In 2018, the Egyptian legislature enacted Law No. 4 of 2018, amending the Companies Law No. 159 of 1981 ("Companies Law"). Under this amendment, Egypt adopted for the first time the concept of the one person company with limited liability ("OPC").
Accordingly, any sole foreign investor who desires to invest in Egypt or open a subsidiary may choose to establish an OPC, which has the following advantages:
- only one owner may establish the OPC without the need for other partners. Either a natural or a juristic person can own an OPC;
- the OPC will leverage the limited liability privilege similar to the limited liability companies. This means that, with a few exceptions, the liability of the sole owner of the company is limited to the paid-in capital;
- the decision making within the company is straightforward because the sole owner of the OPC exercises all the powers that are granted to the board of directors and the general assembly in limited liability companies ("LLCs"). His decisions do not need the approval of any other partners nor board members.
That said, the OPC is not allowed to:
- incorporate another OPC, and
- conduct some business activities (same as LLCs) such as insurance, banking, savings, receiving funds, and investment management. Thus, due diligence must be conducted regarding the company's activities before its incorporation to determine the appropriate legal form.