Available Legal Structures

Investors in Egypt can choose from several forms of legal entities when establishing a local business. The most common corporate forms are joint stock companies (JSCs) and limited liability companies (LLCs). A more recent form is the sole proprietorship company with limited liability (SPC), which was introduced pursuant to Law No 4 of 2018.

In addition, Egyptian law recognises partnerships, namely general partnerships and limited partnerships, which are governed by the provisions of Egyptian Law No 17 of 1999.

Liability Considerations

The extent of the investor’s liability is an important consideration when selecting the appropriate legal structure. Partnerships are generally less attractive to investors seeking to ring-fence their personal assets, as the liability of the general managing partners may extend to their personal financial assets, depending on the type of partnership and the applicable legal framework.

For similar reasons, SPCs may not always be the preferred structure where the investor seeks a clear separation between its personal financial liability and that of the SPC. Accordingly, investors seeking stronger asset protection and a clear distinction between the investor’s assets and those of the business would generally consider an LLC or JSC.

Factors Affecting the Choice Between an LLC and a JSC

The choice between an LLC and a JSC will generally depend on the nature and future plans of the business, as well as its financing requirements.

A JSC may be more suitable where the investor requires higher bankability, particularly for large-scale projects where a more formal corporate governance framework is desirable, such as a flagship manufacturing entity or a holding company. It may also be preferable where there are plans to list the company on the Egyptian Exchange (EGX) or undertake a public offering.

An LLC may be preferable where procedural simplicity, flexibility in management and comparatively lower establishment and operating costs are the primary considerations, particularly where there are no plans to list the company, issue securities to the public or rely extensively on sophisticated capital-market financing tools.

Company Incorporation and Registration Procedures

Incorporating a company in Egypt generally commences with obtaining a non-confusion certificate for the proposed company name, confirming that it is not identical or confusingly similar to the name of an existing company.

The company must then secure premises to serve as its headquarters by entering into a lease agreement. Following this, an incorporation application is submitted to the General Authority for Investment and Free Zones (GAFI) by virtue of the power of attorney granted by the founders, together with payment of the applicable incorporation fees, which are determined based on the company’s capital.

Once GAFI approves the application, the Articles of Incorporation are executed and notarised before the notary public and the Bar Association, as applicable.

Thereafter, the company is registered with the Chamber of Commerce, followed by registration with the Commercial Registry to obtain its commercial registration number. The company then applies for its tax card and opens a file with the Social Insurance Authority. Finally, the company registers with the Value Added Tax Authority, if required under Article 2 of the VAT Law.

The incorporation process generally takes approximately 5 to 20 business days, depending on whether the normal incorporation route or the VIP route is followed. The VIP route involves payment of additional fees to GAFI and may expedite the incorporation process.

Ongoing Compliance Requirements

Ongoing compliance matters include convening an annual General Assembly meeting to approve the financial statements for each fiscal year.

The company must also maintain certain statutory ledgers, including:

• the Partners’ Register – containing the partners’ details and their respective quotas;
• the General Assembly Register – recording the resolutions adopted at General Assembly meetings;
• the board of directors’ minutes ledger – for JSCs, recording the deliberations, resolutions and actions taken during board meetings;
• the daily ledger; and
• inventory ledgers.

In addition, companies with foreign investment in their shareholding structure are required to submit quarterly foreign direct investment reports to GAFI. Companies must also ensure that their corporate records, statutory registrations and regulatory filings remain accurate and up to date throughout their operations.

Share Capital

The rules governing share capital in Egypt are primarily regulated by Companies Law No 159 of 1981 (the “Companies Law”) and Capital Market Law No 95 of 1992 (the “Capital Market Law)”, together with their respective Executive Regulations.

Joint Stock Companies

For JSCs, the share capital is divided into equal nominal value. The articles of association determine the nominal value of each share, which may not be less than EGP1 or exceed EGP1,000, or the equivalent thereof in a foreign currency.

The capital structure of a JSC generally comprises issued capital, authorised capital and paid-up capital.

• Issued capital: The issued capital must be fully subscribed and meet the applicable minimum requirements: EGP500,000 for JSCs offering shares for public subscription and EGP250,000 for closed JSCs.
• Authorised capital: The articles of association may provide for authorised capital exceeding the issued capital by up to ten times. This enables the company to increase its issued capital, within the authorised limit, without having to amend the authorised capital each time.
• Paid-up capital: This represents the portion of the issued capital that has actually been paid by the shareholders. Upon incorporation, each subscriber must pay at least 10% of the nominal value of cash shares, increasing to 25% within three months, with the remaining balance payable within five years.

Accordingly, Egyptian law adopts a par-value share structure for JSCs, with the nominal value of the shares being specified in the articles of association. The concept of no-par-value shares is therefore not applicable to JSCs under the Companies Law.

Limited Liability Companies

For LLCs, the capital is divided into equal quotas rather than shares. The quotas must be fully paid upon incorporation. Generally, the Companies Law does not prescribe a minimum issued capital requirement for the incorporation of an LLC.

Different Classes of Shares and Associated Rights

The Companies Law permits JSCs to issue ordinary shares and preferred shares. Ordinary shares generally carry equal rights, while preferred shares may confer preferential rights in relation to voting, dividends or the proceeds of liquidation.

Shares of the same class must carry equal rights, privileges and restrictions, ensuring that shareholders holding shares of the same class are treated consistently. However, the same preferred shares may not have both preferential voting rights and preferential rights to liquidation proceeds. The issuance of preferred shares requires the approval of the Extraordinary General Assembly by a three-quarters majority of the shares existing before the relevant capital increase.

Under the Companies Law, companies are subject to a general legal obligation to distribute dividends. However, a company may resolve not to distribute dividends where such decision is based on legitimate and reasonable grounds.

Distribution Mechanism

Dividends are distributed pursuant to a general assembly resolution based on the board of directors’ proposal and in accordance with the percentage stipulated in the company’s articles of association.

The board of directors shall implement the following for the distribution of the profits among employees:

• deduct all expenses required for the calculation of the net profits, putting aside all consumptions and allocations required to be calculated and put aside, as per the accountancy rules (“net profits”); and
• put aside from the net profits (i) at least 5% for the formation of a legal reserve and (ii) the regular reserve put in place by the company’s articles of association, if any.

This step will result in calculation of the distributable profits, where:

• the company’s Ordinary General Meeting (OGM) must finally decide on the distributed dividends, which may be less than the distributable profits upon the recommendation of the board; and
• the employees of the company will be entitled to their share, which is equivalent to 10% of the distributed dividends.

The employees’ 10% share of distributed dividends may not exceed their aggregate annual salaries. Any surplus must be allocated to an account to be invested for the employees’ benefit and may be distributed to employees in years when no profits are generated due to reasons beyond the company’s control, or used to establish housing projects or services for the benefit of employees.

