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Tuesday, 6 April 2021

What’s up with the tobacco license tender?

The tender for a license to set up Egypt’s second tobacco company appears to be scheduled to go ahead later this month, after the Industrial Development Authority (IDA) decided over the weekend to shelve the tender, the local press reported, citing an unnamed IDA source. Two industry sources who spoke with Reuters over the weekend suggested the bidding round — which was originally scheduled for today — would be put on ice for a while longer, saying at the time it was postponed “indefinitely.”

The deadline for lodging bids is now likely to be set on 18 or 20 April, with the auction for the license slated for 6 June, the IDA sources say. We reached out to the IDA, Federation of Egyptian Industries and Eastern, but nobody’s talking.

Why the postponement? The authority wants to address some companies’ inquiries on the terms of the license and amend the conditions amid allegations that the authority set unfavorable terms, the source added.

Background: A tender for the license was launched in March, bringing with it the prospect of ending state-owned Eastern Company’s monopoly on the tobacco industry. The sale stopped in its tracks a few days later, when tobacco players submitted a complaint with the competition watchdog alleging that the license violated antitrust rules, before another complaint was filed to the Federation of Egyptian Industries demanding that the IDA put the tender on ice and revise its terms.

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