Egypt

Unveiling the Future of Privacy: The issuance of the Executive Regulations of Egypt's Data Protection Law and establishment of the Personal Data Protection Centre

The Egypt Personal Data Protection Law was published on 15 July 2020 and came into force on 14 October 2020 (the “Law”). Yet, the Law is not fully operational because several aspects and points are yet to be determined. We expect further clarity on these points in early 2024, either through the Executive Regulations upon its issuance or several directives by the Centre upon its establishment. These points include the following:

The procedures and standards necessary to protect and secure personal data;
The license(s) required for controllers and processors to process personal data;
The license(s) required for transferring personal data abroad;
The appointment method of a legal representative by a foreign controller or processor;
The obligations and tasks of the data protection officers along with their appointment and registration procedures in the data protection officer registry at the Centre;
The criteria and controls for the collection, processing, storage and transfer of sensitive personal data;
The policies, standards, controls and rules of cross border transfer of personal data; and
The rules, conditions, and controls of direct e-marketing.

The issuance of these regulations and the establishment of the Personal Data Protection Centre are significant steps towards enhancing the protection of personal data in Egypt and aligning its legal framework with international standards.

Ayman Nour
Partner, Head of Office - Egypt

According to the provisions of the Law, the addressees of the latter shall have a grace period of one year to comply upon the issuance of the Executive Regulations.

The issuance of these regulations and the establishment of the Personal Data Protection Centre are significant steps towards enhancing the protection of personal data in Egypt and aligning its legal framework with international standards. These developments will provide more clarity and guidance for data controllers and processors, as well as data subjects, on their rights and obligations under the Law. They will also enable the effective enforcement and supervision of the Law by the Centre, which will have the authority to issue licenses, directives, and sanctions. Moreover, they will facilitate the cross-border transfer of personal data, which is essential for the digital economy and international cooperation, by setting the policies, standards, and controls for such transfer. These developments will benefit not only the privacy and security of personal data, but also the trust and confidence of data users and providers in Egypt.

Contact Partner:
Ayman Nour

Contributing Author:
Rita Kevork

The Strategic Impact of Egypt's New Labour Law Provisions

The new Egyptian Labour Law (the “New Law”) is being widely anticipated to tackle many of the hurdles presented by the previous Labour Law number 12 of 2003 (the “Labour Law”). The New Law will ultimately have a beneficial impact on the employment culture of both employers and employees.

The following examples illustrate the impediments that the Labour Law currently creates and the New Law provisions that would have a progressive impact on employment law in Egypt:

Termination by an employer for economic reasons: It is expected that the New Law will identify the criteria for termination for economic reasons. There is no clear guidance in the current Labour Law on the criteria for companies to fulfill in order to submit such a request i.e. what level of financial or economic challenges the company should be facing to qualify to submit the request to the relevant committee. This creates a lot of uncertainty for employers and could potentially lead to unfair dismissals of employees if not handled in a clear manner.
Termination due to poor work performance: The New Law is expected to provide clarity on dismissal due to poor work performance. The current Labour Law does not provide clear parameters detailing what qualifies as “poor work performance”, or how it should be measured. Due to such ambiguity, employers which terminate employees for under-performing are often subjected to unfair dismissal claims by the Egyptian courts.

We believe that direct foreign investment has been negatively affected for years due to the current lack of clarity around these vital labour provisions, and this is set to change with the New Law. 2024 holds promise in this area.

Ayman Nour
Partner, Head of Office - Egypt

Indefinite employment contracts: One of the most significant issues which the New Law should tackle is the difficulty companies experience in terminating indefinite employment contracts. Companies are often required to pay large severance or compensatory settlements for employees to exit the companies due to the current ambiguity. Without being able to terminate indefinite employment contracts, businesses often find themselves compelled to retain undesirable employees and/or pay unwarranted compensation or hire those employees with outsourcing companies to avoid the costly implications. We anticipate that this will be addressed adequately in the New Law and ensuing regulations.

Assignment/Secondment: The New Law should cover assignment/secondment arrangement by setting out a clear definition to assignees and employees; this is to avoid the duplication of employment rights which the current Labour Law causes.

These are highlights of some of the welcome additions to Egypt’s employment landscape. We believe that direct foreign investment has been negatively affected for years due to the current lack of clarity around these vital labour provisions, and this is set to change with the New Law. 2024 holds promise in this area, and we will keep you updated on the changes as they occur.

Contact Partner:
Ayman Nour

Contributing Author:
Nadine Khaled

Shaping the Future: Egypt Establishes its Intellectual Property Authority

Following the launch of the national intellectual property strategy (NIPS) in 2022, the Egyptian government has now adopted Law No.163 of 2023 on the establishment of the Egyptian Authority for Intellectual Property (EAIP) as a public body responsible for the regulation and protection of intellectual property rights in Egypt.

The aim of establishing EAIP is to further promote the intellectual property system, to ensure a balance between the protection of intellectual property (IP), the promotion of sustainable socio-economic, cultural, and technological growth, the development of a knowledge-based economy and to support Egypt’s vision 2030.

