Inland Investment is one of the investment systems under which an investment project is set up, established, or operated in accordance with the provisions of Investment Law No. 72 of 2017, outside the free zones.

· All investment projects subject to the provisions of this Law, whether established before or after its entry into force, and irrespective of the legal regime to which they are subject, shall enjoy the general incentives set out in this Chapter, except for projects established under the free zones system.

Incentives and Guarantees:

First: Investment Guarantees:

All investments established in the Arab Republic of Egypt shall be accorded fair and equitable treatment.

The State shall guarantee foreign investors treatment equal to that accorded to national investors. By way of exception, preferential treatment may be accorded to foreign investors by a decree of the Council of Ministers in application of the principle of reciprocity.

Invested funds shall not be subject to any arbitrary measures or discriminatory decisions.
The State shall grant non-Egyptian investors residency in the Arab Republic of Egypt for the duration of the project, without prejudice to the provisions of the laws regulating the same.
The State shall respect and enforce the contracts it concludes. An investment project established on the basis of fraud, deceit, or corruption shall not enjoy the protection, guarantees, benefits, or exemptions prescribed under the provisions of this Law. All of the foregoing shall be established by a final and non-appealable court judgment rendered by the competent judiciary, or by an arbitral award.

All decisions relating to the affairs of an investment project shall be reasoned, and the concerned parties shall be notified thereof.

Investment projects may not be nationalized.
The assets of investment projects may not be expropriated except for public benefit and against fair compensation paid in advance and without delay, the value of which shall be equal to the fair economic value of the expropriated property on the day preceding the issuance of the expropriation decision. Such compensation shall be freely transferable.
Sequestration may not be imposed on such projects by administrative means, and may be imposed on them only by virtue of a final court judgment. Nor may such projects be placed under precautionary seizure except by virtue of a court order or judgment. In all cases, the foregoing shall apply only in the circumstances specified by law.
The assets of investment projects may not be attached, confiscated, or frozen except by virtue of a court order or a final judgment, with the exception of tax debts and social insurance contributions due to the State, which may be collected through attachment of all kinds, without prejudice to any terms agreed upon in contracts concluded by the State or public juristic persons with the investor.

• Investment in Egypt

No administrative authority may issue general regulatory decisions that impose financial or procedural burdens relating to the establishment or operation of projects subject to the provisions of this Law, or that impose or amend fees or service charges on such projects, except after obtaining the opinion of the Authority’s Board of Directors and the approval of both the Council of Ministers and the Supreme Council of Investment.
Administrative authorities may not revoke or suspend licenses issued to an investment project, or withdraw real property allocated to the project, except after serving notice on the investor of the violations attributed to the investor, hearing the investor’s position, and granting the investor a reasonable period to remedy the causes of the violation. In all cases, the Authority’s opinion must be obtained before the decisions referred to in the first paragraph are issued, and the Authority shall express its opinion within seven days from the date on which it receives the request complete with all prescribed legal procedures. The investor shall be entitled to file a grievance against such decision before the committee provided for in Article “83” of this Law.
The investor shall have the right to set up, establish, and expand the investment project and to finance it from abroad without restriction and in foreign currency. The investor shall also have the right to own, manage, use, and dispose of the project, to earn its profits and transfer them abroad, and to liquidate the project and transfer the proceeds of such liquidation abroad, in whole or in part, without prejudice to the rights of third parties.
The State shall permit all cash transfers related to foreign investment to be made freely and without delay into and out of its territory in a freely convertible currency. The State shall also permit the conversion of local currency into a freely usable currency without delay.
In the event of liquidation, the competent administrative authorities shall notify the Authority and the company under liquidation of a statement of the company’s liabilities within a maximum period of one hundred and twenty days commencing from the date on which the liquidator submits a request to that effect, accompanied by the necessary documents. The lapse of this period without such liabilities being stated shall constitute a discharge of the companies under liquidation, without prejudice to the criminal and disciplinary liability of the official responsible for issuing a statement contrary to the facts, or of whoever caused the aforementioned time limit to lapse without responding to the request.

• Investment in Egypt

Without prejudice to the provisions of the laws, regulations, and decisions governing imports, investment projects subject to the provisions of this Law shall have the right to import, directly or through third parties, the raw materials, production inputs, machinery, spare parts, and means of transport appropriate to the nature of their activity that they require for their establishment, expansion, or operation, without the need to be registered in the Register of Importers.
Investment projects subject to the provisions of this Law shall have the right to export their products, directly or through intermediaries, without a license and without the need to be registered in the Register of Exporters.
An investment project shall have the right to employ foreign workers up to (10%) of the total number of the project’s workers. This percentage may be increased to no more than (20%) of the total number of the project’s workers where it is not possible to employ national workers with the necessary qualifications. In certain strategic projects of special importance designated by a decision of the Supreme Council of Investment, an exception may be made to the aforementioned percentages, provided that due regard is given to the training of national workers.
Foreign workers in an investment project shall have the right to transfer their financial entitlements abroad, in whole or in part.

