President Abdel Fattah Al-Sisi decreed a law amending several provisions of the law governing ‘Economic Zones with a Special Nature’, according to the state’s official gazette Wednesday.
The law organises and governs investment in the Suez Canal area, and the economic body that will take over managing the Suez Canal Development Project, in coordination with all the concerned governmental bodies.
According to the official gazette, the amendments stipulated that the general authority, that is to formed to manage the zone, has the right to participate in launching one or more major companies to develop the area, or to licence others to launch this company.
“Each company that is entrusted with developing the economic zone with a special nature or part of it, as well as promoting it, launching, managing, doing the maintenance of the infrastructure within its borders, must be a major development company,” explains the gazette.
The amendments allow trading in the shares of the joint stock companies that initiated the area as soon as they are launched, without being restricted by their nominal value, and upon the agreement of the board of directors, due to the regulations determined by the cabinet.
Hany Sarie-Eldin, the legal adviser of the Suez Canal Area Development Project, told Daily News Egypt that “the new law does not oblige the authority to initiate a major development company for the area, of which it owns over 50%”.
The amendments allow the authority to contract a private sector party to develop the area and perform the maintenance of the infrastructure, without acquiring a quota in the development company, or while owning very small quotas.
Sarie-Eldin said that over the next few days the procedures of forming the general authority of the economic zone will take place, including a head for the authority and nine members, four of whom represent the related ministries and governorates. They include the Ministry of Defence, and five members with financial and technical legal experience.
The amendments stipulate that the president has the right to establish one or more economic zone outside the current urban spaces of the cities and villages. Moreover, the zone may extend to inside the urban space of the cities and villages if the nature of the project requires it.
The general authority issues the work permits of the foreign labour after acquiring the approvals of the security bodies. It also takes over the responsibility of coordinating with the Ministry of Defence, in order to take into account the defence requirements.