CAIRO Feb 24 Egypt's draft investment law
contains provisions to prevent third parties from challenging
contracts made between the government and an investor, a cabinet
source said on Monday, a move designed to attract badly needed
The clauses are intended to reassure investors unnerved by
previous legal challenges to such deals, some of which have left
companies sold by the government in legal limbo.
Since the uprising that toppled Hosni Mubarak in 2011,
Egyptian courts have issued at least 11 rulings ordering the
state to reverse deals signed by the former president's
The lawsuits have been brought by activists and lawyers who
allege that companies were sold off too cheaply in deals that
were representative of corrupt business practices during the
Many companies bought from the Egyptian government by Gulf
Arab investors are at risk of renationalisation. Gulf Arab
businessmen have repeatedly cited a lack of guarantees that
their money will be safe in Egypt as a reason for holding back
One case includes a legal battle with Saudi investors over
the renationalisation of one of Egypt's oldest department
stores, Omar Effendi.
A number of foreign firms, including Mexican cement giant
CEMEX, are locked in appeals processes against
London-listed gold-miner Centamin has been in
Egyptian courts for months over its mining licence in Egypt.
The draft must be approved by Egypt's president before it
becomes law. The government has yet to set a timeframe for this.
"Protecting investors' rights is crucial for business in
Egypt especially with long-term investors," said Saudi-based
businessman Meshal Alkadeeb, vice president for strategy and
business development at Aujan Coca Cola Beverages Co. The
company plans to open a fruit-juice factory in Egypt.
"We have witnessed that the authorities in Egypt are being
very flexible when it comes to bringing in investors to the
country. They're trying to set up a one-stop shop for investors
and introducing these new regulations does help greatly."
Egypt's economy has been battered by three years of
political turmoil which has left the biggest Arab nation in dire
need of foreign investment.