Through a Ministerial decree issued on March 1, 2020, the Egyptian Administration added a new disclosure requirement, obliging companies registered in the Egyptian commercial registry to identify their ultimate beneficial owners (UBOs). This change came into effect through an amendment to the Executive Regulations of the ancient Commercial Registry law no. 34 of 1976, by virtue of Ministerial Decree No. 41 of 2020 (the “Decree“).
BELOW ARE SOME HIGHLIGHTS OF THE DECREE:
Objective. The Decree imposes a new obligation on all companies and corporations established in Egypt to disclose their UBOs’ full information and record same in a physical ledger.
The ledger must include all details on the actual owner or the controlling beneficiary for any company registered in Egypt. Such ledger must be held throughout the lifetime of the company and if legally dissolved, liquidated or otherwise, for an additional period of 5 years.
Compliance. The Decree requires companies registered in Egypt’s commercial registry to comply with its provisions, without highlighting penalties for not doing so.
* * * * * *
Shahid Law team’s initial view is that the Decree poses various uncertainties on how it can be implemented, especially for companies that are publicly listed, or with multiple juristic shareholders, with UBOs that are not necessarily known to the management of the Egyptian companies. Shahid Law Firm is following up on how the authorities plan to apply/enforce such Decree.
Meanwhile, if you would like to discuss the impact of the Decree and the compliance requirements on existing businesses, please feel free to reach out to your usual contact at Shahid Law or write to us at info@shahidlaw.com.
