Investment Dispute Settlement Mechanisms

It is extremely important for investors to settle their disputes in an amicable way to minimize the costs and save time, hence, the legislator in the investment law no. 72 of 2017 was so keen to offer several ways to settle investment disputes away from courts or arbitration in order to assist investors in settling their disputes in the easiest way, The following is the most recent updates of the new law:

First: The Grievance Committee

This committee is responsible for the consideration of grievances against decisions issued by the General Authority for Investment or any competent authority to grant licenses and permits. It is headed by an advisor from one of the judicial bodies, a representative of the Commission, and an expert. The grievances shall be submitted within fifteen working days from the date of issuing the decision. The Committee shall decide on what is presented to it by a reasoned decision within thirty days from the date of the hearing of the parties. And its decision is final and binding to all competent authorities without prejudice to the right of the investor to resort to the judiciary.

In order to activate the provisions of the law, two committees were formed to consider grievances arising from administrative decisions or approvals and licenses issued by the administrative authorities, as the case may be. Where the Minister of Investment and International Cooperation issued:

1. Ministerial Decree No. (135) for the year 2018 to form the first committee of grievance in accordance with the provisions of the Investment Law No. 72 of 2017 under the chairmanship of the President Counselor of the Court of Appeal of Cairo, where the committee is competent to consider the applications of grievances submitted by investors in regard to the land granted by the government, the allocation of real estate for the establishment of projects subject to the free zones areas system, the cancellation of the granted licenses, as well as the granted incentives for public or private or additional investment projects.

2. Ministerial Decision No. (226) for the year 2018 to form a committee for the consideration of grievances in accordance with the provisions of the Companies Law No. 159 of 1981 under the chairmanship of the Advisor, Vice-Premier of the Council of State. The Committee is competent to hear grievances against decisions issued by the General Authority for Investment regarding the authentication of amending the companies’ regulations the authentication of the amendment of the financial structures of companies and the convening of meetings of the General Assemblies of companies.

Second: Ministerial Committee for Dispute Resolution

This is the committee that is competent to consider the submitted requests or complaints or disputes that arise between investors and the State or one of the bodies or bodies or companies affiliated to it. The Committee shall decide on what is presented to it by a reasoned decision within thirty days from the date of the hearing of the parties. The decision shall be final and enforceable and shall be binding on all competent authorities and the provisions of Article 123 of the Penal Code shall be applied in case the authorities refrained from applying the decision. This procedure takes place without prejudice to the right of the investor to resort to the judiciary.

Third: The Ministerial Committee for the Settlement of Investment Contract Disputes

It is the committee that deals with the settlement of disputes arising from investment contracts to which the State or one of its subsidiaries or affiliates is a party. It is formed under the chairmanship of the Prime Minister and one of the Vice-Presidents of the Council of State participates in its membership. The committee shall discuss the disputes arising between the parties to the investment contracts and shall have the necessary adjustment procedure to address the imbalance of those contracts and extend the time, periods or deadlines stipulated therein. It also undertakes the rescheduling of financial receivables or correcting the previous procedures for the conclusion of contracts, provided that the settlement is presented to the Council of Ministers and after its adoption becomes enforceable and binding to the competent administrative bodies and has the same effect of the executive bond.

Fourth: Arbitration and Mediation Center

The Investment Law allows for the use of ad hoc arbitration or institutional arbitration where article 90 stipulates the establishment of an independent arbitration and mediation center called the Egyptian Center for Arbitration and Mediation, which shall have a legal personality and shall have its status in the governorate of Cairo. It settles the disputes arising between investors or between them and between the State or one of its affiliates.