How to Establish a Company in Egypt

Establishing a company in Egypt involves understanding the country’s corporate forms, legal procedures and incentives. Egypt’s strategic location, large domestic market and recent investment reforms make it an attractive destination for entrepreneurs and foreign investors. Under Egyptian law, businesses can take many forms – from Limited Liability Companies (LLCs) and Joint Stock Companies (JSCs) to One-Person Companies (OPCs), partnerships, and foreign branches – each with its own requirements. Egypt’s recent Investment Law (No. 72 of 2017, as amended) offers tax and customs incentives, while free-zone regimes provide even greater benefits. This comprehensive guide explains the legal process to establish a company in Egypt, compares all major company types, and answers practical questions like “How to establish an LLC in Egypt?” and “What is the minimum capital for an LLC?” as well as how Bylaw Law Firm supports you every step of the way.

Advantages of Establishing a Company in Egypt

Egypt offers several regulatory and economic advantages for businesses. A modern investment law grants companies equal treatment and competitive incentives to encourage investment. In addition, free-zone and special economic zone regimes (e.g. Suez Canal Economic Zone) impose low or zero taxes on licensed activities, often much lower than the standard 22% corporate tax. For example, companies in the Suez Special Economic Zone pay a 10% flat income tax on corporate profits (vs. 22% normally), and even just 5% on personal income. In practice, firms in free zones can be tax-exempt on exports and approved activities.

Moreover, Egypt imposes no general restrictions on foreign ownership. Foreign investors may own 100% of an Egyptian company’s capital in any legal form, subject only to industry-specific restrictions (e.g. for media or defense sectors). Repatriating capital and profits is fully permitted under the central bank law. Foreign investors also benefit from Egypt’s extensive trade and investment treaties, a large network of double-taxation agreements, and ongoing reforms to simplify business setup (e.g. e-registration systems at GAFI, the General Authority for Investment). For these and other “advantages of establishing a company in Egypt,” businesses gain access to a market of 100+ million people, favorable labor and land costs, and the ability to export from one of North Africa’s logistics hubs.

Types of Companies in Egypt

Egypt’s Companies Law (Law No. 159 of 1981) (as amended) recognizes several business forms. The most common corporate vehicles are:

• Limited Liability Company (LLC) – (Arabic: Sharikat El-Mahdud el-Mas’oulia). Owned by at least two partners (individuals or legal entities) and up to 50 partners, an LLC has limited liability. Partners’ liability is confined to their capital contributions. An LLC cannot list on the stock exchange or offer shares to the public. It is managed by one or more managers (who may be Egyptians or foreigners, though regulated activities may require Egyptian nationals). Capital is determined by the partners and typically no minimum is required (subject only to sector rules). LLCs are popular for SMEs and joint ventures.

• Joint Stock Company (JSC) – (Arabic: Sharikat El-Amanah). Requires at least 3 shareholders (individuals or companies). A JSC’s capital is divided into equal shares; minimum capital is EGP 250,000. Shareholders’ liability is limited to share value. A JSC must have a board of directors (minimum 3 members) to run daily operations. JSCs can raise capital by public subscription and list on the EGX, making them suitable for large projects. Foreigners may hold all shares (except in some reserved sectors). At incorporation, a JSC must deposit 10% of capital (25% within 3 months, remaining within 5 years).

• One-Person Company (OPC) – A new form created by amendment in 2018. An OPC can be established by one person (individual or legal) who owns 100% of the capital. The sole owner (founder) has limited liability up to the company capital. An OPC’s minimum capital is EGP 1,000 (recently lowered from EGP 50,000), and it must be fully paid in when registering. OPCs cannot issue tradable securities or borrow publicly, and they may not engage in banking, insurance, savings, or investment fund businesses. An OPC must appoint a registered legal advisor and an auditor. OPCs combine the simplicity of sole proprietorship with corporate liability protection, making them ideal for solo entrepreneurs and startups.

• General Partnership (GP) – (Arabic: Sherikat Odawiya). Formed by at least two active partners (who manage the business). Each partner is jointly and severally liable for the partnership’s debts (i.e. unlimited liability). A GP is not a separate legal entity from its partners (but it is registered with the commercial registry). There is no minimum capital requirement by law. GPs are governed by the 1938 Partnership Law (No. 8 of 1938) and often used for small businesses or professional firms. Because of unlimited liability, GPs are less common for foreign investors.

