What Is a Commercial Act Under Egyptian Law?
Egypt's Commercial Code defines commercial acts broadly, covering a wide range of business activities. Under Article 7, the following are automatically considered commercial acts regardless of who performs them:
- Buying movable property (goods of any kind) for the purpose of resale or lease, whether in its original form or after transformation
- Leasing movable property for the purpose of subletting it
- Activities connected to buying and selling goods for profit
Under Article 8, certain activities are considered commercial acts only if carried out on a professional basis:
- Supply of goods and services
- Manufacturing and industrial activities
- Land transport and inland water transport
- Commercial agency and brokerage
- Banking, exchange, and insurance operations
- Construction and real estate development
- Publishing, printing, and media activities
Under Article 9, any act related to commercial navigation — maritime or aerial — is also a commercial act. This includes constructing, repairing, buying, selling, leasing, or chartering ships or aircraft.
Article 10 adds a catch-all: any act that can be analogized to the above due to similar characteristics and objectives will also be treated as a commercial act.
Who Is Considered a Trader in Egypt?
Under Article 13, a trader is:
- Any individual who professionally engages, in their own name and for their own account, in a commercial act
- Any company formed under Egyptian company law, regardless of what the company actually does
This is important for expats: if you set up a company in Egypt, Egyptian commercial law applies to it automatically — even if your activities might seem non-commercial in nature.
What Activities Are NOT Commercial?
Not everything involving money or work qualifies as a commercial act. Key exclusions include:
- Farming: Under Article 12, a farmer selling produce from land they cultivate is not performing a commercial act, whether they own the land or hold usage rights.
- Small craftsmen: Article 19 excludes individuals engaged in crafts requiring minimal expenses to secure their daily livelihood. They are not subject to commercial law.
- The Egyptian State and public legal persons: Under Article 23, government bodies do not have trader status, though commercial law still applies to commercial activities they undertake.
Mixed Contracts: When One Party Is a Trader
A situation expats frequently encounter is entering into a contract that is commercial for one party but not the other. Article 6 addresses this directly:
- Where a contract is commercial for one party only, commercial law governs only that party's obligations
- The other party's obligations remain governed by civil law, unless the law specifically provides otherwise
This means if you, as an individual expat, contract with an Egyptian trading company, the company's obligations are judged under commercial law while yours may be judged under civil law.
Governing Rules When There Is No Agreement
Article 5 establishes a clear hierarchy for commercial matters in Egypt:
- Agreement of the parties (contracts come first)
- Provisions of the Commercial Code or other commercial laws
- Rules of commercial custom and usage
- Principles of civil law (as a last resort)
Practical Tips for Expats
- If you buy goods to resell in Egypt — even occasionally on a professional basis — you may already be performing commercial acts and should seek legal advice on your obligations.
- Setting up any company in Egypt automatically subjects it to commercial law, regardless of the business type.
- Do not assume that working under an assumed name or through another person protects you. Under Article 21, trading under an assumed name or concealing yourself behind another person still establishes trader status for you.
- Consulting a local commercial lawyer before launching any business activity in Egypt is strongly recommended to confirm whether your activities fall under the Commercial Code.