The repurchase, redemption and cancellation of shares are regulated under Article 48 of the Companies Law and GAFI Circular No 12 of 2018, which permit companies to hold treasury shares and set out the applicable rules and requirements as follows:

• shareholding limit – a company may not, by any means, acquire or hold more than 10% of its total issued shares; and
• disposal period – acquired shares must be disposed of within one year – otherwise, the company must reduce its share capital by their nominal value.

Employee Incentive Schemes and Bonus Shares Through Employee Stock Option Plans

The company may dispose of such shares through an employee and management incentive scheme or may distribute them to its shareholders as bonus shares.

Beneficial Ownership Register in the Commercial Register

Under Article 13 bis of the Executive Regulations of the Commercial Register Law, companies registered in the Commercial Register are required to maintain a separate register known as the Beneficial Ownership Register (the “UBO Register”). The UBO Register must be updated promptly upon the occurrence of any event requiring an update, and the relevant Commercial Registry Office must be notified accordingly.

Beneficial Ownership Disclosure Requirements for Banks

In addition, under Law No 194 of 2020 on the Central Bank and Banking System and the AML/CFT framework of the Central Bank of Egypt (CBE), companies maintaining banking relationships are required to provide information identifying their beneficial owners as part of the banks’ know your customer (KYC) and customer due diligence (CDD) procedures.

The CBE’s AML/CFT requirements include the identification and verification of UBOs, obtaining relevant information concerning them, keeping such information up to date and conducting ongoing monitoring of the customer relationship. Accordingly, companies should ensure that their beneficial ownership information is accurate and kept current for both Commercial Registry and banking purposes.

Corporate governance in Egypt is governed by a combination of legislation, executive regulations, regulatory decisions and circulars issued by GAFI and the Financial Regulatory Authority (FRA).

The principal framework comprises the Companies Law, its Executive Regulations and Investment Law No 72 of 2017 and its Executive Regulations. These laws establish the fundamental framework for corporate establishment and management, shareholders’ rights, general assemblies, boards of directors, directors’ duties and liabilities, corporate restructuring and investment activities and incentives.

GAFI circulars, decisions and instructions supplement this framework by regulating practical matters such as incorporation, amendments to constitutional documents, appointment of directors, general assemblies, capital increases and reductions, mergers, liquidation and corporate filings.

Listed companies and companies engaged in non-banking financial activities are additionally subject to the Capital Market Law, the FRA Listing and Delisting Rules (the “Listing Rules”), and relevant FRA circulars and board decisions covering disclosure, financial reporting, shareholder protection, related-party transactions and corporate actions.

Under Egyptian companies law, directors are subject to fundamental fiduciary duties, principally the duties of loyalty, good faith, care and diligence. Directors are expected to act in the best interests of the company, exercise sound and informed judgment, avoid conflicts of interest and refrain from deriving improper personal benefits from their position or corporate opportunities.

The Companies Law provides the principal statutory framework governing directors’ responsibilities and liability. Egyptian courts have generally interpreted these obligations by emphasising directors’ responsibility for lawful and prudent corporate management. Where directors engage in misconduct, negligence or self-dealing, or otherwise breach their statutory or constitutional obligations, they may be held personally liable for the resulting losses, subject to applicable legal requirements.

Accordingly, the Egyptian legislator places significant emphasis on directors’ good faith, proper exercise of managerial authority and accountability for acts or omissions that cause harm to the company and its shareholders.

Directors are expected to exercise reasonable care, skill, diligence and good faith in managing a company. They must act in the best interests of the company, exercise their powers for proper purposes, make informed decisions, avoid conflicts of interest and comply with applicable laws and the company’s constitution. The required standard may depend on a director’s responsibilities, knowledge and experience.

Directors are generally not personally liable for company debts due to the company’s separate legal personality. However, they may incur personal liability for breaches of legal or fiduciary duties, fraud or dishonesty, wrongful or reckless trading while the company is insolvent, misuse of company assets, undisclosed conflicts of interest or other statutory breaches. Liability may also arise from personal guarantees or personal torts, such as fraud or negligent misrepresentation. Accordingly, directors are generally protected for genuine business decisions but may be held liable for misconduct or negligence.

Under Egyptian Companies Law, JSCs, including public and closed JSCs, are governed by a shareholders’ general assembly and a board of directors. The board must consist of at least three members, including the chair. There are no specific requirements under Egyptian law regarding the nationality or residency of directors in Egypt. However, the legal framework governing certain activities may impose Egyptian nationality requirements, such as in the case of importation and commercial agency activities. Shareholders elect directors, subject to applicable eligibility and integrity requirements; individuals convicted of certain financial crimes may be prohibited from serving on a board of directors.

Regarding independence, Egyptian law permits independent directors, although they are not necessarily mandatory for all companies. As a best practice, companies should appoint independent directors without significant ties to major shareholders.

Publicly listed companies and companies subject to the regulatory oversight of the FRA are subject to the general requirements of the Companies Law as well as additional requirements arising from the FRA and the EGX rules. Consequently, listed companies generally face stronger expectations concerning board independence, transparency and governance.

For example, the applicable listing and regulatory rules governing publicly listed companies and companies subject to the regulatory oversight of the FRA require the majority of the members of the board of directors to be non-executive, with at least half of the non-executive directors being independent. The board of directors should also include at least one female member.

In Egypt, ESG disclosure is increasingly becoming a regulatory requirement rather than a voluntary practice. The main requirements are set out in FRA Decision Nos 107 and 108 of 2021, which require listed companies and certain non-banking financial institutions to disclose ESG information in their annual reports. Non-banking financial institutions with capital or net equity of at least EGP100 million are subject to these requirements. Companies meeting the EGP500 million threshold must also provide climate-related financial disclosures in line with the Task Force on Climate-related Financial Disclosures (TCFD) framework.

Directors’ duties in Egypt increasingly require consideration of environmental, social and stakeholder interests, particularly through ESG reporting, risk management and corporate governance requirements. Directors of listed and regulated companies are expected to oversee climate and ESG risks and related disclosures. However, the Companies Law does not expressly impose a general fiduciary duty requiring directors to consider environmental or broader stakeholder interests. Instead, such considerations arise mainly from sector-specific regulations, including FRA corporate governance rules for non-bank financial companies. Therefore, directors’ consideration of ESG and stakeholder interests is increasingly important but remains primarily regulatory rather than a general statutory fiduciary obligation.

Best practices for boards include integrating ESG and climate-related risks into the company’s overall risk governance framework and ensuring regular monitoring and reporting. Boards should oversee the preparation of ESG disclosures and quarterly progress reports for inclusion in annual reports, while ensuring transparency and accountability to shareholders through the general assembly. Establishing a risk committee to oversee different categories of risk is also important. Boards should ensure clear internal regulations defining directors’ responsibilities, sufficient time commitment, alignment with company and shareholder interests, and compliance with board diversity requirements.