• Limited Partnership (LP) – (Arabic: Sherikat Mahdudah) or Limited Partnership (LP). Requires at least one general partner (with unlimited liability, who manages) and at least one limited partner (liability limited to contribution). The limited partner cannot manage the business. LPs must be registered; capital contributions are set by agreement (no set minimum). Like GPs, LPs lack corporate personality in the law (partners act under the partnership name). LPs combine flexibility with the ability to take passive investors (limited partners).

• Branch Office of a Foreign Company – A foreign company (corporation or joint stock) can register a branch in Egypt to carry out business, usually tied to a specific contract or project. A branch is not a separate legal entity from the parent company. It requires formal registration with GAFI. Minimum capital is EGP 5,000 (small, mainly a formality). The parent company must provide certified incorporation documents, board resolutions, and appoint a branch manager. The branch’s purpose is usually limited to specific activities or projects. Branches are taxed in Egypt on income derived here, and like subsidiaries they pay regular corporate taxes.

How to Establish an LLC Company in Egypt

Forming an LLC is a common choice for new businesses. To establish an LLC, follow these steps:

1. Reserve a Trade Name. Propose several company names and apply for a “non-confusion certificate” at GAFI’s portal or commercial registry. This confirms your chosen name is unique.

2. Draft the Articles of Association (AOA). Prepare the company’s founding documents (in Arabic), outlining partners’ details, capital, purposes, etc. Engage legal counsel for accuracy.

3. Open Bank Account and Deposit Capital. Even though no minimum capital is prescribed, open a corporate bank account in the company’s name. Typically partners deposit an agreed initial amount (which will count as issued capital). Obtain a bank certificate of deposit.

4. Secure Foreign Employee Clearances. If any foreign shareholders or managers, apply to GAFI for security clearance (required for each foreign person).

5. Notarize and Legalize Documents. Have the Articles and other company documents notarized by Egypt’s Notary Public or GAFI’s Notarization Office.

6. Submit Incorporation to GAFI. File the complete application via GAFI’s e-portal or in person. Include the non-confusion certificate, AOA, bank deposit certificate, shareholders’ IDs, security clearances, office lease, and (if foreign-owned) parent company documents translated and legalized.

7. GAFI Review and Approval. GAFI will review the application. If all requirements are met, they issue an incorporation license and forward documents to the Commercial Registry.

8. Commercial Registry & Tax Registration. With GAFI approval, register the company at the Commercial Registry (Ministry of Trade), which issues the commercial register and official Gazette notification. Simultaneously, register for tax (income tax, and VAT if applicable) with the Tax Authority, and enroll with the Social Insurance (NSSF) for the partners and employees.

Minimum Capital for an LLC: By law, an LLC generally has no fixed minimum capital requirement. (In practice, partners can choose any amount. Certain activities like licensed imports may require higher capital, but these are industry-specific). Thus, even a modest capital can suffice to start an LLC, making it an attractive vehicle for new ventures.

The total time to incorporate an LLC (name approval, document preparation, GAFI approval, registry, and tax registration) typically takes 2–4 weeks, assuming all paperwork is in order. Recent reforms and online portals have accelerated the process. A typical timeline (indicative) is:

• Name reservation (1–2 days)

• Document drafting & notarization (1–2 weeks)

• GAFI review (1–5 working days)

• Commercial registry and tax registry (1–2 weeks)

Overall, businesses should plan for about 3 weeks to complete registration. The exact duration depends on factors like the complexity of the structure, obtaining foreign clearances, and any special licenses required.

Establishing a Branch of a Global Company in Egypt

Foreign corporations can set up a branch office in Egypt to undertake business under a specified project or contract. Key points:

• Registration: The foreign company submits an application to GAFI for a branch (a form of incorporation). Required documents include the parent’s articles of incorporation (legalized in Egypt), a board resolution approving the branch, a power of attorney for the branch manager, and evidence of the contract to be executed.

• Capital: The law mandates only a nominal EGP 5,000 capital deposit to register a branch.

• Liability: The parent company is fully liable for the branch’s obligations.

• Management: The branch operates through one or more managers appointed by the foreign parent. Managers (who need not be Egyptian) handle day-to-day operations with authority conferred by the parent.

• Business Scope: By regulation, a branch may only perform the specific activities or contract for which it was established. To broaden its scope or continue beyond the project, the foreign entity may form a new legal subsidiary.

