Highlights

On 21 August 2022, the Prime Minister (the “PM”) issued Decree no. 56 of 2022 (the “Decree”), effective as of 22 August 2022, which directly impacts the investment environment in Egypt. The Decree aims to specify the criteria and conditions upon which an Investment Project can be considered national or strategic (the “Investment Project”) regarding the application of article 20 of Investment Law no. 72 of 2017 (the “Investment Law”). The importance of such a Decree can be seen through its impact on enabling the Investment Project to benefit from the advantages of the Single Authorization Process (the “SAP”) provided by the Investment Law. Accordingly, such a Decree is connected to the recently issued Public Planning Law no.18 of 2022, as it enforces the collaboration between public/private sectors in the implementation of the country’s National Plan for Sustainable Development (the “NPSD”) - prepared by the Ministry of Planning and Economic Development and approved by the Council of Ministers and House of Deputy - through important national projects in critical sectors.

Important Stipulations

1. The Investment Project may benefit from the SAP given by the Council of Ministers to the relevant company established for such purpose.
2. The Investment Project may be classified as national or strategic if the same has fulfilled at least two of the following conditions:
   1. The contribution to the growth of exports has been made through exporting no less than 50% (fifty per cent) of its products abroad annually, within 3 (three) years since the beginning of its activity;
   2. The financing is dependent on the foreign currency transferred from abroad through a national bank and following the regulations of the Central Bank of Egypt (the “CBE”);
   3. The reduction in importations by localizing the relevant industry and utilizing local ingredients in its production to be no less than 50% (fifty per cent);
   4. The establishment shall be in one of the areas listed in PM Decree no.7 of 2020;
   5. The contribution in fields of technology transfer and localization in Egypt, innovation support, and scientific research development, following regulations of Ministers of Communications & Information Technology, Industry or Scientific Research in this regard;
   6. The objective is to secure strategic goods for the country and to limit its importation;
   7. The offering of several job opportunities to nationals, lowering the unemployment rate; and
   8. The lessening of environmental impact via reducing gas and temperature emissions and climate improvement through the implementation of Minister of Environment regulations in this regard.
3. The Investment Project shall operate in one of the industries stipulated under the Decree and updated annually following the country’s EDP, as follows:
   • Electricity and renewable energy;
   • Petrol and mineral resources;
   • Transportation, including maritime, railway, and electric transport, in addition to sea or river ports and logistics centres;
   • Industrial;
   • Communications and Information Technology;
   • Housing and utilities;
   • Tourism;
   • Youth and sport;
   • Environment;
   • Agriculture; or
   • Military production.

Privileges and Advantages

It is worth mentioning that the Decree specifies that the above-mentioned SAP includes the project implementation, its operation, management and all related construction licenses and real estate allocation. Moreover, the SAP can activate one or more investment incentives that the Investment Law provides without further action.