Second: Investment Incentives:

(A): General Incentives:

These apply to all projects subject to the provisions of this Law, except for projects established under the free zones system, and are as follows:

The incorporation contracts of companies and establishments, and the credit facility and mortgage contracts related to their business, shall be exempt from stamp tax and from notarization and registration fees for a period of five years from the date of their registration in the Commercial Register.
Contracts for the registration of land required for the establishment of companies and establishments shall be exempt from the aforementioned tax and fees.

Companies and establishments subject to the provisions of this Law shall be governed by the provisions of Article (4) of the Law Regulating Customs Exemptions promulgated by Law No. 186 of 1986 [1] concerning the collection of customs duty at a unified rate of (2%) two percent of the value on all machinery, equipment, and apparatus they import that are required for their establishment. This unified rate shall also apply to all machinery, equipment, and apparatus imported by companies and establishments operating in public utility projects that are required for their establishment or completion.

– Investment in Egypt –

Without prejudice to the temporary release provisions set out in the Customs Law promulgated by Law No. 66 of 1963 [1], investment projects of an industrial nature subject to the provisions of this Law may import molds, dies, and other production inputs of a similar nature free of customs duties, for temporary use in manufacturing their products and subsequent re-export abroad. Release and re-export shall be effected on the basis of arrival documents, provided that the entry and re-shipment documents are recorded in registers maintained for this purpose at the Authority, in coordination with the Ministry of Finance.

*Customs Law No. 207 of 2020 was issued on 11/11/2020 and entered into force on 12/11/2020. Article Five of its promulgating articles repealed the Law Regulating Customs Exemptions promulgated by Presidential Decree-Law No. 186 of 1986.

– Investment in Egypt –

*Customs Law No. 207 of 2020 was issued on 11/11/2020 and entered into force on 12/11/2020. Article Five of its promulgating articles repealed the Customs Law promulgated by Presidential Decree-Law No. 66 of 1963.

(B): Special Incentives:

Investment projects established after the entry into force of this Law in accordance with the Investment Map shall be granted an investment incentive deducted from net taxable profits, as follows:

1- A deduction of (50%) of the investment costs for Sector (A):

This covers the geographic areas most in need of development according to the Investment Map, based on the data and statistics issued by the Central Agency for Public Mobilization and Statistics (CAPMAS) as approved in the General Plan for Economic and Social Development, and in accordance with the distribution of investment activities therein as set out in the Executive Regulations of this Law.

2- A deduction of (30%) of the investment costs for Sector (B):

This covers the remaining parts of the Republic, in accordance with the distribution of investment activities, for the following investment projects:

Labor-intensive projects, in accordance with the controls set out in the Executive Regulations of this Law.
Medium and small projects
Projects that rely on or produce renewable energy
National and strategic projects designated by a decision of the Supreme Council of Investment
Tourism projects designated by a decision of the Supreme Council of Investment
Electricity generation and distribution projects designated by a decision of the Prime Minister upon a joint proposal by the competent Minister, the Minister in charge of electricity affairs, and the Minister of Finance.

– Investment in Egypt –

Projects whose output is exported outside the geographic territory of the Arab Republic of Egypt
The automotive industry and its feeder industries
Wood, furniture, printing, packaging, and chemical industries
Antibiotics, oncology drugs, and cosmetics industries
Food industries, agricultural crops, and agricultural waste recycling
Engineering, metallurgical, textile, and leather industries
In all cases, the investment incentive shall not exceed (80%) of the capital paid up as of the date of commencement of activity, in accordance with the provisions of the Income Tax Law promulgated by Law No. 91 of 2005, and the deduction period shall not exceed seven years from the date of commencement of activity.

– Investment in Egypt –

Conditions for Eligibility for Special Incentives:

For investment projects to be eligible for the special incentives, the following conditions must be met:

A new company or establishment must be incorporated to set up the investment project.
The company or establishment must be incorporated within a maximum period of three years from the date of entry into force of the Executive Regulations of this Law. This period may be extended for further periods not exceeding nine years in total by a decision of the Council of Ministers upon a proposal by the competent Minister.
The company or establishment must maintain regular accounts. If the company or establishment operates in more than one zone, it may benefit from the percentage prescribed for each zone, provided that separate accounts are maintained for each zone.
None of the shareholders, partners, or owners of establishments may have contributed, provided, or used any of the physical assets of a company or establishment existing at the time of the entry into force of this Law in the incorporation, establishment, or setting up of the investment project benefiting from the incentive, or have liquidated such company or establishment during the period specified in item “2” of this Article for the purpose of establishing a new investment project that benefits from the aforementioned special incentives. Any violation of the foregoing shall result in forfeiture of the said incentive, and the company or establishment shall be obliged to pay all tax dues.

