Towards More Sustainable Investment Frameworks

Annex A. Domestic legal and institutional frameworks for investment in Southern Neighbourhood countries

Algeria

Investment climate in Algeria: a practical overview

Foreign investments truly accelerated in Algeria in the mid-1990s, with the macroeconomic reforms and the country’s efforts to liberalise its economy. In 1993, the country adopted its first Investment Code which offered a variety of incentives to foreign investments and supported investors institutionally through the Algerian Agency of Promotion, Support and Follow-up of Investment (Agence de Promotion, de Soutien et de Suivi de l’Investissement, APSI) established the same year.

The country later enhanced its investment incentives offer in the early 2000s and refurbished its institutional framework by replacing the APSI with the Algerian National Investment Development Agency (Agence Nationale de Développement des Investissements, ANDI) entrusted with a reshaped mandate and a distinct legal status (OECD, 2019_[1]). FDI inflows grew increasingly as a result and peaked at USD 2.7 billion in 2009 – representing 2% of the country’s GDP.

Despite its positive FDI performance between the mid-1990s to the late-2000s, FDI inflows in Algeria have somewhat been volatile since the global financial crisis and the political upheavals affecting the whole MENA region in 2011. FDI inflows to the country ultimately plummeted in 2015. Although they have recovered significantly since, they have been generally on the decrease, a trend accentuated by the economic shocks induced by the COVID-19 pandemic in 2020. In 2022, FDI inflows to Algeria were at a record low since the mid-1990s – beside in 2015 – at barely USD 75 million (Figure A A.1).

Figure A A.1. FDI inflows in Algeria (1990-2022)

Source: OECD elaboration from IMF (Balance of Payments and International Investment Position Statistics) and World Bank (GDP data).

The geographic origins of inward FDI stock in Algeria have been stable in the last years. Investors from the EU (37%) – mainly from Italy (11.2%), France (10.4%) and Spain (6.7%) – the United States (29%), the MENA region (15%) and the United Kingdom (6%) held more than 85% of the total USD 23.1 billion inward FDI stock in the country in 2022 (Figure A A.2).

Figure A A.2. Origins and total value of inward FDI stock in Algeria (2018-22)

Note: Inward direct investment positions calculated based on data reported by Algeria to the IMF since 2018.

Source: OECD calculations based on IMF Coordinated Direct Investment Survey (CDIS) data.

As other countries of the MENA region, foreign investments in Algeria have historically been concentrated in the oil and gas sector, a sector with limited job-creating potential due to its relatively low labour-intensity. Although the oil and gas sector remain an important driver of FDI in the country to this day, the sectoral coverage of FDI has diversified since, in line with the priorities flagged in the 2020 governmental Action Plan.

In global indicators developed to assess local business environments, Algeria fared rather poorly in comparison to its regional peers (World Bank Group, 2020_[2]). Investors report facing important hurdles in carrying out their business activity in the country. Bottlenecks identified by relevant stakeholders relate to bureaucratic red taping, which render administrative procedures relatively cumbersome for investors. Procedures to obtain licences, getting electricity, registering a property, paying taxes, etc. are reportedly lengthier in Algeria than the regional average – even twice as high to register a company, and appear to be costlier for businesses and individuals. Foreign-invested firms have also pointed towards the country’s unpredictable business climate, with laws and regulations appearing to be volatile and applied inconsistently (U.S. Department of State, 2022_[3]). Recent legislative and institutional reforms aim at improving the country’s investment climate.

General institutional framework for investment in Algeria

Algeria’s efforts to promote and facilitate investment in the country are undertaken by the Algerian Investment Promotion Agency (AAPI). The AAPI operates two OSS: one geared towards foreign investments and high-stakes investment projects; and a second tailored to domestic investments.

Agence Algérienne de promotion de l’investissement (AAPI). The AAPI succeeds the National Investment Development Agency (Agence nationale de développement de l’investissement, ANDI), Algeria’s previous IPA. Its mandate is set out in the new Investment Law (2022 Investment Law), and was formally established by Executive Decree 22-298 (2022) (Decree 22-298). Two additional ministerial orders dated 28 September 20221 and 24 November 20222 outline its governance and organisation.

AAPI’s main mandates, as established by Decree 22-298, include:3

• Elaborating an investment promotion strategy at the national and regional levels, in coordination with the private and public sector.

• Providing information to investors on investment legislation, procedures, relevant authorities to obtain authorisations and permits required for the implementation of projects and investment opportunities in the country.

• Registering investment projects through an online “investor portal” to benefit from incentives. The investor portal also allows investors to directly recommend improvements for the business environment that can be directly transferred by AAPI to the Cabinet.4

• Accompanying investors when dealing with other authorities for the obtention of licences, authorisations and permits.

• Monitoring investors’ compliance with commitments and processing investor complaints.

Two separate OSS operate within the AAPI to facilitate investment into the country. The first OSS is specifically dedicated to foreign investments and “large projects” (i.e., investments having a capital equal or greater than DZD 2 billion)5; while the second one deals with domestic investments that do not qualify as “large projects”. It was unclear at the time of writing as at September 2023 whether two structurally independent OSS are effectively established, as envisaged initially by the 2022 Investment Law, or if the previous single OSS under ANDI’s mandate is still operating during a transitional period.6

Both OSS share the same structure and perform similar duties with regards to investments falling within their competence.7 They serve as a single interlocutor for investors: they offer an information desk to investors, register investments required to benefit from incentives,8 and facilitate licencing and authorisations procedures.9

The AAPI’s OSS host representatives from several administrative authorities that facilitate setting up and operating a business in the country:

• Some representatives from authorities as listed in Decree 22-298, including tax authorities, the customs authority, and the national centre for commercial registration,10 which may directly issue authorisations, decisions and documents on behalf of their respective authorities and within the limits set by Decree 22-298 (Article 26).

• Additional representatives may also be hosted by AAPI, although they are not vested with the powers to render decisions and authorisations on behalf of their respective licensing authorities.11 Rather, they act as points of contacts for investors relying on OSS services to liaise with their relevant authorities with regards to the applications and formalities required for their investment projects.12

Other relevant authorities. The Investment Law refers to two additional “bodies in charge of investment”, namely the National Investment Council (Conseil national de l’investissement, CNI) and the High National Commission for Appeals related to Investment (Haute commission nationale des recours liés à l’investissement, HCNRLI).13 The CNI – established by Decree 22-297 of 8 September 202214 – is mandated with putting forward a Government investment strategy, overseeing its overall coherence and evaluating its outcomes by way of an annual report submitted to the President of the Republic.15 The HCNRLI – established by Decree 22-296 of 8 September 202216 – is a special commission affiliated to the Presidency of the Republic. It issues decisions regarding investor complaints and grievances in relation to the withdrawal or refusal of incentives, or the refusal by administrative authorities to issue decisions, documents and authorisations for the implementation of projects.17

Transparency and predictability of the Algerian legal framework for investment

This section considers Algeria’s investment framework and those measures which the country has adopted for facilitating investment, including with respect to accessibility to and transparency of the country’s legal and regulatory framework for investment, establishment restrictions and conditions, and operation authorisations; and the manner in which investment-related procedures are streamlined.

Legal and regulatory framework. Algeria recently overhauled its regulatory framework for investment by adopting a new Investment Law 2022.18 The 2022 Investment Law seeks to promote investments in priority sectors and sectors with high added value to ensure sustainable development and to develop natural resources and local raw materials.19 The 2022 Investment Law covers acquisition and ownership operations, extensions of capacity, and greenfield investments in the production of goods and services,20 and provides for a principle of ‘transparent’ and ‘equal’ treatment for foreign investors.21

Several Decrees have been adopted to complete the investment framework. These Decrees concern the institutional setting of investment-related agencies operating in the country,22 investment incentives23, and investment-related procedures.24 The Algerian government’s Secretariat General’s website provides for a platform to consult Algerian legislation extracted from the Official Journal in Arabic and in French. It outlines the instruments alongside all of their related and implementing instruments, which allows for a comprehensive and easy-to-access overview of the different legal instruments. Investors may also consult legislation in Arabic via the Algerian Law Portal.

Transparency and predictability. Ministries and regulatory authorities are not required to publish proposed regulations before their adoption or the rationale behind regulatory amendments, nor are they required to solicit comments on them. In practice however, the People’s National Assembly (APN) and the Council of the Nation (CN) both have dedicated web pages where draft legal texts prior to their adoption are published. Neither offer an opportunity to comment. With regards to the Investment Law 2022 specifically, the proposed legislation’s rationale was explained in a press release of the Council of ministers published on 19 May 2022. News clippings also seem to indicate that consultations had taken place prior to the adoption of the Law in July 2022,25 although it is unclear if these consultations were based on informal exchanges between regulatory authorities and selected stakeholders or if all potential stakeholders were provided a reasonable opportunity to comment on the draft legislation. The legislation was subsequently published in the Algerian Official Gazette on 28 July 2022, four days after its adoption.

Streamlining of investment-related administrative and other procedures.

At the time of writing in September 2023, measures adopted within the Algerian legal and regulatory framework for investment which seek to enhance transparency and predictability and streamline relevant administrative procedures are not overarching but rather apply to specific pre- or post-establishment procedures.

Facilitation of business establishment by foreign investors.

• Restrictions to foreign investment

Algeria applies several restrictions to foreign investment in the country. Restrictions – which may include foreign equity caps, limitations on the appointment of key personnel and prior authorisation procedures – apply in a variety of sectors, including agriculture, electricity, transport and distribution, media, finance, real estate, mining and manufacturing.26 Information related to restrictions applicable to foreign investments does not appear to be consolidated in a negative list, which negatively impacts the transparency of the investment framework.27 Instead, the Ministry of Commerce provides some information on its website with regards to restrictions applying to foreign investors specifically in commercial activities. Information on restrictions applying in non-commercial activities does not seem to be readily available on Algerian official websites.

Algeria recently alleviated some restrictions to foreign investment activity through the adoption of the latest Finance Law 2020. The country lifted the 49% equity cap in enterprises carrying out manufacturing activities and services, for the exception of activities relating to the import of raw materials, to products and goods intended for domestic re-sale, and to strategic sectors.28 Separately, some controlled activities require temporary authorisation by the competent authorities29 prior to legal incorporation (activité ou profession réglementée soumise à inscription au registre du commerce).30 The conditions of operation of such controlled activities are defined by sector-specific laws or regulations,31 and are currently governed by Decree 15-234 (modified by Decree 20-355). Under Decree 20-355 (Article 4), pre-approval seems to be mandated only if required explicitly by the sector-specific legislation.

• Pre-admission formalities and legal incorporation of companies

Foreign investors may register an enterprise in Algeria through the same commercial forms available to Algerian nationals: partnerships (les sociétés en nom collectif), limited partnerships (les sociétés en commandite), limited liability corporations (sociétés à responsabilité limitée), joint-stock companies (sociétés par actions) and simplified joint-stock corporations (sociétés par actions simplifiées).32 These are governed by the provisions of the Algerian Commercial Code.

The conditions for the operation of commercial activities are governed by Law 04-08, as amended.33 Legal incorporation in the Commercial Register is required for all natural or legal persons to operate a commercial activity.34 Once incorporated, investors may freely operate their activity unless subject to licensing or authorisation conditions.

With respect to company legal incorporation specifically, Law 18-08 has amended Law 04-08 to include a provision on the creation of an online portal to facilitate the registration of enterprises.35 The portal is managed by the National Centre of the Commercial Registry (Centre National du Registre du Commerce, NCCR). Investors may directly fill out registration forms on the portal, which are then validated by the NCCR. Once validated, investors may complete other mandatory establishment formalities with the tax authorities, and the social security authority.36 The company legal incorporation process is facilitated by the presence of representatives from the NCCR within AAPI’s two OSS which can directly issue decisions and authorisations on behalf of their respective authorities.

Facilitation of business operations by foreign investors.

Licensing requirements to carry out specific activities apply generally to domestic and foreign investors alike. Information on activities subject to licensing or prior authorisations is scattered throughout various legal sources. Several sector-specific executive decrees adopted over the years specify the regime for controlled activities in oil and gas distribution,37 wholesale and retail trade,38 manufacturing activities,39 scientific activities (testing laboratories),40 or even public utilities.41 There exists no comprehensive list of controlled activities, although the Ministry of Commerce’s website provides an illustrative list of activities that require its authorisation.

The AAPI’s website does not provide comprehensive information on licensing and authorisation procedures applicable in Algeria. It contains a description of both of its OSS and their missions, as well as a description of the nine representatives working within the OSS. AAPI plays a role in facilitating the obtention of approvals, licences and permits through its OSS. Representatives within the OSS may either issue these authorisations directly where they are competent or facilitate the liaison with their relevant authorities.42

The 2022 Investment Law does not provide any procedural framework for the streamlining of licensing formalities and the processing of investment-related applications. Delays for the processing of applications also depend on sector-specific legislations governing licensing procedures.43

Transparency and predictability of the Algerian Investment Incentives Regime

Incentives play a pivotal role in the 2022 Investment Law’s goals to encourage investment in priority industries and promoting the country’s sustainable development.44 The new incentives’ schemes (together the Investment Incentives Regime) are available to both domestic and foreign investors, provided their investments are covered by the scope of the 2022 Investment Law.45 The Law provides a procedural framework to facilitate and streamline the processing of applications, their evaluation, and the granting of incentives.

Three distinct incentives schemes are available under the Investment Law (2022):46

• Incentives for “priority sectors”;

• Incentives for “zones of particular interest”; and

• Incentives for high-stakes investment projects (“structuring investments”).

Information pertaining to Algeria’s Investment Incentives Regime is available through various sources. The 2022 Investment Law alongside its implementing decrees are published in Arabic and French on the Official Gazette’s website as a bundled package under the same issue. The AAPI’s official website (available in Arabic, English, and French) and its investor’s digital platform (available in Arabic and French) also publish measures, but do not provide practical details beyond the Law.

Types of available incentives and eligibility requirements.

Incentives available under the 2022 Investment Law include exemptions from tax, customs duties, and certain corporate and real estate administrative fees. Promoted “structuring investments” could also benefit from the State’s participation in the infrastructure works required for their implementation. All incentives schemes may also benefit of State-owned lands, subject to conditions.

Incentives under the Investment Law may generally be cumulated with other incentives offered under other Algerian legislation,47 provided they do not overlap and are not of the same nature.48

Incentives are implemented for promoted investments in two separate phases:

• During the implementation phase, all schemes give access to identical incentives.

• During the operational phase, for which periods for benefiting from incentives may be higher for zones and “structuring investments” (five to ten years) than for priority sectors (three to five years). The exact period is determined following the investment registration with AAPI’s OSS.49

Eligibility conditions to incentives are clearly detailed in the 2022 Investment Law, as well as by Decree 22-300. These are framed by positive and/or negative lists:

• “Priority sectors” eligible to sectoral incentives are listed out. These include mining activities, agriculture, fishing, industry, services and tourism, new and renewable energies, and information and communication technologies (ICT) amongst others. Economic activities ineligible to sectoral incentives are also set out in Annexes I and II of Decree 22-300.50

• Incentives for “zones of particular interest” are broader in scope than sectoral incentives: eligible zones are framed by positive lists annexed to Decree 22-301,51 as well as a negative list enshrined in Annex I of Decree 22-300.52

• Additional negative lists limit the scope of incentives for priority sectors and for zones (mainly activities governed by a special tax regime or that fall out of the scope of the Investment Law or specific goods that are ineligible to incentives).53

The incentives scheme for “structuring investments” appears to be the broadest in scope. “Structuring investments” refer to investments that have a “high potential to generate wealth and employment and could increase the attractiveness of the territory and create a ripple effect over the economic activity pursuant to a sustainable, economic, social, and territorial development” and which contribute to the essential goals set out by the 2022 Investment Law.54 As such, eligibility to the scheme is not assessed by reference to a list of economic sectors specifically, but rather, is subject to two cumulative conditions as set out by Decree 22-302: the creation of a minimum of 500 direct employments, and a minimum investment amount of DZD 10 billion.55

Procedural requirements and processing of applications.

Algeria’s investment incentives regime falls under the main supervision of AAPI.56 Investment registration with AAPI is required to obtain incentives under the Algerian framework.57 Such registration to obtain investment incentives is undertaken by APII’s OSS: one for foreign investors and projects with a capital beyond DZD 2 billion, and one for domestic investments below DZD 2 billion.58 The registration process may be fully undertaken online on the investor platform.

The process to register investment projects or to amend registration certificates already issued is mainly governed by Decree 22-299.59 The Decree sets out the required documents to support the registration request, the list of goods and services to be filled by applying investors for all incentive schemes, as well as application fees. Supporting documents vary depending on the nature of the investment – whether greenfield, acquisitions or other.60

AAPI reviews registration applications with a view to assess investor eligibility to incentives and lists out its findings in the registration certificate along with the list of goods and services qualified for the incentives.61 Issuance of the registration certificate is done “immediately”, but a specific timeframe is not defined.62 The registration certificate and its attached list of goods and services are enforceable vis-à-vis the concerned authorities (tax, customs etc.).63

Following the delivery of the registration certificate and the list, a second evaluation is undertaken to determine the period during which incentives are granted during the operational phase. These periods vary depending on the specific incentives scheme, ranging between three to ten years.64 Decisions must be notified to the investor within seven days.65

Decisions of refusal to grant incentives must be motivated, and cannot be based on incompleteness or errors in the application, as the APII OSS is required to contact the concerned investor to complete its application.66 Furthermore, investors may file appeals before the AAPI in the face of a refusal or negative decision, and ultimately before the HCNRLI.67

Structuring investments are effective upon the conclusion of an agreement between the investor and the state. The request to conclude such an agreement is submitted to AAPI by the investor, based on a detailed and descriptive quotation of the needed works.68 This request must be approved by the Algerian government.69

Promoted investments must start operations within a maximum period of five years (three years for the investment benefiting of the “priority sectors” regime),70 which could be extended twice, each time for twelve months only71 by submitting a request to the AAPI’s OSS.72 Furthermore, Decree 22-303 sets out how the monitoring of the investment is undertaken, along with the investor’s obligation to report to AAPI of all the necessary information concerning its investment.73 In case of the investor’s persistent default to meet its obligations to report, AAPI may proceed with the revocation of the registration certificate and the incentives, while demanding the investor to reimburse all the advantages it got, along with any possible sanctions.74 Revocation decisions may also be subject to appeal before the AAPI or the HCNRLI.75

Egypt

Investment climate in Egypt: a practical overview

FDI in Egypt surged in several waves over the last three decades. Foreign investments began to emerge with the progressive opening of the Egyptian economy to the private sector initiated in the 1970s with the infitah (‘open door’) policy. The policy led to the adoption of the Law on Arab Capital Investment and Free Zones adopted in 1971, the first ever legislation dedicated to investment in Egypt (OECD, 2020_[4]). The General Authority for Investment and Free Zones (GAFI) was also subsequently established, making it one of the oldest IPAs operating in the region.

