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Ahead of the coming into force of the new Egyptian merger control regime on 1st of June 2024, the Egyptian Competition Authority (ECA) today published its new notification form as well as questions and answers providing clarifications to merger parties. The ECA had received feedback that its proposed jurisdictional thresholds were too broad leading to transactions with no impact on the Egyptian market needing to be notified. To address these concerns, the ECA has narrowed down its jurisdictional thresholds, clearly requiring a local nexus for transactions. The ECA has also created a simplified procedure and fast track process for certain transactions.

The Egyptian Competition Authority (ECA) recently issued its first vertical restraints case prohibiting the vertical agreement between eight manufacturers and suppliers, along with their distributors (organized/hypermarkets and independent merchants). The ECA stated that were they found to have agreed on setting the minimum fixed resale price maintenance (RPM) and adopted Most Favored Nation clauses (MFN) in distribution contracts of household electrical appliances. This conduct was deemed a violation of Article 7 of the Egyptian Competition Law No. 3 for 2005.

On 4 April 2024, the Executive Regulation of the new Egyptian pre-merger control regime was officially published by Prime Minister Decree No. 1120 of 2024. The ER introduces the implementing regulations for the newly established pre-merger control regime issued by the Law number 175 of 2022 which empowers the Egyptian Competition Authority with significant powers in reviewing and approving transactions. The ER states that it will enter into force on 1 June 2024, i.e. transactions that close on or after 1 June 2024, and meet the prescribed thresholds, must obtain prior approval from the ECA.

On 27 January 2024, Law No. 2 of 2024 was issued (“Law”), providing green hydrogen and derivatives projects with certain incentives. These incentives are extended not only to green hydrogen and derivatives projects (such as green ammonia and green methanol), but also to the upstream and midstream facilities, of which 95% of the output is to service green hydrogen and derivatives projects and projects exclusively carrying out transportation, storage and distribution of green hydrogen and its derivatives in Egypt. The incentives also extend to projects that directly and exclusively manufacture production input and supplies for the midstream and downstream facilities for which a cabinet decree has been issued. The Law also applies to future expansions of the aforementioned projects.

On 27 January 2024, Law No. 2 of 2024 was issued (“Law”), providing green hydrogen and derivatives projects with certain incentives. These incentives are extended not only to green hydrogen and derivatives projects (such as green ammonia and green methanol), but also to the upstream and midstream facilities, of which 95% of the output is to service green hydrogen and derivatives projects and projects exclusively carrying out transportation, storage and distribution of green hydrogen and its derivatives in Egypt. The incentives also extend to projects that directly and exclusively manufacture production input and supplies for the midstream and downstream facilities for which a cabinet decree has been issued. The Law also applies to future expansions of suchprojects.

The Financial Regulatory Authority recently published regulations setting out the requirements for establishment and licensing for companies seeking to offer certain non-banking financial services in Egypt (“Fintech Regulations”) which came into force on the 2nd January 2024. The requirements set out under the Fintech Regulations apply to financial technology (“Fintech”) companies seeking to obtain a license to offer mortgage financing, SME financing, microfinance, financial leasing, factoring, and consumer finance services. This marks a significant step for startups in the Egyptian market, providing needed clarity in the form of a unified framework for entry into such market.

We are delighted to invite you to our Baker McKenzie Middle East Customs and Transfer Pricing Briefing.
Hosted at our Dubai International Financial Centre (DIFC) office on 12 October 2023 at 8:30 – 11:30 am GST, the session is designed to provide you with first-hand insights from our Middle East and international experts in the fields of Customs, Transfer Pricing and VAT.

We are delighted to invite you to the Baker McKenzie Middle East Tax Forum in Dubai on Wednesday, 18 October 2023 – a full day of interactive discussions on tax updates across the Middle East and a special focus on the impact of global tax policy developments such as Pillar 1 and Pillar 2 (Global Minimum Tax).

The Central Bank of Egypt recently published regulations setting out the licensing and regulatory framework for digital banks in Egypt (“Digital Bank Regulations”) which came into force on 12 July 2023. The Digital Bank Regulations will effectively allow for the establishment and operation of digital banks in Egypt, thus taking a significant step in aligning the country with global trends in financial technology and catering for the needs of a growing Egyptian financial market.

The Financial Regulatory Authority recently issued decrees No. 139, No. 140 and No. 141 completing and complementing the Financial Technology L aw No. 5 of 2022 which sets out the framework for the development and use of Fintech in non-banking financial services. The decrees, which came into force on 11 July 2023, come as part of the FRA’s continuing efforts to transition Egyptian financial markets towards digitization by encouraging the use of Fintech.