Egyptian conflicts-of-interest and related-party transaction rules are principally governed by the Companies Law, its Executive Regulations and, for listed companies, the CML, FRA regulations and EGX Listing Rules.

Directors and managers must disclose any personal interest that conflicts with the company’s interest in a transaction. The conflict must be recorded in the board minutes, and the interested director may not vote on the relevant resolution. Certain transactions involving the company’s directors or the founders within five years as of the incorporation, including specified self-dealing arrangements and competing activities, require General Assembly approval.

For listed companies, additional requirements apply to related-party transactions depending on the transaction, and General Assembly approval may be required, with the interested shareholder excluded from voting. Listed companies must also make prescribed disclosures to the FRA and EGX, including applicable disclosures when shareholders or related parties reach specified ownership thresholds.

Separately, transactions involving mergers, acquisitions, changes of control or other economic concentrations may fall within Egypt’s Competition Law No 3 of 2005 (ECL) and be subject to notification or review by the Egyptian Competition Authority (ECA). These competition-law requirements operate independently from corporate approval and related-party disclosure requirements.

The principal legislation governing corporate entities in Egypt is the Companies Law and its Executive Regulations, which regulate the main corporate forms, including JSCs and LLCs.

Voting and Participation

Shareholders may attend general meetings in person or proxy, vote, discuss agenda items and question the board, managers and auditor. Meetings are held in the head-office city unless the articles of association specify otherwise, and may be conducted by videoconference to the extent permitted by GAFI. The articles of association may provide for cumulative voting in board elections.

General Meetings

In JSCs, an OGM requires a 25% quorum at first call (increasable by the articles of association to 50%), with no minimum at second call. An Extraordinary General Meeting (EGM) requires 50% at first call and 25% at second. Resolutions are passed by shares represented: an absolute majority at an OGM, ⅔ at an EGM and ¾ for fundamental changes, including increasing authorised capital, reducing capital, early dissolution, changing the corporate purpose or mergers. Holders of 5% may require an OGM; holders of 10% may require an EGM. In LLCs, articles of incorporation amendments require partners holding ¾ of the capital.

Information Rights

Shareholders may inspect specified company records and review financial statements and auditors' reports. Holders of at least 10% have information rights regarding related-party transactions.

Minority Protections

Resolutions contrary to law or the articles of association/articles of incorporation are void, while resolutions favouring or prejudicing particular shareholders may be challenged by qualifying shareholders within one year. Shareholders may also pursue company claims against directors, and 10% holders may request an inspection into serious violations by directors or auditors. Dissenting shareholders may withdraw in specified restructurings. Further remedies and dispute-resolution mechanisms are discussed in 3.2 Shareholder Agreements.

Shareholder agreements (SHAs) are used in Egypt to supplement the statutory framework, regulating governance, funding, transfers, exits and dispute resolution, subject to mandatory provisions of Egyptian law. The Companies Law expressly recognises SHAs.

Governance and Enforceability

SHAs commonly regulate board composition, reserved matters, distributions, deadlock and exit arrangements. They bind their parties but cannot override mandatory law or required corporate approvals and formalities. An SHA may bind non-signatory shareholders if approved by an EGM representing at least ¾ of the capital, subject to higher thresholds for certain matters. In practice, pre-emption rights, rights of first refusal, rights of first offer, general meeting quorums and reserved matters are mirrored in the articles of association/articles of incorporation, subject to statutory limits and GAFI’s acceptance.

Reserved matters are generally implemented through enhanced voting thresholds without encroaching on statutory powers. Tag-along, drag-along, lock-up and call and put provisions remain contractual. Provisions not reflected in the articles of association are unenforceable against third-party transferees, meaning breach gives rise to contractual remedies. Specific performance may be unavailable on public-order grounds; remedies for breach of transfer provisions may be limited to damages.

Derivative Actions

Any shareholder may pursue civil liability claims against board members for breaches in the performance of duties.

Unfair Prejudice and Oppression

Egyptian law does not provide a standalone oppression remedy. Minority shareholders rely on statutory tools, including challenging general assembly resolutions adopted to favour or harm specific shareholders, director liability claims, inspection requests and contractual SHA protections.

Winding-Up

Where losses reach half of shareholders’ equity, an EGM considers dissolution. Partners may seek judicial dissolution for serious cause.

Forum

Companies Law disputes fall under economic courts’ jurisdiction.

Egyptian M&As are principally governed by the Companies Law, Investment Law No 72 of 2017, Capital Markets Law No 95 of 1992, Central Depository and Registry Law No 93 of 2000 and the ECA. Sector-specific laws may impose additional regulatory, licensing or security approvals.

Structuring Considerations

Transaction structure is principally driven by liabilities, licences, tax, financing, regulatory approvals and timetable. Share and quota acquisitions preserve the target’s legal personality, licences and contracts, subject to applicable change-of-control provisions. Asset acquisitions allow greater flexibility in selecting assets and liabilities but generally require asset-by-asset transfer formalities and require licences to be transferred or reissued.

Mergers and Court Involvement

Egyptian law provides statutory merger and demerger procedures but does not provide a general court-sanctioned scheme of arrangement comparable to those available in certain common-law jurisdictions. Mergers require corporate approvals, valuation and prescribed administrative procedures. Courts principally become involved where a transaction’s validity, implementation or legal effects are disputed.

Tender Offers

Acquisitions of listed companies, and of companies that have publicly offered their shares, are regulated by the Capital Markets Law and FRA rules. Mandatory tender offers are triggered on acquiring ⅓ of the capital or voting rights. They are triggered again on crossing 50%, ⅔ and 75%, and on acquiring a further 5% within 12 months between those thresholds. These offers require FRA approval and are subject to disclosure and pricing rules. JSC share transfers are completed through the central-depository framework under Law No 93 of 2000.

Bank and Non-Bank Financial Institutions’ Acquisitions

Under Central Bank and Banking System Law No 194 of 2020, acquiring more than 5% and up to 10% of a bank’s capital or voting rights requires notification to the CBE. Acquiring more than 10%, or any interest resulting in effective control, requires prior CBE approval. Similarly, acquiring 10% or more of a non-bank financial institution, such as an insurance, leasing, factoring, mortgage finance or consumer finance company, requires the prior approval of the FRA.

Foreign Investment

Foreign investors may generally own 100% of Egyptian companies, subject to sector-specific restrictions and applicable security approvals.

Merger Control

Since 1 June 2024, qualifying economic concentrations have been subject to suspensory pre-closing clearance by the ECA. The current notification thresholds are:

• combined Egyptian turnover or assets exceeding EGP900 million, with at least two parties each having Egyptian turnover exceeding EGP200 million; or
• combined worldwide turnover or assets exceeding EGP7.5 billion, with the target having Egyptian turnover exceeding EGP200 million.

Parliament approved amendments in April 2026 would increase these thresholds, but their entry into force remains subject to the full legislative process.

