Over recent weeks, the Ministry of Labour has issued a series of supplementary decrees under Egypt’s Labour Law, covering training and recruitment, working hours, overtime, inspections, dispute resolution, and related matters. These decrees aim to clarify regulatory obligations, enhance compliance, and provide practical guidance for employers and training providers.

To read the full update, click here.

The contributors to this article are Alia Monieb, Partner – Head of Employment; Rawan Roshdy, Managing Associate; Khaled Omar, Associate; and Junior Associates; Hana Abouelmagd and Seifeldin Hamad.

Highlights

On 6 January 2026, the Financial Regulatory Authority (the “FRA”) issued regulatory decree no. 318 of 2025 (the “Decree”), introducing new controls governing the provision of non-banking financing in foreign currency.

The Decree applies to companies licensed to conduct small and medium enterprise (“SMEs”) financing, financial leasing, and factoring activities. It introduces detailed conditions aimed at ensuring that foreign currency financing is strictly linked to foreign currency–generating activities, while strengthening credit risk management and due diligence requirements.

The Decree further regulates the sources of foreign currency funding that may be used by licensed entities and establishes specific requirements for international factoring transactions, including the involvement of Factors Chain International (the “FCI”) members.

Scope of Application

The Decree applies to all companies and entities licensed by the FRA to engage in:

• SMEs financing activities;
• financial leasing; and
• factoring.

Licensed entities are prohibited from extending foreign currency financing to their clients except in accordance with the requirements and conditions expressly set out in the Decree.

Key Requirements

1. Foreign Currency Financing by SME Financing and Financial Leasing Entities:

Entities engaged in the provision of SMEs financing and financial lease activities in foreign currency must ensure that:

1. the financing is granted in connection with an import transaction falling within the scope of the client’s business activities;
2. the import transaction is supported by appropriate documentary credits opened with banks, or equivalent documentary or electronic instruments; and
3. enhanced credit assessment and due diligence is conducted, including verification of:
   • the purpose of the financing;
   • the client’s business activity and track record;
   • the client’s financial position; and
   • the availability of sufficient foreign currency resources to service the financing from the proceeds of the relevant activity.

Clients operating in free zones are exempt from the requirement to present the relevant import documentation.

2. Foreign Currency in International Factoring:

Factoring companies may conduct factoring operations in foreign currency through international factoring transactions, subject to compliance with the following conditions:

1. the factoring transaction must involve an external party through the assignment of financial rights or debts;
2. the assigned receivables must arise from export and import transactions, or be directly linked to the sale of financial rights or debts;
3. the factoring company must retain a right of recourse against the seller in the event of non-payment by the debtor;
4. the transaction must involve exporter and importer factoring companies that are members of the Factors Chain International (FCI); and
5. appropriate due diligence must be conducted on the debtor or seller, including verification of their financial position and foreign currency repayment capacity.

Permitted Sources of Foreign Currency

The Decree requires that foreign currency used to finance clients be sourced exclusively from one (1) of the following:

• the entity’s own resources, provided that its capital is denominated in foreign currency;
• banks registered with the Central Bank of Egypt, or other entities licensed to deal in foreign currency; or
• foreign entities approved by the FRA, subject to obtaining such approval prior to entering into the financing agreement.

Implications

The Decree aims to:

• limit foreign currency financing to clearly defined, foreign currency-generating activities;
• enhance credit discipline and risk management among non-banking financial institutions;
• reduce foreign exchange risk by ensuring alignment between financing currency and revenue streams; and
• strengthen regulatory oversight of foreign currency exposure within the non-banking financial sector.

Conclusion

The Decree reflects the FRA’s continued focus on safeguarding financial stability and ensuring prudent foreign currency exposure within the non-banking financial sector. By imposing strict eligibility, documentation, and funding source requirements, the Decree seeks to ensure that foreign currency financing is provided only within clear parameters. In practice, licensed entities should review and update their credit policies, due diligence procedures, and funding structures to ensure compliance with the new requirements. Entities engaged in international factoring should also confirm alignment with the FCI-related structural and documentation standards to avoid regulatory exposure.

