policy, 2022 1. Preamble 1.1 Bihar is progressing fast on the track of development, with unrelenting efforts being made towards strengthening infrastructure and promoting industrial growth. Government of Bihar is committed to improve competitiveness of the state's economy and achieving inclusive growth. Start-ups and Innovation play a key role in economic growth. This can be realized by promoting innovation and creating an ecosystem that nurtures start-ups from concept to commissioning. Apart from creating jobs, start-ups focus on innovation to create next gen solutions which bring economic dynamism. 1.2 Government of Bihar formulated and notified Bihar Start-up Policy, 2016 to create an independent and transparent eco system, where the state shall provide funding, promotion and policy support which was later amended as Bihar Start-up Policy 2017.The State has setup a Trust, with an initial corpus of INR 500 crores, which acts as the nodal agency for implementation of this policy. 1.3 In order to further boost the ecosystem and to make it more holistic and beneficial for the youth and entrepreneurs of the state, the Government has approved the Bihar Start-up Policy, 2022. This policy also aims to broad base the coverage, with an effective and faster implementation process. 2. Vision The vision for the Bihar Start-up Policy,2022: "To enable Bihar emerge as the most preferred destination for start-ups and entrepreneurs by leveraging the potential of local youth through a conducive Start-up ecosystem for inclusive growth in the State" 3. Policy Period Bihar Start-up Policy, 2022 will be effective from the date of notification. The said date shall be considered as effective date of this policy from which its provisions shall come into force and shall be applicable for 5 years. 4. Objective 4.1 Introduce, promote and encourage entrepreneurship education and career amongst the youth and entrepreneurs through various programs like "Udyami Bihar, Samridh Bihar Campaign", Entrepreneurship Awards, Innovation Challenges and Business Plan Competitions etc. 4.2 Support Start-ups by seed-funding as well as matching grants to increase their viability. 4.3 Facilitate development of Entrepreneurship Development Centers and Entrepreneurship Facilitation Centers to increase awareness and promote entrepreneurship amongst the youth. 4.4 Encourage Entrepreneurship through education by introducing learning modules in the University/ Schools, MOOC (Massive Open Online Courses), internships amongst others. 4.5 Facilitate development of new and support expansion of existing Incubators/common infrastructure spaces/Co-working spaces 4.6 Provide a one stop comprehensive portal for start-ups to access financial support (SEBI registered- Alternate Investment funds, Empanelled Angel Investor, etc.), regulatory support, Network of mentors and Empanelled Project Management Consultants. 4.7 Enable hassle-free and time bound statutory clearances for start-ups. 4.8 Provide appropriate institutional support to enable the nurturing of Start-ups including mentoring, hand holding and trainings/orientation visits. 4.9 Any other activity which will enable and create Start-up ecosystem in the state. 5. Eligibility of Start-Ups in Bihar An entity shall be considered as a Start-upon fulfilling the following conditions: i. Upto a period of ten years from the date of incorporation/ registration, if it is incorporated as a private limited company (as defined in the Companies Act, 2013) or registered as a partnership firm (registered under section 59 of the Partnership Act, 1932) or a limited liability partnership (under the Limited Liability Partnership Act, 2008). ii. Turnover of the entity for any of the financial years since incorporation/ registration has not exceeded one hundred crore rupees. iii. Entity is working towards innovation, development or improvement of products or processes or services, or if it is a scalable business model with a high potential of employment generation or wealth creation. iv.

Provided that an entity formed by splitting up or reconstruction of an existing business shall not be considered a 'Start-up'. v.

Provided Start-up must be incorporated or registered in Bihar and having office in Bihar. vi.

