Establishing importation and exportation companies in the light of the new import and export rules

Import is one of the processes in which goods and services are purchased from a foreign country for sale in the local market. Export is the supply of local goods to the foreign market. The importance of each is to increase employment opportunities, improve the level of markets and improve the economy.

The practical application of the provisions of the Import and Export Law, and the consequent major changes in economic activity and market size revealed the urgent need to review its provisions with a view to establishing rules that would regulate the import and export operations and establish the necessary conditions for those who practice this activity in a manner that protects the internal market.

The Companies Law No. 159 of 1981 regulates the provisions of establishing import and export companies through the General Authority for Investment and Free Zones (“GAFI”). The General Authority for Import and Export Control shall determine the value of the capital and the conditions of registration in the importers and exporters register. We will discuss the basic features and conditions of registration in the register of exporters and importers after the establishment of the company and the role of the General Authority for Export and Import Control in determining the documents required to register legal persons in the register of exporters and importers in order to be able to carry out their activities as follows:

First: For the establishment of companies

We refer to our previous report published in our website.

Second: Getting listed in the register of importers

Law No. 7 of 2017 amending some provisions of the Register of Importers Law, introducing several substantive provisions that would avoid the problems of counterfeit goods or the goods with poor quality that may result from unregulated export operations. The executive regulation of the said law sets out the definition of import for the purpose of trading, where Law No. 121 of 1982 restricts the registration of import importers for the purpose of trading.

Companies that engage in production or service activities are exempted from getting listed in the Register of Importers within the limits of what they import in their name and to the account for this activity. The matter which necessitated that the executive regulation define the word of  "import for trade" as imported from commercial goods to be sold in their condition at importation or after filling them without making any conversion or supplemental thereto, including what the financial leasing companies import in accordance with the provisions of Law No. 95 of 1995 regulating them.

(1)- For Registering Limited Liability Companies

• An official extract from the registration of the company in the commercial register provided that the importation of the goods for the purpose of trading is one of its purposes and that it has been registered for at least one year.
• An official extract from the Company's Memorandum of Association and the amendments thereto, provided that this contract and the amendments thereto are registered in the Commercial Register.
• A document proving that the paid-up capital is not less than 2 million pounds, either by presenting a certified copy for the last budget provided by the company to the Tax Authority or to submit a certificate from a bank registered with the Central Bank stating that the capital is paid.
• An official extract from the birth certificate of the manager responsible for the import or the naturalization card of the Egyptian nationality if he is of foreign origin.
•  Certificate of import practice for the manager in charge of importation and workers.
•  A certified copy of the last tax statement for the previous year to submit the registration application stating that the business is not less than five million pounds and exempt from these conditions companies that have import cards at the time of applying the new regulation.
• Declarations relating to joint partners, company managers and import officials.
• A copy of the company bylaws published in the Memorandum of Association of the Limited Liability Company and its Articles of Association, and a copy of the volumes in which the amendments to the company contract were published.
• A statement from the authorized person to manage and sign stipulates that the company is at least 51% of its shares are owned by the Egyptians.
• Delivery of cash deposit or bank guarantee letter in the amount of two hundred thousand pounds, provided that companies holding an import card must comply with these regulations in accordance with their provisions within six months from the date of their operation.

(2)- For registering the joint stock companies and company with limited shares:

• An extract from the records of the company in the commercial register, provided that the importation of the goods for the purpose of trading is of its purposes and that its headquarter is in the Arab Republic of Egypt.
• • A copy of the tax statement approved for the year prior to the registration application stating that the volume of work is not less than 5 million pounds
•  Statements concerning the managers of the companies and the employees responsible for the import.
• Certificate of importation of the director responsible for importation and import personnel.
• • Delivery of a cash deposit or a bank guarantee letter in the amount of two hundred thousand pounds. The company holding the import card must comply with the regulations in accordance with its provisions within six months from the date of its operation.

(3)- Getting registered in the exporters record

(A) Registration documents of established joint stock and limited liability companies

• An application for registration in the exporter's register signed by a person who has the right to sign on behalf of the company, his agent or his legal representative, including data consistent with the commercial registration data (original + photocopy).
• An Extract from the record of registration in the commercial register, including the type of activity and capital, the one who has the right to manage and sign, and export shall be among the purposes of the company and capital not less than 20 thousand pounds for productive projects and 50 thousand for other activities.
•  Statement identifying the one responsible for export.
•  Copy of the proof of identity of the Chairman of the Board of Directors and the Managing Director and the person who has the right to sign on behalf of the company for the joint stock companies, whose names appear in the Commercial Register for the limited liability companies.

(B)- Registration documents for the Joint Companies and the limited by shares

• Application for registration in the exporter register signed by the responsible manager who has the right to sign on behalf of the company or his agent or legal representative to him containing data in accordance with the commercial registration data (original + photocopy)
• An official extract from the registration paper in the commercial register shall be valid, provided that the capital of the company is not less than LE 20,000 for the productive projects and LE 50,000 for the other activities. The export shall be from the purposes of establishing the company.
• Complete the acknowledgment of the registration in the exporter register, including acknowledgment of the criminal status of all the joint partners, managers and those who have the right to manage and sign on the behalf of the company signed by them personally in front of the employee concerned with the administration or to approve the validity of their signature from the bank.
• The Identification card of the person whose name is registered in the commercial register.
• Statement on the identification of the responsible for export.
• Certificate of export practice and a copy of the identity card for the responsible.
• Fees, stamps and expenses shall be paid via the Authority's treasury or by a government postage stamp on behalf of the General Organization for Export and Import Control or by a bank check of LE 50 (LE 50).