Macroeconomic stabilisation, the country accession to the WTO in 1995 and further liberalisation of cross border investment in the early 2000s further paved the way for a sustained wave of FDI increase between 2000 and 2007, reaching its peak at almost USD 12 billion. However, the global financial crisis and the post-2011 instability in the region had a negative effect on the country’s FDI performance. Egypt was one of the most affected countries of the selected Southern Neighbourhood countries following the Arab Spring movements, with investors having massively suspended their operations, downscaled their commitments, or withdrawn their investments altogether (Figure A A.3). Between 2012 and 2016, FDI inflows had been on a positive upward trend representing around 2% of GDP, yet below the pre-2007 crisis levels of 8%. The COVID-19 pandemic further slowed Egypt’s post-2011 recovery, although FDI inflows in 2022 appear to be the highest they’ve ever been since 2007.

Figure A A.3. FDI inflows in Egypt (1990-2022)

Source: OECD elaboration from IMF (BOP/IIP statistics) and World Bank (GDP data).

The share of FDI stock in Egypt held by European investors and those from the MENA region has increased in the last years. In 2021, more than 90% of Egypt’s inward FDI stock was held by investors from the United Kingdom (29%), the EU (24%) – mainly from Italy, Belgium, the Netherlands and France, the MENA region (19%) – especially from the United Arab Emirates and Saudi Arabia, and the United States (19%) (Figure A A.4).

Figure A A.4. Origins and total value of inward FDI stock in Egypt (2018-2021)

Note: Due to data availability issues, FDI stock origins were estimated based on FDI inflows data published by the Central Bank of Egypt covering the 2002 to 2021 period. Total volume of FDI stock based on reported international investment positions.

Source: OECD estimations based on FDI inflows data of the Central Bank of Egypt and the IMF Balance of Payments and International Investment Position Statistics (BOP/IIP).

In Egypt, as in most of the MENA region, FDI is concentrated in natural resources, real estate, construction, and light manufacturing (e.g., textiles). Most of these sectors have limited job-creating potential due to their relatively low labour-intensity. Since 2010, instability in the region has further skewed the sectoral composition of FDI towards the natural resources sector, which has been more immune to political shocks (OECD, 2014_[5]). FDI inflows in non-oil manufacturing and services sectors have stagnated, while these sectors have a higher propensity to create jobs and promote transfers of technology and managerial knowledge, making it more challenging for Egypt to participate in global value chains.

Comparative surveys reveal sensible differences in the perceptions of the Egyptian investment climate between domestic and foreign-invested firms. Over 65% of foreign invested enterprises surveyed by the World Bank in 2020 identified corruption (23.6%), political instability (26.5%) and customs and trade regulations (16.8%) as being their biggest obstacle in the country, whereas tax rates and fiscal administration appear to affect more domestic businesses than foreign-invested firms (World Bank Group, 2020_[6]). Bottlenecks reported by investors include excessive bureaucracy, lack of transparency, uneven enforcement of laws and regulations, difficulties accessing foreign currency to repatriate profits or import goods, a shortage of skilled labour, cumbersome customs procedures, corruption, and intellectual property issues (U.S. Department of State, 2023_[7]). In recent years, Egypt revised its investment promotion and facilitation structure and enacted legislative changes to address these obstacles identified by investors. In 2017, a new Investment Law was introduced significantly improving the clarity of the investment regime by consolidating the so far scattered investment rules and by streamlining procedures through GAFI’s mandate (OECD, 2020_[4]).

General institutional framework for investment in Egypt

The role of Egypt’s nation-wide IPA, the General Authority for Investment and Free Zones (GAFI), was significantly enhanced further to the 2017 Investment Law, with the establishment of Investor Services Centres (ISCs). ISCs are institutional units operating within GAFI and through its regional branches. The ISCs feature a core investment establishment mandate and facilitate operation formalities by hosting representatives of relevant authorities. The Board of Directors of investment, free and technical zones offer additional facilitation services.

General Authority for Investment and Free Zones (GAFI). GAFI was established in 1971 as an autonomous agency and currently operates under the authority of the Prime Minister. The 2017 Investment Law details GAFI’s governance structure as well as its broad investment promotion, generation, and to a more limited extent, facilitation mandate. GAFI is broadly responsible for developing and implementing investment facilitation measures, including by overseeing the operation of ISCs.

The Investor Service Centre (ISC). The ISC entity was established under the 2017 Investment Law, which outlines its mandate and structure. It is described as an “administrative unit” operating within GAFI – both in its headquarters and via GAFI’s regional branches – and effectively acts as the latter’s OSS. ISCs fall under the supervision of GAFI Board of Directors, which is missioned with developing and fully implementing the entity and its two-fold mandate:

• A core establishment mandate, which pertains to the provision of corporate services, including company incorporation, establishment of company branches, formalities relating to company administration meetings, share allotments, change of activity and liquidation procedures.

• An operation mandate, which is not de jure carried out by the ISC itself, but via the Competent Authorities represented within the ISC and that are mandated with receiving investor applications for approvals, permits, licences and allocation of real estate properties required for the realisation of Investment Projects, as well as deciding upon such applications as per the laws and regulations in force.

The ISC does not enjoy a dedicated website; rather, its mandate and functions are listed via the GAFI website, which outlines the different categories of services it offers, namely: company incorporation and establishment services; and a wide range of what are labelled as “after establishment services”, including corporate-related legal services (e.g., ratifying minutes of ordinary and extraordinary general assemblies, ratifying board minutes, and changing the legal form of companies), technical services (e.g., establishment formalities relating to custom duties), governmental services (e.g., residence and work permits related formalities), private incentives unit services, and publication services (e.g., publication of company Articles of association). In that regard, an ISC Investor Guide outlines the relevant procedures and formalities, documents required, applicable pre-conditions, and fees for each of these categories of services.

Competent authorities are represented in ISCs in one of two capacities: as “delegates”, vested with the power to directly issue those approvals, permits and licences that fall within their Authority’s jurisdiction; or as “liaison officers”, which may not directly issue authorisations and act as points of contact between the competent authorities they represent and investors. As neither the GAFI Board of Directors’ resolutions nor the outcomes of the underlying decision-making process are publicly available, it is unclear which authorities are represented within GAFI through delegates or liaison officers. Further, evidence suggests that authorities are not equally represented throughout all of the ISC regional branches, which could effectively hamper the transparency and predictability of authorisation procedures for investors, and suggests that facilitation services – including services seeking to streamline authorisation procedures – may be uneven across the country’s governorates.

A number of physical ISCs currently operate across the country.76 It is unclear if the composition of ISCs across the country is harmonised and if the same Competent Authorities are represented across all ISCs. While that may be the 2017 Investment Law’s intention, existing evidence suggests that it is not the case in practice, which could suggest uneven investment facilitation services across governorates. As at the time of writing in September 2023, the ISC Investor Guide listed the “Services/Scope of Functions Carried out by each Ministry/Body Represented at the ISC”; these include a number of Ministries, the Egyptian Exchange, the Investment Taxes Office and the Egyptian Customs Authority Office. On the face of the ISC Investor Guide, each of these representative offices are mandated with providing “investment services relating to [their] scope of work” as well as licenses and other required certificates and authorisations that fall within their respective jurisdictions, among others.

“Accreditation” or “Approval Offices”. The 2017 Investment Law provides for the establishment of private-sector Accreditation Offices. Such Offices are licensed and registered by GAFI on the basis of a number of conditions and are subject to GAFI’s scrutiny.77 Their envisaged mandate seeks to expedite the licensing and related processes. It remained unclear at the time of writing in September 2023 whether such Offices have been registered in practice.78

Transparency and predictability of the Egyptian legal framework for investment

This section considers Egypt’s investment framework and those measures which the country has adopted for facilitating establishment and operation for foreign investment, including with respect to accessibility to and transparency of the country’s legal and regulatory framework for investment, establishment restrictions and conditions, and operation authorisations; and the manner in which investment-related procedures are facilitated.

Legal and regulatory framework. Egypt adopted a new investment framework in 2017 (2017 Investment Law or the Law), which repeals the previous 1997 Investment Guarantees and Incentives Law.79 The Law was complemented by the Prime Minister Decree 2310 of 2017 adopting Executive Regulations to the Investment Law as amended (2017 Executive Regulations).80 Separate decrees were subsequently adopted to implement additional provisions of the 2017 Executive Regulations concerning certain aspects of the Egyptian incentives’ regime and the constitution of the Supreme Council for Investment among others.81

The 2017 Investment Law defines the legal regime for domestic and foreign “Investment Projects” in a wide-ranging list of sectors. The Law applies equally to greenfield investment and acquisition and ownership operations.82 The Law sets out the principles and guarantees offered to investors, including fair and just treatment, national treatment to foreign investors, non-discrimination, protection against unlawful expropriation, and free transfer of capital in foreign currency, among others.83 It also sets out Egypt’s investment promotion policy, which consists of a ‘general investment framework’, the “Inland Investment Regime”, as well as three additional special investment regimes, namely, free zones, investment zones, and technical zones. Special economic zones are governed by a stand-alone legislation. Different competent authorities, incentives regimes and at times, operation procedures and requirements apply with respect to each of these different regimes. The present section will exclusively consider the Inland Investment Regime as Egypt’s general investment regime.84 The Law also introduces a new investment promotion tool, the “Investment Map”, elaborated by GAFI in coordination with relevant authorities, including the Supreme Council for Investment. It defines the investment opportunities, regimes, State- or public sector-owned real estate property available for investment on a geographic basis, and the manners in which the latter may be granted for investment under the Law.85

Transparency and predictability. Egypt’s legislation is published in Arabic in the Official Gazette and its supplement (Al-Jarida Al-Rasmiya and Al-Waqae Al-Misriyya, respectively) by the Government Printing Office (Al Amiria). The latter’s website does not however provide free access to the Official Gazette. Other online governmental sources such as the Egyptian Legislation Portal and the Legal Encyclopaedia of the Ministry of Justice are equally fee-based.86 Consolidated official Arabic versions of the 2017 Investment Law and the 2017 Executive Regulations are available via the website of the Court of Cassation of Egypt; however, these are not updated with the implementing decrees relevant to the 2017 Investment Law. The country’s legal and regulatory framework of investment is also available in part through a dedicated portal on the GAFI website: the Law – both its official Arabic version and its English translation – is up to date and reflects its 2019 amendment; the 2017 Executive Regulations, on the other hand only reflects two of the six amendments introduced thereto, in both languages.87 The same GAFI portal lists additional laws and regulation relevant to investment and investors, including companies’, environmental, fiscal, labour, finance, and protection of intellectual property rights legislation. Fragmented and at times, partial only, access to the investment framework may in practice negatively impact the latter’s transparency.

Ministries and regulatory authorities are not required to publish proposed regulations before their adoption or the rationale behind regulatory amendments, nor are they required to solicit comments on them. The draft investment law was thus not published by government or regulatory authorities before its adoption and entry into force.88 Little time was arranged between the adoption of the 2017 Investment Law and its entry into force, as the law was officially approved on 31 May 2017, and entered into force on 1 June 2017 (however, while the Law repeals and replaces the previous 1997 Investment Guarantees and Incentives Law, it specifies that it “does not prejudice the tax privileges and exemptions and other guarantees and incentives” granted to investors existing at the date of its entry into force, who shall keep such benefits until their term expires).89 Further, and based on unofficial sources, public consultations were carried out further to the media sharing a draft of the investment law, in December 2016, principally with stakeholders hailing from the business and investor community. These appear to have been limited to informal exchanges between regulatory authorities and select stakeholders. Information as to the identity of these investors – and whether they were domestic and/or foreign – the outcomes of this consultation process, its specific duration and its impact on the adoption of the 2017 Investment Law is not publicly available.90

Streamlining of investment-related administrative and other procedures. At the time of writing in September 2023, measures adopted within the Egyptian legal and regulatory framework for investment which seek to enhance transparency and predictability and streamline relevant administrative procedures are not overarching but rather apply to establishment and operation procedures specifically. These are considered in turn.

Facilitation of business establishment by foreign investors.

• Restrictions to foreign investment

Restrictions on foreign investment apply in several sectors, and are set out by sector-specific legislation, among others, rather than being consolidated in a negative list, which negatively impacts the transparency of the investment framework.91 These include, among others, foreign equity limits in the construction, distribution (retail), maritime and air transport, media, and professional services (namely legal, audit and accounting) sectors.92 A number of horizontal, cross-sectoral restrictions also apply, namely in respect of land and real estate ownership by foreigners.

• Pre-admission formalities and legal incorporation of companies

There exist no cross-sectoral or horizontal requirements or pre-conditions applying to foreign investors and/or investments in relation to the making of new investments in Egypt. Some specific formalities may be required in relation to certain types of activities; these would be governed by specific sectoral legislation. Nevertheless, foreign investors must obtain a Government background check, carried out by the “Central Security Department at the Investment Services Sector”, which may in practice delay the company legal incorporation process.93

Legal incorporation of companies. GAFI enjoys exclusive jurisdiction over the legal incorporation of companies via the ISC, save for company incorporation under the Financial Regulatory Authority and Special Economic Zones regimes94 and company incorporation in respect of certain economic activities that require other competent authorities’ establishment authorisations, e.g., sector-related approvals from other sectoral competent authorities.95 Investors may incorporate their business vehicles under one of two available governing laws, namely, Companies Law 159 of 1981,96 or the 2017 Investment Law.97 Incorporation under the 2017 Investment Law requires that the company’s economic activity falls within the scope of the Law,98 and provides access to the Investment Incentives Regime thereunder.99 Incorporation under the Companies Law regime is primarily available for those companies whose economic activities fall outside of the scope of the Law. Irrespective of the choice of governing law, all companies incorporated in Egypt are subject to the provisions of the Companies Law. In that regard, different legal commercial entities are available to both Egyptian owned-businesses and foreign-invested enterprises, joint-stock companies (general and limited by shares), limited liability companies, and single member companies.

Company legal incorporation formalities and procedures fall within the mandate of the ISC.100 The ISC Investor Guide outlines the relevant procedures and formalities which can be carried out at the Cairo ISC branch,101 which enhances the investment framework’s transparency and predictability insofar as establishment conditions are concerned, as well as the documents, pre-conditions, and fees relevant to the incorporation of all types of commercial forms. In theory, incorporation formalities may also be carried out online, with GAFI’s e-incorporation portal, as required by the Law.102 E-services were however as at September 2023 not fully operational and/or not fully digitalised (e.g., formalities relating to company general assembly meetings). A separate GAFI page features separate “easier and faster” facilitation services for the incorporation of limited liability companies. It is unclear whether the procedure envisaged thereunder differs from the formalities undertaken by the ISC as outlined in the ISC Investor Guide. The limited availability of electronic applications for the legal incorporation of companies generally hinders the streamlining of authorisation procedures with respect to establishment procedures.

GAFI and/or the ISC are required to complete company legal incorporation applications within one business day of receipt of an application file,103 and streamline all formalities relating to company administration meetings (e.g., approval of general assembly and board of directors’ meetings).104 It is unclear as at the time of writing in September 2023 whether the entirety of these facilitation measures have been adopted and implemented.105 The portal provides information as to the formalities relevant to the incorporation of single member companies, joint stock companies (partnerships limited by shares), partnership companies (general and limited partnerships), limited liability companies, and sole proprietorships. It outlines step-by-step breakdowns of incorporation formalities, including relevant prerequisites and requirements, fees, estimate timeframes and competent authorities (namely, the ISC). Applications may be submitted at any time throughout the year. These considerations enhance the streamlining of the incorporation processes.

Facilitation of business operations by foreign investors.

The ISC is mandated under the 2017 Investment Law to receive investor applications for approvals, permits and allocation of real estate and licences required for set up or management of Investment Projects. The Competent Authorities represented within ISCs that are vested with the authority to issue approvals, permits and licenses, as well as real estate allocations, in line with the conditions and requirements set out in the relevant laws and regulations in force.106 This mandate seeks to centralise operation authorisations at ISC-level, thereby implying both that Competent Authorities representatives within the ISC are entrusted with the powers to directly issue such licences, approvals, permits and other authorisations; and that ISC membership is harmonised across each of the governorates’ ISCs. ISC membership is determined by way of GAFI Board of Resolutions, which are not publicly available. The lack of transparency as to ISC membership and the decision-making powers of Competent Authorities representatives within ISCs generates legal uncertainty as to the mandate of the ISC as a OSS. Further, existing evidence suggests that Competent Authorities representation is not harmonised and consistent across the country’s ISCs,107 which could also point to uneven authorisation procedures’ streamlining services across governorates.

