Watch Your Back — Beating Business and Property Traps in Egypt

Thinking of leaving the country? One place you might consider is Egypt. The country not only offers sunshine, but also boasts a good climate for business.

However, when you make this brave decision to start a new life there, there are some things you’ll be glad you knew when it comes to business and property.

Banks

If you’re setting up a business in Egypt, you’ll need to purchase business insurance and also open a business account. It’s better to bank with international banks like HSCB because they provide more services, greater access to ATMs and can offer better conditions on loans and mortgages. The conditions in smaller, local banks in Egypt tend to be poorer in this regard.

Location

When setting up a business, you want to keep costs down as much as possible.

One way to do this in Egypt is by setting up in one of the country’s free zones. Your business will be exempt from taxes and customs duties while it’s in the free zone, but if you do pay customs duties you can sell a certain percentage of production domestically. You’ll be exempt from import and export regulations, and you’ll also enjoy exemption from certain labour provisions.

Registering your business

When registering your business, you’ll need the services of a lawyer. However, go to a One Stop Shop (OSS) first, which the Egyptian Government has set up to help businesses. They can advise you on the process and also take care of essential aspects such as document notarization for free.

Purchasing a Property

Of course, you’ll consider buying a place to live, too, in which case there are several things you should know.

First of all, real estate agents in Egypt aren’t regulated. If you’re thinking of buying a property, hire a suitable, independent, local lawyer to check whether the real estate agent and/or the developer are legit. They may be under investigation.

Secondly, under Egyptian law, you must register the ownership deeds in the real estate registry to transfer the ownership of a purchased property. Many parties in a property sale sign a preliminary sales contract but don’t register the final sales contract. However, this means the buyer is still not the owner, despite the fact they’ve paid for the property.

Thirdly, the other problem with preliminary contracts is that they have no legal force unless the parties register them. Despite all the terms and conditions in them, without official registration the seller can do what they want with the property — including sell to someone else.

Renting a Property

If you decide to rent a property instead of buying one, find out if it was constructed before 1996. If it is you may benefit from an old Egyptian property law which freezes rents on such properties. Much to the landlord’s disgust, the rent will be little more than loose change.

They say knowledge is power. When it comes to property and business in Egypt, you may not be more powerful, but you can make more informed decisions. By knowing how you can save money and what to watch out for, you can readdress the balance of power between you and others in business and real estate, and enjoy your adventure in Egypt much more.

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