Egypt - Company Incorporation
Forms of Business Structures In Egypt
The kinds of business firms allowed in Egypt are determined the Companies Law No. 159 of 1981. The Companies Law regulates joint stock companies, limited partnerships by shares, and limited liability companies.
- Joint Stock Companies.
- Limited Liability Companies.
- Limited Partnerships by Shares.
Limited Liability Companies - WLL
The form of entity usually chosen by foreign investors is the Limited Liability Company, known as a WLL - with limited liability - this is the equivalent of a French SARL, a German GmbH or UK Private Company. The principal features are :
- Shareholders must number between two and fifty natural or juristic persons.
- Minimum capital is LE 50,000.
- A WLL may not engage in insurance, banking or investment on behalf of others.
- A WLL is required to transfer 5% of the profits for the year to a statutory reserve, until such time as the reserve amounts to at least 50% of the capital.
The Joint Stock Companies (Shareholder Companies) is the most commonly used form of corporate business entities in Egypt. It may be incorporated by three or more natural or juristic persons.
Branches of foreign companies
Foreign investors may carry on business in Egypt through a branch office, rather than through a locally incorporated company. There is, however, no tax advantage in doing so.
Where a branch is set up, it must be registered in the commercial register and it must keep separate accounts which are to be approved by locally registered auditors.
Registration of a Branch for carrying out Government Contracts
A foreign company which is awarded a contract by a Ministry, Government Authority or Government-affiliated companies is required to register as a branch with the following authorities :
- Commercial Register.
- Tax Department.
- Social Insurance Department.
- Companies' Department.
Agencies
If a foreign company's sole interest in Egypt is the exportation of goods to Egypt, then it generally must appoint a local agent for this purpose. Such an agent must be an Egyptian national or company.
Egyptians employed in a company incorporated under the companies law should not be less than 90% of the total employees and their remuneration should not constitute less than 80% of the total salaries and wages paid. For technical administrative staff, Egyptians should not constitute less than 75% in number, and their total earnings should not be less than 70% of the total wages and salaries paid to all such staff.
Starting a business in Egypt
| Obtain a certificate from the Commercial Registry that the name of the company is not similar to any existing company |
| Obtain a certificate from an authorized bank indicating the depositing of the full amount of company's capital |
| Visit the Companies Department to dictate the amendments to computerised model of statutes to the Incorporation Unit (IU) at the Legal Department of the Companies Department |
| Submit documents to the Incorporation Follow-up Unit (IFU) at the Department of Companies and receive the invoice |
| Notarise company's contract at the Public Notary Office affiliated to the Department of Companies |
| Obtain the Notification of Incorporation and Chamber Commerce permit |
| Open a tax file - get a tax card (Tax Authority) |
| Register for sales tax at the Sales Tax Department |
| Register employees with the National Authority of Social Insurance |