The Law does not specify or clarify specifically which investor “approvals, permits and licences” procedures the ISC facilitates and ultimately issues via the Competent authorities representatives. However, GAFI is under the 2017 Investment Law mandated with preparing – in coordination with the “Competent Authorities” – and regularly updating a guidebook outlining the relevant bodies, procedures, indicative timeframes, fees, applicable regulatory frameworks, required documents and forms relevant to the issuance of approvals, permits and licences and the allocation of real estate for the realisation of investment activities as defined under the Law.108 Several such sectoral licensing guides elaborated by ministries are available via the Arabic version of the GAFI website.109 These are not standardised, and the information which each provides varies significantly in depth of detail. Nevertheless, most guides broadly outline the relevant procedures for obtaining operation – and in some instances, establishment – permits, approvals and licenses, eligibility conditions and requirements, the competent authorities to which applications must be submitted, and estimate timeframes of these procedures. These guides are reviewed and if and when necessary, updated, periodically every six months, and are legal binding.110 It is unclear on the face of these guides whether the information provided therein is exhaustive or merely indicative. In parallel, investors may also carry out the necessary formalities and procedures for operation licences, approvals, permits and other authorisations in person directly with the ISC.111 At the time of writing in September 2023, the ISC’s automated e-services were limited to establishment procedures, but consultations with GAFI have confirmed that a system for license automation was currently being developed, and representatives of the entities are being trained for trial operation of such system in preparation for its official launch. This system is expected to allow investors to electronically submit and follow up on their applications for approvals, permits and licenses, as well as electronically submit inquiries and complaints.112

GAFI, the ISC and the Competent Authorities represented therein are bound by a number of facilitation measures introduced by the 2017 Investment Law. These contribute to enhancing both the predictability of the investment framework with respect to licensing and other authorisations, as well as the streamlining of authorisation in that respect – as follows:113

• ISC Competent Authorities representatives are bound by general obligations of due process and diligence;114

• Competent Authorities representatives within the ISC must decide upon investor applications for approvals, licences or permits within 20 days business of receipt of a complete application;115

• Competent Authorities representatives must notify investors of the outcome of the application review by way of registered letter or agreed upon electronic means within five business days from the date of the elapse of the above-cited term;116

• GAFI shall follow up on investor applications which have not been settled within the above-cited timeframe, and coordinate with the relevant Competent Authorities with a view to expedite the decision-making process;117

• In the event of an incomplete application file, Competent Authorities representatives and the Competent Authorities themselves must request from investors any missing documents within two business days of receipt of the application; the application file is deemed complete beyond that timeframe;118

• Decisions rendered further to approvals, permits and/or licences requests must be justified, reasoned and transparent,119 and investors may appeal refusals or negative decisions before a GAFI’s Grievances Committee, the procedure for which is set out in the Law;120

• Competent Authorities may not revoke or suspend issued licenses or reclaim allocated real estate property without providing the investor with prior notice and a “grace period” not exceeding 60 days to rectify any notified breaches; GAFI must authorise any revocation where appropriate, within seven days of a Competent Authority’s notification;121

• A ‘tacit approval’ mechanism also applies if, within 60 days of receipt of a complete application, the relevant Competent Authority has not issued a decision in respect of a licence, approval or permit request, GAFI’s Chief Executive Officer will issue the decision directly. This decision must be communicated to the investor by way of registered letter within seven days of expiry of the above-cited term.122

As outlined above, “Accreditation” or “Approval” Offices are also envisaged under the 2017 Investment Law with a view to further facilitate the approvals, permits and licences review and issuance process. Their mission concerns the review of investor applications for approvals, permits and licences for establishing, developing and expanding an Investment Project, with a view to ascertain whether they meet the technical and financial conditions required under the applicable laws and regulations.123 The outcome of this review process is the delivery to the investor, the ISC, the Competent Authorities and other relevant administrative authorities of an “accreditation certificate” valid for one year, that attests that a given Investment Project has “satisfied all or part of the conditions in accordance with the laws and regulations which regulate the issuance of approvals, permits, and licences”. The Competent Authority – or its representative via the ISC – may object to the accreditation certificate within 10 business days of receipt. If no objections are raised in respect of the certificate, the latter will be deemed accepted, and the Competent Authorities – either directly and/or via the ISC – are required to decide on the application for licences, approvals and/or permits within 60 days of receipt; no response within this timeframe will be deemed a tacit approval.124 It is nevertheless unclear at the time of writing in September 2023 whether any such Offices have been effectively implemented in practice.

Investors may also under the 2017 Investment Law access real estate property which they may require for pursuing or expanding Investment Projects, in accordance with the Investment Map and applicable laws and regulations.125 The rules pertaining to real estate property allocation to investors are set out in detail in the Law.126 In parallel to the ISC mandate for operation approvals, permits and licences, GAFI is mandated with reviewing and issuing approvals, permits and licences required in the context of activities on real estate allocated for investment.127

Transparency and predictability of the Egyptian investment incentives regime

The 2017 Investment Law introduced three incentives schemes under the general investment framework, which repeal and replace the investment incentives provided under Law 8 of 1997 on Investment Guarantees and Incentives.128 They include general incentives, special incentives,129 and additional incentives for projects in Investment zones and Technological Zones.

Specific eligibility conditions as well as application processes and procedures apply with respect to each incentives regime. While information pertaining to the General Incentives Scheme is clearly detailed in the 2017 Investment Law, the eligibility conditions as well as the benefits granted under the Special and Additional Incentives Schemes are fragmented in several instruments. Some information about the incentives schemes available under the Inland Investment Regime is provided via the GAFI website, but it is unclear as to whether this information is up-to-date and/or regularly updated.

Types of available incentives and eligibility conditions.

General Incentives Scheme. All “Investment Projects” as defined under the 2017 Investment Law enjoy the benefits granted under the General Incentives Scheme, save for those projects established under the Free Zone Regime.130 General incentives include a number of benefits and discounts, such as stamp duty and notary fees exemptions for company incorporation documents among others; a standardised custom duty rate for the import of certain equipment and custom duty exemptions.

Special Incentives Scheme. The Scheme is available to two categories of investments. First, greenfield investments which meet certain eligibility conditions set out under the 2017 Investment Law, including a timeframe requirement during which an investor seeking to benefit from advantages under the Scheme should have incorporated their company.131 The Law also provides that establishment in accordance with the Investment Map is a pre-condition to obtaining Special Incentives; this requirement is not outlined in further detail in the Law. Second, Investment Projects that seek to extend capacity and which meet additional conditions.132

This Scheme effectively grants a discount off of the eligible Investment Projects’ taxable net profits, calculated on the basis of “investment costs” as defined under the relevant instruments^.133 Different discounts apply to different territorial “sectors”, which are defined by reference to three criteria (geographic location, type of investment, and economic sector). Additional eligibility requirements apply with respect to each of these sectors. The applicable discount rates, the sectors to which they apply, the sectors’ eligibility requirements, and the determination of these sectors, are set out in the 2017 Investment Law, the 2017 Executive Regulations, as well as subsequent decrees which further specify and amend the Scheme’s implementation.134 Benefits granted under the Scheme may not exceed seven years as of the start date of the “activity” and are capped to 80% of the paid up capital at the time of the start date, and can only be granted for a period not exceeding from that time.135 The process by which an activity’s “start date” is ascertained by procedures established and carried out by GAFI.136 Beneficiaries may cumulate different discount rates in the Schemes’ two separate sectors, when applicable, provided that separate accounts are kept for each of the companies operating in the different zones.137

Additional Incentives Scheme. The Scheme is available to those Investment Projects that fulfil the eligibility conditions of the Special Incentives Scheme,138 as well as the additional requirements set out in the 2017 Executive Regulations, namely having commenced operations – as per criteria and a procedure defined by GAFI – and satisfying one of a number of requirements, including but not limited to Egypt being the principal place of production or a minimum 50% of local contents involved in the Investment Project’s production.139 Benefits are granted under this Scheme by way of Cabinet Decree, and are set out in the 2017 Investment Law. Some of the notions relevant to the granting of those benefits (e.g., the definition of an “industrial project”, which can benefit of a 50% refund of the value of the land allocated for an industrial project under certain conditions) are either not defined in the 2017 Investment Law and related instruments, or those definitions are not readily available. The Cabinet may also define further non-tax incentives under the Additional Incentives Scheme by way of decree.

Single-Approval Mechanism. Joint stock companies and limited liability companies may benefit from a single-approval mechanism if they are undertaking strategic or national projects.140 The mechanism seeks to facilitate licencing procedures and the allocation of real estate property for the establishment, operation and management of investment projects.141 Investment projects qualifying for the Single-Approval Mechanism may also benefit from incentives provided under the Schemes outlined above.142 Eligibility conditions were initially defined under the 2017 Investment Law and the 2017 Executive Regulations. These were subsequently amended and supplemented more recently by Cabinet Decree 56 of 2022.143 These are currently as follows:144

• The Investment project must qualify as a strategic or national project as per Cabinet Decree 56 of 2022, i.e., (i) operate within a priority sector listed in the Decree (electricity, renewable energy, oil and mineral resources, transportation, industry, telecommunications and information technology, housing, tourism, youth and sports, environment, and agriculture sectors);145 and (ii) meet two out of the eight economic performance criteria listed therein, relating among other to its planned contribution to sustainable development and employment of Egyptian nationals.146

• The Investment Project must meet the conditions as set out under supplemental Decrees amending the 2017 Executive Regulations; these concern limited liability companies specifically, which are required to provide a proof of solvency and have incorporated in Egypt after the entry into force of the 2017 Investment Law.147

A “Golden Licence Guidebook”, prepared and published by GAFI, provides investors information on eligibility conditions and application procedures. It was recently updated, in April 2023, and an Arabic version of the Guidebook is now publicly available, reflecting the mechanism’s latest implementing decrees.

Procedural requirements and processing of applications.

The 2017 Investment Law does not outline the formalities and procedures which investors must comply with a view to benefit from Special and Additional Incentive, which negatively impacts the transparency and hinders the predictability of these schemes for investors. In that regard, the 2017 Investment Law notes that Additional Incentives are granted by way of Cabinet Decree.148 Incentives under the General Scheme are in contrast automatically granted to investors further to legal incorporation under the regime of the 2017 Investment Law.149 Separately, Single-Approval applications are submitted to and processed by a special unit within GAFI created for this purpose.150 The application is reviewed before submission to the competent Minister, and is ultimately approved by the Cabinet.151 This application may be submitted online via the Cabinet’s official website, operational at the time of writing in September 2023.

GAFI must, with respect to all three schemes, issue a certificate allowing investors to benefit from incentives thereunder. It is described under the Law as being “final and self-executory without the need for the approval of other authorities”.152 While the 2017 Investment Law provides some information as to requirements regarding some of the schemes,153 the process and practical procedures by which such a certificate is obtained, or what steps investors must engage with further to obtaining this certificate, is not clarified in the Law or the relevant implementing Decrees.154

GAFI is required under the 2017 Investment Law to publish the list of companies which benefit from incentives under the 2017 Investment Law in an annual report freely accessible online, so as to enhance the transparency of the Investment Incentives Regime.155 At the time of writing in September 2023, this list was not readily available via the GAFI website. Companies benefiting from incentives under any of the Investment Incentives Regime’s Schemes are bound by an annual reporting obligation.156 The scope of these reporting obligations is unclear.

Further, GAFI may revoke incentives, in whole or in part, and adopt sanctions in case of violation of the 2017 Investment Law.157 It is unclear whether investors may appeal such decisions, as the GAFI Grievances Committee’s competence is limited to matters related to approvals, permits and licences.158

Jordan

Investment climate in Jordan: a practical overview

Jordan truly advanced its attractivity to foreign investment after a series of reforms launched in the mid-1990s reducing the state’s participation in the economy and after its accession to the WTO in April 2000. The country issued its first law regulating investment in 1987, amended it in 1992 and replaced it by the Investment Promotion Law 16 of 1995 which established the Jordan Investment Board (JIB),159 the first IPA operating in the country.

As a result, FDI inflows grew rapidly and reached their peak at USD 3.5 billion in 2006, representing almost a quarter of the country’s GDP recorded at the time. Following their initial contraction in the aftermath of the Global Financial Crisis and the political upheavals in the country between 2011 and 2012, FDI inflows stabilised relatively until 2017. Followingly, they have systematically been declining, a trend further accentuated by the shocks induced by the Covid-19 pandemic (Figure A A.5).

Figure A A.5. FDI inflows in Jordan (1990-2021)

Source: OECD elaboration from IMF (Balance of Payments and International Investment Position Statistics) and World Bank (GDP data).

Jordan’s inward FDI stock is principally held by investors from the MENA region (42%) UAE, Kuwait, and Saudi Arabia; from the EU (17%, mainly from Belgium, Italy, the Netherlands), the United Kingdom and People’s Republic of China (hereafter ‘China’) (Figure A A.6).

Figure A A.6. Origins and value of inward FDI stock in Jordan (2019-2020)

Note: Total volume of inward FDI stocks at year-end estimated by accumulation of inward FDI flows.

Source: OECD calculations based on Central Bank of Jordan, Foreign Investment Survey (geographical origins of inward FDI stock) and World Bank (total volume of inward FDI stock).

Jordan has historically seen significant FDI flowing into industries like real estate, construction, and oil and gas-related energy, despite not necessarily being the primary contributors to the creation of high-quality jobs or the fostering of innovation. There has been a notable shift in the sectoral composition of FDI in recent years from traditional sectors such as manufacturing or construction towards industries with the potential to generate more high-quality employment opportunities and foster the transfer of knowledge. These emerging sectors include renewable energy, business, financial, and health services, transport and logistics, and the field of information and communication technology.160

In global reports developed to assess local business environments, Jordan has demonstrated favourable performances when compared to its regional peers.161 This success may be attributed to the country’s repeated efforts to rearrange its regulatory framework for investment, primarily motivated by its eagerness to improve the general business climate. Despite notable advancements, numerous investors still voice concerns about persistent challenges. Obstacles include excessive red tape or bureaucratic hurdles, shifting interpretations of laws and regulations, difficulties in both starting and exiting businesses162 and various other factors including elevated operational expenses of doing business – in particular in terms of energy costs – limited access to financial resources, burdensome procedures for talent hiring, and obstacles related to land acquisition.163 Moreover, almost half of the firms – whether domestic or foreign-invested – surveyed by the World Bank identified the Jordanian tax administration as a major constraint in doing business in the country.164

Recent positive developments in terms of improved co-ordination and streamlining of licensing procedures are the country’s effort to overhaul its regulatory and institutional framework for investment by creating an MoI in October 2021165, the adoption of a new Investment Environment Law in 2022, and the MOI’s announcement to digitalise most of the ministry’s investment services.166 FDI is identified as an important lever to achieve the SDGs set out in the country’s Economic Modernisation Vision (2022-2025), especially in renewable energies, ICT, and infrastructure development.

General institutional framework for investment in Jordan

Under its current framework, Jordan does not operate an IPA as a separate administrative agency in charge of promoting and facilitating investment in the country. Rather, investment facilitation is overseen by the MoI, which was established in October 2021 to address the shortcomings of the previous IPA – the Jordan Investment Commission.167 The Ministry absorbed the JIC’s missions, which was the IPA operating previously in the country since 2014, as well as the Private-Public Partnership Unit which used to be under the Prime Minister’s jurisdiction.168

The Ministry of Investment (MoI). According to the Investment Environment Law (2022), the MoI is “the main reference authority for investment in the Kingdom”, and shall aim to “attract, encourage and promote investment, ensure the sustainability of an attractive investment climate, and enhance confidence in, develop and organise the investment environment” (Article 7). To the extent that the MoI absorbed the duties of the JIC, the Ministry’s mandate in terms of investment facilitation mirrors the Commission’s previous mandate in this regard.

The Ministry’s Secretariat is composed of several functional directorates and units, including:

• A “Comprehensive Investment Service” (CIS) which oversees the Jordanian “investment window” (OSS) previously operated by the JIC. It aims at providing information and technical assistance to investors by simplifying the registration of companies and licensing procedures for investors. However, the scope of its facilitation services is limited to 12 economic sectors as defined by Schedule 1 of the Decree 7 of 2023 on the Investment Environment Law. A list of its facilitation services for establishment and operation matters is provided under Schedule 2 of the Decree.169 To fulfil its facilitation mandate, the CIS includes fully authorised representatives of public agencies who have the authority to issue directly approvals and licences for investment projects, such as representatives of tax authorities (for company registration procedures), of the Ministry of Tourism or the Ministry of Agriculture (for sectoral licences), of the Ministry of Environment (for environmental approvals) or even of the Ministry of Labour (for work permits).

• The Ministry also comprises a “Follow-Up and After Care” section which aims at resolving all obstacles faced by investors with central or local authorities for the implementation of their projects. The section was established initially as a JIC department in 2018. The section may also receive suggestions by investors or relevant stakeholders to improve the Jordanian business environment.

• Finally, the Ministry operates a grievance mechanism which was introduced in 2019 to address investors’ complaints. The grievance mechanism aims at avoiding investment disputes arising from investment procedures or decisions by official bodies related to a given investment in the country. As such, the mechanism is available to investors that have not yet formally filed complaints in domestic courts or initiated arbitration proceedings against the State.170. The grievance committee may issue recommendations to the official body of which a decision is subject of the investor’s grievance, although its recommendations are not binding upon the authorities concerned.

The Investment Council. Chaired by the Prime Minister, and comprising ministers with economic portfolios, and representatives from the private sector, the Investment Council oversees the management and development of national investment policy and proposes legislative and economic reforms to facilitate and promote investment in the country.171 The Investment Council also acts as a grievance mechanism in case investors face administrative hurdles in the implementation of their projects.172

The Incentives and Exemptions Committee (IEC). An Incentives and Exemptions Committee (IEC) was created pursuant to Article 12 of the Investment Environment Law (2022). The IEC is an inter-ministerial committee which plays an important role in the granting of incentives to eligible investors, especially for the additional incentives scheme and the single approval mechanism which it supervises in conjunction with the Council of ministers.

Transparency and predictability of the Jordanian legal framework for investment

Legal and regulatory framework. Jordan recently overhauled its legal framework for investment by adopting the Investment Environment Law in October 2022 which entered into force on 14 January 2023.173 The Law applies to greenfield investments as well as acquisitions and ownership operations by Jordanian or non-Jordanian natural or legal persons. It has a limited material scope as its provisions apply to industrial, commercial, agricultural activities, services, tourism, information technology or creative industries and exclude banking or money exchange, or any professional activities governed by sector-specific regulations.174

The Law reflects Jordan’s investment policy strategy aimed at enhancing its business environment and encouraging sustainable investment in the country. Article 3, which frames the purpose of the Law, mentions the country’s willingness to:

• Create an appropriate environment for the development of small and medium enterprises;

• Digitalise and automate all procedures and services provided to investors; and

• Protect the environment and encourage the transition to a green economy, safety and public health, according to social standards, among others.

The Law sets out a principle of national treatment of foreign investors, and enshrines the principle of fair, equitable and transparent treatment within Jordan’s regulatory framework.175 It also limits the possibility of partial or total expropriation of an investment to circumstances where a “public, specific and legitimate purpose” may warrant it and if carried out in a non-discriminatory manner and subject to fair compensation.

