Highlights

On 29 October 2023, Egypt issued Law No. 173 of 2023 (the “Law”), providing exemptions from certain provisions outlined in the Importers’ Register Law No. 121 of 1982 (the “Importers’ Register Law”) for companies with less than 51% (fifty-one per cent) ownership by Egyptians or no ownership by Egyptians. The Law represents a significant departure from previous regulations, enabling foreign-owned companies to be registered in the Importers’ Register.

Scope of Application

• The Law applies to joint stock companies (“JSCs”), partnerships limited by shares, limited liability companies (“LLCs”), or partnerships that do not fulfil the ownership criteria of being predominantly owned by Egyptians or with ownership stakes held by them of less than 51% (fifty-one per cent).
• Previously, only companies predominantly owned by Egyptians were eligible for registration in the Importer’s Register, as mandated by the Importers’ Register Law. However, the Law now exempts these restrictions, extending eligibility to foreign-owned companies for registration in the Importers’ Register.
• The Law applies exclusively to importation for trading purposes and does not encompass private use or production by individuals or corporate entities.

It is worth noting that this exemption applies solely to the nationality requirement outlined in the Importers’ Register Law. Therefore, all other statutory requirements remain in effect.

Key Statutory Requirements

The statutory requirements for trading-oriented importation in Egypt are as follows:

• the company must be duly registered under the commercial register and possess a tax card;
• partnerships and LLCs must have a registration period of at least 1 (one) year;
• the company must achieve a business turnover of at least EGP 5,000,000 (five million Egyptian pounds);
• the company’s headquarters must be located in the Arab Republic of Egypt, explicitly stating importation for trade as its purpose;
• LLCs are required to maintain a minimum capital of EGP 2,000,000 (two million Egyptian pounds), while JSCs and partnerships limited by shares require a minimum capital of EGP 5,000,000 (five million Egyptian pounds); and
• additionally, individuals responsible for importation activities must be Egyptian nationals with no prior felony convictions and must not hold positions in the parliament or state council. They must have also completed approved training courses by the Foreign Trade Affairs Ministry.
   

Duration of Exemption      

• Under the provisions of the Law, companies are allowed to register in the Importers’ Register for an initial period of up to 10 (ten) years from the effective date of the Law.
• It is important to note that there is a provision allowing for the potential extension of this registration by an additional 10 (ten) years. Nevertheless, such an extension is contingent upon approval by the Cabinet, following the recommendation of the Minister responsible for foreign trade.
   

Effective Date

The Law takes effect on the day following its publication in the Official Gazette.