Minister of Industry and Trade Tareq Kabil announced the issuance of the bylaws of Law no.15 of facilitating the procedures of licensing industrial establishments. The law was approved by the parliament and issued by a republican decree last May.
The regulation aims at streamlining the procedures, eliminating bureaucracy, and facilitating the necessary licenses for investors. It also aims to deal with the issue of granting operating licenses, one of the most important factors affecting the ranking of Egypt in the performance reports issued by international institutions Kabil stressed that this law will revolutionize the next phase of Egyptian industry, which will contribute to putting the country among the leading countries to attract foreign investments. This law helps change the licenses idea in Egypt, where there will be an integrated system that will be in line with international licensing systems. This will take place by actualizing the role of the Industrial Development Authority (IDA), which is authorized to organise industry processes, to issue procedures for industrial firms, and to adopt new trends for licensing procedures, like, setting a list of requirements for granting licenses in accordance with the risks of industrial activity; Kabil added.
He pointed out that the bylaws include the basic principles adopted by the IDA in dealing with investors, which included the commitment to complete the procedures and take into account the times stipulated in the law and the regulation. This is to be done without loading the industrial establishment with any additional burdens and to provide information on the exercise of industrial activity on the authority’s website and to link between the decisions and the purpose of their issuance, in addition to adopting a systematic way for complaints against decisions that affect any industrial zone. Kabil added that "in accordance with these regulations, the time needed for issuing a licence will be less than seven days for notified licensing and 30 days for pre-licensing instead of 600 days.
All licensing procedures will be automated, while there will be specific criteria for complaints, and technical accreditation offices will be established. Kabil pointed out that the former has chosen one authority—instead of 11 ones in the old law—to receive the documents required to grant operating licenses. As for the needed operations to be licensed, those were lowered to three operations instead to seven, and internal procedures decreased to 19 rather than 154. Kabil added that, for the first time, the law adopts the licensing through notification. Firms are obliged to notify the competent administrative authority facility in accordance with the nature of the risks that may be caused by that industry. He pointed out that the regulation has authorized the notification of operations and documents either by hand, electronically, or by mail.
The IDA is obliged to give a certified copy of the license to the concerned party. He pointed out that the law has remained on the system of pre-licensing for industrial activities, which represent a high-degree of risk on the environment, on security, or on health, which represent 20% of existing industries. The executive regulations simplified the procedures to apply for a license and has enabled submission by hand, electronically, or by mail. In case the application for all documents have been submitted successfully, the IDA shall approve the application within a period not exceeding 30 days from the date of submission.
The authority shall notify the applicant within 21 days if the application is incomplete. The minister added that the regulation stipulates that the law authorizes qualified accreditation offices from the private sector to control the extent to which the industrial establishments comply with the requirements through a number of regulations, including the exemption of establishments that submit a certificate of approval from the inspection in cases of a new license or a conciliation in the same day if there are serious violations and no later than a working day in other cases. Kabil pointed out that the regulation sets out the rules of professional liability that the offices must adhere to in the practise of their work. He added that the work must comply with the law and that there must be no corruption and discriminatory practices of any kind when implementing the accreditation contracts. Furthermore, the offices must perform the work entrusted to them to the fullest extent and to avoid conflicts of interest and maintain the confidentiality and privacy of the information of the applicants and the obligation to notify the competent administrative authority by the services provided to their clients. He pointed out that the regulation dealt with the procedures of reconciliation, which included granting temporary operating permits for existing industrial facilities prior to the issuance of the new law and its regulations, and to submit requests for conciliation to the IDA within two years from the date of submitting the request of the licensing system and three years for the establishments subject to the pre-licensing system.
The IDA shall then reach a decision regarding reconciliation requests within one week from the date of completion of all data and documents. Kabil stressed that the executive regulations clearly defined the controls of the inspection of industrial establishments, whether by the authority or by the accreditation offices. He further stipulated the existence of an authorized commission from the authority, and that the examination be conducted during the official working hours and punishing those who intentionally disrupt the work of any industrial facility licensed to a fine of not less than EGP 5,000 and not more than EGP 100,000. The minister added that the minister formed a grievance committee to consider all license grievances and accreditation offices related to the application of the provisions of the law in order to avoid any obstacles that may be faced by the applicant.
The committee is also responsible for reviewing the decisions issued by the competent administrative authority, such as rejecting the license application, revoking or stopping the license, submitting grievances and their dates, provided that the complaint be submitted within 15 days from the date of notification. Kabil added that the regulation included many facilities to small and micro enterprises and included special requirements that suit the nature of these enterprises and doubling the maximum time limit for such projects for conciliation. Furthermore, the regulation exempts them from half the license fee, license waiver fees, and annual complaints fees, and it excludes these projects from some requirements. On the other hand, Ahmed Abdel Razek, chairperson of the IDA, said the measures taken by the authority to prepare the new law of facilitating industrial licensing procedures works on four parallel axes: development of procedures, restructuring, training, and automation. He added that, as part of the development of the procedures, the list of industrial activities according to ISIC4, and the list of products according to HS 2017, the risk matrix has been prepared, high-risk industries identified, and a complete system of licensing procedures has been developed.
Emad Raafat, the vice president of the authority and head of the licensing system development, pointed out that the IDA has restructured the system in all sectors by activating the role of decentralization to provide services from all authority branches and by restructuring the technical departments. He pointed to the authority’s keenness to activate the training system by developing the customer service system, operating a hotline to serve investors, and training the employees of the authority and its branches on industrial licensing procedures in light of the law of facilitating procedures. Regarding the automation of services provided by the authority, Raafat indicated that a global tender has been released to evaluate the technical offers in preparation for automating the services provided and to coordinate the electronic linking between the authority and the Egyptian Customs Authority. Mohamed El Suwaidi, the chairperson of the Federation of Egyptian Industries, said that the new industrial licensing law represents a major step forward to the industrial licensing system.
He pointed out that the law represents an important step on the right path towards a competitive industrial environment that supports all national industries, especially small and medium enterprises (SMEs). Al-Suwaidi pointed out that the law is like a dream coming true for the national industrial system, pointing out that it contributes to boost all financing initiatives supporting the Egyptian industry. He added that the accreditation offices approved by the law contribute greatly to the elimination of bureaucracy and corruption, praising the tireless efforts made by various concerned parties to issue licensing law to start a new chapter in the history of national industry.”The new law represents an important step in facilitating business flaw and eliminating industrial investment obstacles” said Mohamed Farid Khamis, the chairperson of the Egyptian Union for Investors Association. He added that everyone who participated in the issuing of the new law enjoys a high level of patriotism and has the desire and willingness to help Egypts grow to unprecedented levels.