The contributors to this article are Hossam Gramon, Partner - Head of Banking and Project Finance, and Nour Osama, Associate.

Overview

On 6 December, the General Authority for Investment and Free Zones (the “GAFI”) announced the official launch of the Cash Investment Incentive Guide (the “Guide”)  pursuant to Article 11 bis of Law No. 72 of 2017 (the “Investment Law”), marking a significant step in Egypt’s ongoing efforts to promote industrial development, localise production, and enhance the competitiveness of Egyptian industry. This initiative represents a significant shift in attracting industrial investments, as it moves the incentive from a traditional tax exemption to a direct cash benefit, paid to the investor after the tax has been settled. The Guide also introduces a mechanism to protect the investor by allowing the request for preliminary approval valid for three (3) years, thus providing legislative stability in the event of any subsequent amendment to the rules, provided the project commences its activity within the grace period.

Legal Basis and Policy Framework

As part of the government’s broader industrial strategy, Law No. 160 of 2023 amended the Investment Law by introducing Article 11 bis, which establishes a direct cash incentive for qualifying industrial investment projects. This incentive is offered in addition to other incentives available under Egyptian law.

To implement this reform, the Cabinet issued decree no. 77 of 2023 (the “Decree”), which sets out the criteria, categories, procedures, and monitoring mechanisms governing the incentive. Notably, the Decree authorises the issuance of preliminary approvals valid for three (3) years, providing investors with greater certainty throughout the implementation phase of their projects.

This Guide, as outlined and summarised below, is a means by the GAFI to provide information transparently, enhancing the investor’s confidence and understanding of Egypt’s investment environment, and supporting the assessment of eligibility for the incentive to enable informed decisions before submitting an application.

Key Features of the Cash Incentive

• Direct cash payment is made after the payment of taxes.
• Incentive levels are tied to the volume of foreign direct investment injected into the project.
• The foreign investment component must constitute at least 50% (fifty per cent) of the project’s capital.
• To qualify, industrial products listed in the Cabinet’s annex must represent at least 50% (fifty per cent) of annual turnover.
• The incentive is positioned as a major tool for foreign direct investment attraction in the industrial sector.
• Commencement of industrial activity: entitlement to the incentive is tied to the date on which actual industrial activity begins, rather than the date of the company’s incorporation or the issuance of its commercial register.

This decision identifies the starting point based on clear criteria, such as the occurrence of the first production or sales operation, the start of actual operations, issuance of the industrial registration, and official operation records issued by the competent authority.

Incentive Calculation

The incentive is calculated as follows: 35%/45%/55% x (*) the tax paid on the industrial project’s activity.

Eligibility

As noted, the Decree is limited to industrial projects producing a specified industrial good, with the targeted product types precisely identified. The Decree applies to both newly established industrial projects being set up for the first time, as well as expansion projects within existing factories, provided that all other technical requirements are met.

Eligibility Qualifications for a Project

• The project must commence its activity within six (6) years from the effective date of Article 11 bis, which is July 2025.
• The project must be established in one of the Sector A zones specified under Article 11 of the Investment Law, or in remote areas designated by a decision of the Council of Ministers, or in the new urban communities, industrial zones, investment zones, or technology zones.
• The project must rely, up to the date of commencing its activity, on foreign currency transferred from abroad to finance at least 50% (fifty per cent) of its capital, in accordance with the definition of “funds” under the Investment Law. Foreign currency transfers from abroad include:
  • foreign currency transferred through a bank registered with the Central Bank of Egypt (the “CBE”), used for establishing or constructing the project;
  • foreign currency transferred through a bank registered with the CBE, used for subscribing to the capital of the project in Egypt;
  • Egyptian currency paid, subject to the approval of the relevant authorities, in settlement of obligations due in free foreign currency, provided that it is used in establishing or expanding the project;
  • machinery, equipment, raw materials, production inputs, and transportation means imported from abroad for the purposes of establishing or constructing the project; the valuation of such invested assets must follow the rules and procedures set out under Egyptian Accounting Standards; and
  • profits that are eligible for repatriation abroad under Article 6 of the Investment Law, if reinvested in establishing or constructing the project.

