How to Establish a Joint Stock Company in Egypt?
Joint Stock Company
As per article no. 2 of Law No. 159 of 1981, the joint stock company is a company whose capital is divided into equal-value shares that can be traded in the manner specified in the law.
Conditions for Establishing a Joint Stock Company
The conditions for establishing a joint stock company are as follows:
- The shareholder’s responsibility is limited to the performance of the value of the shares to which he subscribed.
- The number of founders in the joint-stock companies shall not be less than three, and their issued capital shall not be less than 250 thousand Egyptian pounds, of which 10% shall be paid upon incorporation.
- The company shall have a trade name derived from the purpose of its establishment, and this name may include a name or title for one or more of its founders.
- The company’s shares may be offered for public subscription and listed on the Egyptian Stock Exchange.
- The company’s shares shall be registered with the depository companies and the central constraint.
- The company shall be established following the provisions of the Investment Law No. 72 of 2017 or Law No. 159 of 1981.
The Characteristics of a Joint Stock Company in Egypt
The joint stock company in Egypt is distinguished by its unique characteristics, such as:
- The company depended on financial considerations as its owner is seen as a group of shares or a legal representative, not a specific person. This is to ensure the company’s continuity even in the event of the death of a shareholder or his exposure to financial bankruptcy.
- When establishing a joint stock company in Egypt, it is necessary to know the ability of shareholders to exchange their shares without any restrictions, and they are traded on the stock market or stock exchange.
- Dividing the company’s debts among the shareholders according to their share ratio, where the indebtedness does not exceed the percentage of shares owned only in the joint stock company.
- Preference for some activities, such as banks, investment and insurance companies, stock exchange business, real estate loans, and credit and savings institutions to be established.
Documents Required for Establishing a Joint Stock Company
There are many papers necessary to establish a joint stock company in Egypt, such as:
- A certificate of non-confusion approved by the Commercial Register.
- A Bank certificate and at least 10% of the issued capital have been deposited in one of the Egyptian banks approved by the Central Bank.
- Copies of the relevant powers of attorney, if the incorporation is requested to be completed through an attorney.
- Clear copies of the valid personal ID of the founders or the partners.
- An official original certificate obtained from the Register of Accountants and Auditors to the effect that the company’s auditor is entitled to review and approve the budgets of corporations. A copy of the certificate or the acknowledgment of the acceptance of the appointment must be submitted in case the original certificate was previously furnished to GAFI.
- A copy of the Bar Association Card of the lawyer who signs the articles of incorporation before the Bar Association.
- Investor identification forms for the foreign founders or partners must be submitted in paper format and their copies in a compact disk (CD) format.
Steps for Establishing a Joint Stock Company
Incorporation via the E-portal:
- Sign up, create an account, and specify your workspace using GAFI E-Portal.
- Choose the incorporation service, upload the required documents, and submit the application.
- Pay the fees using a credit card and e-sign the documents.
- All your company’s documents will be sent to your workspace on GAFI’s e-portal.
Incorporation via the ISC:
- Select the service and take a number from the queue machine.
- The documents will be checked, and then the articles of incorporation of the company will be issued and signed electronically before payment of fees.
- Sign electronically the documents giving effect to the articles of incorporation and receive your company’s documents.
We have shown all you need to know about establishing a joint stock company in Egypt. For more information, click here, or contact AHG, one of the leading companies in establishing the leading companies in Egypt.
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