The model of Corporations is probably the closest to the idea of Joint-stock company under the Common Law. Such an entity may be established in accordance with the Egypt’s Companies Law
Youssry Saleh & Partners have assisted vast numbers of foreign investors to establish their Joint-stock company in Egypt
The Joint-stock company in Egypt is subject to the following rules and limitations:
• The registration with the Commercial Registry is required with the registration being supervised by GAFI. The issuance of bonds or stocks is a procedure that requires a notification being sent to the Egyptian Financial Supervisory Authority (EFSA) with the said Authority having the right to object the issuance. The period of objection possibility lasts for three weeks. Moreover, the Authority has to issue a license for the registration of “companies operating in the securities field”
• Joint-stock company has no limitations for the areas of activity
• A minimum of three shareholders is required. Shares shall be available for the public. No minimum capital requirements for the foreign shareholders apply. The sale of the shares to the public shall be performed by means of either a bank that holds a license to receive subscriptions, a company set up for this purpose or a company licensed by EFSA to deal in securities. The board of directors is responsible for the management. The BOD consists of at least three members designated by the shareholders for a period of three years with the exception of the first BOD being elected for five years.
• Taxes on company profits apply
• For the expatriation of funds same rules as under the Branch establishment
• For the Import/export same rules as under the Branch establishment
• The minimum initial capital requirement is 250,000 EGP. During the incorporation phase 10% is paid with an increase to happen within three months. The rest of the amount is to be deposited within five years.
If the company is established for the purpose of stock trading, the minimum capital requirement is 5 million EGP.
When the operations of the company includes investment funds, direct investment funds, venture capitals and others, the minimum capital is 10 million EGP.
For the last two cases the whole amount shall be paid in one installment at the time of incorporation. The payment of the foreign entity shares shall be done by the means of foreign currency transfer from abroad. The authorized capital shall not surpass 10 times the initial capital
• A minimum of 10 per cent of the net profit should be distributed among employees with the condition that the said amount does not exceed the annual wages and salaries payable. Generally, foreign employees are not included in the profit sharing