Duration of Eligibility and Operational Continuity

The incentive’s eligibility period may extend up to seven (7) years, provided that the project continues operating the industrial activity specified in the decision and meets the following conditions:

• compliance with all tax and financial regulations;
• maintaining the required percentage of foreign financing; and
• demonstrating that the industrial activity continues to represent more than 50% (fifty per cent) of the project’s total turnover.

Establishment of the Incentive Committee

Mandate of the Committee

• reviewing and processing applications;
• requesting additional documents if needed; and
• issuing eligibility certificates.

After paying the tax and submitting the tax return, the project must submit an annual request for disbursement of the incentive to the competent technical committee.

If approved, the Ministry of Finance (the “MoF”) is obligated to disburse the incentive amount within forty-five (45) days from the end of the tax return filing deadline.

If the MoF delays the payment beyond this period, the investor becomes entitled to a delay compensation.

Steps for the Issuance of the Certificate of Incentive Eligibility

1. Submitting the application using the approved form, attached to the Guide.
2. The Committee reviews the application within a period not exceeding forty-five (45) days from the date of submission, and may request any additional information from the investor.
3. The Committee issues its recommendation regarding eligibility or non-eligibility and submits it to the CEO of the GAFI for approval within seven (7) working days of completing the review.
4. The investor is notified of the decision within seven (7) days of the CEO’s approval, whether the application is accepted or rejected.
5. If approved, the GAFI issues a Certificate of Incentive Eligibility, including the project details and the end date of the eligibility period (which is seven (7) consecutive years). The GAFI must notify the MoF of the issued certificate within seven (7) days of issuance.

The aforementioned steps should be submitted by email on [email protected].

A list of documents required for submission is attached to the Guide.

The Guide further elaborates and states the industries that can enjoy the incentive as well as their customs tariffs categories, such as metal, chemical, engineering, medical and pharmaceutical, textile, and mining industries.

Moreover, the Guide issues a list of Q&As to provide further clarifications and any additional information to the investors to further understand their scope.

The Guide is now publicly available and can be accessed through the link provided by GAFI: Link here.

What This Means for Investors

Industrial investors, particularly those with substantial foreign capital contributions, may now benefit from a significant direct cash incentive designed to improve project economics and reduce post-tax costs.

Unclarified Scope of Eligibility for Existing Investments and Acquisitions

While the Guide confirms that the incentive applies to newly established industrial projects as well as expansions of existing factories, provided all technical conditions are met, an important question remains unaddressed: whether the incentive also extends to acquisitions of existing industrial projects by foreign investors, or to capital increases injected into already operating companies without undertaking a physical expansion.

The current legal framework does not expressly clarify whether an investor who acquires an existing project, or who injects new foreign capital into an operating entity, would qualify for the cash incentive in the absence of a qualifying expansion that results in new industrial activity. Given that eligibility is tied to the financing of the project “up to the date of commencing its activity,” the applicability of the incentive to acquisition-only transactions remains uncertain.

The contributors to this article are Mohamed Abdelgawad, Partner and Head of General Corporate, Commercial, and Regulatory; Farida Tawfik, Associate; and Sara ElZayat, Junior Associate.

We are delighted to share our recent contribution to the sixth edition of the Legal Industry Reviews (LIR).

In our chapter, “Strengthening Consumer Protection in Egypt’s Digital Telecom Landscape”, we examine the evolving regulatory framework governing the telecom sector and how recent reforms are reshaping telemarketing practices and data privacy compliance. The article also highlights the broader impact of these regulations on Egypt’s digital economy and legal landscape.

Our insights are provided by Darah Zakaria, Counsel, and Marwan Ahmed Awny, Junior Associate.

To read our contribution, click here (page 46).

We advised a syndication of eight lenders on the signing of an EGP 8 billion financing facility granted to Orange Egypt, led by CIB Egypt, with the participation of Banque Misr, ALEXBANK, National Bank of Egypt (NBE), Attijariwafa bank Egypt, Crédit Agricole Egypt, Emirates NBD Egypt, and HSBC Egypt. The facility is intended to support Orange Egypt’s operational requirements and strategic growth objectives in the Egyptian market.

