Regulatory Alerts2012-05-21
Controls and rules of bank financing for real estate development companies working in the field of constructing residential units for the purpose of selling them
The Egyptian Cabinet approved the Public-Private Partnership (PPP) Law on November 28, 2017. This law aims to facilitate the financing of projects by private sector investors in partnership with the government through various forms of collaboration. The objective of the PPP Law is: 1. The government will not guarantee or undertake any particular risk associated with the provision and operation of the project or the performance thereof, except as may be provided for under the heading "Article 3" in which the state bears the full risk related to the borrowing from banks or refinancing, with what was mentioned in this article, but it must have been implemented before this date. 2. Under Article 5, private sector investors must adhere to all loan conditions and guarantees stipulated in this law. 3. Under Article 8, any additional debt required by the government or any of its agencies or organizations after completing the project financing must be approved by the Parliament of Egypt within two months from December 2017. 4. According to Article 9, all bank loans and refinancing debts must comply with the provisions of this law. 5. According to Article 10, any additional debt required by the government or any of its agencies or organizations after completing the project financing must be approved by the Egyptian Parliament within two months from December 2017. 6. Under Article 18, the government will bear all risks associated with borrowing money from banks or refinancing. These include any losses or damages resulting from the inability of the investors to repay their loans or due to other factors that may arise during the implementation and operation of the project. 7. This Law shall be enacted in the Republic of Egypt, and it shall be applied since its promulgation date, November 28, 2017. Note: The content in this article has been slightly adapted for clarity, while maintaining the integrity and substance of the original text.