Foreign companies that want to enter the Egyptian market have many options that adjust to their business needs. Non-Egyptian companies have a wide umbrella of business entities to choose from and register with the Egyptian authorities. Register Representative Offices of Foreign Companies in Egypt is the best vital choice they have. Even though the scope of action is limited to non-profit activities, a Representative Office is a safe choice and allows for a structured business plan to take place.
What is a Representative Office?
A representative office is a temporary business entity that is not a legal entity in its own right. It is typically used by foreign companies to conduct market research, promote their products or services, and build relationships with potential customers and partners. Representative offices cannot generate revenue or engage in any commercial activities.
In Egypt, according to the investment Law No. 742 of 2018, representative office is permitted to operate solely for the purposes of conducting market studies and research, and are prohibited from taking part in any trading activities. Under this decision, offices which are compliant with this definition will be required to register as a branch or subsidiary within three years from the date of their establishment. This deadline may also be extended for an additional year in exceptional circumstances, subject to GAFI’s assessment.
There are no partners required, however, a manager should be appointed by the head office abroad to perform the administrative work based on the responsibilities determined by the head office. This manager can be Egyptian or foreigner.
Benefits of register Representative Offices of Foreign Companies in Egypt
Establishing and register Representative Offices of Foreign Companies in Egypt can have several benefits for foreign companies or entities, including:
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Low setup cost
Setting up a Representative Office is less expensive than other types of business entities, such as subsidiaries or branch offices.
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Market research and promotion
A Representative Office can conduct market research, product promotion, and feasibility studies to help the parent company make informed decisions about entering the Egyptian market.
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Brand awareness
A Representative Office can help raise brand awareness and increase the visibility of the parent company in Egypt.
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Business development
A Representative Office can serve as a liaison between the parent company and potential customers or partners in Egypt, and assist in business development efforts.
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Limited liability
A Representative Office does not have a separate legal personality from the parent company, which means that the parent company assumes all liabilities.
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Tax benefits
A Representative Office is subject to a lower tax rate than other types of business entities, and is exempt from income tax as long as it does not engage in any income-generating activities in Egypt.
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Flexibility
A Representative Office can be set up quickly and easily, and can be closed down easily if the parent company decides not to pursue business opportunities in Egypt.
General Conditions of Representative Offices
- Foreign Companies are allowed to establish representative offices in Egypt.
- The purpose of the representative office shall be confined to the study of markets and possibilities of production without carrying out any commercial operations including the activity of commercial agents.
- The approval of the Egyptian Insurance Supervisory Authority if the company activity is insurance.
- The approval of the CBE (Central Bank of Egypt) if the foreign company’s activity is related to a bank activity.
As we at “Consortio Law Firm” understand the value of foreign investments and their impact on the local and international economy, we always strive to provide the best legal services that facilitate all procedures for the legal process for register Representative Offices of Foreign Companies in Egypt, through experts specialized in international law and investment laws, which ensures the smooth conduct of business, and achieving the highest levels of economic development that produces fruits for all parties.
If you want to start your investments in Egypt, and register Representative Offices of Foreign Companies in Egypt, Contact us Now via the phone number 002 01028806061 or send us a WhatsApp or email Info@consortiolawfirm.com.