The transaction highlights the capacity of leading Egyptian banks to support large-scale financing in the telecommunications and digital infrastructure sector.

Our team was led by Hossam Gramon, Partner - Head of Banking and Project Finance, and Karima Serry Seyam, Senior Associate, assisted by Junior Associates Malak Zaki, Mostafa Khaled Serry, and Nour Osama.

We are pleased to have worked alongside our colleagues at CIB Egypt, including Karim El-Rimaly, Banking Officer, Sherif Osman, Project Finance and Syndication Senior Office Debt Capital Markets, and Hana Fawzy, Project Finance & Syndication Officer, as well as representatives of the other participating lenders.

For more information, check Masrawy’s coverage here.

We are pleased to share ADSERO's latest contribution to the updated edition of the International Employment Lawyer’s (IEL) Guide to Workplace Investigations – Egypt. The updated contribution reflects recent developments and provides practical insights into the legal framework governing workplace investigations in Egypt, including procedural considerations and employer obligations.

Our insights are provided by Alia Monieb, Partner - Head of Employment; Rawan Roshdy, Managing Associate; Hoda Khira, Junior Associate; and Khaled Omar, Junior Associate

Read our contribution here.

Read the full guide on IEL's website here.

We are pleased to share ADSERO’s latest contribution to Chambers and Partners' Environmental, Social, and Governance (ESG) Global Practice Guide 2025 - Egypt. The contribution provides an overview of Egypt’s ESG legal and regulatory landscape, addressing key developments, compliance considerations, and the evolving role of ESG principles across corporate governance, environmental regulation, and social responsibility frameworks.

Our insights are provided by Malak Khalil, Partner – Head of EENR; Taya Pirinis, Managing Associate; Dina Sharshar, Associate; and Khaled Abdelrahman, Associate.

Read our contribution here.

We are pleased to have acted as legal counsel to Tawasoa Factoring and its shareholders on the successful public and private offering of its shares on the Egyptian Stock Exchange (EGX).

The offered shares represented 25% of the company’s issued capital and was executed across two tranches—a public offering for retail investors and a private placement for institutional and qualified investors.

This transaction marks a key step in ADSERO’s capital markets practice, reflecting our growing role in equity offerings and non-banking financial services in Egypt.

The transaction was led by Ahmed Adib, Partner, and Ibrahim El Messery, Counsel and the supervision of Dr. Ahmed Abdelgawad, Partner and Co-Head of M&A and Capital Markets, supported by Abdelrahman El Sherif, Associate, and Abdelrahman Amgad, Junior Associate.

We extend our congratulations to Mohamed Zaghloul, Samer Daoud, and Hussien Sedky, as well as our appreciation to all stakeholders who contributed to the successful execution of the offering.

To read more check Tawasoa’s post here.

We are proud to have advised the Ministry of Finance (MOF) on Egypt’s first-ever sovereign domestic sukuk program, as well as on the first issuance under that program. The program size was set at EGP 200 billion.

The first issuance — a three-year, fixed-rate sukuk valued at EGP 3 billion — was oversubscribed 5x, reflecting strong demand from leading Gulf financial institutions, including Abu Dhabi Islamic Bank, Kuwait Finance House, Faisal Islamic Bank and Al Baraka Bank, in addition to local primary dealers.

The transaction was led by Hossam Gramon, Partner and Head of Banking and Project Finance, and Ibrahim ElMessery, Counsel, with support from Karima Seyam, Senior Associate, and Junior Associates Malak Zaki, Marc Hany Georgy, Mostafa Khaled Serry, Nour ElKholy and, Nour Osama.

Congratulations to the Ministry of Finance and the Egyptian Financial Company for Sovereign Taskeek on this landmark transaction, and our appreciation to the Central Bank of Egypt and the Egyptian Stock Exchange for their invaluable support.

For more information, read Al Mal Newspaper coverage here.

We advised Arrow Holdings, a leading regional HR technology and staffing group operating across Africa and the Middle East, on the strategic investment by AfricInvest Fund IV, through which AfricInvest subscribed to a significant minority stake in the company.

