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flag Egypt Egypt: Operating a Business

Setting Up a Company | Working Conditions | Cost of Labor | Social Partners

Setting Up a Company

Legal Business Entities

Types of Companies and Capital (Max/Min) Number of Partners/Shareholders and Liability
The Limited Liability company
 
Minimum 50,000 EGP, fully paid up when formed. 		Minimum 2 partners
 
Their responsibility is limited to their contribution amount.
Joint Stock Company is a public limited company (Incorporated)
 
250,000 EGP of which half is fully paid up when formed. 500,000 EGP in case of initial public offering. (1/4 fully paid up) 		Minimum 2 partners
 
Their responsibility is limited to the contribution amount.
General Partnership
 
Minimum 5,000 EGP 		Unlimited number of partners
 
General partner liability is unlimited
Limited Partnership
 
Minimum 5,000 EGP 		One general partner, unlimited number of limited partners
 
Limited partner liability is limited to the extent of his share
 
The Competent Organization
GAFI has a role in guiding and promoting foreign and Egyptian investments. It helps the investors in their administrative steps. GAFI has created a one-stop shop counter and the formalities for setting up a company are done in this counter. The One-stop Shop counter thus provides useful documents on law no. 8 of 1997 for encouraging investments, guarantees, exemptions, company creation procedure, the different zones with special statutes to the investors. For speeding up the setting up process, GAFI is authorized to grant temporary licenses for starting the project. The ITIDA (Information Technology Industry Development Agency) was established by law no. 15 of 2004. It is attached to the Ministry of Information Technology and Communication. ITIDA guides investors for executing their projects with a single counter which helps them with various relevant administrative authorities. The IDA (Industrial Development Authority) which comes under the Ministry of Commerce and Industry has been given charge since 2006 to develop and facilitate industrial establishments. In connection with the governing bodies the IDA recovers, prepares and puts up for sale lands for developing industrial zones by foreign and Egyptian promoters. The State develops the road network and other networks for these lands. The IDA also offers a one-stop shop for industrial investors to give them information on the available lands and help them get the permits for industrial operations.
 
Setting Up a Company Egypt Middle East & North Africa
Procedures (number) 6.0 8.1
Time (days) 7.0 20.0

Source: Doing Business.

 
Business Setup Procedures
Consult Doing Business Website, to know about procedures to start a Business in Egypt.
 General Authority for Investment

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Working Conditions

Legal Weekly Duration
The length work is 8 hours per day, 6 days per week with a maximum of 48 hours per week, and a rest obligation of a minimum of 24 consecutive hours in a week. There is a minimum 1 hour of rest for a day of work. If an employee works for more than 8 hours per day, he has a right to a 35% bonus for day work and 70% bonus for night work.
Retirement Age
60 years.
Working Contracts
The work contracts are governed, in the order of importance, by the legal provisions, collective agreement and individual negotiation. The two types of contract frequently used are the limited duration contract and the open-ended contract. There is also the temporary work contract which is used with the purpose of giving the employee a well-specified assignment. There is no maximum duration. The occasional work contract exists in the case of a specific assignment and its duration cannot exceed 6 months. The seasonal work contract highly used in the tourism sector is concluded for a work which is required to be repeated every year at around the same fixed date. This type of contract cannot be renewed. Dismissal / layoff criteria are also very rigid compared to the employment conditions which are very flexible.

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Cost of Labor

Minimum Wage
The government-mandated minimum wage in the public sector is approximately EGP 176 (USD 33) a month. The minimum-wage law is also observed in the private sector.
Average Wage
The average Egyptian salary is about 100 EUR per month.
Social contributions
Social Security Contributions Paid By Employers: For salaries between 0 and 750 EGP: 26%
For salaries between 751 EGP and 1,250 EGP: 24%
 Social Security Contributions Paid By Employees: For salaries between 0 and 750 EGP:14%
For salaries between 751 EGP and 1,250 EGP: 11%

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Social Partners

Social Dialogue and Involvement of Social Partners
There are 23 trade unions (labor unions) which are represented by the ETUF (Egyptian Trade Union Federation).
Unions
Egyptian Trade Union Federation
Unionization Rate
Union membership is around 20%.
Labor Regulation Bodies
Ministry of Labor (in Arabic)

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Learn more about Operating a Business in Egypt on Globaltrade.net, the Directory for International Trade Services.
 

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Last Updates: January 2012