Free Zone Nasr City Companies: What You Need to Know

If you're eyeing the Nasr City Public Free Zone as a base for your Egyptian operation, you're looking at one of the oldest and most established free zones in the country. Free zone Nasr City companies get real tax perks and currency flexibility — but the rules have tightened over the past few years, and not every business qualifies anymore.

Quick answer

Free zone Nasr City companies operate under the General Authority for Investment and Free Zones (GAFI) framework set out in Investment Law No. 72 of 2017 and its Executive Regulations. Companies licensed in the Nasr City Public Free Zone enjoy exemption from customs duties, VAT, and corporate income tax on their activities, but pay an annual fee of 1% or 2% of revenue (depending on activity) plus a 1% GAFI service charge. Most output must be exported. Oil refining, fertilizer, iron and steel, and a few other activities are now excluded.^[1][2]

What the Nasr City Free Zone actually offers

The Nasr City Public Free Zone sits in eastern Cairo and is managed directly by GAFI. It's a "public" free zone — meaning multiple tenants share the licensed area — as opposed to a private free zone, which is created for a single project.

Companies set up there get:

• Full exemption from Egyptian customs duties on imports used in the licensed activity
• Exemption from VAT (currently 14%) on in-zone transactions
• Exemption from corporate income tax (currently 22.5%) and dividend tax on free-zone profits
• The right to invoice and hold accounts in foreign currency
• No restrictions on profit repatriation

In exchange, you pay an annual fee: 1% of the CIF value of goods entering the zone for storage/warehousing projects, or 2% of revenue for manufacturing and service projects, plus a 1% service charge to GAFI. Service projects without tangible goods pay 1% of revenue. These rates come from Article 41 of Law 72/2017 and its executive regulations.^[2][3]

Honestly, the tax picture is still generous — but the activity restrictions are the part most people miss.

Who can — and can't — license there

Investment Law 72/2017, as amended by Law 114/2015 originally and subsequent amendments, carved out several activities from the free zone regime. You cannot license a Nasr City free zone company for:

• Petroleum manufacturing and refining
• Fertilizer manufacturing
• Iron and steel production
• Manufacture, liquefaction, and transport of natural gas
• Energy-intensive industries
• Wine, alcohol, and tobacco production
• Weapons and ammunition

Everything else — logistics, light manufacturing, assembly, IT services, consulting, back-office operations, textiles, pharmaceuticals packaging — is generally on the table, subject to GAFI approval of your project study.^[1][4]

There's also an export orientation requirement. At least 50% of a free zone project's output (by value) must be destined for export outside Egypt. Selling into the Egyptian domestic market from a free zone is possible, but you pay full customs duties and taxes on those sales as if the goods were imported from abroad.

Setup process and costs

The practical path for free zone Nasr City companies looks roughly like this:

1. Submit a project study to GAFI's Free Zones Department covering activity, capital, employment, export projections, and area required
2. Pay the application and examination fees (currently USD 1,500 for new projects under GAFI's published fee schedule)
3. Obtain the Board of Directors' approval — this is the real gatekeeper
4. Sign the lease allocation agreement with the Nasr City zone management
5. Incorporate the company (usually a joint-stock or limited liability company) through GAFI's one-stop shop
6. Pay the opening guarantee (typically 1-2% of the first year's projected costs, capped)

Expect 2 to 4 months from a complete application to an operating license, assuming your file is clean. Project studies that gloss over the export plan or understate operating costs get sent back.

Costs to budget (indicative, 2026)

• GAFI application fee: USD 1,500
• Annual service charge: 0.001 of revenue (minimum USD 100, maximum USD 1,000)
• Annual activity fee: 1% or 2% of revenue depending on project type
• Land/warehouse rent: set per m² by the zone's annual tariff
• Guarantee deposit: 1-2% of first-year costs

Rent and fee schedules are republished by GAFI periodically — always pull the current tariff from the GAFI Free Zones page before you model your numbers.^[3]

Common traps

A few things trip up new entrants into Nasr City free zone companies more than anything else:

Treating the free zone as a tax haven for domestic sales. It isn't. The moment goods cross into the Egyptian customs territory, they're treated as imports. The duty-free advantage only works if you're genuinely exporting or re-exporting.

Underestimating the annual fee. 2% of gross revenue is not nothing. For a thin-margin trading or assembly business, that fee can exceed what you'd pay in corporate income tax under the ordinary mainland regime. Run both numbers.

Assuming you can switch activity freely. Any material change to your licensed activity needs GAFI Board approval. Starting to warehouse a different product class, or adding a service line, is not a casual decision.

Labor rules still apply. Free zone status does not exempt you from the Egyptian Labour Law (Law 12/2003) or from social insurance contributions. Your workers are Egyptian employees with all the normal protections.^[5]

Frankly, the free zone makes sense for export-focused manufacturers, regional distribution hubs, and foreign-currency service exporters. For a company whose real market is Egyptian consumers, it rarely pencils out.