Transparency and predictability. Some business- and investment-related legislations and regulations can be found on the Companies Control Department (CCD)’s website. English translations are provided for three main legislations (Investment Environment Law, Insolvency Law and Commercial Code) whereas regulations are only available in Arabic. The MoI’s website only provides an English translation of the Investment Environment Law (2022) and of the Public-Private Partnership Projects Law (2020). Other implementing instruments are available in Arabic through the Official Journal’s website. The official government portal also provides an overview of several business-related procedures in Jordan (company registration, obtaining licences, loans, permits, electricity, water etc).

There exist no legal or regulatory requirement which requires regulatory bodies to publish draft laws and other instruments. Ministries and regulatory authorities are nevertheless encouraged to publish texts of proposed regulations before their adoption, especially those related to investment, to enhance regulatory transparency and predictability.176 Proposed legislation and regulations are readily available for consultation on the relevant ministries’ websites, often completed by explanatory notes on the proposed regulatory changes. More specifically, investment-related amendments are available on the MoI’s website, where stakeholders are provided with an opportunity to comment on the drafts within a timeframe, as specified by the drafts’ explanatory notes. The House of Representatives also provides a dedicated section on its website to receive comments from relevant stakeholders. It appears that the draft Investment Environment Law (2022) was made public several months prior to its adoption. It was first published by Petra, the government’s news agency, in June 2022, followed by the Prime Minister’s office in July 2022, along with an explanatory note to the Law. It also appears from publicly available information that the draft was subject to extensive consultations with public and private sector representatives prior to its adoption in October 2022. The Law entered into force 90 days after its publication in the Official Gazette on 10 October 2022.

Facilitation of business establishment by foreign investors.

Restrictions to foreign investment

Jordan maintains limited restrictions to foreign investment in the country. Besides in a handful of sectors in which foreign ownership caps apply, wholly foreign-owned enterprises may operate in the country.177 The Decree 7 of 2023178 adopted pursuant to the new Investment Environment Law sets out two negative lists of restricted sectors: a list of activities in which foreign investments are prohibited; and a list of activities in which a foreign ownership cap of 50% applies. Restricted sectors to foreign investments include financial activities, commercial activities, transport, and engineering services among others.179

Pre-admission formalities and legal incorporation of companies

Outside of controlled or restricted activities, investors may register their enterprises freely to carry out their businesses. The Law shifts Jordan’s investment policy from a system of “prior control” to a system of “post control”, in accordance with the previously announced business practice requirements.180 As such, the registration of enterprises is generally not subject to review by the relevant authorities and no prior authorisation is required for enterprise registration except for certain controlled activities according to sector-specific legislations.181 Around 360 economic activities require prior approvals in Jordan, which fall within the competence of 35 distinct official bodies, including the Energy and Minerals Regulatory Commission, the Ministry of Interior, the Ministry of Public Works and Housing, the Telecommunications Regulatory Commission, the Jordan Central Bank etc. A list of pre-registration approval requirements is provided by the Companies Control Department (CCD) in charge of company registration in Jordan.

Only a handful of pre-registration approvals required for certain economic activities may be directly obtained through the CCD’s online portal for enterprise registration. These concern approvals granted by authorities having partnered with the CCD specifically for the provision of the pre-registration approvals falling within their jurisdiction. At the time of writing in September 2023, there seems to be only 6 agencies out of the 35 competent authorities that have partnered with the CCD to facilitate the obtention of these approvals and authorisations: the Ministry of Industry and Commerce’s Insurance Department; the Jordan Securities Commission; the Central Bank of Jordan; the Ministry of Public Works and Housing; the Ministry of Interior; and the National Committee for Demining and Rehabilitation. Besides those granted by these six agencies, pre-registration approvals need to be obtained directly from the competent authorities prior to registering an enterprise with the CCD, which may pose additional administrative hurdles to investors in controlled activities.

The MoI’s Comprehensive Investment Service, which acts as a OSS for investors, facilitates the registration of enterprises in the economic sectors subject to the provisions of the Investment Environment Law (2022).182 Schedule 1 of Decree 7 of 2023 defines more precisely a list of 12 sectors in which investors may benefit from the CIS’ services. Beyond these 12 sectors, investors are required to carry out the registration of their enterprises by liaising directly with the CCD and obtaining pre-registration approvals from the relevant authorities as required by sectoral policies. The OSS’ limited material scope creates an imbalance in its facilitative services which are not equally available to all investors throughout all economic activities in the country.

Company registration follows the process set out by the Companies Law 1997, as amended. Specific guidance for company registration in Jordan is provided in Arabic on the CCD’s website. Foreign-registered enterprises may either register “non-operational companies” (representative or liaison offices or branches), or “operational companies” (subsidiaries) in Jordan. The conditions and supporting documentation are set out in detail in Article 240 (for offices) and Article 241 (for subsidiaries) of the Companies Law (1997).

Other commercial forms available to investors in Jordan include limited liability companies, joint liability companies and single partnerships. The registration of companies may be undertaken through the CCD’s online portal, developed with the support of the United States Agency for International Development (USAID) through the Jordan Local Enterprise Support Project (LENS).183 Fees are publicly accessible through the CCD’s website.

Facilitation of business operations by foreign investors.

After having registered their enterprises, investors are required to obtain operational licences to carry out some controlled activities in Jordan. There appears to be no aggregate information on activities subject to licensing conditions, which hinders the overall transparency and accessibility of Jordan’s legal framework for investment. The 2022 Investment Environment Law refers to “professional activities governed by sector-specific regulations” to exclude them from its provisions, without mentioning which activities are concerned specifically. The MoI’s OSS may however provide some guidance to foreign investors with regards to the licensing conditions applicable to their intended projects, and in some cases, may even facilitate the obtention of these licences in the 12 economic sectors falling within its competence as defined by the Decree 7 of 2023.184 These include permits in the health sector, agricultural permits, tourism, environmental permits etc. Outside of CIS services for licensing, investors need to address relevant authorities to obtain licences that do not fall within the competence of the CIS which may cause delays in the implementation of their investment projects.

The 2022 Investment Environment Law, which aims specifically at improving the Jordanian business climate, incorporates specific provisions for the facilitation of licensing and authorisations procedures by the MoI. It provides for the creation of a joint electronic platform between the MoI and the competent licensing authorities. It also provides for several guiding principles for administrative practices with regards to licensing, to streamline approval procedures:

• Authorities shall not request a document that has been delivered by another administrative body if they already have access to it.185

• The delays for the processing of applications are set within the general framework: authorities have 15 days to process complete applications for licences, unless specified otherwise by the relevant authorities. The Law enshrines a principle of ‘tacit approval’ if no answer has been received by the investors following their complete application to the relevant authorities within this timeframe.186

• The Investment Environment Law organises a process for following-up with the implementation of projects by nominating an official to issue additional licences as required and on behalf of the authority they represent.187

The Law also enshrines principles of transparency and stability to ensure legal security and procedural fairness to investors regarding licensing procedures:

• Authorities may not impose additional requirements for the approval of a licence beyond what is provided by sector-specific legislations.188

• The list of conditions to obtain licences as well as the licences’ validity periods need to be provided by the relevant authorities.189

• Decisions refusing to grant licences need to be clearly motivated and the Law explicitly prohibits some grounds for refusal to grant licences.190

• Decisions to withdraw licences must follow a specific procedural framework under the Law: authorities need to notify the licence holder of the alleged violation of the licence terms and provide them with a timeframe for rectification or for responding with evidence that no violation has occurred.

To enhance the transparency of the licensing framework, the Law requires that a “licensing guide” be published, which should include the conditions, procedures, requirements, and legal periods for issuing licences in accordance with sector-specific legislations and that these guidelines shall be regularly updated.191 The new licensing guide was published by the MoI in April 2023. The guide, available in Arabic, provides detailed information on the conditions, procedures, documents, requirements, and timeframes for obtaining permits and licences. It covers incorporation, pre-approvals, operating permits and licences, construction permits, FDI restrictions, environmental assessment, services offered by the OSS, and the single approval, amongst other topics. It also provides hyperlinks for the available online services. In that regard, the Jordanian MoI recently announced that it had digitalised 95% of the services offered by it through its CIS portal. Outside of these, investors must address the relevant competent authorities to obtain authorisations that do not fall within the competence of the CIS.

Transparency and predictability of the Jordanian Investment Incentives Regime

Two sets of investment incentives are available under the Investment Environment Law (2022): incentives for investments in “free and development zones”, and those outside of zones. The Law does not specify nationality requirements for the obtention of investment incentives: all incentives schemes are available to domestic and foreign investors alike.192

The Council of Ministers and the Minister of Investment, each within their respective jurisdictions, are mandated to issue the executive instruments of the Law’s provisions.193 Some of these provisions were fully complemented by the Council of Ministers’ Regulation 7 of 2023, while additional instruments are yet to be adopted to complete the incentives’ framework (e.g., rules on monitoring economic activities benefiting of the additional incentives,194 the required documents to apply to the additional incentives,195 the required fees for applying to the single approval196).

Jordan is also the only country among the selected Southern Neighbourhood countries that does not currently maintain a webpage centralising information on the country’s investment incentives, despite its previous IPA successfully developing and launching an ‘incentives inventory’ in 2016, relevant to the previous investment framework.197 The country’s current priorities, as outlined in its Investment Promotion Strategy (2023-2026), include addressing such shortcomings through a dedicated online investor portal.198

Types of available incentives and eligibility conditions. The Jordanian incentives regime is comprised of “basic incentives” for promoted investors that may be cumulated with “additional incentives” on a case-by-case basis:199

• Basic incentives include exemptions from customs duties, a zero-rate general sales’ tax, and a waiver, in whole or in part, from income tax for a maximum period of five years;

• Additional incentives include tax and non-tax advantages (e.g., preferential sale and rental of State-owned lands, subsidising energy,200 water, deducting the costs of infrastructure works from their due accounts).201 Additional incentives also include a “single approval” scheme, which replaces “any licence, permit or permission required by any legislation” for eligible investors.202

Incentives under the Law may be granted to investments in the sectors covered by its provisions.203 Eligibility to incentives is assessed based on a variety of criteria including the economic sector of the investment, the region of the investment, capital thresholds, and even performance requirements in terms of employment of Jordanian nationals and exportation. The eligibility criteria are clearly detailed by the Law and its Regulation:

• Exemptions from customs duties or zero-rate general sales tax may be granted for fixed assets, “production requirements” and “production inputs” as defined by the Regulation204 and spare parts that are necessary to implement the investment project. The economic activity, provided that the economic activity falls within the scope of the Law. A schedule approved by the Council of Ministers also frames the eligibility of goods to the zero-rate general sales tax.205

• Partial or total waivers of income tax for a maximum period of five years, are offered only to projects that have not yet started operations nor benefited from any tax incentives under the previous regime.206 These projects must operate within a positive list of eligible sectors and activities, set out under Regulation 7 of 2023, which includes industrial activities, agriculture, hospitals, hotels, entertainment cities, call centres, information technology, media production among others.207 A negative list of sectors is also set out under the Regulation to exclude activities or investment projects from the benefits of the income tax waiver (electricity generation, some mining activities, and activities undertaken by enterprises established in a free or development zone).208 Additional eligibility criteria include the geographic zone of the investment or performance requirements in terms of employment of Jordanian nationals.209 Eligible zones are classified into three categories,210 each unlocking a different rate of waiver.211

• Eligibility to additional incentives is assessed by reference to eight alternative criteria to assess the “strategic” nature of the economic activity,212 including the employment of Jordanian nationals, activities that export 50% of their production, transfer of knowledge and technology, private-public partnerships, and activities that target poverty areas,213 accompanied by a negative list of ineligible activities (e.g., activities undertaken by enterprises established in a free or development zone, and some mining activities).214 The amount and types of additional incentives depend on the specific fulfilment of cumulative criteria by the investors.215 Although additional incentives are capped at 20% of the investment amount, the cap may be increased by increments on a case-by-case basis depending on the fulfilment of individual criterion.216

Procedural requirements and processing of applications. The procedural framework to apply for incentives under the Investment Environment Law is mainly detailed by the Regulation 7 (2023) and is expected to be completed by a series of additional regulations pertaining to the monitoring of promoted investments, required documentation to apply for incentives and fees for the single approval scheme.217

Several authorities are involved in the process of assessing investors’ eligibility to incentives and deciding upon incentives applications. Access to information on incentives is unequal as the process, timeframes and required supporting documentation for each scheme are set out with varying degrees of detail within the Law and implementing regulations:

• Customs duties exemptions and zero rate sales tax are assessed by the MoI and granted by a decision of the Minister to be issued within 15 business days following a complete application. The Regulation does not seem to mention the documents required to support investors’ applications. It only specifies the elements to be included in such a decision.218

• Partial or total income tax waiver applications are assessed by a special committee formed by the Minister of Investment, which shall issue its recommendations to the Minister within 15 business days for final decision.219 Neither the Law nor the Regulation sets out a specific timeframe for the decision to grant such incentives following the assessment by the special committee. The Regulation hints at supporting documentation to be submitted to support investors applications.220

• The process to apply for additional incentives (besides the single approval) is yet to be fully determined by the Minister of Investment.221 Applications are assessed by the Incentives and Exemptions Committee (IEC), which issues its recommendations directly to the Council of Ministers222 within 15 business days.223 The Law and implementing regulations do not specify a timeframe for the Council of Ministers’ decision or supporting documentation to be submitted.

• The process for applying for the single approval scheme seems to be the most elaborate yet under the current regulations, which list the required documents,224 timeframes, as well as the evaluation method by relevant authorities. Applications for the single approval scheme follow a three-fold process: (i) a committee formed by the Minister of Investment would first assess the applications and submit its recommendations to the Minister if the investments are deemed eligible; (ii) applications would then be transferred to the IEC for a second assessment; 225 and (iii) in case the latter has a favourable opinion, it would submit its recommendation to the Council of Ministers for final decision.226 The decision to grant the single approval takes the form of a decree containing the timeline for the implementation of promoted projects, which may be extended by the Council of Ministers.227 The evaluation process by the IEC and the decision-making process at the Council of Ministers level do not seem to be subject to specified timeframes. Fees for the processing of single approval applications are also expected to be set in the coming months, as required by the Regulation 7 of 2023.228 The process to apply for single approvals may be facilitated by the MoI’s OSS as it is the only incentive scheme falling within its facilitation services.229

The granting of incentives may entail specific obligations and requirements for promoted investors to avoid their misuse or abuse.230 As such, promoted investors may be subject to the scrutiny of authorities following the granting of incentives, which may lead to revoking their promotion status. Investors are required in some instances to provide regular updates to the MoI on the effective implementation of their projects, as well as to the tax or customs authorities, as required.231 The Regulation sets in detail the rules governing this administrative scrutiny regarding the exemption from customs duties and the zero-rate general sales’ tax.232 It does not however contain similar provisions for the waiver of income tax, despite being subject to post-approval scrutiny as stated by the Law.233 As for the additional incentives and the single approval, such process is yet to be determined in detail by the IEC,234 and the Minister of Investment,235 respectively. The Regulation only sets an obligation to submit annually the necessary documents proving that the investor remains eligible to the advantages it was granted.236

The Investment Environment Law and its implementing instruments contain provisions on the exceptional revocation of incentives or sanctions that could arise if an investor or investment does not meet the requirements for their benefit. Tax amounts may be reclaimed and additional fines may apply if the goods and services benefiting of basic incentives (exemption from customs duties or general sales’ tax, or a full or partial waiver of income tax) were sold, transferred, disposed of, or used in activities other than those for which they were granted.237 The single approval may also be revoked, although the rules governing such a process are yet to be determined by the IEC.238

Morocco

Investment climate in Morocco: practical overview

Privatisation programmes and the progressive liberalisation of the economy in the mid-1990s239 opened up opportunities for foreign investors in Morocco, leading to it becoming one of the largest investment destinations in the MENA region. As part of its commitment to fostering private sector growth, Morocco enacted a first major investment legislation in 1995, being – with some provisions revised – the foundation for investment activities until its replacement by the new Investment Charter in 2022.

While FDI flows have been rather volatile over the past two decades, the overall trend has remained positive even following the 2008 economic crisis or the upheavals caused by political instability in the MENA region in the early 2010s. In 2018, FDI flows reached an all-time high of USD 3.6 billion, representing almost 3% of the country’s GDP (Figure A A.7). Despite the global Covid-19 pandemic and its resulting negative effects on investor confidence, FDI flows in the country did not plummet and have fairly recovered and stabilised since.

Figure A A.1. FDI inflows in Morocco (1990-2022)

Source: OECD elaboration from IMF (Balance of Payments and International Investment Position Statistics) and World Bank (GDP data).

Morocco has been an important destination for European investors as well as for those stemming from the MENA region. In 2022, investors from the EU (49%) and from the MENA region (36%) held nearly 85% of the total USD 63 billion inward FDI stock in the country. The share of FDI stock held by European investors grew in the last years, with investors stemming in majority from France (27%), and Spain (7.8%). Investors from the MENA region are essentially from the United Arab Emirates, who held 30% of the inward FDI stock in Morocco in 2022 (Figure A A.8).

Figure A A.2. Origins and total value of inward FDI stock in Morocco (2018-2021)

Note: Calculations based on inward FDI positions reported by Morocco.

Source: OECD calculations based on IMF Coordinated Direct Investment Survey (CDIS) data.

FDI has historically been most prominent in the real estate sector, followed by the manufacturing industry. Interestingly, in contrast to other selected Southern Neighbourhood countries, the extractive sector has only played a minor role in attracting FDI in the country.240 As such, manufacturing activities represent the highest share of FDI stock, followed by real estate and telecommunication, sectors with particular significance due to their potential for generating employment opportunities.241

Perceptions of Morocco’s business environment by investors appear to be highly favourable and outperforming the other five countries of the Southern Neighbourhood, as indicated by comparative studies.242 Investors have nevertheless reported facing important bottlenecks in terms of administrative processes in Morocco. A third of the domestic firms and a quarter of foreign-invested firms surveyed by the World Bank in 2020 identified business licensing and permits as a major constraint affecting the investment climate in Morocco.243 Significant differences in perceptions may be observed following the location of investors in the country, potentially indicating uneven facilitation services across the regions. While practically no firms operating in the regions of Marrakech-Safi, Rabat-Salé-Kénitra or Tanger-Tétouan-Al Hoceïma reported having issues with business licensing, nearly half of firms surveyed in the regions of Fès-Meknès, Souss-Massa or in the Oriental identified it as a major constraint.

