Egypt introduces first bankruptcy law with eye on increased investment
Egypt has introduced the country’s first bankruptcy law which among others seek to minimize the need for individuals or companies to resort to courts while abolishing imprisonment in bankruptcy related cases. This, as the country looks to economic reforms with a view to encouraging investment.
Until now, Egypt has had no specific law on bankruptcy, meaning failed companies have had to go to court on a case-by-case basis.
Egypt is in the process of passing a long-awaited investment law aimed at reviving the economy and attracting foreign investors.
Egypt's economy has been struggling since a popular uprising in 2011, which overthrew veteran leader Hosni Mubarak and drove away tourists and foreign investors, important sources of hard currency.
According to the Minister of Justice Hossam Abdul Rahim, the new draft law stipulates that the economic courts would establish bankruptcy management and form a committee of experts to speed up the restructuring and settlement of troubled companies. The new law will depend on the compatibility between the creditor and the debtor.
He continued that the draft law would abolish imprisonment and replace it with fines in bankruptcy cases.
The companies operating in Egypt which face difficulties in completing their investment activity are suffering from the long period and difficult procedures of exiting the Egyptian market either through selective or compulsory liquidation.
Minister of Investment Dalia Khorshid said that the bankruptcy law is meant to be complementary to the new investment law and aims to develop the legislative environment for economic activity, so as to attract more local and foreign investments.
Meanwhile, all economic sectors are suffering from high costs of production after the flotation of the Egyptian pound and the increase in fuel prices. Some sectors have demanded the government increase the price of their products, such as medicines, fertilisers, and agricultural crops, particularly as the dollar exchange rate has jumped from EGP 8.88 to EGP 19 per dollar after the flotation.
Agriculture Minister Essam Fayed said that the cabinet agreed to increase the purchase price of sugar cane from farmers from $28 to $34 per tonne. The cabinet also vowed to study increasing the purchase price of sugar beet in the next period, as farmers have complained about the high cost of production.
Egypt introduces first bankruptcy law with eye on increased investment
Egypt has introduced the country’s first bankruptcy law which among others seek to minimize the need for individuals or companies to resort to courts while abolishing imprisonment in bankruptcy related cases. This, as the country looks to economic reforms with a view to encouraging investment.
Until now, Egypt has had no specific law on bankruptcy, meaning failed companies have had to go to court on a case-by-case basis.
Egypt is in the process of passing a long-awaited investment law aimed at reviving the economy and attracting foreign investors.
Egypt's economy has been struggling since a popular uprising in 2011, which overthrew veteran leader Hosni Mubarak and drove away tourists and foreign investors, important sources of hard currency.
According to the Minister of Justice Hossam Abdul Rahim, the new draft law stipulates that the economic courts would establish bankruptcy management and form a committee of experts to speed up the restructuring and settlement of troubled companies. The new law will depend on the compatibility between the creditor and the debtor.
He continued that the draft law would abolish imprisonment and replace it with fines in bankruptcy cases.
The companies operating in Egypt which face difficulties in completing their investment activity are suffering from the long period and difficult procedures of exiting the Egyptian market either through selective or compulsory liquidation.
Minister of Investment Dalia Khorshid said that the bankruptcy law is meant to be complementary to the new investment law and aims to develop the legislative environment for economic activity, so as to attract more local and foreign investments.
Meanwhile, all economic sectors are suffering from high costs of production after the flotation of the Egyptian pound and the increase in fuel prices. Some sectors have demanded the government increase the price of their products, such as medicines, fertilisers, and agricultural crops, particularly as the dollar exchange rate has jumped from EGP 8.88 to EGP 19 per dollar after the flotation.
Agriculture Minister Essam Fayed said that the cabinet agreed to increase the purchase price of sugar cane from farmers from $28 to $34 per tonne. The cabinet also vowed to study increasing the purchase price of sugar beet in the next period, as farmers have complained about the high cost of production.