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flag Egypt Egypt: Operating a Business

In this page: Setting Up a Company | The Active Population in Figures | Working Conditions | Cost of Labor | Social Partners

 

Setting Up a Company

The Limited Liability company
Number of partners: Minimum 2 shareholders (partners)
Capital (max/min): Minimum 50,000 EGP, fully paid up when formed.
Shareholders and liability: Their responsibility is limited to their contribution amount.
Joint Stock Company is a public limited company (Incorporated)
Number of partners: Minimum 3 shareholders (partners)
Capital (max/min): 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)
Shareholders and liability: Their responsibility is limited to the contribution amount.
General Partnership
Number of partners: Unlimited number of partners
Capital (max/min): Minimum 5,000 EGP
Shareholders and liability: General partner liability is unlimited
Limited Partnership
Number of partners: One general partner, unlimited number of limited partners
Capital (max/min): Minimum 5,000 EGP
Shareholders and liability: 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 8.0
Time (days) 7.0 23.0

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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The Active Population in Figures

201120122013
Labor force 26,500,00027,240,00027,690,000

Source: CIA - The world factbook

 
200920102011
Total activity rate -48.80%48.90%
Men activity rate 75.30%74.20%74.30%
Women activity rate 22.40%23.50%23.70%

Source: UN - United Nations

 
Employed Persons, by Occupation (% of Total Labor Force) 2008
Agriculture, Hunting and Forestry 30.9%
Manufacturing 11.4%
Construction 10.1%
Education 9.1%
Transport and Storage 7.0%
Health and Social Work 2.6%
Hotels and Restaurants 2.1%
Real Estate, Renting and Business Activities 2.0%
Electricity, Gas and Water Supply 1.3%
Households with Employed Persons 0.3%
Mining and Quarrying 0.2%

Source: International Labor Organization (ILO)

 

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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.
Labor Laws
Consult Doing Business Website, to obtain a summary of the labor regulations that apply to local entreprises.

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Cost of Labor

Minimum Wage
EGP 400 per month (source: ILO, 2011).
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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Last Updates: October 2014