In consultation with private and public partners, the government established the Roadmap for Improving the Business Environment 2023-2023 in March 2023. The roadmap is structured around three pillars which aim to improve the structural conditions for investing and entrepreneurship in Morocco, strengthen national competitiveness and optimise the costs of production and develop an environment conducive to entrepreneurship and innovation.

General institutional framework for investment in Morocco

Morocco’s approach to investment promotion and facilitation is unique among the Southern Neighbourhood countries considered in this Report. It is characterised by decentralised regional mandates, rather than entrusted to a centralised agency, and a centralised and unified approach to investment-related procedures and decision-making.244 Investment facilitation in Morocco is primarily undertaken at regional level by Regional Investment Centres (Centres régionaux d’investissement, CRIs) and Regional Unified Investment Commissions (Commissions régionales unifiées d’investissement, CRUIs). The facilitation mandate of Morocco’s nation-wide IPA – the Moroccan Agency for Investment and Expert Development (Agence Marocaine de Développement des Investissements, AMDIE) – is more limited although it does work along with CRIs and other regional actors in assisting investors, post-investment monitoring and aftercare services.245

Regional investment facilitation agencies and entities: CRIs and CRUIs. CRIs and CRUIs are mandated with wide-ranging powers to effectively support investors in the implementation of their investment projects and facilitate investment-related administrative procedures (these are summarised in Table A A.1). CRIs play a pivotal role in Morocco’s decentralised approach to investment facilitation across its twelve regions. Their establishment in 2002 was part of the country’s broader decentralisation efforts aimed at significantly enhancing the efficiency of investment facilitation and the country’s economic and social development.246 CRIs had performed unevenly and at times inefficiently across the country, impeding the overall effectiveness of the nation-wide investment facilitation strategy.247 Decree 1-19-18 of 13 February 2019 promulgating La (Law 47-18) was adopted among others with a view to harmonise CRI mandates across regions, and thereby enhanced their effectiveness.248 CRIs operate as OSS to assist and guide investors with investment-related establishment and operation formalities. These procedures are facilitated by the CRIs themselves and via the harmonised CRI-Invest Platform,249 the exclusive platform shared by CRIs to streamline investment-related formalities and applications through which most of the CRIs’ OSS services are provided.250 CRIs are also required to operate their own websites to publish information relating to the Moroccan regulatory framework for investment and investment procedures and formalities.251

Law 47-18 also established a new entity, CRUIs, that are mandated with supporting investors in obtaining a number of defined establishment and operation authorisations and formalities required for the implementation of investment projects. These requirements and formalities are explicitly set out in Law 47-18,252 which nevertheless provides that CRUI powers are broad as the entity may rule on “all investment-related matters”. They replace previous regional commissions that processed parallel but uncoordinated investment-related administrative procedures and formalities.253 Their membership and organisation is designed to centralise and enhance the efficiency of these processes, and their decisions are binding upon CRUI members and the administrations they represent.254 In contrast to CRIs, whose role is limited to assisting, guiding and supporting investors, CRUIs are entrusted with regulatory powers and either directly decide upon or provide their formal opinion or assent on investment-related administrative acts, in respect of both establishment and operation requirements and formalities.255 The clearly set out and harmonised mandates of regional CRUIs and the processing and decision-making framework for investment-related established by Law 47-18 contributes to significantly enhancing the predictability of the legal and regulatory framework for investors.

Law 47-18 also established a new entity, CRUIs, that are mandated with supporting investors in obtaining a number of defined establishment and operation authorisations and formalities required for the implementation of investment projects. These requirements and formalities are explicitly set out in Law 47-18,256 which nevertheless provides that CRUI powers are broad as the entity may rule on “all investment-related matters”. They replace previous regional commissions that processed parallel but uncoordinated investment-related administrative procedures and formalities.257 Their membership and organisation is designed to centralise and enhance the efficiency of these processes, and their decisions are binding upon CRUI members and the administrations they represent.258 In contrast to CRIs, whose role is limited to assisting, guiding and supporting investors, CRUIs are entrusted with regulatory powers and either directly decide upon or provide their formal opinion or assent on investment-related administrative acts, in respect of both establishment and operation requirements and formalities.259 The clearly set out and harmonised mandates of regional CRUIs and the processing and decision-making framework for investment-related established by Law 47-18 contributes to significantly enhancing the predictability of the legal and regulatory framework for investors.

Commission nationale des investissements. The National Investment Commission (Commission nationale des investissements, CNI) was established in 2022, and its mandate and structure were reformed further to Decree 2-23-1 of 16 February 2023 (Decree 2-23-1). It is chaired by the Head of the Government; its membership comprises principally Ministry and Government branches representatives, and the AMDIE acts as its secretariat.260 The CNI’s mandate under the 2022 Investment Charter relates in great part to the implementation of the incentives regime.261

Table A A.1. Summary of investment facilitation missions of CRI OSS and CRUIs

	Missions
	CRI OSS	CRUIs
Establishment	Assist investors with company establishment procedures Pre-review investment project files prior to CRUI handover	Carry out and decide upon preliminary evaluations of investment projects
Operation Administrative acts and authorisations	Assist investors obtain investment-related administrative acts and authorisations, review their applications with relevant authorities Prepare administrative acts under the region’s authority Prepare operation authorisations manual (procedures, formalities and documents required)	Rule on or assent to investment-related authorisations and administrative acts
Operation Incentives	Monitor execution of Investment Agreements concluded between investors and the Government Prepare guide outlining eligibility conditions for investment incentives	Review investment projects’ eligibility for investment incentives Issue opinions on investment projects’ access to advantages under investment schemes and on investment agreements related thereto*
Aftercare	Advise and assist businesses Monitor investment projects (underway or completed)	/
Resources for investors	Launch online regional investment platforms (data on the regional investment environment, financing and labour; regulatory framework for investment; regional investment opportunities; investment projects procedures; investor portals for tracking progress of applications) Digitalise investment applications procedures and formalities	/

Note: * Law 47-18, Article 29(c) provides that CRUIs are to examine and give their opinion on investment projects that seek to benefit from investment incentives and on investment agreements related thereto. This aspect of the CRUIs’ mandate specifically relates to the investment incentives regime in force under the 1995 Investment Charter. As per Article 35 of the 2022 Investment Charter, this mandate will be complemented – and/or supplanted – by additional measures. Until such measures are adopted, the CNI is responsible for approval all Investment Agreements relating to the Primary Incentives Regime regardless of the total value of the investment project (Decree 2-23-1, Article 29).

Source: OECD compilation on the basis of Law 47-18 and the CRI available websites; non-exhaustive.

Transparency and predictability of the Moroccan legal framework for investment

This section considers Morocco’s investment framework and those measures which the country has adopted for facilitating investment, including with respect to accessibility and transparency of the country’s legal and regulatory framework for investment, establishment restrictions and conditions, and operation authorisations; and the manner in which investment-related procedures are streamlined.

Legal and regulatory framework for investment. Morocco adopted a new investment law in 2022 (2022 Investment Charter or the Charter), which replaces and repeals the previous investment legislation in force since 1995, which had been subject to review for a number of years.262 Law 47-18, the 2022 Investment Charter and its implementing decrees together define the legal regime for domestic and foreign investors across economic sectors,263 except for agricultural activities which are subject to sector-specific policies.264 At the time of writing in September 2023, one decree was adopted implementing specific incentives schemes which the Charter introduced, as well as three implementing orders. Two further implementing decrees are scheduled to be adopted by June and December 2023 respectively, in accordance with the calendar set out in the Charter.265

The adoption of the 2022 Investment Charter is part of a broader set of structural reforms on administration decentralisations and the streamlining of administrative procedures among others, as set out in detail in the Charter’s Preamble.266 The latter outlines that the Charter rests on three central pillars: the new investment incentives regime and its governance; the harmonisation of decentralised investment facilitation; and foreseen reforms to further enhance the country’s business climate.267 The Charter sets out general principles and rights enjoyed by investors, including freedom of enterprise, free competition, equal treatment irrespective of the nationality of the investor, the right to transfer funds related to investment projects, and legal predictability and good governance.268

Transparency and publication. Legislation is published by the Official Printing Directorate (Direction de l’Imprimerie Officielle) in the Official Bulletin (Bulletin Officiel), which is freely accessible online to the public. Instruments are in theory published in the Arabic official edition and a French translation edition. In practice, legislation is not systematically translated into French (or is translated and published in the French edition of the Official Bulletin but with a significant delay).269 Further, stakeholders consultations have also highlighted that adopted legislation may at times have a retroactive effect; these considerations may in practice hinder the transparency and predictability of the investment framework. While the country’s legal and regulatory framework for investment is not available through a unique, comprehensive portal, a number of CRI portals feature links to the framework’s main legal instruments (e.g., the Tanger-Tetouan-Al Hoceima CRI and the Fès-Meknès CRI, by way of example), as required under Law 47-18, thereby contributing to the investment framework’s transparency and predictability.

The 2011 Moroccan Constitution requires that public authorities undertake public consultations in their decision-making process and policymaking, and the Moroccan House of Representatives and House of Councillors each publish drafts of laws and regulations. A report examining the draft Charter was prepared and published online on the House of Representatives website in October 2022, alongside the examined draft. The report detailed the Charter’s purpose, and how it was debated and amended throughout the elaboration process.270 It is unclear when these documents, and more particularly, when the draft Investment Charter, was made publicly available, and as such it is difficult to assess whether reasonable time was afforded to investors and interested persons between the Charter’s publication and its entry into force. Morocco’s legislative frameworks affords an opportunity for the public to comment on drafts laws and bills are available to the public.271 Based on publicly available information, the Government undertook stakeholder consultations in the development of the Charter starting in February 2022.272 It is unclear whether these consultations were based on informal exchanges between regulatory authorities and selected stakeholders, or if all potential stakeholders were provided a reasonable opportunity to comment on the draft legislation. Further, no official information sheds light as to whether the outcomes these consultations impacted the adoption of the Charter.

Streamlining of investment-related administrative and other procedures. Morocco has adopted legislation which significantly enhances the transparency and predictability of its investment framework and streamlines authorisation procedures. These measures are summarised in Box A A.1. Unless specified otherwise, they apply to both establishment and operation procedures.

Box A A.1. Streamlining of authorisation procedures, transparency and predictability in Morocco

Morocco adopted Law 55-19 to improve the efficiency of administrative procedures and formalities. It sets out the principles and rules relevant to procedures, timeframes, rights of appeal, and highlights the imperative of digitalisation of administrative procedures. These complement the streamlining requirements set out in Law 47-18 for establishment and operation formalities and procedures undertaken by CRIs and CRUIs. Four decrees implementing Law 55-19 were adopted in May 2023.273

Table A A.2. Authorisation procedures in Morocco: streamlining, transparency and predictability

Streamlining of authorisation procedures	Transparency and predictability
CRUIs decide or assent to or give their opinions on all administrative acts depending on the relevant regulatory regime for the realisation of investment projects; decisions adopted by CRUIs bind all those administrations represented therein	Relevant administrations must compile and publish directories listing the administrative acts for which they are competent within 6 months of the publication of Law 55-19 (see, the Idarati national portal, launched in 2021); these must outline the documents required for administrative acts applications
Public administrations may only request from users administrative acts, documents and record required by laws and regulations in force and identified, listed, formalised, transcribed and published on the IdaratiIdarati national portal	Standardisation of the contents and format of administrative acts
Unless otherwise required by laws and regulations, public administrations shall not ask users for more than one copy of an application for an administrative document (including documents and other items making up the application file)	Standardisation of the general procedure relating to the issuing of administrative acts and document requirements
Unless otherwise required by laws and regulations, public administrations shall not ask users to provide publicly available administrative documents that do not directly concern them	Make available electronic applications for administrative acts on adequate platforms by 2025 (e.g., the CRI-Invest platform)274
Public administrations must refrain from requesting from investors documents they may already have in their possession/which can be provided by other public administrations	CRUIs must reason their negative decisions, and investors may appeal negative decisions. Relevant timeframes and procedures: (i) investors appeal a decision before the ministerial steering committee within 10 days of notification of refusal; alternatively, (ii) investors lodge an appeal (recours gracieux) with the region’s wali for submission to the CRUI; the latter renders the appeal decision within 10 days of receipt. If under (ii) no response is received with these timeframes or a negative decision is rendered further to the recours gracieux, then the investor may appeal with the ministerial steering committee, which issues a decision within a period of 30 days**
Public administrations may only request additional information relevant to a user’s application once; any such request will extend relevant timeframes for the processing of such an application
CRIs are to submit investment project applications to the CRUIs (in respect of matters which the CRUIs are mandated to issue decisions upon) within 30 days of receipt of a complete investment project file
CRUIs are to render their decisions within a maximum of 30 days from the date of receipt of an investment project file from the region’s CRI; this timeframe may only be extended once and only in certain circumstances*
‘Tacit approval’ applies if the timeframes envisaged under the relevant legal instruments have expired with respect to certain administrative acts; Decree 2-22-141 provides among others provides a list of nine administrative decisions subject to tacit approval

Note: *Timeframe for the review and issuance of administrative acts is capped to 60 days; timeframe is capped to 30 days with respect to the review of applications for administrative acts required for the realisation of investment projects (Law 55-19 of 2020, Law 47-18); **Law 47-18 does not outline the implications of an informal appeal as opposed to those of an appeal. Appeal provisions outlined in Law 55-19 concern administrative acts other than those falling within the CRUIs’ mandate.

Source: OECD compilation based on Law 47-18 (Articles 15, 29(b), 30, 33, 36, 37), and Law 55-19 (Articles 5-7, 10, 13, 16-19, 24-26, 29); non-exhaustive.

Facilitation of business establishment by foreign investors

Restrictions to foreign investment

Restrictions on foreign investments apply across several sectors, as set out by sector-specific legislation rather than consolidated in a negative list, which negatively impacts the transparency of the investment framework.275 This significantly hampers the transparency of the investment framework insofar as restrictions to foreign investment are concerned in terms of accessibility to applicable legislation, and the processes by which exemptions – if and when applicable – may be obtained.276 These restrictions include, among others, foreign equity limits to acquisitions in the air and maritime transport, financial and professional services (including insurance, legal services, audit and accounting, and architectural services), and fishing sectors, among others.

Pre-admission formalities and legal incorporation of companies

Preliminary evaluations of investment projects. CRUIs are tasked with carrying out preliminary economic, social, environmental and urbanistic and employment-creation related evaluations of investment projects submitted by investors. Law 47-18 does not confirm whether this evaluation constitutes an establishment pre-condition for foreign – or all – investments, although information provided by CRI websites (e.g., the Tanger-Tetouan-Al Hoceima CRI) suggests that these might be. Similarly, the Law is not clear as to whether this requirement is relevant to all investment projects, or only those seeking to benefit from investment incentives. The basis upon which these evaluations are carried out is clarified neither by way of regulation nor via the CRI-Invest Platform, which negatively hinders the transparency of the establishment process.277

Legal incorporation of companies. CRIs provide information and support to investors to facilitate the legal incorporation of companies. These services are provided by the CRIs themselves, rather than through the CRI-Invest Platform. Many of their websites feature specific company incorporation portals. In their great majority, these outline the pathway for legal incorporation (e.g., the Rabat-Salé-Kénitra CRI, the Guelmim Oued-Noun CRI and the Casablanca-Settat CRI portals). Some also offer company establishment guides (e.g., the Oriental CRI “Setting up a company” guide). When these are featured, they outline in varying degrees the: (i) documents required and formalities relevant for each company incorporation step; (ii) administrations involved at each of these steps; (iii) timeframes and fees associated with these formalities; and the (iv) types of companies and legal forms available under Moroccan law, the procedural requirements and formalities required for their establishment, as well as the factors which investors should consider when deciding upon the most suitable form of incorporation for their business. Different legal entities are available to both Moroccan-owned businesses and foreign-invested enterprises, including partnerships and joint-stock companies, among others.278

Some CRIs also facilitate company incorporation services and formalities via their websites, e.g. by providing access to administrative forms relevant to company incorporation procedures (e.g., the Guelmim Oued-Noun CRI, the Marrakech Safi CRI and the Fes Meknes CRI); by featuring online simulation tool designed to assist investors in choosing the company form best suited to their business needs (e.g., the Fes Meknes CRI). Other CRI websites feature company incorporation portals which allow investors to create an account with the CRI for the purposes of setting up their business and/or book a “business creation” appointment with a CRI advisor (e.g., the Marrakech Safi CRI, Tanger-Tetouan-Al Hoceima CRI and Casablanca-Settat CRI). It is unclear whether these CRI-specific services and/or portals will in time be merged with the CRI-Invest Platform.

Table A A.3. Facilitating company incorporation in Morocco

Steps	Relevant public administration
Negative certificate application*	CRI or via the official government business creation and support platform (“Direct Entreprise”)
Filing of company’s incorporation documents and other registration formalities**	Regional tax authorities representation within the relevant regional CRI; alternatively, online
Business tax application	Regional tax authorities representation within the relevant regional CRI
Commercial Registry	Commercial court (appointment online)
National Social Security Fund (CNSS) affiliation	For Moroccan investors: with their affiliated CNSS; unclear for foreign physical or moral persons
Official Bulletin publication	Through the Official Bulletin, online

Note: *required for all commercial companies except sole proprietorships; **required for public limited companies, limited liability companies, general partnerships, limited partnerships, and partnerships limited by shares.

Source: OECD compilation based on CRI websites (as and when available); non-exhaustive.

Facilitation of business operation by foreign investors

Regional CRUIs may rule or give their opinion or assent in respect of administrative acts required for the realisation of investment projects, in accordance with requirements and procedures in force.279 Law 47-18 provides a list of the matters which CRUIs may issue such decisions upon. The operation authorisations which CRUIs are mandated to consider, as listed exhaustively in Law 47-18, fall within three general categories: land-related authorisations, planning permissions, and operating licences and permits.280 The CRI-Invest Platform outlines these authorisations, as well as the formalities and documents required to successfully complete them, the regulatory frameworks relevant to them, and an estimate timeframe for their successful completion.281 Law 47-18 also requires that CRIs prepare a manual which outlines the procedures, formalities and documents relevant to investment-related operation authorisations;282 these were at the time of writing in September 2023 not publicly available. Investors submit their investment file applications directly via the Platform, with the assistance of a CRI advisor, based on the CRI-Invest platform User Guide. These must provide information relating to the investor and the investment (e.g., the industry specific to the projected investment, the description of the investment, the total value of the investment, employment-creation expected as a result of the investment, among others) as well as the authorisations required for the realisation of the investment project.

