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Sunday, 7 June 2020

Amendments to the sovereign fund law are up for final parliamentary review and vote today

LEGISLATION WATCH- Sovereign fund law is up for plenary discussion in parliament today: Proposed amendments to the Sovereign Fund of Egypt (SFE) law, which the House Planning and Budget Committee approved in February, will be up for discussion in the House of Representatives’ general assembly today, Al Mal reports. The proposed amendments would, if passed, provide VAT refunds to any company that is more than 50% owned by the SFE and its sub-funds and limit the scope of legal action that can be taken against the fund (it’s effectively designed to shield the fund and its coinvestors from spurious third-party lawsuits that are common when the state partners with the private sector).

Background: The SFE is due to set up sub-funds to attract investment to key sectors including logistics, renewables and manufacturing. Extra legal protections for the fund, outlined in the amended legislation, would shield the SFE from third-party legal action. The Madbouly Cabinet had approved the amendments in December and the House Planning and Budget Committee gave the go ahead for tax breaks and legal immunity in February.

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