Common Deal Structures

Share and quota acquisitions of controlling or 100% interests are the most common structures, sometimes combined with a primary capital increase where new funding is injected into the target. Asset acquisitions, statutory mergers, demergers and joint ventures are also very frequently used based on the specific strategic transaction goals.

Egypt’s capital markets are governed by the CML and its Executive Regulations, the Central Depository Law, the Law establishing the FRA, the Companies Law and FRA decrees, notably the Listing Rules. The FRA is the principal regulator: it approves prospectuses and licenses market participants. The EGX operates the market and applies the Listing Rules under FRA supervision.

An IPO has three stages.

• The EGX Listing Committee admits the shares once the issuer meets the main Listing Rules conditions: fully paid-in capital of at least EGP100 million, two years of audited financial statements, pre-tax profit from its core activity of at least 5% of paid-in capital in the last financial year and at least five million shares.
• FRA registration and prospectus approval, supported by an independent financial adviser’s fair value study, valid for six months. FRA review generally takes four to six weeks.
• Offering at a fixed price or through book-building within a price range, after the prospectus is published in the press.

After the offering, the issuer must have at least 300 shareholders and a free float of at least 10%. Follow-on offerings require a shareholders’ resolution, an FRA-approved prospectus and observance of pre-emption rights unless validly waived.

The CML and the Listing Rules provide no prospectus exemptions for public offerings of securities. That said, a company may nonetheless be admitted to listing on the EGX without conducting a public offering provided that listing criteria are satisfied prior to listing.

There is no single hold period, but privately placed securities may not be offered to the public without a prospectus. On listing, holders of 10% or more must retain at least 51% of their shares, topped up to 25% of capital by other shareholders where necessary. The lock-up runs for at least 24 months and until periodic financial statements for two financial years have been issued. Transfers to institutional or strategic investors assuming the lock-up require FRA and general assembly approval. Special purpose acquisition company (SPAC) founders face a 100% lock-up for 12 months. Off-exchange or non-compliant trades are void, and breaches may attract imprisonment, fines, trading suspension or delisting.

Listed entities must submit to the FRA and the EGX:

• audited financial statements and the board’s report annually;
• financial statements with the auditor’s limited review, and a report on shareholding structure, board composition and treasury shares on a quarterly basis; and
• an activity report reflecting the company’s true financial position and, after a cash capital increase, confirmation that proceeds were used as disclosed on a semi-annual basis.

Summaries of the annual and semi-annual financial statements must also be published in two widely circulated newspapers.

Additionally, listed entities shall promptly notify the EGX of:

• changes to information in the listing application, prospectus or annual board report;
• general assembly resolutions, and board resolutions approving financial statements or dividend distributions;
• capital increases, and acquisitions of investments exceeding 10% of the company’s equity;
• administrative measures, arbitral awards or court judgments that may affect its financial position, equity, share price or investors’ decisions; and
• custodial sentences against board members or senior executives.

Material events, including resolutions related to the amendment of the nominal value of the company’s shares and cash dividends distributions, shall be notified to the EGX for publication on trading screens before the next trading session. If information leaks, or the event occurs during a session, the EGX may suspend trading until disclosure.

The CML bars anyone holding material non-public information, including directors, executives, employees, advisers and recipients, from dealing in the issuer’s securities or disclosing it before public release. The Listing Rules prohibits insiders and holders of 20% or more from trading for a period of five working days before or one working day after material disclosure, on documented advance notice.

Listed companies are required to maintain a register including all insiders and holders of 20%; they are also required to document in writing material events under negotiations and notify the EGX in case of insider information leak. The CML criminalises price manipulation.

The FRA chair and the head of the EGX may bar violators from buying on the EGX for up to six months, and the EGX may suspend or delist securities. For FRA-licensed firms, the FRA may suspend activities for up to 30 days, revoking licences if violations remain unremedied.

The CML lays down the following statutory penalties.

• Insider dealing: Imprisonment for at least two years and/or a fine ranging from EGP50,000 (or the profit/loss avoided) up to EGP20 million (or twice the profit/loss avoided).
• Illegal disposal of securities: A fine between EGP5,000 and EGP100,000.
• Failure to launch a mandatory tender offer: A fine between EGP100,000 and EGP500,000, plus restitution of the securities’ value. Settlement requires submitting the offer and paying 1–10% of the securities’ value to the FRA
• Executive regulations violations: A fine between EGP2,000 and EGP1 million.

Substantial shareholdings are governed by the CML, its Executive Regulations and the Listing Rules. Principal shareholders and their related parties must disclose direct and indirect holdings every January and July, and notify the EGX of each change, including through subscription rights, crossing 5% or a multiple thereof. Each disclosure must identify related parties and whether holdings are direct, indirect or in concert.

A shareholder reaching 25% must disclose its investment plans and intended management policies. Acquiring 33.3%, 50%, 66% or 75% of capital or voting rights triggers a mandatory tender offer for remaining shares. No violation arises where a related party, unaware of the other’s trades, exceeds a threshold by up to 1%, or for holdings resulting from discretionary portfolio management by a licensed manager.

Regarding changes in interests, as per the Listing Rules, companies shall have the Nomination and Remuneration Committee assess board nominations, particularly independent candidates, and notify the FRA in advance of any auditor replacement, stating reasons and a handover plan ensuring reasonable transition.

Concerning obligations according to thresholds:

• board members, employees and their related parties disclose each purchase or sale reaching 3% of the company’s securities;
• at 10%, the holder becomes a principal shareholder (counting direct, indirect, concert and related party holdings) subject to periodic disclosure;
• principal shareholders notify every increase or decrease crossing 5% or a multiple thereof (15%, 20%, 25%, etc);
• at 25%, disclosure of investment plans and intended management policies is required; and
• at 33.3%, 50%, 66% and 75%, a mandatory tender offer is required.

The obligations apply to individuals and legal entities, including funds and their related parties, and to the issuer’s board members and employees. Related parties include a shareholder’s spouse and minor children, and entities it controls.

Breaches are punishable by a fine of EGP2,000 to EGP1 million. The FRA chair and the head of the EGX may prohibit the violator from buying securities on the EGX for up to six months, and the EGX may suspend trading in the security until the required disclosure is made.

The Listing Rules require listed entities to:

• maintain audit, nomination and remuneration committees monitoring financial reporting and executive appointments;
• enforce insider blackout windows and updated insider lists;
• document material negotiations in writing;
• prepare detailed board annual reports and certified board minutes;
• comply with controls over asset acquisitions or mergers; and
• regularly publish audited standalone and consolidated financial statements.

Egyptian law does not mandate internal whistle-blowing mechanisms for listed entities. The Egyptian Corporate Governance Code recommends a “comply-or-explain” policy, supplemented by a direct FRA channel. That said, listed companies must promptly disclose material information and events, potentially capturing conflicts of interest, related-party transactions and other concerns.

