Prime Minister's Decision No. 654 of 2021

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Official Gazette - No. 13 Rec. (A) on April 5, 2021

Prime Minister's Decision No. 654 of 2021 Issuing the Executive Regulation of the Law on Developing Medium, Small, and Micro Enterprises Issued by Law No. 152 of 2020

Prime Minister After reviewing the Constitution; and the Penal Code; and the Civil Code; and the Criminal Procedure Code; and the Civil and Commercial Procedure Code; and Law No. 11 of 1940 concerning the sale and mortgage of commercial establishments; and Law No. 90 of 1944 concerning judicial fees and registration fees in civil matters; and Law No. 114 of 1946 concerning the organization of real estate registration; and Law No. 308 of 1955 concerning administrative seizure; and Law No. 21 of 1958 concerning the organization and encouragement of industry; and Law No. 70 of 1964 concerning registration and recording fees; and the Agriculture Law issued by Law No. 53 of 1966; and the Productive Cooperation Law issued by Law No. 110 of 1975; and Law No. 118 of 1975 concerning import and export; and Law No. 34 of 1976 concerning the commercial register; and Law No. 24 of 1977 concerning the industrial register; and Law No. 143 of 1981 concerning desert lands;

Official Gazette - No. 13 Rec. (A) on April 5, 2021

and the Law on Joint Stock Companies, Companies Limited by Shares, Limited Liability Companies, and Single-Person Companies issued by Law No. 159 of 1981; and Law No. 7 of 1991 concerning certain provisions related to private state property; and the Environment Law issued by Law No. 4 of 1994; and the Commerce Law issued by Law No. 17 of 1999; and the Real Estate Financing Law issued by Law No. 148 of 2001; and the Law on Protecting Intellectual Property Rights issued by Law No. 82 of 2002; and the Labor Law issued by Law No. 12 of 2003; and Law No. 15 of 2004 concerning the organization of electronic signatures and the establishment of the Information Technology Industry Development Authority; and the Income Tax Law issued by Law No. 91 of 2005; and the Construction Law issued by Law No. 119 of 2008; and the Tax on Built Properties Law issued by Law No. 196 of 2008; and Law No. 10 of 2009 concerning the organization of supervision on markets and non-banking financial instruments; and Law No. 141 of 2014 concerning the organization of conducting the activity of financing medium, small, and micro enterprises; and Law No. 5 of 2015 concerning the preference of Egyptian products in government contracts; and the Electricity Law issued by Law No. 87 of 2015; and the Law on the Organization of Movable Collateral issued by Law No. 115 of 2015; and the Value Added Tax Law issued by Law No. 67 of 2016; and the Law on Facilitating Procedures for Granting Industrial Establishment Licenses issued by Law No. 15 of 2017;

Official Gazette - No. 13 Rec. (A) on April 5, 2021

and the Investment Law issued by Law No. 72 of 2017; and the Law on the Organization of Restructuring, Protective Composition, and Bankruptcy issued by Law No. 11 of 2018; and Law No. 92 of 2018 concerning the organization and encouragement of mobile food unit operations; and the Law on the Organization of Contracts Concluded by Public Entities issued by Law No. 182 of 2018; and the Law on the Organization of the Use of Non-Cash Payment Means issued by Law No. 18 of 2019; and the Social Insurance and Pensions Law issued by Law No. 148 of 2019; and the Law on the Organization of Civil Work Practice issued by Law No. 149 of 2019; and the Public Establishments Law issued by Law No. 154 of 2019; and the Law on Developing Medium, Small, and Micro Enterprises issued by Law No. 152 of 2020; and the Law on the Central Bank and the Banking System issued by Law No. 194 of 2020; and the Law on the Organization of Waste Management issued by Law No. 202 of 2020; and the Unified Tax Procedures Law issued by Law No. 206 of 2020; and the Executive Regulation of the Law on Developing Small Enterprises issued by Prime Minister's Decision No. 1241 of 2004; and based on the proposal submitted by the Minister of Trade and Industry and the Executive Chairman of the Micro, Small, and Medium Enterprises Development Agency; and based on the opinion of the State Council; and after approval by the Council of Ministers;

Official Gazette - No. 13 Rec. (A) on April 5, 2021

DECIDED: ( Article 1 ) The provisions of the attached Executive Regulation concerning the aforementioned Law on Developing Medium, Small, and Micro Enterprises shall be implemented. ( Article 2 ) All state entities, local administration units, and state-owned utility companies shall provide the Agency with any information and documents it requests regarding the guides and forms it issues. ( Article 3 ) The Executive Regulation of the Law on Developing Small Enterprises issued by Prime Minister's Decision No. 1241 of 2004, mentioned above, is hereby repealed, and any provision conflicting with the provisions of the attached Regulation is also repealed. ( Article 4 ) This Decision shall be published in the Official Gazette and shall take effect from the day following its publication date. Issued at the Prime Minister's Office on 23 Sha'ban 1442 AH (Corresponding to April 5, 2021 AD).