Provided further applicable taxes from the operations of the company are payable in Bihar. 6. Institutional Framework A strong Governance structure shall be established for effective implementation and monitoring of Bihar Start-up Policy, 2022. The composition of the governance structure is as follows: a. Bihar Start-up Fund Trust (BSFT) chaired by Development Commissioner, Government of Bihar for deliberation on the policy matters, inter-departmental collaboration and bi- annual progress review on the policy implementation outcomes. b. Start-up Monitoring & Implementation Committee (SMIC) to take decisions on the matters of policy implementation, inter-departmental co-ordination or any other issues referred by PSC for decision making. c. Preliminary Scrutiny Committee (PSC) to oversee the work of Start-up support unit as well as decision making for effective implementation of the Start-up policy. d. Start-up Support Unit (SSU) to act as single point of contact for all Start-up related matters. 6.1 Bihar Start-up Fund Trust (BSFT) The Bihar Start-up Fund Trust is an autonomous body constituted under the Chairmanship of Development Commissioner, Government of Bihar. The composition of BSFT is as follows: S No Members Designation Chairperson Development Commissioner 2 Principal Secretary, Industries Member-Secretary 3 Principal Secretary, Finance aCode Principal Secretary, Planning Principal Secretary, Science & Technology Two eminent experts in the Start-up field nominated by the Department of Industries 7 Director IIT Patna, Director CIMP 8 2 Representative of Associations, Organisations and Institutions promoting entrepreneurship to be nominated by the Department of Industries Representative of Financial Management Company/ Society 6.1.1 Role of Bihar Start-up Fund Trust a. Monitoring and review of Start-up policy and its implementation b. Amendments and/or modifications, if any, required in the policy c. Approve major issues like rating system of start-ups, detailed guidelines for Start-up approvals and handholding etc. d. Liaison with Central and other State Departments for effective implementation of the policy, if required e. Any other issues referred by SMIC. 6.2 Start-up Monitoring and Implementation Committee (SMIC) SMIC shall be constituted under the Chairmanship of Principal Secretary, Department of Industries, Government of Bihar. The composition of SMIC shall be: S No Members Designation Chairperson 1 Principal Secretary, Industries 2 Director to be notified by the Department of Industries. Member-Secretary 3 Representative of Finance Department 4 Representative of Science & Technology Department 5 Representative of IT Department 6 2 Representative of Incubators to be nominated by the Department of Industries 7 2 Representatives of Associations, Organisations and Institutions promoting entrepreneurship to be nominated by the Department of Industries 8 Nodal Officer of SSU Member SMIC shall meet frequently and gap between two consecutive meetings shall not be more than 45 days. 6.2.1 Role of Start-up Monitoring and Implementation Committee (SMIC) a. Overall Implementation of the Policy b. Approval for certification of start-ups c. To onboard Start-up ecosystem stakeholders such as mentors, incubators, angel investors, venture capitalist etc and develop infrastructures such as common space, Start-up portal, EDC etc d. To approve matching grants to start-ups, success-grants etc. e. Liaison with other state Departments for effective implementation of the policy f. Any other issues related to the effective implementation of Start-up policy. 6.3 Preliminary Scrutiny Committee (PSC) A Preliminary Scrutiny Committee shall be constituted under the Chairmanship of Director to be notified by the Department of Industries, Government of Bihar. The composition of Preliminary Scrutiny Committee shall be: S No Members Designation 1 Director to be notified by the Department of Industries. Chairperson 2 2 Representatives of Incubators to be nominated by the Department of Industries 3 2 Representative of Associations, Organisations and Institutions promoting Entrepreneurship to be nominated by the Department of Industries 4 Nodal Officer of SSU Member-Secretary India committee (SMIC) 6.3.1 Role of Preliminary Scrutiny Committee a. Approve, tag and refer the applications shortlisted by PMA/ TPA to the subject related incubators. b. Assist SMIC in on boarding Start-up ecosystem stakeholders such as mentors, incubators, angel investors, venture capitalist etc. and development of infrastructures such as common space, EDC, Start-up portal etc c. Assist SMIC on various issues related to implementation of the Policy. d. Monitoring of Start-up Support Unit (SSU) e. To provide timely redressal of grievance of start-ups and other stakeholders. 6.4 Start-up Support Unit (SSU): A Start-up Support Unit (SSU) under Department of Industries shall be created for effective implementation of this Policy. SSU shall be responsible for creating a conducive policy environment for sustained growth of Start-up ecosystem in the state. It will act as single point of contact for engagement with ecosystem stakeholders such as mentors, incubators, angel investors, venture capitals etc. To manage the operations of SSU, department of industries may depute adequate manpower from the department or through a Project Management Agency (PMA). SSU may also be placed in Corporation or Company of the Government for effective functioning. 6.4.1 Role of Start-up Support Unit (SSU): a. Work as single point of contact for start-ups in the state for providing information as well as hand-holding support b. Process applications through an online portal, their screening and approval by competent authorities c. All communications with start-ups d. Providing hand-holding support to start-ups through various stages e. Act as single window system for getting all statutory clearances for start-ups f. Act as Secretariat for implementation of Start-uppolicy g. Organise events, sessions, trainings, visits and other activities for promoting the Start-up culture 6.5 Third Party Agencies Third Party Agencies (TPA) may be taken on board for: a. Design of the rating system for start-ups b. Evaluation of applications as per the approved rating system c. Recommending certification of start-ups d. Recommending seed funding / matching grants etc as per the approved criterion based on rating achieved by the start-ups. 6.6 Financial Management Company An existing or new Company of Government of Bihar may be made Financial Management Company to carry out the financial operations under this policy. Financial Management Company shall disburse incentives, loans and other financial assistance to the Start-ups as decided by SMIC. It shall carry out the following activities: a. Asset Management of the Trust b. Facilitation and assistance for funding to Start-ups such as seed grant, early stage and scale-up funding and other funding support stated in the policy c. Financial assistance to develop and manage ecosystem such as Entrepreneurship Development Cells, common infrastructures etc and raise funds from multilateral donor agencies d. Facilitate Investment related decisions under the policy in a time bound manner 7. Application Process and Certification of Start-ups a. The Start-ups shall submit their application online along with detailed description of idea in the prescribed form through the Online Start-up Portal. b. Online applications received shall be scrutinized and processed by SSU. The SSU will short list the eligible start-ups as per criterion approved by the Start Up Fund Trust. The SSU will also provide hand holding support to the Start-up applicants to improve their proposals. c. The short-listed applications will be approved by the "Preliminary Scrutiny committee" headed by Director to be notified by the Department of Industries for referring them to the incubators. d. After preliminary examination the shortlisted applications shall be tagged to the Incubators. The Incubators will provide hand-holding support and after the incubation process shall prepare a proposal for Start-upon the following issues: i. Business Plan ii. The amount of funding assistance required at various stages iii. Any requirement of common infrastructure or other infrastructure created under this policy iv. Any assistance as envisaged under this policy e. The list of such recommendations/proposals received from incubators shall be evaluated by the Third Party Agency (TPA) and a rating will be provided as per the approved rating criterion. f. Start-up Monitoring and Implementation Committee (SMIC) shall examine these recommendations and certify Start-ups as per the rating criterion. g. Financial incentives and other support shall be provided to start-ups based on their categorization through rating mechanism. The detailed guidelines in this regard will be finalized with approval of BSFT. 8. YUVA: The action plan to support start-ups and create an enabling ecosystem. 8.1 Bihar Start-up Policy has been designed on following four pillars (YUVA) Yes to Start-ups (Awareness, Networking and Mentoring Campaign) Unleash Regulatory Enablers for Supporting Start-ups Vibrancy in Education System to encourage and facilitate Start-ups Access to financing & incubation support

Section 9, Bihar Startup Policy 2022 (Act 1502 of 2022).