Listed companies should adopt a board-approved compliance framework comprising:

• a compliance function reporting directly to the audit committee;
• written policies on insider dealing, disclosure and AML/KYC;
• a risk management framework overseen by a risk committee;
• a whistle-blowing policy consistent with the Code of Corporate Governance; and
• regular training and periodic independent review.

Security interests in Egypt are regulated by several laws. Real estate mortgages fall under the Civil Code (Law No 131 of 1948), security over most movables under Law No 115 of 2015 and its Executive Regulations (the “Movables Collateral Law”) and fonds de commerce mortgages under Law No 11 of 1940. Insolvency ranking is set by the Civil Code and the Restructuring, Preventive Composition and Bankruptcy Law (Law No 11 of 2018).

Common forms of collateral include real estate mortgages, security over movables, share pledges, assignments of receivables and contractual rights by way of security, and pledges over bank accounts and insurance proceeds, each with distinct creation and perfection requirements.

A real estate mortgage is perfected by registration with the notary public, making it enforceable against third parties and setting priority by registration date; unregistered, it binds only the parties. Movable security covers receivables, future assets, bank accounts, inventory, equipment and certain IP rights. The Movables Collateral Law permits non-possessory security perfected by registration with the Egyptian Collateral Registry (ECR), supervised by the FRA. Registration makes the security enforceable against third parties, with priority by registration date, subject to statutory exceptions. Share pledges are registered with Minister for Central Clearing, Depository and Registry (MCDR).

This distinction extends to enforcement. Real estate mortgages are generally enforced through court-supervised public auctions, while movable security can largely be enforced out of court after notice to the debtor and registration of an enforcement notice with the ECR. In insolvency, statutory priority claims such as judicial expenses and certain taxes are paid first. Secured creditors then recover from their collateral’s proceeds, subject to priority rules and enforcement costs, and any balance goes to unsecured creditors. Any shortfall ranks pari passu with unsecured claims.

Because security and its ranking largely determine recovery, acquisition financing typically begins with due diligence on the borrower and the target company, which lenders treat as a determining factor for proceeding. The package commonly includes a pledge over the target’s shares, security over the borrower’s bank accounts and receivables, and an assignment of its rights under the acquisition documents. As Egyptian law does not recognise the trust, security for syndicated or multi-tranche facilities is typically held by a security agent. Since statutory ranking rules apply in insolvency, intercreditor and subordination arrangements are mainly contractual matters between creditors.

Finally, recent developments shaping financing practice include the Central Bank and Banking Sector Law (Law No 194 of 2020), the Law Regulating the Use of Non-Cash Payment Methods (Law No 18 of 2019), and CBE regulations and circulars on electronic banking and electronic know-your-customer (eKYC) and the licensing of payment service operators (PSOs) and payment service providers (PSPs).

Contracts in Egypt are principally governed by Egyptian Civil Code No 131 of 1948 (the “Civil Code”), supplemented by Commercial Code No 17 of 1999 and sector-specific legislation. Under the Civil Code, a contract is concluded through matching expressions of will, whether oral, written, implicit or expressed through customary signs, subject to applicable formalities. Under Article 147, a contract constitutes the law of the parties and may be amended or revoked only by mutual consent or on grounds recognised by law.

Validity requires consent, capacity, a defined subject matter, a lawful cause and any mandatory formalities. The age of majority is 21 under Article 44. Legal entities contract through authorised representatives acting within their powers.

Grounds for invalidity include missing essential elements, illegality, incapacity and defects in consent, including mistake, fraud and duress. Egyptian law distinguishes between absolute nullity, generally invocable by any interested party or raised by the court, and relative nullity, which protects a particular party.

Under Article 150, clear contractual wording must be respected. Ambiguities are resolved by determining the parties’ common intention, considering the transaction, good faith and commercial usage, with doubt interpreted in favour of the obligor. Article 148 requires performance in good faith, including obligations arising from law, custom and equity.

Mandatory restrictions include:

• adhesion contracts – Article 149 permits courts to modify or disregard abusive terms notwithstanding contrary agreement; and
• exclusion of liability – Article 217 permits contractual exclusion or limitation of liability, except for fraud or gross negligence; exclusion of tortious liability is void.

Liquidated Damages

Articles 223–225 provide that agreed damages are not payable without loss and may be reduced if excessive or where the obligation has been partly performed. Recovery exceeding the agreed amount requires proof of fraud or gross negligence.

Principal remedies include specific performance, revocation and compensation. Under Article 157 of the Civil Code, where a party to a bilateral contract fails to perform after being placed in default, the other party may seek performance or revocation, with compensation where appropriate. Article 158 permits agreement on automatic termination.

Specific performance is generally available where performance remains possible. Article 203 provides for performance in kind, subject to statutory conditions, while compensation may be awarded where performance is impossible or insufficient. Termination may arise by agreement, under an express contractual clause or through judicial revocation. Wrongful termination may itself constitute a breach giving rise to compensation.

Under Articles 215 and 165, a debtor may be exempt from liability where non-performance or damage results from an external cause beyond their control, subject to any agreement providing otherwise.

Article 147(2) addresses unforeseen circumstances. Where exceptional, general and unforeseeable events make performance excessively onerous, without rendering it impossible, and threaten the debtor with excessive loss, the court may adjust the obligation to a reasonable level after balancing the parties’ interests. Any agreement excluding this judicial power is void.

The principal legislation is Intellectual Property Rights Law No 82 of 2002, covering patents, utility models, industrial designs, trade marks, trade names, geographical indications, copyright, related rights, undisclosed information and trade secrets.

Commercial agreements should address ownership, assignment, licensing, permitted uses, territory, duration, confidentiality and enforcement. Under Article 149, copyright assignments must be written and specify the rights transferred, scope and purpose of exploitation, duration and territory. Economic rights not expressly assigned remain with the author, while moral rights generally cannot be assigned.

Article 95 permits trade mark licensing, while Article 96 establishes certification and registration requirements for effectiveness against third parties. Under Article 7, rights in commissioned inventions generally belong to the commissioning party. Employers may hold rights in employee inventions arising within the employment relationship. Article 6 addresses jointly created inventions, establishing equal patent rights among contributors unless otherwise agreed.

Contractual drafting is particularly important for commissioned copyright works and commercially created IP, given the differing statutory ownership rules. Egypt has no comprehensive statutory regime specifically allocating copyright ownership of purely AI-generated works. Protection therefore depends on whether the output satisfies statutory copyright requirements and, where human contribution exists, the applicable authorship and contractual arrangements.

Available infringement remedies include civil damages, precautionary measures, seizure of infringing goods and, where applicable, criminal penalties. Article 115 permits precautionary measures in trade mark infringement proceedings, including establishing infringement and seizing relevant goods and materials.