Prime Minister Dr. Mostafa Madbouly

Official Gazette - No. 13 Rec. (A) on April 5, 2021

Chapter One Definitions Article (1) In application of the provisions of this Regulation, the following words and expressions shall have the meanings indicated alongside each of them: 1 - The Law: The Law on Developing Medium, Small, and Micro Enterprises issued by Law No. 152 of 2020. 2 - Enterprises: Medium, small, and micro enterprises, regardless of their economic activity or legal form. 3 - The Competent Minister: The Prime Minister. 4 - The Agency: The Micro, Small, and Medium Enterprises Development Agency, established by Prime Minister's Decision No. 947 of 2017. 5 - The Board of Directors: The Board of Directors of the Micro, Small, and Medium Enterprises Development Agency. 6 - Service Delivery Units: Units established by the Agency in its offices and branches, or in the General Authority for Investment and Free Zones or its branches in governorates, responsible for issuing approvals, permits, operating licenses, cards, and registrations required by applicable legislation for enterprises to conduct their activities.

Official Gazette - No. 13 Rec. (A) on April 5, 2021

7 - Business Volume: Total annual sales or revenues of enterprises, as applicable. 8 - Industrial Enterprise: Any enterprise that carries out a physical or chemical conversion of raw materials, or performs changes on any product, including assembly, sorting, packaging, grading, or recycling, in accordance with standards and controls issued by the Competent Minister for industrial affairs. 9 - Medium / Small / Micro Enterprises: (أ) Medium Enterprises: Any enterprise with an annual business volume of 50 million EGP and not exceeding 200 million EGP according to the audited financial statements for the last year. Any newly established industrial enterprise with paid capital or invested capital of 5 million EGP and not exceeding 15 million EGP. Any newly established non-industrial enterprise with paid capital or invested capital of 3 million EGP and not exceeding 5 million EGP. (ب) Small Enterprises: Any enterprise with an annual business volume of 1 million EGP and less than 50 million EGP according to the audited financial statements for the last year. Any newly established industrial enterprise with paid capital or invested capital of 50,000 EGP and less than 5 million EGP. Any newly established non-industrial enterprise with paid capital or invested capital of 50,000 EGP and less than 3 million EGP.

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(ج) Micro Enterprises: Any enterprise with an annual business volume of less than 1 million EGP. Any newly established enterprise with paid capital or invested capital of less than 50,000 EGP. 10 - Newly Established Enterprise: An enterprise that has not been established, registered, or conducting its activity for more than two years. 11 - Financing Provider: Banks, financing institutions, companies, financial institutions, and other entities licensed to conduct financing or credit facilities activities for enterprises, or where this activity falls within their objectives according to applicable legislation. 12 - Real Estate: Any fixed asset that cannot be moved without damage, such as land and buildings. 13 - Competent Authority for Real Estate: The entity with the authority to exploit and dispose of real estate allocated for the purposes of enterprises subject to the provisions of this Law and Regulation. 14 - Allocation: Allocating real estate from the Competent Authority for Real Estate to any enterprise subject to this Law and Regulation through any of the following forms: sale, sale of usufruct, license of usufruct, lease, or lease-to-own. 15 - Informal Economy Enterprises: Medium, small, or micro enterprises conducting their activity without obtaining a construction or operating license, or any other license or approval required to conduct the activity, as determined by a Prime Minister's Decision upon the Agency's proposal.

