Egypt approves draft law on state-owned companies
The Egyptian Cabinet approved a draft law on Wednesday aimed at regulating the state’s ownership of companies it either fully owns or contributes to, according to a Cabinet statement.
The law applies to companies entirely or partially owned by the state’s administrative units or public legal entities, or in partnership with them.
It enforces the state’s ownership policy, emphasising the state’s role in economic activities, prioritising investments in essential public sectors, and aiming to attract both local and foreign investments.
Key goals of the law include safeguarding fair competition, stimulating financial markets, introducing new sectors for transactions, enhancing market liquidity, and improving the performance and investment returns of state-owned companies.
It also focuses on boosting efficiency, promoting economically-based decision-making, increasing transparency and governance, and optimising the use of state resources.
The law mandates the creation of the Unit for the Inventory and Follow-up of State-Owned Companies within the Cabinet.
This unit will formulate and execute regulatory programmes for state-owned companies, identify companies for sale or capital increase, and compile yearly lists for regulatory programmes based on sectoral studies.
Regulatory mechanisms outlined in the law include the sale, capital increase, ownership expansion, division, or merger of state-owned companies.
For companies where the state holds a stake, the mechanisms include the sale of shares, quotas, or voting rights, adhering to existing contracts and agreements.
This comprehensive framework aims to ensure efficient management and utilisation of state resources while fostering a competitive and transparent investment environment.
