EGYPT Law and Practice Contributed by: Nadia Abdallah, Zahra Ashraf, Beshoy Mounir and Yasmine Attia, Matouk Bassiouny & Hennawy
5.6 Labour Law Regulations A new Egyptian Labour Law No 14 of 2025 (New Labour Law) has recently been issued, replacing the previous Labour Law No 12 of 2003 (Former Labour Law), with the aim of, inter alia, modernising labour regulations in response to shifting economic dynamics and evolving labour market needs. Under the New Labour Law, acquirers must consider various labour-related matters when conducting due diligence on a potential target. By way of example, companies are required to main- tain comprehensive employee records whilst ensur- ing that no employee’s salary falls below the statu- tory minimum wage, as adjusted. Upon exceeding a certain number of employees, companies are required to hire individuals with disabilities at a rate equiva- lent to a percentage of their total workforce. If foreign nationals are employed, they must hold valid work permits. Under the New Labour Law, employers are now permitted to maintain electronic records of their employees, including personnel files, leave records, and employee requests. Similarly, all employees and board members must be registered under the social insurance scheme, and the company is obligated to submit annual evidence of such registration to the National Organization for Social Insurance. In relation to the statutory employment funds, and specifically the occupational training fund, employers who hire more than 30 employees are required to con- tribute 0.25% of the minimum social insurance wage per employee on an annual basis. This contribution is subject to a minimum of EGP10 and a maximum of EGP30 for each employee per year. This represents a change from the Former Labor Law, which mandated a 1% annual net profit contribution to a training fund for employers with over ten employees. Further, the New Labour Law adopts a stricter approach by increasing nearly all existing penalties and introducing additional sanctions compared to the previous law.
the COMESA market within one and the same member state. COMESA member states are Burundi, Comoros, the Democratic Republic of Congo, Djibouti, Egypt, Eri- trea, Eswatini, Ethiopia, Kenya, Libya, Madagascar, Malawi, Mauritius, Rwanda, Seychelles, Somalia, Sudan, Tunisia, Uganda, Zambia and Zimbabwe. For the purpose of assessing the satisfaction of the above financial thresholds, the acquirer group refers to the acquirer and its Related Parties (ie, direct and indirect parents, subsidiaries, and sister companies) (Acquirer Group) and the target group refers to the target, along with its Related Parties (ie, direct and indirect parents, subsidiaries, and sister companies), excluding the seller(s) that will no longer have sole/ joint control of the Target post-completion of the Transaction and the Related Parties of these seller(s) (Target Group). The Acquirer Group and the Target Group are collectively referred to as Parties. The notification to the CCC must be given as soon as it is practicable but in no event later than 30 days of the Parties’ decision to effect the transaction (ie, from the date of signing the binding transaction docu- ments). Any notifiable merger/acquisition that has been car- ried out without notifying the CCC within 30 days of the Parties’ decision to merge/acquire shall have no legal effect and impose no rights or obligations on the participating Parties, and the CCC may impose financial penalties that shall not exceed 10% of either or both of the merging Parties’ annual turnover in the COMESA market as reflected in the accounts of any party concerned for the preceding FY. Filing fees The notification of a merger/acquisition must be accompanied by a fee calculated at 0.1% of the com- bined annual turnover or combined value of assets in the COMESA member states of each of the Acquirer Group and the Target Group, whichever is higher, pro- vided that the fee shall not exceed USD200,000. If the filing fees are paid to COMESA, they shall not be refundable if the envisioned transaction is not com- pleted.
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