Official Gazette - No. 13 Rec. (A) on April 5, 2021

16 - Legalization: Obtaining a license from competent administrative authorities or the Agency according to governing laws before the temporary license period expires. 17 - Entrepreneurship Enterprises: Enterprises that have not exceeded seven years from the date of commencing activity or production, as applicable, and which involve a degree of novelty or innovation, according to controls determined by the Board of Directors. 18 - Accreditation Offices: Offices licensed by the Agency to examine whether the enterprise complies with requirements and has the necessary documents to obtain construction, operating, or expansion licenses, and to issue an accreditation certificate to the applicant for submission to the Agency and relevant authorities, or accreditation offices licensed by other authorities according to applicable legislation and entrusted by the Agency. 19 - Business Incubators: Companies, establishments, associations, or other legal entities aiming to help newly established and entrepreneurship enterprises grow by providing various services, especially in financing, marketing, and management. 20 - Business Accelerators: Companies, establishments, associations, or other legal entities aiming to help enterprises and entrepreneurship enterprises requiring guidance, counseling, and support by providing various services, especially in financing, marketing, and management.

Official Gazette - No. 13 Rec. (A) on April 5, 2021

Chapter Two Facilitating Procedures for Commencing Business ( Section One ) Procedures for Real Estate Allocation Article (2) Competent authorities for vacant lands in industrial, tourist, and urban development areas, agricultural reclamation lands, and other lands shall coordinate with the Agency to determine the percentage allocated to enterprises, not less than (30%), in accordance with the nature of activities licensed within those areas. Competent authorities for real estate shall also:

1. Equip, subdivide, plan, and offer lands allocated to enterprises according to the nature of targeted activities within the areas.
2. Provide the Agency with all data on lands allocated to enterprises, and coordinate and cooperate with it in planning these lands and determining terms and conditions for their disposal.
3. Coordinate with the Agency when disposing of land through sale, lease, lease-to-own, license of usufruct, sale of usufruct, or contributing land as a capital share in enterprises.
4. Designate representatives equipped with maps of available lands and all data on them, and facilitate obtaining and submitting applications through service delivery units. Representatives shall have the authority to contract and take registration and recording procedures. Article (3) Industrial complexes serving agricultural or animal production may be established on agricultural lands. A Prime Minister's Decision shall determine the lands on which these enterprises are established, based on a proposal by the Agency in coordination with competent authorities and relevant ministers.

Official Gazette - No. 13 Rec. (A) on April 5, 2021

Article (4) The Agency, after coordinating with competent authorities, may establish facilities for paying the consideration for disposing of the lands referred to in Article (49) of the Law, when there is an economic justification, in either of the following cases:

1. The enterprise's activity falls within one of the following sectors: (a) Sectors targeted for growth by the State according to the national strategy for the enterprise sector. (b) Sectors facing challenges and requiring State support, according to economic indicators.
2. The enterprise's financial conditions deteriorate to the point of threatening insolvency, provided it is not due to collusion or fraud, and does not constitute a case of deception. The facilities include:
3. Installments matching the nature of the concerned sector.
4. Postponing the start of payments for up to three years from the date of commencing production or activity.
5. Granting deadlines for paying overdue installments without interest or at a reduced interest rate. ( Section Two ) Enterprise Start-up Licenses Article (5) Service delivery units shall issue approvals, permits, operating licenses, cards, and registration procedures required by legislation for enterprises to conduct their activities. The Agency may establish more than one service delivery unit within the same governorate, according to actual need and enterprise volume per governorate, with their establishment, jurisdiction, and authorities determined by an Agency decision. Service delivery units may also provide other services to support the service system for enterprises, with a decision by the Agency's Executive Chairman in coordination with competent authorities, according to applicable legislation.

Official Gazette - No. 13 Rec. (A) on April 5, 2021

Article (6) The Agency's Executive Chairman, in coordination with authorities and public utility companies referred to in Article (7), shall determine the necessary number of permanent and reserve staff to represent them in service delivery units, subject to:

1. Good reputation and conduct.
2. Appropriate appearance and communication skills.
3. Technical and practical expertise in issuing approvals and permits for their affiliated authority.
4. Employment in specialized administrative positions within the authority.
5. Holding an appropriate rank enabling decision-making. Article (7) The following competent authorities and public utility companies shall issue decisions appointing their authorized representatives in service delivery units and notify the Agency: First - Ministers:
6. Minister of Local Development.
7. Minister of Environment.
8. Minister of Interior.
9. Minister of Supply and Internal Trade.
10. Minister of Finance.
11. Minister of Social Solidarity.
12. Minister of Justice.
13. Minister of Petroleum and Mineral Resources.