The principal legislation is Consumer Protection Law No 181 of 2018 and its Executive Regulations (CPL). It imposes mandatory obligations concerning product safety, quality, disclosure, advertising, invoicing, warranties and after-sales services. Articles 3–5 require compliance with applicable safety and quality standards, disclosure of material product information and Arabic-language consumer-facing documents, including electronic records and contracts.

For distance and e-commerce transactions, Article 37 requires sufficient pre-contractual information, including supplier identity and registration details, product characteristics, price and payment arrangements. Article 40 grants consumers a 14-day withdrawal right following receipt of goods, subject to statutory exceptions. Article 17 provides a general 14-day return or exchange right without requiring a reason, subject to exceptions. Under Article 21, defective, non-conforming or unsuitable goods may be returned or exchanged for a refund within 30 days.

The Consumer Protection Agency (CPA) may investigate violations, request information and documents, suspend misleading advertisements and issue binding decisions in certain consumer disputes. Under Article 52, it may order replacement or refunds in disputes involving consumers and suppliers or advertisers. The CPL prescribes administrative fines of up to EGP2 million for various violations, including breaches of consumer information, advertising and distance-contracting requirements.

Misleading advertising and unfair commercial practices are addressed through the CPL’s disclosure and advertising rules. Applicable Supreme Council for Media Regulation requirements may also govern advertising materials. Depending on the online activity, Anti-Cyber and Information Technology Crimes Law No 175 of 2018 may impose additional obligations.

Merger Control

Egypt’s merger control regime is governed by the ECL and its Executive Regulations.

An “economic concentration” is any change of control or material influence resulting from:

• a merger, acquisition of control or material influence in a person;
• the establishment of a joint venture; or
• the acquisition of an existing entity undertaking a joint venture project.

An economic concentration requires pre-closing approval from the ECA if, for the last financial year, the concerned persons’ aggregate annual turnover or assets: (i) in Egypt exceed EGP900 million, with at least two persons each having Egyptian turnover exceeding EGP200 million; or (ii) worldwide exceed EGP7.5 billion, with at least one person having Egyptian turnover exceeding EGP200 million.

The ECA’s review process comprises two phases: 30 working days for Phase I and, if referred to Phase II, a further 60 working days, extendable by 15 working days where commitments are submitted. The ECA assesses whether a concentration may limit, restrict or otherwise harm competition, considering market structure, competition, the parties’ market positions and financial strength, alternatives, barriers to entry and expansion, and effects on consumers, investment, innovation and development.

The ECA may conduct ex post reviews of below-threshold concentrations that could restrict or harm competition. Concentrations in activities supervised by the FRA fall outside the ECA’s jurisdiction and require FRA pre-closing clearance. The FRA must seek the ECA’s advisory opinion before approval. Banks and other Central Bank-supervised entities, and public utilities directly managed by the State, are excluded from the ECL’s application.

Failure to Notify

If a filing violation is established, the ECA shall require the violating party to remedy the violation or take corrective measures. Non-compliance shall render the transaction agreement void.

Where the ECA initiates criminal proceedings, failure to notify is punishable by a court-imposed fine of 1% to 10% of the relevant annual turnover, asset value or transaction value, whichever is higher, or EGP30 million to EGP500 million if the percentage cannot be calculated. The same fines apply to non-compliance with the ECA’s conditional approval or rejection and obtaining clearance through knowingly false information or documents.

Consequences of Anti-Competitive Conduct

The ECL prohibits anti-competitive agreements and practices, including horizontal agreements, vertical restraints and abuse of dominance. Violations may trigger criminal action, initiated only upon the ECA chairperson’s written request. Court-imposed fines are:

• 2% to 12% of relevant product revenues for horizontal agreements; or
• EGP500,000 to EGP500 million if incalculable.

Lower ranges apply to vertical restraints and abuse of dominance. Violations may be settled with the ECA. The ECA shall also require remedial or corrective measures and may issue cease-and-desist orders where a practice may cause irreparable harm to competition or consumers.

A new competition law, approved by the House of Representatives, awaits presidential ratification and publication, representing a significant reform of Egypt’s competition framework.

Egyptian law does not impose a specific foreign investment review or approval requirements based on the investor being a foreigner or the value of the investment, except for certain sectors highlighted in the following. Nevertheless, companies operating in Egypt with foreign participation are subject to FDI reporting requirements to GAFI for statistical purposes.

Foreign Ownership Restrictions in Regulated Activities

The following restrictions apply:

• maritime and air transport generally require at least 51% Egyptian ownership;
• postal services require approval from the National Postal Authority;
• commercial agency companies must be 100% Egyptian-owned;
• domestic manpower activities require 100% Egyptian ownership, while overseas manpower activities allow up to 49% foreign ownership; and
• foreign shareholders cannot hold management rights in press institutions or media agencies.

Security Clearance Procedures

Foreign investors and certain foreign representatives of companies are subject to security clearance procedures through GAFI and other competent authorities.

Investment Incentives

General incentives include exemptions from stamp duty and certain notarisation and registration fees for five years, exemption from applicable fees for registering lands required for the company or investment and a unified 2% customs duty on imported machinery, equipment and devices required to establish the company.

Special incentives include a deduction from taxable net profits equivalent to 30% or 50% of investment costs, depending on the project’s geographical location and activities. Certain eligible industrial projects may also receive a cash incentive ranging from 35% to 55% of tax paid on income generated from the relevant activity.

Additional incentives may include government contributions in utility and infrastructure costs. Free and special economic zones are subject to separate incentive regimes. Companies may obtain a golden licence (single approval) covering the establishment, operation and management of investment projects, primarily for strategic or national projects.

Recent Developments Affecting Foreign Investment

Law No 170 of 2025 establishes a framework enabling private sector participation through the acquisition or increase of shareholdings in state-owned companies. It signals a shift towards greater private sector participation in the economy.

Egypt has witnessed more industrial and investment zones, as well as free and economic zones, with the Suez Canal Economic Zone continuing to serve as Egypt’s flagship logistics and industrial hub.

Companies with less than 51% Egyptian ownership, including wholly foreign-owned companies, may register in the Importers’ Registry to undertake importation for trading purposes for up to ten years, extendable once for an additional ten years by Cabinet decision.

Recent tax reforms have also introduced tax benefits and measures aimed at simplifying tax procedures and facilitating settlement of tax liabilities. These include an exemption from capital gains tax on the disposal of shares listed on the EGX, subject to the applicable stamp duty.

The Sovereign Fund of Egypt and the Future of Egypt Authority have continued to attract private and foreign investment through partnerships and the development and monetisation of state-owned assets.

Egypt’s data protection framework is regulated by Personal Data Protection Law No 151/2020 (the PDPL), its Executive Regulations and guidelines issued by the Personal Data Protection Centre (PDPC). Sector-specific requirements may also apply, notably in the banking sector, which is subject to additional customer data confidentiality and protection requirements under Articles 140–142 of Central Bank and Banking System Law No 194 of 2020, as well as circulars and instructions issued by the CBE.