• Process: The incorporation steps for a branch largely mirror those of a subsidiary (name reservation, submission of documents to GAFI, issuance of registration). After GAFI approval, the branch is entered in the Commercial Registry and obtains a tax card.

• Free Zone Branches: Establishing a branch in a free zone may confer additional benefits (e.g. tariff reductions) under that zone’s rules, on top of the standard corporate tax advantages for free-zone entities.

By contrast, foreign companies not seeking a commercial presence may open a representative office for market research; these have very limited activities (no commercial operations) and simpler registration.

Establishing Partnerships in Egypt

While corporate forms dominate, entrepreneurs can also form partnerships:

• General Partnership (Sherka ‘Odawiya): Requires at least two general partners (individuals or companies) who both share active management and liability. A GP is not a separate legal person; partners are jointly responsible for all debts. The partnership must be registered at the Commercial Registry but is governed by older partnership law (Law No. 8 of 1938). There is no minimum capital rule. GPs are common for small trading businesses or professional services. However, because each partner’s personal assets are at risk, this form is less attractive for larger ventures.

• Limited Partnership (Sherka Muhaddada): Involves at least one general partner (with unlimited liability and management duties) and at least one limited partner (who contributes capital but does not engage in management and whose liability is capped at their contribution). Like GPs, LPs are governed by the 1938 law and require registration. LPs combine passive investors with at least one active partner. There is no statutory minimum capital (partners agree amount). As a partnership, it lacks share issuance ability. LPs can be suitable for family businesses or small enterprises with silent investors.

• Comparison: Partnerships are relatively informal, with flexible internal governance (determined by the partnership agreement). However, except for limited partners in an LP, all personal partners are exposed to liability. Profit is taxed as personal business income. Partnerships do not benefit from the corporate incentives (they are not “companies” under Law 159) but can operate in free zones if registered there.

In practice, foreign entrepreneurs more commonly use corporate forms (like LLCs) than partnerships, due to liability concerns. Nonetheless, understanding partnerships is useful, as they can be converted into corporations later by inserting additional partners or restructuring.

The Company Registration Process in Egypt

All company types follow a structured registration process overseen by GAFI and the Commercial Registry:

1. Name Reservation: Apply for a trade name clearance (“non-confusion certificate”) to ensure your proposed name is not already taken.

2. Prepare Documentation: Draft the articles of association and other incorporation documents (in Arabic, per templates provided by GAFI). Documents must include founders’ details, capital, company purpose, etc.

3. Bank Account and Capital: Open a corporate bank account. Deposit the initial capital (even if no legal minimum) and obtain a bank deposit certificate. Funds may be released after registration.

4. Foreign Clearances: For each foreign shareholder or manager, apply for security clearance from GAFI. These checks can run in parallel with the incorporation process.

5. Notarization: Have the incorporation documents (articles, powers of attorney, etc.) notarized by GAFI’s Investment Notarization Office or a public notary.

6. Submit to GAFI: Through the electronic portal (or one-stop service), submit the full application to GAFI, including notarized documents, clearances, lease contract for a registered address, and any special licenses needed for your activity.

7. GAFI Approval: GAFI reviews and approves the application. If approved, they issue an incorporation certificate or license. This typically involves publishing a notice in the Official Gazette.

8. Commercial Registry: Register the company with the Commercial Registry at the Ministry of Trade. Upon registration, a commercial registration number is issued and the company’s legal personality is established.

9. Tax and Social Insurance: Finally, register the company with the Tax Authority and obtain the tax card (for income tax and VAT if applicable). Also register with the National Social Insurance Authority (NSSF) for employee and partner social insurance contributions.

Timelines: Thanks to reforms, this process is fairly swift. A typical LLC or JSC can be fully registered and tax-activated in about 3–4 weeks. Foreign investors should account for time to notarize documents abroad and secure clearances. Bylaw Law Firm can streamline these steps using our local expertise and dedicated portal access, helping meet all requirements efficiently.

Checklist & Timeline

• Day 1–2: Reserve company name; prepare draft Articles of Association.

• Day 3–7: Notarize Articles and legalize documents; submit foreign clearances.

• Day 7–14: Open bank account, deposit capital; complete GAFI online submission.

• Day 14–20: GAFI review and approval; obtain incorporation certificate.

