On January 14, 2018, an amendment to Egypt’s Companies Law No. 159 of 1981 was enacted by virtue of Law No. 4 of 2018, which provided that any newly established joint stock company or partnership limited by shares must centrally deposit their securities (mainly shares) with the Misr for Central Clearing, Depository and Registry (MCDR), prior to registering with the commercial register.

Further, existing joint stock companies and partnerships limited by shares are obliged to deposit their securities with MCDR within a period of one year commencing on January 17, 2018 until January 16, 2019, if not already registered.

What it means for you

Joint stock companies and partnerships limited by shares which were incorporated before the issuance of the amendment shall have a period of one year commencing from January 17, 2018 and ends on January 16, 2019, in order to deposit their securities with MCDR.

With respect to companies which will be or have been incorporated after the issuance of the amendment, the General Authority for Investment and Free Zones in Egypt requires that founders, or their representatives, provide the Authority with, among other documents, a certificate from MCDR evidencing that their securities have been centrally deposited therewith, in order to register the company with the commercial register.

Failure to comply with this new obligation hinders the commercial registration of such company which is obligatory for the company to perform its activities in Egypt.

To view the full article, including the steps for registration in the central depository system of MCDR, please click here.

 

Author

Mohamed Ghannam heads Baker McKenzie's Banking & Finance and Energy, Mining & Infrastructure practice groups in Cairo. He focuses on project finance, major projects, mergers and acquisitions, oil and gas, debt capital market and transactional work, acting as counsel to many of the world's leading multinational companies and financial institutions in various industries and helping them carry out high-value, precedent-setting transactions in Egypt.

Author

Moneer Bayomy is an associate at the Cairo office of Baker McKenzie, focusing on banking and finance, corporate and M&A. Qualified in Egypt in September 2017, Moneer has represented a number of significant clients in high profile and award winning transactions, and has contributed to various publications.

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