Guide to Setting up A Business in Egypt: A Must-Read
Egypt is one of the best places to start or expand your business. Regulations and business law in Egypt promote inward investment and start-ups, ease transitions, stimulate commerce, and show no bias against firms with offices abroad. In fact, Egyptians are proactive in understanding the special needs of foreign firms and expatriate workers.
The process of setting up a business in Egypt is quite simple. In Egypt, foreign companies and individuals can operate through a subsidiary, partnership, or branch (i.e., an incorporated or unincorporated entity). Individuals and legal entities engaged in commercial activities must register with the local chamber of commerce’s Trade Registry to conduct business.
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No matter what type of business you plan to start, you will have to register it with the General Authority for Investment (GAFI). The main GAFI office is located in Nasr City, Cairo, but other branches are located in Ismailia, Assiut and Alexandria.
Egypt’s General Authority for Investment and Free Zones is the primary regulatory body responsible for overseeing the establishment of the most common types of companies in Egypt. From the day of the company’s establishment until its dissolution, Companies Law No. 159 of 1981, New Investment Law 72 of 2017 and the Capital Market Law, along with their executive regulations, govern and manage the company.
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According to Law No. 159 of 1981, numerous types of companies in Egypt can be formed. However, the most popular legal forms used by investors in Egypt are;
(i) Joint Stock Company (JSC)
(ii) Limited Liability Company (LLC)
(iii) Branch of a Foreign Company
(iv) One Person Company
(v) Representative office.
The Main Features of each kind are as follows:
Branch:
- An Egyptian branch of a foreign company may only carry out construction works or other contractual obligations if the company concludes a contract with any Egyptian entity, be it the Egyptian government, the public sector, private companies, etc.
- Although the branch can carry out commercial, financial, industrial, and contractual activities, it can only carry out the activities stated in its contract in Egypt, so the branch is treated as an Egyptian company for all purposes except corporate governance.
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Registration:
A foreign company engaging in any commercial, financial, industrial or contracting activity in Egypt must register as a branch with the Commercial Registry and General Authority for Investment and Free Zones.
Joint Stock Company (JSC):
- A joint-stock company in Egypt can be a closed company or a listed company, with the liability of its partners limited to the value of their shares.
Registration:
- A joint-stock company must be registered with the commercial registry authority Egypt, and it is supervised by GAFI.
Limited Liability Company (LLC):
Egypt’s limited liability companies are closed companies where the partners are liable only for the value of their shares in the company.
Registration:
- GAFI Egypt supervises and inspects limited liability companies, which are registered in the Commercial Registry.
One Person Company in Egypt:
- A-One Person Company is owned by one person, whether natural or juristic, that focuses on the purpose for which it was established, and the founder shall not be liable for the company’s obligations except to the extent of the allocated capital.
Representative Offices:
- It is permitted for foreign companies to establish representative offices, scientific or technical offices, and other offices to conduct market surveys and study production feasibility without engaging in any commercial operations or commercial agency activities.
Registration:
- Foreign companies can register their representative office under the Companies Law or the Commercial Agencies Law, which require the company to submit an application to the Companies Department of the General Authority for Investment and Free Zones.
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To start a company in Egypt, the following documents are required:
- An authenticated Non-confusion certificate, obtained from the commercial registry authority Egypt (This can be found at the web site of GAFI, http://www.gafi.gov.eg ),
- A certificate of depositing capital in a bank,
- Copies and the original of a power of attorney for review,
- A copy of the partners’ and Egyptian managers’ IDs (passports for foreign nationals),
- Auditor account’s original copy, etc.
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