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Tuesday, 17 December 2019

Baker McKenzie explains Egypt’s latest Investment Act exec reg amendments on foreign investment data

If your company has a foreign investor in its shareholder base, GAFI wants extra data from you every quarter: The Investment Ministry issued last month amendments to the Investment Act that will require public and private entities alike to submit quarterly report to the General Authority for Freezones and Investment (GAFI) with their data including key financial indicators. The amendments are now applicable to all companies with any form of foreign investment, rather than being limited to those set up under the new Investment Act, Baker McKenzie explains in a primer on the amendments.

What have the amendments changed? “Before imposing the new reporting requirements, all companies were required to submit the financial statements to GAFI on an annual basis. Furthermore, all key corporate resolutions / actions should be submitted to GAFI for ratification. The key change introduced is that companies are now required to extract the data and complete the templates provided by GAFI and they are required to do so more frequently, i.e., on a quarterly basis.” The templates are available in Arabic and in English.

What do the changes mean for your business? If the amendments apply to your business, you are now required to submit quarterly reports to GAFI with the required data, in addition to notifying GAFI within 30 days of any changes to your capital, shareholder structure, or board of directors. Noncompliance can earn you a EGP 50k penalty and might result in GAFI refusing to provide or delaying its services, including issuing licenses, until the forms are complete and submitted.

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