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The Restructuring of the Ministry o

The Restructuring of the Ministry of Investment
The Ministry of Investment was first established in July of 2004 to perform part of the role of what was previously known as the Ministry of Economy as well as supervising the public business sector. Since then, the Minister of Investment has been responsible for Holding and Subsidiary companies which form the Public Business sector, the General Authority of Investment and Free Zones (“GAFI”), the Capital Market Authority, the Egyptian Insurance Supervisory Authority and the General Authority for Mortgage as well as a few other entities. Following the January 2011 Revolution, the Ministry of Investment did not last. It remained for a while a ministry without a minister. In addition, part of its old jurisdiction was amended, as GAFI and the Egyptian Financial Supervisory Authority (“EFSA”) (which merged within it the three authorities supervising the capital market, insurance and mortgage) came under the supervision of the Prime Minister. For these reasons and after forming the new cabinet under the leadership of Dr. Hesham Kandil and appointing the New Minister of Investment, the President issued Decree No. 177 of 2012 concerning the restructuring of the Ministry of Investment as follows (the “Decree”).[1]
The Mandate of the Ministry
The Decree states that the main purpose of the Ministry is to encourage and develop investment in Egypt through creating the suitable environment for investment, removing obstacles, increasing the competitiveness of the Egyptian economy as well as providing incentives for investment. This kind of specification is important as it gives weight to the importance of promotion, encouragement and the removal of obstacles as opposed to the supervisory aspects, which should be performed by other specialized regulatory entities. Nonetheless, the Decree also states that one of the purposes of the Ministry is to protect the right of the State in public sector companies.
The Role of the Minister of Investment
The Decree states that the Minister of Investment is responsible for enforcing the provisions of the Companies Law No. 159 of 1981, the Public Business Sector Companies Law No. 203 of 199 and the Investment Guarantees and Incentives Law No. 8 of 1997. Accordingly, the entities under the Minister of Investment’s supervision are GAFI, all of the Public Business Sector as well as the entities related thereto such as the Information Centres, Support Fund and the restructuring programs for public sector companies. It is worth noting that EFSA, which is responsible for non-banking financial markets, is no longer under the supervision of the Ministry of Investment which provides for the autonomy the financial supervisory authorities need as it is with the central bank.
Specific Duties
Besides the general provisions that define the role of the Minister of Investment, the Decree also clarifies some clear duties:
  • Drawing out investment policies in cooperation with other ministries;
  • Protecting the State’s right in the public business sector;
  • Setting rules and conditions for forming the general assemblies of holding and subsidiary companies;
  • Rectifying the funding structures of public sector companies;
  • Simplifying investment procedures;
  • Implementing a system of electronic services in the field of investment;
  • Developing awareness on the subject of investment and cooperating with international entities.
Conclusion
This new Decree restructures the Ministry of Investment in a time of great need. However, it would have been an even more productive step to also take a closer look at the Minister’s role and to broaden it to enable him to improve the environment of investment and encourage other ministries to cooperate in this field. Nonetheless it is a positive step.   [1] Presidential Decree No. 177/2012 on the restructuring of the Ministry of Investment, Official Gazette, Issue No. 39, 27 September 2012.
The Ministry of Investment was first established in July of 2004 to perform part of the role of what was previously known as the Ministry of Economy as well as supervising the public business sector. Since then, the Minister of Investment has been responsible for Holding and Subsidiary companies which form the Public Business sector, the General Authority of Investment and Free Zones (“GAFI”), the Capital Market Authority, the Egyptian Insurance Supervisory Authority and the General Authority for Mortgage as well as a few other entities. Following the January 2011 Revolution, the Ministry of Investment did not last. It remained for a while a ministry without a minister. In addition, part of its old jurisdiction was amended, as GAFI and the Egyptian Financial Supervisory Authority (“EFSA”) (which merged within it the three authorities supervising the capital market, insurance and mortgage) came under the supervision of the Prime Minister. For these reasons and after forming the new cabinet under the leadership of Dr. Hesham Kandil and appointing the New Minister of Investment, the President issued Decree No. 177 of 2012 concerning the restructuring of the Ministry of Investment as follows (the “Decree”).[1]
The Mandate of the Ministry
The Decree states that the main purpose of the Ministry is to encourage and develop investment in Egypt through creating the suitable environment for investment, removing obstacles, increasing the competitiveness of the Egyptian economy as well as providing incentives for investment. This kind of specification is important as it gives weight to the importance of promotion, encouragement and the removal of obstacles as opposed to the supervisory aspects, which should be performed by other specialized regulatory entities. Nonetheless, the Decree also states that one of the purposes of the Ministry is to protect the right of the State in public sector companies.
The Role of the Minister of Investment
The Decree states that the Minister of Investment is responsible for enforcing the provisions of the Companies Law No. 159 of 1981, the Public Business Sector Companies Law No. 203 of 199 and the Investment Guarantees and Incentives Law No. 8 of 1997. Accordingly, the entities under the Minister of Investment’s supervision are GAFI, all of the Public Business Sector as well as the entities related thereto such as the Information Centres, Support Fund and the restructuring programs for public sector companies. It is worth noting that EFSA, which is responsible for non-banking financial markets, is no longer under the supervision of the Ministry of Investment which provides for the autonomy the financial supervisory authorities need as it is with the central bank.
Specific Duties
Besides the general provisions that define the role of the Minister of Investment, the Decree also clarifies some clear duties:
  • Drawing out investment policies in cooperation with other ministries;
  • Protecting the State’s right in the public business sector;
  • Setting rules and conditions for forming the general assemblies of holding and subsidiary companies;
  • Rectifying the funding structures of public sector companies;
  • Simplifying investment procedures;
  • Implementing a system of electronic services in the field of investment;
  • Developing awareness on the subject of investment and cooperating with international entities.
Conclusion
This new Decree restructures the Ministry of Investment in a time of great need. However, it would have been an even more productive step to also take a closer look at the Minister’s role and to broaden it to enable him to improve the environment of investment and encourage other ministries to cooperate in this field. Nonetheless it is a positive step.   [1] Presidential Decree No. 177/2012 on the restructuring of the Ministry of Investment, Official Gazette, Issue No. 39, 27 September 2012.