The PDPL establishes a licensing framework for controllers and processors, under which supplementary licences may be required depending on the specific processing activities they conduct. Processing must be conducted based on a PDPL-recognised legal basis, including data subject consent. Personal data must be collected and used only for disclosed, legitimate purposes and to the extent necessary to fulfil those purposes, with appropriate transparency and security measures in place.

Disclosure to third parties must similarly have an appropriate legal basis and be consistent with the purposes of collection; all such information, among other prescribed information, must be communicated to data subjects through a privacy notice. Data breaches must be notified to the PDPC within 72 hours and affected data subjects within three days thereafter, with shorter notification periods applying in certain circumstances.

Cross-border transfers are generally subject to PDPC licensing and data subject consent, and require consistency between the parties’ activities or processing purposes, a legitimate interest of either party or the data subject, and an adequate level of legal and technical protection in the recipient jurisdiction. Exceptions may apply in prescribed circumstances, subject to the data subject’s explicit consent. CCTV footage is subject to data localisation requirements and may not be transferred outside Egypt. As these requirements are not yet fully enforced in practice, their practical impact on businesses remains to be seen.

Egypt’s AML/CFT framework is principally governed by AML Law No 80/2002, its Executive Regulations, Anti-Terrorism Law No 94/2015 and Egyptian Money Laundering and Terrorist Financing Combating Unit (EMLCU) Decision No 1/2024. Regulated entities must conduct risk assessments, customer and beneficial-owner due diligence, ongoing monitoring, enhanced due diligence for higher-risk relationships, suspicious-transaction reporting, record retention and tipping-off controls. The regime applies to financial institutions and specified non-financial businesses and professions.

Key legislation includes Anti-Terrorism Law No 94/2015, Law No 8/2015, EMLCU Decision No 1/2024, Import and Export Law No 118/1975 and Customs Law No 207/2020. Businesses must screen counterparties, comply with asset-freezing measures and verify applicable trade restrictions and authorisations. Breaches may result in fines, confiscation, licence measures and imprisonment.

Businesses must avoid offering or accepting improper benefits, corrupt influence arrangements, misuse of public funds and laundering corruption proceeds. Compliance programmes commonly include senior-management oversight, third-party due diligence, payment controls, gifts and hospitality procedures, employee training and internal reporting mechanisms.

The Administrative Control Authority investigates corruption-related misconduct, the Public Prosecution investigates and prosecutes criminal offences, and the Administrative Prosecution addresses administrative and financial misconduct. The EMLCU analyses suspicious-transaction reports and refers suspected offences to competent authorities, while the CBE and the FRA may impose corrective directions, activity restrictions, suspension and other licence-related supervisory measures.

Environment Law No 4 of 1994 requires an environmental impact assessment (through a three-tier screening) for new projects. The Waste Management Regulatory Authority now enforces extended producer responsibility registration for waste-generating businesses. No statutory contaminated-land regime exists; liability relies on the general tort principles under the Civil Code.

Egypt does not have a specific climate-related litigation regime. Corporate exposure arises through the statutory environmental requirements under the Environment Law (sanctioned by fines and business closures) as well as Civil Code tort claims.

Labour Law No 14 of 2025 (the “Labour Law”), together with (among others) Ministerial Decree No 211 of 2003 and Ministerial Decree No 249 of 2026, sets employer duties: safe workplaces, protective equipment, insurance, and occupational health and safety committees at higher-risk sites. Egypt has one national regime that applies uniformly, with no provincial-level regulatory differences.

GAFI is the central authority for investment approvals, and Industrial Licensing Law No 15 of 2017 streamlines factory permits. Further approvals may be required from sector-specific regulators, including the Egyptian Electric Utility Agency, the FRA and the Egyptian Drug Authority for energy, financial services and pharmaceuticals, respectively.

Egypt does not currently have a comprehensive AI-specific law. AI is regulated through existing legislation, sector-specific rules and policy instruments, principally the National AI Strategy 2025–30, the Egyptian Charter for Responsible AI 2023 (the “AI Charter”), the National AI Governance Framework 2026 and the National Guidelines for Trustworthy and Responsible AI 2026 (the “Responsible AI Guidelines”) . The Framework adopts a risk-based approach to AI systems; while these instruments remain principally non-binding unless incorporated into legislation, a dedicated AI legislation is currently under development.

Pending its enactment, binding obligations arise mainly under the PDPL and its Executive Regulations, together with applicable cybersecurity, consumer-protection, IP and sector-specific laws.

Key expectations include the following.

• Transparency: Organisations should disclose AI use, explain the system’s purpose, data use, capabilities and limitations, and provide accessible complaint or appeal mechanisms. Where personal data is processed, PDPL transparency requirements and data-subject rights apply.
• Bias and fairness: Organisations should use representative data, test for bias and imbalance, apply proportionate fairness criteria and document mitigation measures.
• Accountability: Responsibility should remain with identified persons, supported by proportionate human oversight, escalation and override mechanisms, audit logs and clear decision ownership throughout the AI life cycle.

Businesses in Egypt may be subject to various other regulatory compliance regimes depending on their activities, including competition and merger control, consumer protection, employment and labour, tax, anti-bribery and anti-corruption, corporate and commercial, import/export and customs, and product-specific requirements. Certain industries are also subject to sector-specific regulatory and licensing regimes, including banking and financial services, telecommunications, healthcare and pharmaceuticals.

Main Employment and Labour Laws in Egypt

The main laws are:

• the Labour Law – the primary statute governing private-sector employment, covering contracts, wages, working hours, leaves, investigations, termination and labour disputes;
• Social Insurance and Pensions Law No 148 of 2019;
• Comprehensive Health Insurance Law No 2 of 2018;
• Child Law No 12 of 1996;
• Trade Union Organizations and Protection of the Right to Organize Unions Law No 213 of 2017;
• Persons with Disabilities Law No 10 of 2018; and
• Civil Code No 131 of 1948.

Termination of Employment in Egypt: Key Legal Considerations for Employers

The general principles are as follows:

• termination is governed by the Labour Law, which protects employees regardless of company size or length of service;
• disciplinary dismissal requires a labour court decision – employers cannot dismiss unilaterally;
• lawful grounds include evidenced gross misconduct and approved economic downsizing; and
• dismissal during pregnancy, maternity leave or certified sick leave, or for union activity, is prohibited.

Resignation

Resignations must be ratified by the labour office to be valid, preventing reliance on pre-signed resignations. Employees may withdraw resignations within ten days – also before the labour office. The Labour Law now considers unjustified absence as an implicit resignation subject to compliance with statutory process.

Wrongful Dismissal

For limited-term contracts, if the employer terminates during the term of the agreement, the employee shall be entitled to a remuneration equivalent to one month’s wage for each year of service, if the contract is renewed for more than five years. This is without prejudice to the employee’s right in claiming a compensation for unfair dismissal.