Separate to those acts and authorisations, activities in a number of sectors are regulated and require a prior authorisation. Two out of the twelve CRIs provide information as to these authorisations (e.g., the Tanger-Tétouan-Al Hoceima CRI). A CRI-affiliated SME support platform also provides a list of regulated activities requiring prior authorisations; it refers to the legal instruments relevant to each of these regulated activities and outlines the pre-conditions and formalities related thereto as well as the competent authorities. Investors may also require licences, permits and other authorisations for the realisation of their investment projects. In that regard, investors may refer to the Rokhas.ma platform for economic authorisations (autorisations à caractère économique) and urban planning permits. The platform allows for the submission of applications to the competent authorities and the receipt of authorisations directly via user portals. The Idarati national platform also provides standardised information on all formalities and requirements relevant to administrative acts issues by public bodies and authorities, at national and regional level (procedural steps, relevant authorities, documents required, estimate timeframes, fees).283 A significant number of these administrative acts have been identified by way of decree, adopted in May 2023.284 Law 55-19 requires that electronic applications for administrative acts be made available on adequate platforms by 2025. Morocco is currently working on the development of a unified national platform with a view to digitalise procedures and formalities.285 It is understood that investors are in the meantime required to submit their applications directly to the relevant authorities.286

Transparency and predictability of the Moroccan Investment Incentives Regime

The 2022 Investment Charter introduced four new investment incentives schemes (dispositifs de soutien à l’investissement) which repeal and replace the previous incentives schemes provided for under the 1995 Investment Charter.287 These include a Primary Incentives Regime which encompasses Common, Territorial and Sectorial Premiums; and three separate schemes relating to strategic investment projects (projets d’investissement à caractère stratégique); medium and small enterprises; and Moroccan businesses expanding into the international market.288 As per the calendar set out in the 2022 Investment Charter, Decree 2-23-1 and three Orders were adopted to implement the Primary and the Strategic Investment Projects Incentives Scheme in February and March 2023.289 Two additional decrees are foreseen for the implementation of the two remaining specific incentives schemes.290 This section sets out the investment incentives available under the Moroccan legal and regulatory framework, their eligibility requirements, and the application requirements and process related thereto.

Types of available incentives and eligibility conditions

Schemes may be cumulated with specific and separate incentives offered at regional level,291 and additional sectoral incentives may be relevant to specific investment projects, on a case-by-case basis. Incentives under the Strategic Investment Projects Incentives Scheme cannot however be cumulated with Primary Incentives Regime incentives.292 The three premiums available under the Primary Incentives Regime may be cumulated up to a limit of 30% of the total amount of the investment.293 Investment projects eligible under the Primary Incentives Regime must fulfil either one of the two following conditions: a MAD 50 million investment value and generate 50 to 149 employments; or generate a minimum of 150 employments, independent of investment value.294 Eligibility criteria and details of how premiums are calculated and applicable rates are set out in Decree 2-23-1.295 Separately, investment projects may qualify under the Strategic Investment Projects Incentives Scheme if their total value equals or exceeds MAD 2 billion and if they fulfil the pre-conditions set out in Decree 2-23-1, e.g., the investment project’s foreseen contribution to ensuring water, energy, food and health security, and employment-creation.296 Investors undertaking investments that fulfil the Scheme’s eligibility conditions may negotiate tailored advantages.297

CRIs are, under Law 47-18, missioned with preparing and making available to investors guides outlining the Investment Regimes and Schemes and their eligibility conditions. The contents of these guides are to be harmonised across CRIs to ensure that consistent services are provided to investors. These have not seemingly been published yet, but an Investment Charter Guide was published via the AMDIE’s website in June 2023. It among others outlines each of the investment incentives schemes, their respective objectives and their eligibility conditions. The CRI-Investment Platform also outlines the available investment incentives schemes, their eligibility conditions and requirements, as well as steps involved in the application process to obtain access to such incentives. However, the websites of some CRIs (e.g., the Tanger-Tetouan-Al Hoceima CRI) have not yet been updated to reflected the reforms brought about the 2022 Investment Charter.

Procedural requirements and processing of applications

CRUIs are specifically mandated with the preliminary evaluation of the eligibility of investment projects under the Investment Incentives Regime and issue opinions as to whether investment projects may benefit from advantages thereunder, regardless of the value of the investment project.298 This review results with the granting by the CRUI of an administrative act, required before proceeding with their applications for advantages under the Primary Incentives Regime.

Investment Agreements are concluded between the Government and investors and govern the terms and conditions of benefits granted under the investment incentives regime (save for incentives for MSMEs).299 These are not made publicly available. Their core features and contents are clearly defined by Decree 2-23-1,300 and they are elaborated, subject to approval and signed either at the regional level or at national level by the CNI, depending on total value of the investment. The conclusion of Investment Agreements also provides access to additional benefits and advantages, including tax- and customs-related, in accordance with the relevant laws and regulations.301 These are not set out in the 2022 Investment Charter.

Premiums are paid in instalments on the basis of an investment project’s progress, the total timeframe of which should not exceed five years, unless stipulated otherwise in a given Investment Agreement.302 In the event of default under the specific terms and conditions of an Investment Agreement, investors are required to refund the advantages and/or investment premiums granted to the investment project to the Government, within the framework of either the Primary Incentives Regime or the Strategic Investment Projects Incentives Scheme.

Table A A.4. Investment agreements under the Primary Incentives Regime and the Strategic Investment Projects Incentives Scheme: attribution of powers and mandates between competent authorities

Total value of investment	< MAD 250 million	> MAD 250 million	IPSN (i.e., x ≥ MAD 2 billion)
Competent authority	Regional level – CRIs / CRUIs	National level – CNI
Role of the competent authority	Carry out a preliminary review of investment projects’ eligibility* Issue opinions on investment projects’ access to advantages to incentives regime* Prepare approve and conclude Investment Agreements with investors**	Prepare approve and conclude Investment Agreements under the Primary Incentives Regime and the Strategic Investment Projects Incentives Scheme Determine the strategic nature of investment projects under the Strategic Investment Projects Incentives Scheme

Source: OECD compilation based on the 2022 Investment Charter and its implementing decrees; non-exhaustive.

Tunisia

Investment climate in Tunisia: a practical overview

Over the years, Tunisia has made considerable efforts to open its economy to foreign investment. The country adopted its first Investment Code in 1969 and created its Agency for the Promotion of Industry and Innovation (APII) the same year. Structural reforms initiated in the late 1980s to enhance Tunisia’s attractivity to foreign investors culminated with the adoption of a new Investment Incentives Code in 1993 and the subsequent establishment of the Foreign Investment Promotion Agency (FIPA) in 1995.

As a result, FDI inflows in Tunisia gained traction and reached their peak in 2006 at USD 3.2 billion, representing more than 9% of the country’s GDP recorded at the time.303 Economic drawbacks caused by the Global Financial Crisis, and internal political disruptions linked to the Tunisian Revolution considerably impacted FDI inflows into the country, which have been generally decreasing since 2012 despite showing some signs of recovery in 2017 and 2018. External shocks resulting from the COVID-19 pandemic in 2020 brought about additional contraction in terms of FDI inflows (Figure A A.9).

Figure A A.1. FDI inflows in Tunisia (1990-2021)

Source: OECD elaboration from IMF (FDI inflows data from the Balance of Payments and International Investment Position Statistics) and World Bank (GDP data).

As for the other five countries of the Southern Neighbourhood, foreign investors in Tunisia appear to stem essentially from the EU and from the MENA region. In 2021, investors from the EU (48%) – principally from France, Italy, Germany and Spain, and from the MENA region (40%, from the United Arab Emirates and Qatar essentially) held nearly 90% of the total FDI stock in the country in non-energy activities (Figure A A.10).

Figure A A.2. Origins and total value of inward FDI stock in Tunisia (2018-2021)

Note: Due to data availability reasons, the FDI stock data by origins excludes the energy sector. Total FDI stock based on reported international investment positions.

Source: OECD elaboration based on FIPA (Rapports annuels des IDE) and IMF (International Investment Positions).

FDI were historically geared towards the energy, manufacturing, and services sectors. In 2018, a notable shift occurred, with the manufacturing sector receiving 41% of total flows to Tunisia. The trend has persisted since, with manufacturing activities attracting an increasing amount of share of greenfield investment compared to the years before the financial crisis,304 creating opportunities for FDI to create better-paid and higher-skilled jobs.305

In global indicators developed to assess local business environments, Tunisia fared relatively favourable in comparison to its regional peers, but poorly by international standards.306 Although a positive consensus appears to exist with respect to the facilitation of pre-establishment matters such as the declaration of investment projects and the setting up of businesses, the main constraint systematically referred to by Tunisian entrepreneurs is access to financing, dealing with tax authorities and administrative burdens.307 More than a quarter of domestic and foreign-invested firms surveyed by the World Bank in 2020 have also identified business licensing and permits as a major constraint of the country’s business and investment climate.308

In recent years the Tunisian government has conducted efforts aimed at simplifying business procedures and attracting foreign investment. In that regard the in 2016 established Investment Law provides for a relatively open environment for investments and sets a framework for streamlining the administrative processing of applications through timeframes and online submission portals.309 In the same light, more recently, Tunisia has made the improvement of its business environment a national priority, as reflected by its Development Plan 2023-2025 and has announced a number of reforms, some of them relating to investment facilitation, in the comprehensive “National strategy to improve the business climate”, presented in January 2023.310

General institutional framework for investment in Tunisia

Tunisia stands out among the other five Southern Neighbourhood countries in that it operates more than one IPA. Tunisia’s IPAs carry different, albeit at times overlapping roles. Two principal agencies feature investment facilitation mandates.311 The Tunisian Investment Authority (Instance Tunisienne de l’investissement, TIA) was established further to the adoption of the new Tunisian Investment Law in 2016 (2016 Investment Law or Law).312 The TIA operates above and together with a number of other agencies, whose respective mandates were not reconsidered further to the adoption of the Law, including the Agency for the Promotion of Industry and Innovation (Agence de Promotion de l’Industrie et de l’Innovation, APII). The TIA was originally established with the objective of integrating and replacing pre-existing IPAs, the main of which is APII. The TIA’s and the APII’s mandates are complementary but do not offer the same range of facilitation services for those investment projects that fall within their respective mandates, and investment facilitation for projects which fall under the TND 15 million capital threshold313 – and outside of the TIA’s mandate – is therefore limited. Based on stakeholder consultations, the vision of the TIA’s new Director General is that the TIA’s digital platform should work as unique front-office for all investors, while back-office functions are still to be carried out by other agencies. The respective mandates and missions are considered in this section. Other sector-specific entities also offer some limited and sector-specific investment facilitation services; these are not considered in this Country Section.314

Tunisian Investment Authority (TIA). The TIA was established by the 2016 Investment Law; its governance and mandate were further detailed in the subsequent Government Decree 2017-388 of 9 March 2017 (Decree 2017-388).315 The TIA endorses a number of mandates, including investment policy advocacy among others. It is also features specific investment facilitation missions, namely: reviewing and deciding upon investment incentives applications; and, through a Commission for licences and approvals (Commission des autorisations et agréments), deciding upon all applications for chiefly operation approvals and authorisations necessary for the realisation of investments.316

Decree 2017-388 provides in that regard that the TIA “may delegate the supervision of investment operations whose value is equal to or inferior to TND 15 million to [the relevant bodies], and that until the time the TIA is established and carries out all of its missions”.317 At the time of writing in September 2023, no decree, order, or other legal instrument has indicated that this transitional period and ensuing delegation of mandate had terminated. Instead, the TIA website confirms capital-based split and complementary mandates between the TIA and other investment promotion agencies, including the APII.318 Stakeholder consultations, have confirmed that the current working arrangement between the TIA and the APII is that the APII is responsible for all industrial investment project which fall under the TND 15 million capital threshold, except if they fall within any of the mandates of other sector-specific agencies.

A single interlocutor (interlocuteur unique de l’investisseur) operates within the TIA to assist domestic and foreign investment projects and facilitate all stages of establishment and operation phases. The TIA’s single interlocutor carries out on behalf of investors the establishment administrative procedures relevant to the incorporation of companies and the mandatory declaration of investments as well as other operation authorisations, and addresses all investor queries and creates a public database of frequent queries and issues raised by investors relevant to the investment process.319 The TIA showcases its services through its website, which among others outlines the investment process stages from start to finish and provides download links for administrative documents relevant to investment-related formalities (e.g., legal incorporation of companies, investment declarations). The TIA’s Investor Guide platform similarly provides practical information on the administrative formalities relevant to establishment and operation phases and requirements and provides the contact details of TIA staff mandated to assist investors at every step of the investment process.

The Agency for the Promotion of Innovation and Industry (APII). The mandate of the APII predates the 2016 Investment Law and is concerned with the implementation of the Tunisian government’s policies relative to the promotion of the industrial sector.320

The APII’s OSS (guichet unique) operates both out the APII head office in Tunis and via its regional offices. The agency’s website provides contact details to each of the headquarter and regional OSS. The APII OSS’s membership includes representatives from a number of investment-related authorities and administrations, including the tax authorities, the Official Printing Office, customs authorities, the Commercial Registry, among others.

The mandate of the APII’s OSS is showcased on its OSS online portal, and principally concerns facilitating procedures and providing guidance to investors with respect to investment declarations and company incorporation.321 Formalities relating to these procedures and requirements can be processed in part via APII dedicated portals (the online investment declaration portal, and separately, the online pre-legal incorporation of companies portal, available only to certain types of companies). Within the APII operates a Single Contact Point, established in collaboration with the Tunisian Ministry of Finance in 2006, which is specifically and exclusively mandated with carrying out on behalf of investors the procedures and formalities relevant to company incorporation within 24 hours of receipt. The APII does not, under the current institutional framework for investment, facilitate any post-establishment authorisations and formalities or access to investment incentives. This suggests that facilitation measures for projects which fall under the TND 15 million capital threshold is limited.

Higher Council for Investment. The Higher Council for Investment (HCI) was established by way of the 2016 Investment Law. It is headed by the Prime Minister and its membership includes Ministers whose respective jurisdictions are relevant to investment.322 The HCI’s mandate is closely linked to the investment incentives regime; among others, the HCI is responsible for assessing investor applications for incentives, while decisions for the granting or refusal of investment and incentives and the implementation of investment incentives are dealt with at other levels of the Government and/or administrative entities. Based on stakeholder consultations, it does not convene on a regular basis.

Transparency and predictability of the Tunisian legal framework for investment

This section considers Tunisia’s investment framework and those measures which the country has adopted for facilitating investment, including with respect to accessibility to and transparency of the country’s legal and regulatory framework for investment, establishment restrictions and conditions, and operation authorisations; and the manner in which investment-related procedures are streamlined.

Legal and regulatory framework for investment. Tunisia overhauled its legal framework for investment with the adoption of the 2016 Investment Law. Save for specific provisions principally concerning incentives schemes, the Law repealed and replaced the Investment Incentives Code of 1993 which previously governed foreign investment activity in the country.323 The 2016 Investment Law rests on two core pillars: the reform of the investment governance structure and the creation of several investment governance entities among which a new IPA, the TIA; and the introduction of a new investment incentives regime (Investment Incentives Regime).

The 2016 Investment Law, its implementing decrees and related instruments324 together define the legal regime for domestic and foreign investors across economic sectors, and applies to greenfield investments as well as acquisition and ownership operations of enterprises in Tunisia.325 It establishes the general principle of freedom of investment, and sets out that foreigners enjoy a treatment under the Law no less favourable than that enjoyed by domestic investors in.326 It guarantees the protection of investor assets against unlawful expropriation and their intellectual property rights and the right to transfer funds related to investment projects.327

Transparency and predictability. Tunisia’s laws, regulations, decrees, governmental decrees, ministerial orders and notifications, among others, are published in the Official Journal (Journal Officiel de la République Tunisienne, JORT) and freely accessible through the website of the Official Printing Office of the Republic of Tunisia, the Imprimerie Officielle de la République Tunisienne. The Official Journal’s and the Official Printing Office’s official language is Arabic, and French translations of the Official Journal are available through the same website portal (also available in French). English translations of the Official Journal are only available for some instruments. Both the TIA and the APII websites outline the principal legal and regulatory instruments of the Tunisian investment framework. The latter also features a number of Fact Sheets, available in Arabic, French and English, which shed light on specific features of the 2016 Investment Law and the newly introduced Investment Incentives Regime.

The Tunisian legislator is required as per its new internal regulations to publish proposed texts and bills on its website.328 However, the portal is currently not operational, and it remains at the time of writing in September 2023 difficult to assess whether under the Tunisian legislative framework, laws and regulations – or alternatively, documents that provide details about such upcoming instruments – are published in advance, and whether specifically, drafts of the 2016 Investment Law were made publicly available prior to the Law’s adoption.329 It is also unclear whether documents outlining the purpose or rationale of the new investment framework were published prior or after the adoption of the Law. The Tunisian Assembly is required to conduct public consultations over questions deemed “essential and which determine strategic choices”.330 Official government sources do not directly confirm whether such consultations were carried out. However, based on an official presentation prepared in the context of a presentation carried out by Members of Parliament members of the Committee on Finance, Planning, and Development, dated February 2016,331 over 1500 private sector, public sector, international organisations and non-governmental organisations stakeholders were consulted, as well as regional authorities and committees. The consultations were undertaken between 2012-2013, and subsequently, in 2015. Information as to outcomes of this consultation process, and its impact on the adoption of the final text of the 2016 Investment Law is not publicly available. The legislation was adopted on 30 September 2016, published in the Official Journal on 7 October 2016, and subsequently entered into force on 1 April 2017, thereby allowing a reasonable time between its publication and date of compliance by investors.

