Egypt’s parliament Oks amendments to public business sector law – minister
Egyptian parliament’s economic affairs committee has approved in principle the amendments to law that regulates the public business sector and its companies, Minister of Public Business Sector Hisham Tawfik said on Tuesday.
Tawfik said that the new Public Enterprises Act witnessed amendments to 16 articles, the repveal of four articles, and adding eight articles and paragraphs, the new regulations to “promote financial stability” in state-owned enterprises (SOE) and introduce new limits on board compensation,
He said the new amendments include setting new rules for forming holding firm boards and firm affiliates, expanding the powers of general assemblies regarding the assessment of board performance, stimulating employees and boards to upgrade their performance and increase the companies’ profits, and increasing transparency and disclosure levels in the companies that belongs to the sector.
According to the new amendments, annual bonuses would be capped at 5 percent of distributable annual profit for board members of holding companies and 10 percent for people sitting on the boards of subsidiaries, while employees will be entitled to a 10-12 percent share of the profits, Tawfik said. Boards will also be required to have between five to nine members and select at least one member to represent the company’s employees.
In a statement, Minister Tawfik said that the public business sector law has not witnessed changes since its issuance in 1991 despite the shifts that Egypt’s economy has witnessed in that period, which should be met with reforming regulations for the sector’s companies.
He added that the new amendments aim to improve the sector’s companies, upgrade their performance, financial structures, management, and making the ultimate use of their assets to ensure their sustainability and to increase their contribution to the national economy, according to the statement.
They also target uplifting the companies’ competitiveness in domestic and external markets, according to the statement.
The new amendments give the holding companies and their affiliates the right to take part in founding new companies, according to the statement.
The amendments also allow workers to have a share of the annual profits disbursed in cash with a minimum of 10 percent and not exceeding 12 percent, according to the statement.