• Day 21–25: Register at Commercial Registry; issue tax card and VAT certificate.

• Day 21–30: Register with NSSF and obtain social insurance number.

(These are estimates. Delays can occur due to document legalization or licensing requirements.)

Regulatory and Tax Incentives

Under Egypt’s Investment Law (Law 72 of 2017, amended), qualified projects may receive customs duty exemptions and tax advantages. The Investment Law covers many sectors (industry, agriculture, ICT, tourism, etc.). It also enshrines “equal opportunities” for investors and simplifies many procedures through electronic systems. In practice, specific incentives (tax breaks, land discounts, etc.) are granted on a case-by-case basis, especially in priority sectors or less-developed regions.

Free Zones: Egypt has several public free zones (Alexandria, Damietta, Suez, etc.) where companies receive full exemption from corporate income tax and customs duties on inputs and exports. The new Suez Canal Special Economic Zone goes even further: for example, in the Suez SEZ a flat 10% income tax applies, and land sales to companies are taxed only on their imported input value. These zones also offer one-stop-shop services and greater flexibility (e.g. repatriate 100% of sale proceeds).

Standard Taxation: Outside free zones, the standard corporate income tax rate is 22% (as of 2022). A flat 10% tax rate applies to qualifying small and medium enterprises. VAT is 14%. Egypt does not offer general tax holidays for local companies, but selective incentives under investment promotion laws may include customs duty exemptions on machinery imports and utility discounts for approved projects.

Legal Protections: Egyptian law provides strong shareholder protections under civil and commercial codes. The corporate veil generally shields owners’ personal assets from company debts, except in cases of fraud or violations. Egypt is a signatory to the New York Convention, so foreign arbitral awards are enforceable. Recent arbitration centers have been established for investment disputes (e.g. the Investment Dispute Settlement Center). Intellectual property, labor, and contractual rights are well-defined by statute.

In summary, forming a company in Egypt grants investors legal certainty through established corporate law and investor-friendly reforms, along with practical tax and customs incentives – especially within designated zones or investment projects.

Foreign Ownership and Regulations

Foreign ownership is broadly permitted. Any of the above company types (LLC, JSC, OPC) may be 100% owned by non-Egyptians, subject only to sector-specific limits (for example, foreign ownership caps in local financial institutions, media, or sensitive industries are set by separate laws). No government pre-approval is required for foreign ownership: you simply register your foreign shareholders in the GAFI application. The only general foreign-investment requirement is to report your foreign capital ownership to GAFI (which the registration process automatically captures).

Egyptian law imposes no restrictions on profit or capital repatriation for foreign investors. Under the Central Bank Law No. 194 of 2020, any investor can transfer foreign currency abroad provided the usual banking procedures are followed. Dividends, royalties, interest, or capital proceeds can flow freely out of Egypt, subject to standard documentation. This full capital mobility is a key advantage for international companies.

Special zones (like SEZs and free zones) have additional procedural flexibility (e.g. dual currency accounting, 100% import/export orientation, etc.), but the baseline rule is permissive for foreign ownership and repatriation.

How Bylaw Law Firm Can Help

Bylaw Law Firm’s Corporate and Business Setup services guide entrepreneurs and investors at every step of company formation in Egypt. Our expert team can:

• Advise on the Best Legal Structure. We help you choose between an LLC, JSC, OPC, partnership or branch, based on your business needs and ownership preferences.

• Prepare All Documentation. We draft and review the Articles of Association, powers of attorney, board resolutions and any special licensing paperwork, ensuring compliance with Egyptian law.

• Handle Registration Filings. We manage name reservations, GAFI submissions, notarizations, and liaise with all authorities so you don’t miss any steps.

• Navigate Incentives and Regulations. We identify applicable investment incentives and free-zone opportunities, and ensure your company meets regulatory requirements (capital, local manager rules, etc.).

• Assist Post-Registration. Beyond incorporation, we support tax registration, social insurance, labor compliance, and future corporate governance (capital increases, annual filings, etc.).

With deep experience and local presence, Bylaw Law Firm simplifies the incorporation timeline and ensures a smooth process. We also offer ongoing corporate legal services to keep your company in good standing.

Ready to establish your company in Egypt? Contact Bylaw Law Firm today for personalized assistance. Our Corporate Law team and Business Setup experts are ready to help you launch and grow in Egypt’s dynamic market.