Streamlining measures. Tunisia has adopted legislation with a view to enhance the transparency and predictability of its investment framework and streamline authorisation procedures. These are enshrined chiefly in Law 2019-47 and Government Decree 2020-310 of 15 May 2020 (Decree 2020-310),332 and are summarized in Box A A.2. Unless specified otherwise, they apply to both establishment and operation procedures.333

Box A A.2. Streamlining of authorisation procedures, transparency, and predictability

Tunisia has adopted a number of overarching measures which bind “Public bodies” and seek to improve the country’s business climate by enhancing transparency, reducing procedural timeframes, and streamlining procedures for company incorporation and more generally, all of those procedures relevant to investors and businesses, including by way of Law 2019-47, which among others amended the 2016 Investment Law. Based on stakeholder consultations, implementation of Law 2019-47 remains an issue.

Decree 2020-310 established a Commission for the monitoring and coordination of administrative streamlining mechanisms for investors and businesses and working groups within each Ministry that is concerned with investment, entrusted with monitoring the implementation of the Government Decree.334

Table A A.5. Authorisation procedures in Tunisia: streamlining, transparency and predictability

Streamlining of authorisation procedures	Transparency and predictability
Coordinate and share among themselves up-to-date documents which they either hold or are entrusted with issuing, as well as information and data relevant to process investor applications for the realisation of investments, an authorisation to carry out an economic activity, an investment declaration, or company incorporation	Make available and regularly update, through the Ministries’ and Public bodies’ online portals, all of the information relating to the conditions, timeframes and completion of administrative procedures relevant to investors and businesses
Refrain from requesting from investors any administrative documents not required under the applicable laws and regulations	Make available relevant cahiers des charges online for download
Refrain from requesting from investors documents they may already have in their possession/which can be provided by other Public bodies	Investors may correct documents, information, or data in event of error
	Liaise with investors by way of written notice
	Make available online payment options for administrative fees
	Allow investors to follow the review of their applications online
	Paperless administrative forms for investor and businesses applications

Source: OECD compilation based on Law 2019-47 and Government Decree 2020-310; non-exhaustive.

Facilitation of business establishment by foreign investors

• Restrictions to foreign investment

Restrictions on foreign investments apply in several sectors, as set out by sector-specific legislation and commercial legislation, among others, rather than consolidated in a negative list, which negatively impacts the transparency of the investment framework.335 This significantly hampers the transparency of the investment framework insofar as restrictions to foreign investment are concerned in terms of accessibility to applicable legislation, and the processes by which exemptions – if and when applicable – may be obtained.336

These restrictions include foreign equity limits to acquisition and/or greenfield investments in agriculture, transport, fishing and aquaculture, telecommunications and financial services, among others. A number of foreign investment restrictions are also provided under Annex 1 of Decree 2018-417.337 These appear to partially overlap with restrictions relating to foreign nationals and foreign legal entities carrying out certain commercial activities – including in the sectors of wholesale and retail distribution, media, telecommunications – prior to obtaining “foreign merchant card”. Further, a number of commercial activities are also barred to foreigners and foreign investors, and that unless an exemption is granted by the Secretary of State for Planning and Finance.338

• Pre-admission formalities and legal incorporation of companies

As outlined above, the TIA’s and the APII’s respective mandates are complementary on the basis of a capital threshold of TND 15 million, and both entities operate OSS or single interlocutors that facilitate a number of investment procedures, including establishment formalities and requirements.339 Establishment formalities are broadly split into successive stages: the declaration of an investment project, followed by company legal incorporation. The granting of an “investment declaration certificate” is a necessary pre-condition to the incorporation of a company.

Investment projects declarations. The 2016 Investment Law requires that investment declarations and company legal incorporation of companies be carried out on the basis of a single set of administrative forms (liasse unique),340 and that the TIA’s single interlocutor provide investors with their investment declaration certificates and the documents pertaining to the incorporation of their company within one working day of the date of deposit of the complete investment declaration. Specifically with respect to investment declarations, both the TIA single interlocutor and the APII OSS provide investors whose investment’s fall within each of IPAs respective mandates information pertaining to the timeline of the process, forms to be considered and filled out and fees to be paid. Both IPAs also provide for the electronic submission of investment declaration applications through the APII’s dedicated investment declaration page and through the TIA’s dedicated investor portal.

Legal incorporation of companies. Similarly, both the TIA’s single interlocutor and the APII’s OSS provide investors with information relevant to the legal incorporation of companies. Both IPAs also provide online services for the legal incorporation of companies. The TIA manages this through the same dedicated investor portal. The APII assists investors with the legal incorporation of companies, either through its OSS or via the APII’s single intermediary which carries out the relevant legal incorporation formalities on behalf of investors within 24 hours of receipt of a full application. The APII also offers an online pre-legal incorporation of companies portal for certain types of companies only, with a view to expedite the formalities investors are required to complete in person at the APII OSS.

In that regard, foreign-invested enterprises can register under the same commercial forms available to Tunisian-owned businesses. These include partnerships (societés en nom collectif, societés en commandite simple, joint ventures), limited liability companies (limited liability companies and single-member private limited companies) and joint stock companies (limited companies, joint stock companies and open joint stock companies).341

Facilitation of business operations by foreign investors

The 2016 Investment Law has introduced a list of sectors in respect of which both domestic and foreign investors may require licences and authorisations to carry out certain activities. Decree 2018-417 outlines the administrative procedures relevant to obtaining operational licences and other authorisations,342 with a view to simply and clarify business – and investor – relations with public authorities and administrations. More specifically, it sets out: a comprehensive list of all the economic activities subject to authorisation (a total of 100 activities; Annex 1), a list of administrative authorisations required for the realisation of certain investment projects (143 authorisations; Annex 3), and a list of activities for which pre-authorisations are required (27 activities; Annex 4). Activities within these controlled economic sectors which are not specifically cited in Annex 1 are in principle considered open to private investment activity. Each of these lists is organised on the basis of economic sectors categories, namely: natural resources; land, maritime and air transport activities; financial services (banking, insurance, and securities trading); dangerous or polluting industries; health; education; telecommunications; and certain commercial activities and services.343

Stakeholder consultations have clarified that the overall objective of Decree 2018-417 is to gradually review the Annex 1 list to ultimately establish a limited negative list of sectors where prior authorisations are required. Indeed, the enactment of Decree 2019-417 ended another 27 authorisations, and an additional 13 activities were exempt from licensing conditions further to the enactment of Presidential Decree 2022-317.344 Stakeholder consultations have signalled that additional exemptions are expected to enter into force.

The common procedural framework established further to Decree 2018-417 seeks to streamline the processing of authorisations with a view to enhance the predictability of the framework. The lists set out in each of the Annexes define the pre-conditions and supporting documentation, competent authorities, indicative timeframes and legal frameworks relevant the authorisations. When timeframes for the processing of investor authorisations are not clearly set out, the Decree sets a general timeframe of 60 days for the processing and issuing applications for licences or permits, extendable by 90 additional days in instances where the application requires the assessment of several administrative authorities, or to 180 days if the application requires the approval by the HCI – the conditions or basis upon which the HCI’s approval is specifically required are however not clarified.345 Negative decisions must be motivated and grounds for refusal notified in writing;346 recourse or appeal mechanisms are however not available to applicants.

Authorisations required for the realisation of investment projects whose capital value exceeds TND 15 million are processed through the TIA Commission for licences and approvals.347 The Commission, whose membership includes relevant ministries and public bodies, operates within the TIA and is directly responsible for reviewing, deciding upon and ultimately issuing applications for these authorisations, in coordination with the relevant competent authorities, with whom it is required to liaise according to defined procedures and within specified timeframes.348 The TIA also provides general assistance and guidance to qualifying investors and investments with respect to the entire operation process. In that regard, the TIA Investor Guide provides a general overview of the licensing requirements, the relevant procedures to obtain them and the contact details of dedicated TIA staff and liaison officers. The TIA’s dedicated investor portal is also expected to provide online services for investment incentive and authorisation applications. It is not clear whether this feature was at the time of writing in September 2023 operational.

The Law also sets out an overarching ‘tacit approval’ procedure, whereby a complete authorisation application which has not been explicitly denied by the relevant competent authorities within the pre-defined processing timeframe is deemed approved. In such instances, investors – regardless of the capital value of their investment, i.e., including investments falling under the TND 15 million threshold and that do not fall within the scope of the TIA’s facilitation mandate – may apply directly to the TIA to obtain the requested authorisation, following a process and timeframes clearly set out under Decree 2018-417.349 Aside from this ‘tacit approval’ mechanism, the procedural and institutional arrangements for operation authorisations for projects whose capital value falls below the TND 15 million threshold and outside of the TIA’s mandate is limited, and investors are expected to submit their authorisation applications directly to the relevant competent authorities.

Transparency and predictability of the Tunisian investment incentives regime

Prior to the adoption of the 2016 Investment Law, Tunisia’s framework of investment incentives was severely fragmented, featuring over 20 separate mechanisms which had been amended numerous times over the years. The schemes were characterised by their protracted procedures, which hindered the overall effectiveness of the promotion schemes.350 With a view to facilitate investor access to investment incentives, the 2016 Investment Law reorganised and clarified Tunisia’s framework for investment promotion.

The TIA is expected to publish a practical guide on the Investment Incentives Regime in Tunisia, specifically on the process to obtain them and on post-approval stages.351 No such document appears to have been published as at the time of writing in September 2023, although the TIA’s online Investor Guide provides an interactive platform featuring a succinct overview of the different types of incentives available to investors at the regional and national levels. The Investor Guide offers information on the value of incentives, relevant procedures, and contact details of a dedicated TIA liaison officer. It does not however specify in any detail the conditions for obtaining incentives or provide practical information on any post-approval processes, which hinders the transparency of the investment framework insofar as investment incentives are concerned.

Types of available incentives and eligibility conditions. The Tunisian Investment Incentives Regime offers a wide array of financial and fiscal investment incentives to eligible foreign investors, ranging from tax deductions to customs exemptions, loans, grants, or leases of state land. The 2016 Investment Law introduced a new investment incentives regime which consists of four distinct schemes underpinned by well-defined rationales, three of which are available to foreign investors – namely:352

• “Premiums” for eligible activities, which are in turn divided in four separate categories: (i) premiums for the increase of the value added and competitiveness of the Tunisian economy; (ii) premiums for projects contributing to regional development; (iii) premiums for the projects with high employment capability; and (iv) premiums for projects contributing to sustainable development;353

• Loans for the purchase and development of agricultural land;354 and

• Incentives for qualified “projects of national interest” (PNI).355

Eligibility to, as well as the procedure and institutional arrangements for requesting and being granted incentives, are principally detailed in Decree 2017-389356 and its accompanying Joint Ministerial Order of 2017.357 The Investment Law 2016 sets out practical considerations for the obtention of incentives: they may be individually granted to investors, cumulated – subject to specific conditions and thresholds358 – or awarded through a bundled package.359 The Law also explicitly provides for the possibility for investors to change incentives scheme, provided they complete the necessary administrative steps to that effect.360

The primary eligibility condition of an investment project to incentives concerns its economic sector or activity:

• Direct investment projects eligible to premiums for the “increase of added value and competitiveness”361 and to some premiums for the “development of employability capacity”362 are confined to “priority sectors”. Priority sectors, which are considered strategic to the economic development of the country, are set out in a positive list in the Decree 2017-389 (Annex 1, I).363 They include industry, agriculture, high technology, research and development, and labour-intensive fields, inter alia.364 The second list of economic sectors annexed to the Decree 2017-389 (Annex 1, II) concerns activities that are eligible only to premiums for the improvement of added value and competitiveness, including extractives.365

• Activities eligible to premiums for regional development are framed by a negative list annexed to the Decree 2017-389 (Annex 1, III) which sets out sectors barred from obtaining these premiums. They include extractive industries, financial and insurance activities, telecommunication services, wholesale and retail trade, non-renewable electricity generation and distribution, and transport services, among others.366

• Premiums for sustainable development are specifically geared towards water and air pollution control projects; projects applying green technologies to prevent pollution at its source or to control the exploitation of resources; and projects involving the installation of collective depollution equipment.367

Additional eligibility conditions for incentives may include the geographic location of the investment project, especially for incentives geared towards regional development, or even professional qualifications.

The eligibility of a project to qualify as a PNI is not assessed by reference to a positive – or negative – list of sectors or activities. Rather, PNI scheme eligibility is conditioned upon a minimum investment capital requirement, performance requirements in terms of employment of local workers, and their contribution to national economic priorities, subject to the discretionary appreciation of the relevant authorities.368

Further, the 2016 Investment Law provides information with regards to the capital amount of incentives available to investment projects and their practical implementation (duration and disbursement of funds especially).369 The total amount of promotion incentives a project may receive is often subject to a maximum capital ceiling,370 and the amount each incentive depends on the general project or the implementation costs for which it is specifically granted.371

Procedural requirements and processing of applications. The 2016 Investment Law provides, as a preliminary condition, that requests for incentives may be submitted only one year from the date of the declaration of an investment project. Two distinct procedures exist for the granting of incentives: one for PNI, and a separate procedure for all other incentives available under the Investment Incentives Regime (premiums, equity participations and agricultural land loans, respectively):

• For projects of national interest: incentives are effectively granted further to the adoption of a governmental decree, following the recommendations formulated by the HCI and the TIA on the applications for such incentives.372

• For other incentives: premiums, equity participations and agricultural land loans are granted further to a “decision of the Minister in charge of the sector or their delegate”. Decisions to grant these incentives are based on a preliminary assessment of applications by the commissions established within the relevant authorities.373

The Law and its implementing instruments frame the administrative processing of applications as well as the competent authorities’ discretion in their assessment thereof with a view to reduce the potential for arbitrary or discriminatory outcomes. This is done by:

• Setting a detailed list of documents required for the applications for incentives under Decree 2017-389, thereby limiting the possibility for authorities to request additional supporting documentation or to impose additional conditions upon investors to obtain incentives.

• Defining clear timeframes for the processing of applications by the relevant authorities. Granting or refusing applications for incentives must be decided within one month of the filing of a complete application,374 and investors must be notified of the results of the committee’s deliberations within seven days as of signing the decision by the competent minister.375

• Requiring that decisions which reject a request for incentives be clearly motivated and grounds for the refusal of an investor’s application be explicitly mentioned.376

• Allowing investors to request the review of decisions refusing to grant incentives within 30 days from their issuance. In case of review, the application for incentives is referred to the same commission that carried out its first assessment and may be supplemented by additional documentation.377

The HCI is responsible for the assessment of applications for the project of national interest incentives scheme.378 The assessment of investor applications with respect to the remainder of the schemes falls within the mandate of special commissions at national and regional levels, which were established within relevant authorities (the TIA, and more specifically, its pôle des primes et des incitations and pôle de l’évaluation et du contrôle des primes et des incitations; APII, APIA, ONTT).379 The allocation of tasks between these authorities is contingent upon the economic sector relevant to a given investment, as well as the investment capital.380

These commissions are also responsible for re-examining applications for incentives when decisions refusing to grant incentives are challenged by investors. Final decisions to grant or refuse incentives to an investment project are taken, further to recommendations formulated by the competent assessing authorities, either at government level with respect to projects of national interest incentives,381 or ministerial level with respect to all other incentives.382

The release of approved premiums is subject to detailed rules and procedures under Articles 12 to 14 of the Decree 2017-389. Their disbursement is separated in two separate stages, subject to an assessment by the relevant authorities of the implementation of the project based on supporting documentation and on-site visits by representatives of relevant sectoral agencies.

Promoted investments are subject to the scrutiny of relevant administrative authorities following Article 21 of the 2016 Investment Law. Investors are required to report annually to the relevant authority on the effective implementation of the investment project.383 Incentives may be withdrawn by the TIA384 in defined situations as set out under Article 20, especially if the investment project is not carried out within four years of the investment declaration,385 or in case of illegal misappropriation of the initial object of the investment. The withdrawal of incentives may be accompanied by sanctions, especially in case of delays in their reimbursement by the investor.386

Notes

← 1.  Ministerial order dated 28 September 2022 portant nomination des membres du conseil d'administration de l'agence algérienne de promotion de l'investissement.

← 2.  Interministerial order dated 24 November 2022 fixant l'organisation interne de l'agence algérienne de promotion de l'investissement.

← 3.  AAPI’s role and mandate are outlined on its website. The website contains information on Algeria and its investment opportunities, a presentation of AAPI, and information essential for investors such as the various incentive schemes, OSS services, forms to fill out and a complaints register. The website also provides an online version of the 2022 Investment Law.

← 4.  In order to assist investors, guidelines are available online (in French and Arabic) outlining the different steps required to register an investment through the portal. Investors are required to create an account in order to access the guidelines.

← 5.  Decree 22-299 of 8 September 2022, Article 4.

← 6.  Article 37 of the AAPI Decree provides that “En attendant la mise en place des guichets uniques prévus par l’article 18 ci-dessus, les dispositions du présent décret ainsi que les effets induits par la période de transition sont pris en charge par le guichet unique décentralisé créé par l’article 22 de l’ordonnance n° 01-03 du Aouel Joumada Ethania 1422 correspondant au 20 août 2001”.

← 7.  2022 Investment Law, Articles 19-21 and AAPI Decree, Articles 18-26.

← 8.  2022 Investment Law, Articles 25. Registration consists of the issuing of a certificate, accompanied by a list of goods and services eligible for incentives.

← 9.  AAPI Decree, Article 19 and 2022 Investment Law, Articles 19-20.

← 10.  AAPI Decree, Article 20.

← 11.  AAPI Decree, Article 20.

← 12.  AAPI Decree, Article 26 para. 10. The designation of these additional administrative authorities requires a joint order issued by the Prime Minister, the Finance Minister, and the Authority in charge of civil servants (AAPI Decree, Article 6).

← 13.  2022 Investment Law, Article 16.

← 14.  Decree 22-297 of 8 September 2022 on the composition and functioning of the National Investment Council (in French), JORF, issue No. 60.

← 15.  2022 Investment Law, Article 17.

← 16.  Presidential Decree 22-296 of 4 September 2022 on the composition and functioning of the Higher National Commission of Appeals related to Investment (in French), JORF, issue 60.

← 17.  HCNRLI Decree, Article 6.

← 18.  Previously, the investment regime was governed by Investment Law 16-09 of 3 August 2016. However, the new 2022 Investment Law provides that the provisions of Law 16-09 are repealed (except for its Article 37). The executive regulations of Law 16-09 remain in force until the adoption of the executive regulations of the 2022 Investment Law (Article 40).

← 19.  2022 Investment Law, Article 2.

← 20.  2022 Investment Law, Articles 4-5.

