On 31 July 2019, the House of Representatives approved the first amendment to Egypt’s new Investment Law no. 72 of 2017 (the “Investment Law”). The amendments are introduced by virtue of Law no. 141 of 2019 (“Amending Law”).
Incentives for Projects’ Expansions
The Amending Law allowed existing companies to benefit from the incentives stipulated under Articles 11 and 13 of the Investment Law in relation to expansions of their existing projects. Expansion means increasing the capital used in the project by adding new assets to increase the production capacity. The purpose of this amendment is to ensure equal incentives and treatment for new as well as existing projects.
Ratification’s Fees of the Companies’ Constitutional Contracts
The Amending Law adds a paragraph at the end of Article 48 requiring the ratification of the signatures of the partners or their representatives on the companies’ constitutional contracts whatever the investment system that the company is subject to. The ratification fee shall be ¼ percent of the value of the paid-up capital of the company with a cap of EGP 10,000.
This amendment comes to to put a cap on the ratification fees similar to that under the Companies Law.
Disclosure of Information and Data relating to Foreign Investments
The Amending Law adds a new paragraph allowing GAFI to request information and data relating to the assets of direct and indirect foreign investments from public and private entities for statistical purposes. Such collection of information will be in accordance with the applicable international practices and without prejudice to the national security and the rights of privacy and confidentiality as well as the protection of third parties’ rights.
GAFI may, for this purpose, prepare forms and questionnaires to be filled by the relevant entities by any means, including the electronic ones, provided that a decision is issued in this regard by the Prime Minister. The aforementioned entities are obliged to provide GAFI with the requested information within the timeline determined by the Executive Regulations of the Investment Law.
A fine of EGP 50,000 will apply on the person responsible for the actual management of the corporate entity in case s/he breached refused to provide GAFI with the requested data.