Shahid Law Firm has succeeded in obtaining an exceptional exemption for an international oil and gas E&P project in Sinai from the 55% Egyptian nationality requirement of the Decree-Law no. 14/2012. The exemption was issued by Presidential Decree, after Shahid Law has secured a positive Cabinet recommendation, following several meetings and lobbying with the concerned authorities, including the Egyptian General Petroleum Corporation (EGPC), the Sinai Development Authority (SDA) through the General Authority for Investment and Free Zones (GAFI), and the Administrative Control Authority (ACA).
The exemption sets a precedent for branches of IOCs operating in the strategic area of Sinai, which are otherwise exempt from the application of the Companies’ Law by virtue of their Concession Agreements, as well as arguably from the hold of the strict application of the afore-mentioned Decree-Law that does not regulate the case of branches of foreign companies established in Egypt, as these are naturally fully owned by the foreign company and not in a position to fulfill the minimum requirement of a 55% Egyptian shareholding to operate in the Sinai Peninsula.
The easing of this roadblock is perceived as a positive signal to international investors aiming to set up integrated development projects in this part of the country of strategic importance.
For more information about Shahid Law Firm’s Oil & Gas and Corporate practices, please visit our Practices & Industries page.
