Starting Your own Business in Egypt
If you are looking forward to setting up a business in Egypt and how you should go about it, I have found a place for you in this article.
Because of its geographical position, Egypt is deemed to be at crossroads between Africa and the rest of the world. In fact, the country has signed a score of bilateral and regional free trade agreements and programs.
Investing in Egypt has several advantages, especially in terms of highly qualified manpower (particularly in the finance, tourism and information and communication technology fields), the low cost of manpower, a reliable local telecommunications network, etc.
Despite the discrepancies relating to the concentration of economic activities around the Nile, growth rate remains favorable, thus encouraging the setting up of businesses in the country.
Types of companies
Limited Liability Company
The Limited Liability Company, or WLL, involves a minimum of two associates whose liabilities are limited to their amount of contribution. A minimum capital of 50,000 Egyptian pounds is required. The total amount must be released during the company’s constitution.
Joint Stock Company
The Joint Stock Company is an anonymous company involving at least three partners whose liabilities are limited to their amount of contribution. A minimum capital of 250,000 Egyptian pounds is required. Half of this amount should be released upon the constitution of the company. In case of public offering, a minimum capital of 500,000 Egyptian pounds will be required. Only a quarter of this amount will be released at the constitution.
The General Partnership involves an unlimited number of associates or partners. Their liabilities are joint and several. A minimum capital of 5,000 Egyptian pounds is required.
The Limited Partnership involves a general partner and an unlimited number of sponsors. Each partner is entitled to unlimited liabilities. As regards sponsors, their liabilities are limited to their amount of contribution. A minimum capital of 5,000 Egyptian pounds is required.
The setting up of a business in Egypt is regulated by the General Authority for Free Zones and Investment (GAFI). You will find a complete guide about relating procedures and formalities in the useful links provided below.
Booking a company name
First of all, you are required to register your company at the local Register of Commerce. A counter is available at the GAFI. Note that fees of 25 Egyptian pounds apply. A certificate of eligibility, including the official government stamp will then be issued.
Obtaining a bank certificate
The bank certificate is issued by the Alexandria Bank at the GAFI. This procedure can last for one or two days and costs between 300 and 500 Egyptian pounds. But you can still open an account with another bank to obtain this statement.
Accountants and Auditors Registry
You company’s auditor has to be registered at the Accountants and Auditors Registry. A certificate will then be issued.
The company’s contracts, constitution and statutes have to be notarized before the Investment Notarization Office at the GAFI.
Registering at the GAFI
To register with the GAFI, you are required to produce the following documents:
- the eligibility certificate (original)
- the bank statement (original)
- the company’s constitution signed by its founders and representatives (copy)
- the founders’ passport or identity card or resident permit (copy)
- the certificate issued by the Accountants and Auditors Registry (original)
- a duly filled and signed application form (provided by the GAFI)
- the company’s notarized statutes.
Note that several fees apply for the following; notary, formalities, syndicate, publications, Chamber of Commerce, Registry of Commerce, etc. In total, you will need an average of 2,600 Egyptian pounds. However, this amount is likely to vary according to the type of company and its capital.
Obtaining an incorporation certificate
The incorporation certificate is issued by the GAFI once it has validated the company’s statutes. This document is issued within 24 hours. You then have to request for an operating certificate from the Chamber of Commerce. Thereafter, you are required to officially register the company at the Registry of Commerce. The legal incorporation notice will then be published in the Official Gazette by the Companies Department within 15 days in case of no objection.
Once the company has been incorporated, it can be registered at the Tax Office at the GAFI. The application is then transferred to another office in Cairo for printing. If you have completed these formalities before noon, your tax card will be issued the same day. Otherwise, you will have to collect it the following day. Documents to be produced are the following:
- the company’s statutes
- the bank certificate
- an original extract of the company’s registration at the Registry of Commerce
- proof of address (the company’s original lease documents).
Registration at the National Authority of Social Insurance
Finally, you are required to register your company at the Social Security office. Start by creating a company file which you will fill every time you hire staff. The following documents are to be produced:
- the company’s tax registration card
- the company’s statutes
- proof of address (the company’s office lease documents).
Each employer has to fill the Form No. 2, produce a bank statement, as well as a copy of his latest diplomas. Employees, for their part, have to fill the Form No. 1, produce a copy of their identity card, of their birth certificate, copies of their latest diplomas, a duly filled and signed Form No.6 and their social security number if they have been employed in the part. Note that the Form No. 6 applies to employees who have previously worked for a company.