Omran: EGX Suspends Trading In OCI’s Stock On Tax Fraud Claims

The Egyptian Exchange Chairman Mohamed Omran said the bourse has suspended trading in Orascom Construction Industries (OCI) – (OCIC.CA)’s stocks awaiting the firm’s comments on the news published by Amwal Al Ghad regarding its EGP 14 billion tax fraud.

Egyptian Tax Authority sources told Amwal Al Ghad that the authority had called the Egyptian tycoon Onsi Sawiris alongside his son Nassif Sawiris to start interrogations regarding Orascom Construction Industries (OCI) – (OCIC.CA)’s evading to pay EGP 14 billion tax dues to the state.

President Morsi stated Saturday that Egypt is owed about EGP 100 billion by five companies adding that the state is in talks with these entities to have its dues. The President clarified that some of these dues arose from financial irregularities or tax evasions.

The sources further told Amwal Al Ghad that the selling deal of OCI’s Orascom Building Materials Holding to French Lafarge in 2008 has been reviewed referring that the deal has violated the law leading to tax fraud.

It is worth mentioning that OCI sold in 2007 its entire stake in Orascom Building Materials Holding (OBMH) to French Lafarge at $ 12.9 billion.

The tax sources added that OCI had founded Orascom Building and had listed it in the EGX for a short while, transferring to it the Lafarge deal valued at EGP 71 billion.

On the other hand, OCI noted on Monday that the capital gains from selling its entire stakes in the EGX-listed Orascom Building Materials Holding to Lafarge are tax exempt.