Banking operations
1. What legislative requirements exist for the organization of banking operations for foreign companies/non-residents?
In Egypt, banking operations are primarily governed by Banking Law No. 194 of 2020 and the regulations issued by the Central Bank of Egypt (CBE). Foreign companies and non-residents may conduct banking operations through licensed Egyptian banks. Banks must comply with Anti-Money Laundering Law No. 80 of 2002, "Know Your Customer" (KYC) regulations, and foreign exchange regulations issued by the CBE. There is no prohibition on foreign entities opening accounts; however, strict compliance and disclosure obligations apply.
2. What requirements exist for opening accounts of foreign companies and individuals? How are they checked? What documents/guarantees of origin of capital are required?
For foreign companies, banks require: Certificate of Incorporation (legalized), Articles of Association, Board Resolution authorizing account opening, identification of directors and Ultimate Beneficial Owners (UBOs), tax registration (if operating locally), proof of address, and declaration of source of funds.
For foreign individuals: valid passport, entry visa or residence permit (if applicable), proof of address, and documentation evidencing lawful source of funds.
Banks conduct KYC procedures, enhanced due diligence where required, sanctions screening, and UBO identification. Proof of lawful origin of funds is mandatory.
3. Is it obligatory for a foreign company to have an office in Egypt to open a bank account?
Not necessarily. A foreign company may open a non-resident account without establishing a branch. However, if it intends to conduct commercial activity in Egypt, it must register a branch or company with the competent authorities.
4. Does a private investor need a residence permit to open a bank account?
A residence permit is not strictly required to open a non-resident account. However, for long-term banking relationships or credit facilities, banks typically require valid residency documentation.
5. Can a foreign company get a loan for business development? What are the requirements?
A foreign company operating through a registered entity in Egypt may obtain financing subject to legal registration, audited financial statements, business plan, credit assessment, and provision of collateral such as real estate, corporate guarantees, or cash margins.
6. How can settlements with local partners be organized?
Settlements may be conducted via local bank transfers (EGP or foreign currency), documentary credits, documentary collections, or escrow arrangements. Trade-related transactions must comply with CBE regulations.
7. Are there restrictions on bringing foreign currency into Egypt?
Cash amounts exceeding USD 10,000 (or equivalent) must be declared upon entry. Cashless transfers are permitted through licensed banks, subject to Anti-money laundering (AML) compliance. Declaring the source of the money and relationship to the depositing party will be a crucial question that needs an answer to the bank and Anti-money laundering authorities.
8. Are cash payments permissible?
Yes, but commercial transactions exceeding EGP 15,000 between companies are generally required to be conducted through non-cash methods in accordance with financial inclusion regulations.
9. How to organize non-cash settlement? What documents are required?
Non-cash settlements are conducted via bank transfers, SWIFT payments, letters of credit, or documentary collection. Required documents include commercial contracts, invoices, tax documentation, and import/export documentation where applicable.
10. Is it possible to open a foreign currency account? Are there restrictions?
Both residents and non-residents may open foreign currency accounts (USD, EUR, etc.). Transfers must comply with CBE regulations and AML requirements. Declaring the source of the money and relationship to the depositing party will be a crucial question that needs an answer to the bank and Anti-money laundering authorities.
11. Is it possible to settle with counterparties in foreign currency?
Yes, particularly in international trade or where one party is foreign. Purely domestic transactions are generally conducted in Egyptian Pounds unless justified.
12. How can withdrawals be made? Is withdrawal in foreign currency allowed?
Withdrawals may be made in cash or by transfer. Foreign currency cash withdrawals are permitted subject to bank liquidity and documentation requirements.
13. How can funds be transferred abroad? What is required?
Funds may be transferred abroad via SWIFT transfers, trade finance instruments, or profit repatriation mechanisms. Supporting documentation, tax clearance (if applicable), and contractual justification are required. Egyptian law guarantees repatriation of profits and capital for investors.
14. How is financing of transactions organized? Are special authorizations required?
Financing tools include letters of credit, letters of guarantee, factoring, and bank loans. Special authorizations are generally not required unless operating in regulated sectors. Banks may require collateral or margin deposits. Financing projects in Egypt varies according to the applicant ; an individual or a company, local or foreigners, the amount of loan needed and the guarantees available by the applicant.
Banks are really cautious when financing projects that involve a foreign party as they ask for more guarantees to secure that loans could be repaid in the due time.
15. How are financial statements structured? What documents must be submitted and to which authorities?
If a branch or subsidiary is established in Egypt, financial statements must comply with Egyptian Accounting Standards. Annual balance sheets, profit and loss statements, auditor's reports, and tax filings must be submitted to the Egyptian Tax Authority and other relevant authorities. If no legal presence exists, only banking compliance documentation is required.