For unlimited-term contracts, an unjustified termination entitles the employee to compensation of not less than two months’ salary per year of service, in addition to other statutory and/or contractual entitlements.

The Labour Law also recognises circumstances akin to constructive dismissal, where the employee terminates the employment due to the employer’s breach of a fundamental statutory, contractual or regulatory obligation, including cases of assault on the employee by the employer. Such cases are deemed as an unjustified employer-initiated termination.

Structuring Executive Compensation in Egypt: Key Considerations

The applicable framework depends on the individual’s capacity. Board members and managers are not in an employment relationship, as they are appointed and dismissed through corporate resolutions, and are primarily governed by the Companies Law and the company’s articles, relying on the Labour Law only for limited rights such as leave. For an additional layer of protection, it is generally recommended to conclude a management agreement setting out their duties, remuneration and exit terms. Senior and key personnel engaged under employment contracts, by contrast, are fully subject to the Labour Law.

In all cases, incentive arrangements, including bonuses and equity-based plans, may apply to any individual regardless of capacity and are usually governed by company policies. A change of control does not trigger termination; employment relationships are protected under the Labour Law and continue with the new owner. From a tax perspective, remuneration and incentives are generally subject to income tax, which the company withholds and remits, although certain statutory and non-statutory benefits, such as employee profit sharing, may be exempt.

Non-Compete, Non-Solicitation and Confidentiality Covenants

Concerning confidentiality, the employee has a duty to keep all information to which they have/had access confidential during their term of employment. A breach of confidentiality by the employee resulting in gross damages qualifies the employer to seek their termination through labour courts.

There is no specific statutory regime governing non-solicitation; enforceability therefore depends principally on the contractual terms and applicable general principles.

Concerning non-compete:

• during employment, the Labour law prohibits engaging in similar activities during employment, whether as a partner or an employee; and
• post-employment, the Civil Code governs non-compete restrictions and requires them to be limited as to duration, geographical scope and type of activity.

Courts asses any interpretation, enforceability or breach of any of these fundamentals on a case-by-case basis subject to their discretionary power.

Forms of land ownership by companies include acquisition through purchase, lease-to-own and allocation of lands through governmental authorities such as the New Urban Communities Authority or the Industrial Development Authority.

Foreign ownership is restricted in certain asset classes and geographical areas, including the following.

• Agricultural lands: Foreigners are prohibited from acquiring agricultural, uncultivated or arable lands.
• Desert lands: Foreign ownership of desert land is generally capped at 49% of a company’s capital. This restriction does not apply where the company acquires desert land necessary to carry out or expand its activities.
• Built properties and vacant lands: Foreign ownership of built properties and vacant lands is subject to restrictions, including ownership of a maximum of two properties nationwide, each intended for private residential use and not exceeding 4,000 square metres, excluding properties classified as antiquities under the applicable laws. Disposal of the built property is generally restricted for five years, and development of vacant land must commence within five years of acquisition. However, in certain designated new urban and tourist areas, non-Egyptians may be treated as Egyptians for the purpose of owning residential units in areas such as Hurghada, the Red Sea, Ras El-Hekma and Marsa Matrouh, subject to approval from the competent authorities.
• Sinai and other security-sensitive areas: Foreigners are generally prohibited from owning lands or real estate rights in the Sinai Peninsula. They may, however, acquire a usufruct right over a residential unit for up to 50 years, subject to prior approval from the Ministry of Defence, Ministry of Interior and General Intelligence Service. Foreigners are also prohibited from acquiring certain real estate rights in locations designated on national security, public order or environmental grounds.

Registration of Properties

Egyptian law provides that ownership of real estate property must be registered with the competent notary public office to be transferred to the purchaser. However, a significant portion of properties in Egypt remains unregistered. An unregistered owner may still possess and exercise the rights associated with the property, except that the legal title is not officially registered in its name. In practice, transactions involving unregistered properties are often documented through preliminary sale agreements.

Registration by foreigners or companies that are majority foreign-owned is also subject to applicable security clearance requirements. In practice, foreigners without a valid Egyptian residency permit or applicable exemption card may face restrictions in obtaining registration or notarisation services for real estate acquisitions.

Real Estate Taxation

Real estate tax is imposed on built-up properties, with the owner generally responsible for payment. Disposals of real estate properties by natural persons are subject to real estate transaction tax at 2.5% of the sale price, payable by the seller. These taxes also apply to resident foreigners.

Key Legal Framework Governing Commercial Real Estate Transactions

Commercial real estate transactions are primarily governed by the Civil Code, which regulates the sale, lease, usufruct and mortgage of real estate property. Depending on the property’s nature, location and permitted use, additional legislation may apply, including laws governing new urban communities, industrial and tourism developments, investment, free zones and special economic zones.

Acts relating to real estate transactions that create or affect in rem rights must be registered with the notary public to be effective against third parties. Leases exceeding nine years are also subject to registration.

Key Considerations in Commercial Real Estate Acquisitions

The principal considerations in commercial real estate acquisitions include comprehensive due diligence covering:

• chain of title;
• the seller’s authority to dispose of the property;
• registration status;
• encumbrances;
• building permits;
• land allocation conditions;
• outstanding financial obligations; and
• environmental compliance.

Although title insurance has not traditionally been common in Egypt, the FRA introduced a standard real estate title insurance policy in 2025 covering risks relating to title validity.

Commercial Mortgage Financing

Commercial mortgage financing is primarily governed by the Civil Code, Mortgage Finance Law, and Central Bank of Egypt Law. Mortgages must be registered to be effective against third parties, with priority generally determined by the date of registration. In the event of default, the law provides an enforcement process involving notices, an enforcement order and the public auction of the mortgaged property, with proceeds distributed among creditors according to their priority.

Key Considerations for Commercial Leases

Commercial leases are generally governed by the Civil Code, with renewal, assignment and subletting primarily subject to the parties’ agreement. Leases exceeding nine years must be registered at the Notary Public to be effective against third parties, while shorter leases require date certification. The parties may also agree on contractual remedies, alongside remedies available under the Civil Code for actual losses and lost profits.

Recent Developments in Real Estate Regulations

Recent developments include discussions on a proposed draft law to regulate real estate development in Egypt and establish a union representing real estate developers. New rules have also been introduced governing the allocation of industrial lands, providing a unified process, more governance for their allocation and greater flexibility regarding their disposal.

The FRA has taken steps to regulate fractional real estate investment through real estate investment trusts (REITs) rather than any additional taxes or levies applicable to non-resident purchasers in the traditional models. The FRA has also introduced some regulations to facilitate the establishment of REITs and transformation of existing real estate companies into REITs. The FRA issued the second edition of the Egypt Real Estate Valuation Standards, replacing the framework in place since 2015 to enhance valuation practices and real estate market transparency.