Promoting Industrial Growth and Encouraging Foreign Direct Investment in Egypt
History
General Reforms
- Resolve the confusion surrounding the voting procedures, namely the cumulative voting system for electing board members in companies that are listed in the Egyptian stock exchange, and non-banking financial companies: Circular No. 1 of 2019, issued by the Financial Regulatory Authority, obligates companies to specify cumulative voting as the applicable voting system in their rules of procedure. This directive contradicts with Circular No. 1 of 2018, which is issued by GAFI. The latter, which reflects the legal and regulatory framework for protecting the rights of minority shareholders, stipulates that adopting the system of cumulative voting is optional rather than mandatory, which is in line with Article 74 (Paragraph 2) of the Companies Law. Thus, it is imperative to issue a clear directive to eliminate any ambiguity regarding the voting system.