The Financial Regulatory Authority (FRA), chaired by Islam Azzam, has issued a decision to reduce by 50% the fees for reviewing and assessing applications to offer sustainability-linked securities, as part of efforts to encourage companies and financial institutions to issue bonds that finance environmental, climate and social development projects in line with Egypt Vision 2030.
Under the decision, the fee reduction will no longer be limited to green bonds, which have benefited from reduced review and assessment fees since the FRA issued Board Decision No. 141 of 2019.
Instead, the incentive will be extended to all sustainability-related securities introduced under the latest amendments to the executive regulations of the Capital Market Law. These include sustainability bonds, sustainability-linked bonds, social bonds used to finance or refinance new or existing social projects, women’s empowerment bonds, climate bonds dedicated to environmentally friendly projects, and transition bonds designed to finance emissions reductions in existing polluting activities.
The decision cuts by 50% the fees payable to the FRA for reviewing and assessing applications to issue these sustainability-related securities, whether through public or private offerings.
Azzam said the decision is consistent with the recent amendments to the executive regulations of the Capital Market Law, which recognise these instruments as financing mechanisms linked to sustainable development objectives while maintaining issuers’ obligations to repay the principal and returns due to investors.
He added that the FRA remains committed to supporting projects that advance key social and environmental objectives and contribute to sustainable development, while strengthening the role of non-banking financial services in improving quality of life.
Azzam said proceeds from sustainability-related securities can be used to finance a broad range of development initiatives, including green projects, programmes supporting women’s empowerment and gender equality, projects aimed at reducing carbon emissions and mitigating climate change, pollution control initiatives, efforts to reduce harmful gas emissions and water pollution, as well as energy-efficiency projects.