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9. Minister of Electricity and Renewable Energy.
10. Minister of Water Resources and Irrigation.
11. Minister of Trade and Industry.
12. Minister of Agriculture and Land Reclamation.
13. Minister of Housing, Utilities, and Urban Communities.
14. Minister of Health and Population.
15. Minister of Manpower. Second - Relevant Governors. Third - Chairmen of the following authorities and companies:
16. National Authority for Social Insurance and Pensions.
17. General Authority for Investment and Free Zones.
18. National Food Safety Authority.
19. General Authority for Industrial Development.
20. Internal Trade Development Authority.
21. Environmental Affairs Agency.
22. Waste Management Authority.
23. Egyptian Tax Authority.
24. Real Estate Registration and Authentication Service.
25. General Federation of Chambers of Commerce.
26. Egyptian Electricity Holding Company.
27. Drinking Water and Sewerage Holding Company.

Official Gazette - No. 13 Rec. (A) on April 5, 2021

Article (8) The authority to issue approvals, permits, and licenses required for enterprises to conduct their activities, according to technical conditions in governing laws, along with all authorities granted to the competent authority in this regard, shall be transferred to representatives of competent authorities and public utility companies, without referring to their original workplaces. Article (9) Representatives of authorities and companies in service delivery units shall be supervised by the Agency during their stay, and shall comply with rules and controls set by the Agency to regulate these units in coordination with competent authorities. The Agency shall determine the number of days they must be present in a service delivery unit, whether full-time or part-time. The Agency may request replacing a representative based on an overall behavioral evaluation deemed appropriate by the Agency's Executive Chairman or competent authorities. Article (10) Competent authorities and relevant public utility companies shall bear the salaries, incentives, bonuses, and any financial dues of their representatives working in the Agency's service delivery units during their stay, as if they were at their original workplaces. The Executive Chairman may, according to what the Board of Directors decides, grant a bonus to the employee joining the units commensurate with the work and time performed. Article (11) Competent authorities shall notify the Agency of the conditions and documents required to obtain licenses, tailored to the nature of enterprises, and notify the applicant to fulfill them. Each authority shall also promptly notify the Agency of any updates to the list of general and specific conditions and required documents, including any modifications, deletions, or additions.

Official Gazette - No. 13 Rec. (A) on April 5, 2021

Article (12) The Agency shall prepare an operations guide for service delivery units, complying with legal frameworks and this Regulation, including job responsibilities, procedures for obtaining all services, required documents, forms, and applications. Representatives shall comply with the guide, and the Agency shall notify concerned authorities of procedural guides and amendments. This guide shall be binding on all users of service delivery units, and a decision by the Agency's Executive Chairman shall be issued regarding it. Article (13) Representatives and responsible employees in service delivery units must request the fulfillment of necessary documents to obtain approvals, permits, licenses, or cards within five working days from the date of license applications by applicants; otherwise, they shall be deemed fulfilled. No additional documents may be requested after this period. Required documents include:

1. Approval from the Organization Management.
2. Approval from the Licensing Center.
3. Approval from the competent Civil Defense Administration.
4. Tax Card.

Official Gazette - No. 13 Rec. (A) on April 5, 2021

5. Commercial Register.
6. Proof of ownership, lease, or possession of the enterprise's premises.
7. Proof of identity for the enterprise owner.
8. Any other approvals or documents necessary for the enterprise's safety and operational suitability, according to the nature of each activity, determined in coordination with competent authorities. Service delivery units may, upon request by the enterprise owner or representative, fulfill inspections and procedures to obtain approvals and documents in items (1) to (5) by contacting competent authorities, which must respond within ten days with approval or rejection with reasons. If an authority requests additional conditions from the owner to obtain approvals, the owner shall be notified to fulfill them, and the authority must approve within fifteen days from the date of notification of compliance. If the applicant fails to comply for 12 months from notification, the application shall be deemed void and archived, and a new application may be submitted. Service delivery units shall issue a temporary license to the enterprise owner for up to one year, renewable once, within fifteen days from the date of completing the designated form with the aforementioned documents. Article (14) The enterprise owner, upon obtaining the temporary license, must fulfill all documents, approvals, and conditions required to issue the final license from competent authorities.

