In the last few years, Egypt’s economy has been growing strongly. This is due to the government’s efforts to implement economic reforms in 2016. As the Egyptian economy’s dynamic growth, geographical position, low labor costs, skilled workforce, and unique tourist potential make it a highly desirable investment opportunity. So that, the authorities have been encouraging people and investors to register their companies. However, the procedures, establishment steps, and the like may become an obstacle to achieving that dream. Therefore, many companies have recently sought to know about How to establish One Person Company to get the full knowledge of the necessary tools to succeed in different sectors.
What is the One Person Company?
A one-person company is defined as a company formed with a single person as a member, different from the traditional manner of having at least two members. This one person is wholly responsible for the business and is able to take more risks without affecting or suffering the loss of personal assets.
One person company is the latest type of company regulated in Law No. 4 of 2018 which allows any investor or person to establish a company on their own without the need for a partner.
These types of companies are popular in many regions due to their limited liability which is restricted to the value of the shared capital. Subsequently, protecting the investor from any risks that may put their fortune in danger. Once you register a one-person company in Egypt, you will become the main beneficiary of your business.
Advantages of One Person Company (OPC)
- Legal status: The OPC receives a separate legal entity status, protecting the individual who has incorporated it. The member’s liability is limited to their shares, and they are not personally liable for the company’s losses.
- Easy to obtain funds: Being a private company, OPCs have easier access to fundraising through venture capitalists, angel investors, and incubators. Banks and financial institutions also prefer to grant loans to companies rather than proprietorship firms, making it easier to obtain funds.
- Less compliance: OPCs enjoy certain exemptions in compliance requirements under the Companies Act, 2013.
- Easy incorporation: OPCs can be incorporated with just one member and one nominee, with the member also serving as the director. There is no minimum paid-up capital requirement, making the incorporation process relatively simple compared to other forms of companies.
- Easy to manage: With a single person managing the affairs of the OPC, decision-making becomes efficient and quick. Resolutions can be quickly passed by the member and recorded in the minute book, resulting in smooth company management without conflicts or delays.
- Perpetual succession: OPCs maintain perpetual succession, even with only one member. When incorporating an OPC, the single member appoints a nominee who will assume control of the company in case of the member’s death.
How to register a One-Person company in Egypt?
To establish a One-Person company, you need to submit an application to the Authority. The One-Person company should have its internal regulation that includes:
- Company name.
- Purpose of the company.
- The Intended duration of the company.
- Personal information of the founder.
- Head office address.
- Capital amount.
- Liquidation rules.
- Any other information as per the Executive Regulations.
The company’s capital should be paid in full upon the establishment of the company.
Required documents for establishing a one-person company are:
- A notarized power of attorney, legalized from the Egyptian consulate.
- The business name.
- Certificate from an authorized. Egyptian bank that the capital of the company has been deposited in full.
- An ID card or Passport copy.
- The Certificate of the Auditor of the company.
- A possession deed of the company headquarters or the lease contract of the same.
Overall, a One Person Company is an attractive option for entrepreneurs who wish to have complete control over their business without sacrificing the benefits of limited liability. The flexibility and ease of operations, along with the taxation and capital raising advantages, make a One Person Company an excellent choice for those looking to start their own business in Egypt.
Would you like to register a one-person company in Egypt? Hire our business consultancy services at “Consortio Law Firm”, Just Contact us Now via the phone number 002 01028806061 or send us a WhatsApp or email Info@consortiolawfirm.com.