Achieving the Sustainable Development Goals and Egypt’s Vision 2030
The new law seeks to establish a national organization replacing the numerous administrative bodies in charge of managing intellectual property. These include the Ministry of Higher Education and Scientific Research, the Ministry of Supply and Internal Trade, the Ministry of Culture, the Ministry of Communications and Information Technology, the Ministry of Agriculture and Land Reclamation, the Ministry of Trade and Industry, in addition to the Internal Trade Development Agency, the Supreme Council for Media Regulation, the Patent Office, and the Plant Varieties Protection Office.

The EIPA is affiliated to the Office of the Prime Minister and its Board of Directors shall be responsible for creating and implementing the NIPS strategy and achieving its goals. EIPA will be financially independent and can be funded through foreign grants, donations, and fees charged against the services it will provide. The headquarters of EIPA shall be in Cairo, with branches all over the country.

The EAIPA……is uniquely positioned to promote innovation, creativity, and economic growth through the efficient use of intellectual capital thanks to its broad mandate, strategic vision, and financial independence.

Khaled Attia
Partner, Head of Dispute Resolution - Egypt

Roles of the EIPA
The legal framework that controls how the EAIP operates is updated with several important clauses. Roles of the EIPA can be summarized as follows:

Updating the National Intellectual Property Strategy, in cooperation with the relevant ministries and authorities.
Registering, filing, and granting protection documents to intellectual property rights as set out in the Law on the Protection of Intellectual Property Rights.
Preparing integrated databases on intellectual property rights and making them available to public.
Coordinate with the relevant ministries and authorities, to provide technical support, create IP awareness.
Encouraging researchers, inventors, start-ups, and SMEs owners to register their creations, aiming to maximize the economic benefits from the same.
Establishing registers for the registration of patent agents and technical experts specialized in valuating IP assets and developing valuation policies.
Increasing awareness of the importance of IP rights in coordination with international and regional organizations.

Examining submitted complaints on IP-related matters disputes and exchanging the legally permitted information with other national, international and regional organizations, aiming to control trade in goods and services that infringe IP rights.
Commenting on draft laws and international agreements related to the protection of intellectual property rights.

Implications of Enacting Law No. 163 of 2023 in Egypt
The EAIPA is expected to be fully operational in 2024. It is uniquely positioned to promote innovation, creativity, and economic growth through the efficient use of intellectual capital thanks to its broad mandate, strategic vision, and financial independence.

The success in achieving this milestone reflects Egypt’s desire to become a world leader in intellectual property and to develop a knowledge-driven economy.

Contact Partner:
Khaled Attia

Contributing Author:
Hala El Sebay

Egypt's Regulatory Evolution: Understanding the Economic Concentrations and preapproval regime in Egypt

The Egyptian Law on the Protection of Competition and Prohibition of Monopolistic Practices (the “ECL”) was amended in 2022, introducing a pre-approval regime for economic concentrations by the Egyptian Competition Authority (the “ECA”). The new regime is not yet operational, as the Executive Regulations and ECA Guidelines that are necessary for its implementation have not been issued.

The Executive Regulations will explain and define some terms that were introduced in general terms in the Law. Therefore, it is paramount for the application of this regime to have the Executive Regulations and Guidelines in place before implementation.

The expected changes are likely to include the following:

The definition and scope of "material influence", which is a key criterion for determining whether a transaction is notifiable to the ECA,

The Egyptian Law on the Protection of Competition and Prohibition of Monopolistic Practices was amended in 2022, introducing a pre-approval regime for economic concentrations by the Egyptian Competition Authority. [It] is paramount for the application of this regime to have the Executive Regulations and Guidelines in place before implementation.

Khaled Attia
Partner, Head of Dispute Resolution - Egypt

The clarification of whether the thresholds for turnover and combined assets in Egypt and worldwide are cumulative or alternative, and the cases in which the ECA can assess a transaction that does not meet the thresholds,
The types and conditions of behavioural and/or structural remedies that the ECA can demand from the parties to clear a transaction, and the criteria for assessing their adequacy and effectiveness. This includes what types of remedies are acceptable for ECA to accelerate the approval process,
The procedures and standards for the ECA to refer a transaction to phase 2, which is a more in-depth and longer investigation, and the difference/type of legal and economic tests to be applied in phase 1 and phase 2 of examining any notification,

The amendments gave ECA the right to unwind any transaction. However, it is unclear whether unwinding the transaction is a stand-alone sanction that would be classified as an administrative decision subject to Administrative Courts procedures or it would be a sanction in addition to financial sanctions (i.e. fines), which are of criminal nature (like all ECL violations sanctions) subject to Criminal Courts procedures.
The definition and enforcement of gun-jumping, which is the implementation of a transaction either before obtaining the ECA's approval or in breach of its conditions, and the possible penalties and remedies for such conduct.

These are some of the issues that are expected to be covered by the Executive Regulations and Guidelines, which are anticipated to be released in 2024.

Contact Partner:
Khaled Attia

Contributing Author:
Yassin Ehab