This milestone investment will further accelerate Arrow Holding’s digital transformation and regional expansion strategy, including the launch of the Arrow AI Hub for digital HR services. 

Our team was led by Ibrahim ElGeneghy, Partner and Hana Awad, Counsel, assisted by Associates Farida Banoub, Salma Soliman and Soha Hussein.

The team was also supported by Youssef Moussally, Associate, Malak Abda, Junior Associate and, Youssef Abdelmaksoud, Junior Associate.

Congratulations to AfricInvest team: Ziad Oueslati, Founding and Co-Managing Partner, Ismail El Tabli, Senior Partner, MD, Hedi Dziri, Director, Mahmoud El Sayaad, Investment Professional, and Nihal Kassem, Analyst.

We also extend our congratulations to Mohamed El Derwy, Founder and CEO of Arrow Holding, and Meran Ossama, Global Growth Partner at Manpower Egypt – Target HR, on this significant achievement.

Pleased to have collaborated with our colleagues at Blackwood Capital Group - Thomas Kardos, Alexander John and Dimitris Gretsistas who acted as the financial advisor to Arrow Holding, and PwC represented by Passant El Tabei, Partner who have acted as the tax advisor.

We wish to recognise the efforts of Matouk Bassiouny & Hennawy (MBH): Omar Bassiouny, Ossama Abouzaid, and Mariam El Gabry - legal advisors to AfricaInvest. 

To read more about this transaction, check Blackwood Capital Group’s post here.

We are pleased to share our latest report highlighting the laws and decrees issued in the third quarter of 2025.

To access the report, click on the attachment below.

If you are interested in acquiring a copy of the legislation and keen on remaining up to date with the most recent laws and decrees, sign up here.

We are proud to have acted as local transaction counsel in connection with the country’s first-ever private placement sovereign sukuk listed on the Vienna Stock Exchange.

This milestone transaction highlights Egypt’s continued efforts to tap into Islamic finance markets and enhance public debt management tools.

The transaction was led by Hossam Gramon, Partner, Head of Banking and Finance.

Congratulations to the team of Clifford Chance, the international transaction counsel.

For more information, check out the Enterprise coverage here.

We advised private equity firm Morpho Investments on the successful establishment of its investment fund structure. Our team provided end-to-end legal support throughout the entire fund formation process, including the preparation of all core fund documentation and negotiation of the fund’s initial funding round. 

Our team was led by Ragy Soliman, Managing Partner, Co-Head of M&A and Capital Markets, Laila Shoukry, Managing Associate, and Ahd Ayad, Junior Associate.

Congratulations to Ayman Soliman, Managing Partner and Co-Founder, Ihab Rizk, Co-Founder and Managing Partner, and Kamal Tarek, Legal Counsel, Nermin Adel, Vice President, and Mohamed Nashaat, Associate of Morpho Investments on this achievement.

For more information, check out Enterprise's coverage here.

For the second consecutive year, we are proud to support The Distinguished Gentleman’s Ride (DGR)–a global initiative committed to raising awareness and funds for men’s health, with a focus on prostate cancer and mental health.

Prostate cancer is the second most common cancer among men, with 1.4 million new cases diagnosed each year. Over 10 million men worldwide are currently living with or have survived a prostate cancer diagnosis. Thanks to the support of DGR, Movember–its official charity partner–has been able to lead groundbreaking biomedical research and develop improved diagnoistic tools and treatments for high-risk patients.

On Sunday, 18 May, riders around the world will take part in DGR to raise awareness and support healthier, happier lives for men everywhere. We stand in solidarity with all men affected by prostate cancer and mental health challenges and are honoured to take part in this important movement once again.

A special thank you to Stefania Schito, Group General Counsel at Ora Developers and currently the top female fundraiser worldwide for DGR, for inviting us to join this meaningful cause.

Learn more about DGR here.

To support this initiative, click here.

We are pleased to share our latest report highlighting the laws and decrees issued in the first quarter of 2025.

To access the report, click on the attachment below.

If you are interested in acquiring a copy of the legislation and keen on remaining up to date with the most recent laws and decrees, sign up here.