– Investment in Egypt –

(C) Additional Incentives:

1. Permitting the establishment of special customs ports for the investment project’s exports or imports, in agreement with the Minister of Finance.

2. The State bearing the cost incurred by the investor in connecting utilities to the real property allocated to the investment project, or part of such cost, after the project commences operation.

3. The State bearing part of the cost of technical training for workers.

4. Refunding half of the price of land allocated to industrial projects if production commences within two years from the date of land delivery.

5. Allocating land free of charge to certain strategic activities in accordance with the controls prescribed by law in this regard.

6. Exemption from the usufruct consideration for land allocated to the project for a maximum period of ten years commencing from the start of operation, upon a proposal by the competent Minister.

The Prime Minister may, by a decision issued upon a proposal by the competent Minister, exempt the projects referred to in Articles (11 and 11 bis) of the Law from contributing to the costs of establishing infrastructure, services, and public utilities at a rate not exceeding (50%) of such costs, in accordance with the controls specified by a decision of the Supreme Council.

The Public Treasury may bear no more than (50%) of the project’s consumption charges for basic utilities for a maximum period of ten years, in accordance with the controls specified by a decision of the Supreme Council of Investment.

– Investment in Egypt –

Conditions for Eligibility for Additional Incentives:

For companies and establishments to be granted any of the additional incentives provided for in Article 13 of the Investment Law, they must have commenced production or activity, as the case may be, according to the report approved by the Authority, and must also satisfy one of the following conditions:

The Arab Republic of Egypt is one of the company’s principal locations for producing the products in which it specializes, or the Arab Republic of Egypt is the principal home of the products in which the company specializes.
The company relies, in financing its projects, on foreign currency resources transferred from abroad through an Egyptian bank, in accordance with the controls set by the Board of Directors of the Central Bank.
The company exports part of its products abroad, amounting to no less than 50%.
The company’s activity includes operating in a field of advanced modern technology, transferring advanced technology to Egypt, and supporting its feeder industries.

– Investment in Egypt –

The local component of the project’s products is deepened, provided that the local component of raw materials and production inputs in its products is not less than 50%, in accordance with the controls applicable at the Industrial Development Authority.
The company’s activity is based on research outputs resulting from research projects conducted within the Arab Republic of Egypt.

(D) Special Incentives (Newly Introduced Incentives):

Added pursuant to Law No. 160 of 2023 amending Investment Law No. 72 of 2017 (under Article 11 bis):

Investment projects engaged in any of the industrial activities designated in accordance with this Article, and their expansions in accordance with the last paragraph of Article (12) of this Law, shall be granted a cash investment incentive of not less than (35%) and not more than (55%) of the tax paid with the income tax return on the income derived from carrying on the activity in the investment project or its expansions, as the case may be. The Ministry of Finance shall disburse the incentive within forty-five days from the end of the time limit for filing the tax return; otherwise, a delay charge shall be due from it, calculated on the basis of the credit and discount rate announced by the Central Bank on the first of January preceding the incentive’s due date, disregarding fractions of a month and of a pound. This incentive shall not be deemed taxable income.

The grant of the incentive provided for in this Article is conditional upon the project, or its expansions, as the case may be, relying for its financing, up to the date of commencement of activity, on foreign currency from abroad for at least (50%) of its funds, and upon commencing activity within six years from the date of entry into force of this Article. This period may be extended by a maximum of six years by a decision of the Council of Ministers upon a joint proposal by the competent Minister, the Minister in charge of industry, and the Minister of Finance.

– Investment in Egypt –

The Council of Ministers, upon a joint proposal by the competent Minister, the Minister in charge of industry, and the Minister of Finance, shall issue a decision specifying the industries and zones eligible for the incentive provided for in this Article and the incentive period for each, not exceeding ten years, as well as the conditions, rules, and categories for granting the incentive and the mechanisms for its disbursement.

Exemption for Expansions of Existing Investment Projects:

Added pursuant to Law No. 141 of 2019 amending Investment Law No. 72 of 2017, as follows:

Expansions of existing investment projects may benefit from the incentives provided for in Articles 11 (Special Incentives) and 13 (Additional Incentives). “Expansions” means an increase in the capital employed through the addition of new assets leading to an increase in the project’s production capacity.

– Investment in Egypt –