Egypt’s Minister of Industry, Khaled Hashem, has issued Ministerial Decree No. 171 of 2026, amending provisions of Decree No. 107 of 2026 to introduce a new package of incentives aimed at removing obstacles facing serious industrial investors, accelerating production, and improving the management of industrial land.
The amendments abolish the previous requirement for factories to operate for three years before owners could transfer ownership or for one year before leasing industrial land.
Instead, investors will only be required to demonstrate the seriousness of their projects by obtaining an operating licence and an industrial registration certificate, paying the full price of the land, and commencing production before transferring ownership, assigning rights, or leasing industrial land.
The move follows the minister’s recent announcement suspending the implementation of Ministerial Decree No. 107 from mid-August until the end of December 2026 as part of efforts to strike a balance between facilitating private sector investment and maintaining oversight of industrial land allocation.
Hashem said the first article of the new decree restructures the framework governing grace periods for delayed industrial projects based on their actual implementation rates.
Projects that have obtained building permits and completed at least 75% of construction will receive a maximum six-month extension, with full exemption from delay penalties, allowing them to complete construction, install machinery, and obtain operating and industrial licences after paying the applicable standard fees.
Projects that have completed between 50% and less than 75% of construction will be granted an extension of up to 12 months, with exemption from delay penalties during the first six months only. Standard penalties and fees will apply thereafter.
Projects that have completed less than 50% of construction, or have not started building despite obtaining the necessary permits, will receive a maximum 18-month extension, with exemption from delay penalties during the first six months and payment of the applicable penalties for the remaining period.
Meanwhile, projects that have already benefited from previous extensions but failed to demonstrate sufficient progress will receive a final three-month grace period. Failure to comply after that period will result in cancellation of the land allocation and the immediate withdrawal of the plot for reallocation.
The minister stressed that the new incentives will apply only to serious projects and will not cover industrial land where investors failed to demonstrate commitment and where formal cancellation or land withdrawal decisions have already been issued after the approved implementation timetable expired.
Under the second article of the decree, the government has also eased restrictions on industrial land transactions by removing the mandatory operating period previously required before transferring ownership or leasing industrial land.
Instead, beneficiaries holding land under sale, usufruct, or lease-to-own arrangements will be allowed to transfer ownership, assign their rights, or lease the land only after paying the full land price and all outstanding dues, obtaining operating and industrial licences, commencing actual production, and paying the applicable standard fees.
The decree also introduces greater flexibility for changing industrial activities.
Investors will now be permitted to shift from one industrial sector to another on allocated land within industrial zones and developer-operated industrial parks, subject to approval by the Industrial Development Authority. Approval will be based on a justified feasibility study, the suitability of the site’s location for the proposed activity, and payment of the required standard fees.