Official Gazette - No. 13 Rec. (A) on April 5, 2021

Article (15) After issuing the temporary license, service delivery units shall notify the administrative authority under which the enterprise falls and other competent authorities, by any means (hand, electronic, mail, or other means specified by the Agency), of the issuance of the temporary license on the form specified in the operations guide. The temporary license issued by the Agency's service delivery unit shall produce all legal effects and be binding on all authorities, replacing licenses issued by competent authorities according to applicable laws. The temporary license expires upon its term ending or issuance of the final license. Temporary licenses shall be recorded in paper or electronic registers containing owner and enterprise data, issuance, and expiry dates. Article (16) Competent authorities must notify the Agency of their decision on a license request within thirty days from receiving a complete request, according to the following cases:

1. Approval: The authority must notify service delivery units to deliver the final license to the owner or representative.
2. Request to complete necessary conditions based on site inspection: Service delivery units shall study the response and notify the owner of required conditions.
3. Postponement due to non-compliance with safety/operational conditions, with possibility of modification if violations are removed: Service delivery units shall study the response, notify the owner of rejection reasons, and grant necessary time.
4. Final rejection due to non-compliance with safety/operational conditions, impossible to fulfill later: Service delivery units shall notify the owner of final rejection.

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In cases (2) and (3), service delivery units shall notify the owner of the authority's reasons. If the owner provides evidence of removing violations or fulfilling conditions, units shall notify the authority to proceed and request the final license within fifteen days. Article (17) If competent authorities do not respond within thirty days, and the owner provides evidence of fulfilling all required documents regarding safety and operational suitability, the Agency may issue a final license producing all legal effects and binding on all official authorities, replacing licenses from competent authorities. Service delivery units shall notify competent authorities of final license data. Final licenses shall be recorded in paper or electronic registers containing owner and enterprise data, issuance, and expiry dates. Article (18) The enterprise owner may modify data in the temporary or final license issued by the Agency, via a request on the designated form with supporting documents, provided it is not a fundamental modification regarding safety or operational conditions; otherwise, it shall be considered a new license application. In all cases, the Agency must notify the competent authority of the requested modification to assess its fundamentality and take necessary procedures. Article (19) Competent authorities shall notify the Agency of summaries of periodic follow-up results reviewing compliance of licensed enterprises, detailing data updates, changes, closures, or liquidations, to update Agency data and ensure proper enterprise operation. If a violation is recorded during follow-up, the authority shall notify the Agency of the violation and measures taken. If the owner proves obstruction or harm by follow-up authorities, they may submit a complaint to the Agency, which may contact competent authorities regarding follow-up results and coordinate accordingly.

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Article (20) Fee categories for issuing licenses, approvals, and permits collected by service delivery units for the Agency are as follows:

Medium Enterprises	Paid or Invested Capital Value	Fees
Industrial	More than 12 million EGP and not exceeding 15 million EGP	5,000 EGP
	More than 10 million EGP and not exceeding 12 million EGP	4,000 EGP
	From 5 million EGP and not exceeding 10 million EGP	3,000 EGP
Non-industrial	More than 4 million EGP and not exceeding 5 million EGP	5,000 EGP
	From 3 million EGP and not exceeding 4 million EGP	3,000 EGP
Small Enterprises	Paid or Invested Capital Value	Fees
Industrial	More than 3 million EGP and less than 5 million EGP	2,000 EGP
	More than 1 million EGP and not exceeding 3 million EGP	1,000 EGP
	From 50,000 EGP and not exceeding 1 million EGP	500 EGP
Non-industrial	More than 2 million EGP and less than 3 million EGP	2,000 EGP
	More than 1 million EGP and not exceeding 1 million EGP	1,000 EGP
	From 50,000 EGP and not exceeding 1 million EGP	500 EGP
Micro Enterprises	Paid or Invested Capital Value	Fees
	More than 25,000 EGP and less than 50,000 EGP	500 EGP
	Not exceeding 25,000 EGP	300 EGP

Enterprises receiving services shall also pay other fees imposed by governing laws for enterprise activities, which the Agency shall collect on behalf of competent authorities. Article (21) Competent authorities may delegate the Agency to grant operating licenses, activity licenses, or other licenses, approvals, and permits for enterprises as follows:

1. Licensing Centers at Local Units: Delegate the Agency to grant operating licenses.
2. New Urban Communities Authority: Delegate the Agency to grant operating licenses for enterprises.
3. Egyptian Tax Authority: Delegate the Agency to issue tax cards for enterprises.
4. Internal Trade Development Authority: Delegate the Agency in any of its competencies regarding the commercial register for enterprises.
5. General Authority for Industrial Development: Delegate the Agency in any of its competencies regarding the industrial reg