← 21.  2022 Investment Law, Article 3.

← 22.  Decree 22-296 of 8 September 2022 on the HCNRLI (Decree 22-296); Decree 22-297 of 8 September 2022 on the CNI (Decree 22-297); and Decree 22-298 of 8 September 2022 on the AAPI (Decree 22-298).

← 23.  Decree 22-300 of 8 September 2022 on activities, goods and services ineligible to certain advantages and the minimum funding thresholds for remittance guarantee (Decree 22-300); Decree 22-302 of 8 September 2022 on incentives for high stakes “structuring investments” (Decree 22-302); and Decree 22-301 of 8 September 2022 on incentives for “zones of particular interest” (Decree 22-301).

← 24.  Decree 22-299 of 8 September 2022 setting out the procedures for investment registration, disposal or transfer of investments, as well as the procedures for the payment of investment applications (Decree 22-299); and Decree 22-303 of 8 September 2022 on the monitoring of investments and the measures to be taken in case of breaches of duties and commitments (Decree 22-303).

← 25.  See e.g., Algérie Eco, “Abdelouahab Ziani : « Le nouveau code de l’investissement va libérer et booster les investisseurs »”, 8 May 2022.

← 26.  See, OECD (2021), Middle East and North Africa Investment Policy Perspectives, OECD Publishing, Paris.

← 27.  See, OECD (2015), Policy Framework for Investment, 2015 Edition, OECD Publishing, Paris.

← 28.  2020 Complementary Finance Law, Article 49.

← 29.  Law 04-08, Article 25 and Decree 15-234, Article 4.

← 30.  Law 04-08, Article 4(2).

← 31.  Law 04-08, Article 24.

← 32.  Article 544 of the Algerian Commercial Code, amended by Law 22-09.

← 33.  Law 04-08 dated 14 August 2004 concerning the conditions of operation of commercial activities; Law 13-06 dated 23 July 2013 modifying and completing Law 04-08 dated 14 August 2004 concerning the conditions of operation of commercial activities; Law 18-08 dated 10 June 2018 modifying and completing Law 04-08 dated 14 August 2004 concerning the conditions of operation of commercial activities.

← 34.  Law 04-08, Article 4.

← 35.  Law 04-08, Article 5bis 1.

← 36.  Law 04-08, Article 5bis 2.

← 37.  Decree 15-57 on the storage and/or distribution of oil and gas products.

← 38.  Decree 14-165 on the wholesale trade of fishing and aquaculture products; Decree 13-176 on the manufacture, storage and distribution of lubricants and regeneration of waste oils; Decree 22-383 on the dealing of new cars; Decree 09-181 on the importation of raw materials destined for resale in its same state.

← 39.  Decree 22-384 on the construction of vehicles.

← 40.  Decree 14-153 on the opening and operation of laboratories.

← 41.  Decree 09-19 on the collection of special waste.

← 42.  AAPI Decree, Article 26.

← 43.  2022 Investment Law, Article 22.

← 44.  2022 Investment Law, Article 2.

← 45.  2022 Investment Law, Article 24.

← 46.  2022 Investment Law, Article 24.

← 47.  2022 Investment Law, op. cit., Articles 27, 29 and 31.

← 48.  2022 Investment Law, op. cit., Article 35.

← 49.  2022 Investment Law, op. cit., Articles 27, 29 and 31.

← 50.  Decree 22-300, Article 26; separately, Article 3.b, Decree 22-300 of 8 September 2022, setting the lists of activities, goods and services non-eligible to advantages, and fixing the minimum thresholds of financing to benefit of the transfer guarantee, published in issue No. 60 of the Official Gazette (available in Arabic and French), on 18 September 2022.

← 51.  Decree 22-301 of 8 September 2022, on the list of areas that are among the zones to which the State accords a particular interest in terms of investment, published in in issue No. 60 of the Official Gazette (available in Arabic and French), on 18 September 2022 (p. 38-41), as amended in issues No. 64 and 65 of the Official Gazette, for the Arabic text, and issue No. 65 of the Official Gazette, for the French text.

← 52.  Decree 22-300, Article 3.a.

← 53.  Decree 22-300, Articles 3-6.

← 54.  Among the goals enumerated by the first Article of the Investment Law, the following goals are considered the essential ones to be fulfilled by structuring investments: (i) import substitution, (ii) export diversification , (iii) integration in global and regional value chains, and (iv) the acquisition of technology and know-how, as per Article 15, Decree 22-302, Article 15.

← 55.  Article 16, Decree 22-302 of 8 September 2022, setting the criteria to qualify as structuring investments, the conditions of benefiting of incentives during the operational phase, and the evaluation schemes, published in in issue 60 of the Official Gazette (available in Arabic and French), on 18 September 2022.

← 56.  2022 Investment Law, Article 18 and Decree 22-298, Article 4.5.

← 57.  2022 Investment Law, Article 25.

← 58.  2022 Investment Law, Article 25, para. 1.

← 59.  Decree 22-299.

← 60.  Decree 22-299, Articles 6-8.

← 61.  Decree 22-298, Article 4.5 and Article 26.1.

← 62.  2022 Investment Law, Article 25, para. 2.

← 63.  2022 Investment Law, Article 25 and Decree 22-299, Article 5, para. 2.

← 64.  2022 Investment Law, Articles 32-33. See also, para. 0.

← 65.  Decree 22-302, Article 22.

← 66.  Decree 22-299, Article 9.

← 67.  Presidential Decree 22-296 of 8 September 2022, Articles 6-7, on the composition and functioning of the High National Appeals Commission related to Investment, published in issue No. 60 of the Official Gazette (available in Arabic and French), on 18 September 2022.

← 68.  Decree 22-302, Article 18.

← 69.  2022 Investment Law, Article 31, para. 2 and Decree 22-302, Article 19.

← 70.  2022 Investment Law, Article 32, para. 1.

← 71.  2022 Investment Law, Article 32, para. 3.

← 72.  Decree 22-299, Articles 15-17.

← 73.  2022 Investment Law, Article 36.

← 74.  Decree 22-303, Articles 7-10.

← 75.  Decree 22-303, Article 11.

← 76.  As at September 2019, 10 ISCs were established and operational across the country, and an additional 27 were at the time in the process of being set up across all 27 governorates (OECD, 2020_[4]). See also, ISC Investor Guide, “Investor Service Centres in Governorates”.

← 77.  2017 Investment Law, Article 22; 2017 Executive Regulations, Articles 17 et seq. Among these conditions is that the application must be a joint-stock company exclusively dedicated to accreditation activity, to have technical personnel with 10 years of experience, and to purchase an insurance policy for the benefit of GAFI with a minimum amount of EGP one million. Furthermore, the operational licence of the accreditation activity is valid for one year and must be renewed (2017 Executive Regulations, Article 17). Similar structures exist in other sector-based legislations (e.g., industry, tourism, medium and small enterprises (see e.g., Law 15 of 2017 on the facilitation of the licensing procedures of industrial establishments, published in the Official Gazette, Law 8 of 2022 on hotels and touristic establishments, and Law 152 of 2020 on the development of medium, small and micro projects).

← 78.  2017 Executive Regulations, Article 28. GAFI has not published any list of such licensed Offices. According to information provided by the Egyptian authorities to the OECD Secretariat, GAFI announced establishing only one Approval Office in March 2020.

← 79.  2017 Investment Law, Articles II and VIII, repealing Law 8 of 1997 on Investment Guarantees and Incentives (as amended) and every provision that contradicts the Investment Law.

← 80.  Investment Law 72 of 31 May 2017, which has entered into force on 1 June 2017, as amended by Law 141 of 2019 (2017 Investment Law); Prime Minister Decree 2310 of 2017 adopting Executive Regulations to the Investment Law promulgated by Law 72 of 2017, as amended, namely by: Prime Minister Decrees 2731 of 2019, 1199 of 2020, 2467 of 2020, 910 of 2021, 2300 of 2022, and 4426 of 2022 (2017 Executive Regulations). Cabinet Decree 2140 of 2023 was adopted in June 2023, amending the 2017 Executive Regulations; it principally eases the conditions for operation in a private free zone. When relevant, the 2017 Investment Law and its related instruments are also hereafter referred to as the “2017 Investment Law”.

← 81.  Cabinet Decree 57 of 2022 on the conditions of qualifying an investment project as strategic or national in implementation of the provisions of Article 20 of the 2017 Investment Law (Cabinet Decree 57 of 2022); and Prime Minister Decree 104 of 2022; Prime Minister Decree 981 of 2022; Prime Minister Decree 1775 of 2022; President Decree 141 of 2023.

← 82.  2017 Investment Law, Definitions, namely, investment activities in a defined set of sectors; see also, 2017 Executive Regulations, Part I, Chapter I, which lists those “investment activities” governed by the Law, sector-by-sector (investment activities carried out in those sectors are referred to as “Investment Projects” throughout the law and in this country sections).

← 83.  2017 Investment Law, Articles 2-8.

← 84.  See also, OECD (2020), OECD Investment Policy Reviews: Egypt 2020, OECD Investment Policy Reviews, OECD Publishing, Paris.

← 85.  2017 Investment Law, Articles, 68 and 71; 2017 Executive Regulations, Articles 44-59.

← 86.  Egypt has in that regard been working on a regulatory reform program for a number of years, including in respect of the development of an Egyptian Legislation Register. It remained unclear at the time of writing in September 2023 whether this platform is operational.

← 87.  These are namely, Prime Minister Decrees 2731 of 2019 and 1199 of 2020. English translations prepared by GAFI feature disclaimers that provide that translations of the official Arabic texts are provided for “convenience and information purposes only” and that in the event of discrepancies, inconsistencies, conflict or other between the original Arabic instrument and its translation, the former will prevail. Separately, another version for the Law and the 2017 Executive Regulations is available on the Invest in Egypt promotion website, but only in Arabic (both the 2017 Investment Law and the 2017 Executive Regulations without incorporating any subsequent amendments).

← 88.  The law was however published the website of Youm7, a local privately owned daily newspaper on 29 December 2016; Full text of the new investment law after its approval by the Council of Ministers, Youm7, 29 December 2016.

← 89.  2017 Investment Law, Article II.

← 90.  No governmental and/or official sources provide insight as to the 2017 Investment Law consultation process. It was at the time however reported in the local press, see e.g., Sisi chairs second meeting of Supreme Council for Investment (unofficial translation from Arabic), Al Masry Al Youm, 4 December 2016; Dalia Khorshid: Preparation of the final draft of the investment law December 14 (unofficial translation from Arabic), Shorouk News, 5 December 2016; The Minister of Investment announces the development of alternatives to special free zones and maintaining the current one (unofficial translation from Arabic), Al Masry Al Youm, 8 January 2017; Dalia Khorshid: New Investment Law Issued After Community Dialogue (unofficial translation from Arabic), El Balad, 19 November 2016.

← 91.  See, OECD (2021), Middle East and North Africa Investment Policy Perspectives, OECD Publishing, Paris.

← 92.  See, OECD (2020), OECD Investment Policy Reviews: Egypt 2020, OECD Investment Policy Reviews, OECD Publishing, Paris.

← 93.  See, the ISC Investor Guide.

← 94.  2017 Investment Law, Article 70; 2017 Executive Regulations, Article 30.

← 95.  See e.g., a Central Bank of Egypt preapproval is required for the establishment of a bank (Law 194 of 2020 on the promulgation of the Central Bank and Banking Sector Law, Articles 63-65).

← 96.  Companies Law 159 of 1981, as amended. The English translation of the Companies Law provided via the GAFI website does not reflect the latest amendments to the law.

← 97.  The 2017 Investment Law (Article 48) distinguishes between the incorporation of companies under the Law and under the Companies Law 159 of 1981. See also, the ISC Investor Guide and GAFI’s e-services guide.

← 98.  2017 Investment Law, Definitions, “Investment Project”; 2017 Executive Regulations, Part I, Chapter I.

← 99.  2017 Executive Regulations, Article 1.

← 100.  2017 Investment Law, Article 21, which outlines among other that outlines that the entity “shall provide” a wide range of incorporation and corporate-related services.

← 101.  The ISC Investor Guide lists those Competent Authorities represented at the ISC Cairo headquarters, and their physical offices therein. No indication is provided as to whether these Competent Authorities are represented at other branches and/or whether these formalities can equally be carried out at other branches.

← 102.  2017 Investment Law, Article 54; 2017 Executive Regulations, Articles 127-128. The Law requires that both GAFI and the ISC automate and integrate via a unique platform all of those services which fall within their mandates, and more specifically pertaining to the legal incorporation of companies, the standardisation of fees and a certain number of corporate forms and documents, with a view to replace existing – presumably paper-based – formalities falling within the GAFI and ISC’s mandates^. GAFI’s e-services portal is available both in Arabic and partly in English.

← 103.  2017 Investment Law, Article 51; see also, ISC Investor Guide.

← 104.  The 2017 Investment Law prescribes the completion of these formalities within 15 days of receipt of an investor request (Article 51); the 2017 Executive Regulations do not impose any time limit or cap, and simply require that streamlining provisions be set up in that regard.

← 105.  2017 Investment Law, Article 54; 2017 Executive Regulations, Articles 127-128.

← 106.  2017 Investment Law, Article 21.

← 107.  See, footnote 16.

← 108.  2017 Investment Law, Article 19; 2017 Executive Regulations, Article 16. The Law provides that this Guide should be prepared and published within 90 days of the Law’s entry into force, while the 2017 Executive Regulations requires that it be made available within 60 days of its entry into force.

← 109.  At the time of writing in September 2023, only one guide (the Gas Market Regulatory Authority Guide) was available in English as well as French. Additional translations are planned to be made available via the GAFI website (information provided further to consultations with GAFI, August 2023).

← 110.  Information provided further to consultations with GAFI, August 2023.

← 111.  2017 Investment Law, Articles 48 and 50; 2017 Executive Regulations, Articles 32, 37, 38 and 127.

← 112.  Information provided further to consultations with GAFI, August 2023.

← 113.  Supplemental streamlining measures have been introduced via sectoral instruments, see e.g., Law 15 of 2017 on the Simplification of Industrial Licences, which seeks to reduce the timeframes relevant to obtaining licenses required to establish new factories.

← 114.  2017 Investment Law, Article 27.

← 115.  2017 Investment Law, Article 18; Cabinet Decree 982 of 2022, Article I.

← 116.  2017 Investment Law, Article 18; Cabinet Decree 982 of 2022, Article I.

← 117.  2017 Investment Law, Article 18; Cabinet Decree 982 of 2022, Article II.

← 118.  2017 Investment Law, Article 21.

← 119.  2017 Executive Regulations, Article 7.

← 120.  2017 Investment Law, Articles 5, 83-84; 2017 Executive Regulations, Articles 129-133. The timeframes and procedures are defined as follows: (i) complaints must be submitted within 15 days from of notification of decision making the object of complaint; (ii) the Grievance Committee must settle the matter with a reasoned decision within 30 days from the date of closing of hearings and submissions. The decision rendered is final and binding on all competent authorities but does not prejudice the investor from resorting to legal action.

← 121.  2017 Investment Law, Article 5; 2017 Executive Regulations, Articles 7, 8, 58, 59 and 124. See also, 2017 Investment Law, Article 81, whereby GAFI is also mandated with monitoring compliance with the provisions of the 2017 Investment Law and may in that regard request that investors comply with their rights and obligations thereunder and if applicable, impose a certain number of determined sanctions, including the suspension of benefits under the incentives schemes, the revocation of licences, among others. In this context, investors must also be provided with a similar “grace period”.

← 122.  2017 Investment Law, Articles 24-25.

← 123.  2017 Investment Law, Article 22; 2017 Executive Regulations, Article 24.

← 124.  2017 Investment Law, Article 22; 2017 Executive Regulations, Articles 25 and 29.

← 125.  2017 Investment Law, Articles 55 et seq.

← 126.  2017 Investment Law, Section III, Chapter 6; 2017 Executive Regulations, Articles 44-59.

← 127.  2017 Investment Law, Article 26; 2017 Executive Regulations, Articles 44-59.

← 128.  2017 Investment Law, Article VIII.

← 129.  These are not considered within the scope of this country section.

← 130.  2017 Investment Law, Article 9.

← 131.  2017 Investment Law, Article 12, as amended by Law 141 of 2019, Article I; Cabinet Decree 22 of 2020, Article I; 2017 Executive Regulations, Articles 10-13.

← 132.  2017 Investment Law, Article 12; Law 141 of 2019 (amending the 2017 Investment Law), Article I, complementing 2017 Investment Law, Article 12, which introduces projects for the expansion of existing investments that aim to increase the production capacity of the investment project as eligible to the Scheme, subject to certain rules and conditions; Cabinet Decree 6 of 16 February 2020, which was adopted to clarify the conditions for the implementation of the above-cited amendment, and provided that further criteria and technical pre-conditions would be issued via GAFI Board of Directors resolutions (Article I). These were not at the time of writing publicly available. See also, Memoranda of 15 July 2020 and GAFI Board of Directors Technical Secretariat Letter No. 2809/M5, which all pertain to criteria, rules and conditions pertaining to eligibility to the Special Incentives Scheme. Whether these are publicly and readily available remains unclear.

← 133.  “Investment costs” is defined in the 2017 Investment Law, Article 11; 2017 Executive Regulations, Article 11.

← 134.  2017 Investment Law, Article 11; 2017 Executive Regulations, Article 11, as amended by subsequent implementing decrees amending the definitions of the sectors.

← 135.  2017 Investment Law, Article 11.

← 136.  2017 Executive Regulations, Article 13.

← 137.  2017 Investment Law, Article 12(3).

← 138.  2017 Investment Law, Article 13.

← 139.  2017 Executive Regulations, Articles 12-13.

← 140.  2017 Executive Regulations, Article 42.

← 141.  2017 Investment Law, Article 20.

← 142.  2017 Investment Law, Article 20.

← 143.  Cabinet Decree 56 of 2022.

← 144.  In that regard, the Egyptian Cabinet recently approved an amendment to the 2017 Investment Law, extending the eligibility conditions under the Mechanism to cover those companies established prior to the entry into force of the 2017 Investment Law. The adopted text of the amendment was available for consideration at the time of writing in September 2023. See, Cabinet Meeting No. (244), Press Release, 21 June 2023 (last accessed on 12 September 2023).

← 145.  Cabinet Decree 56 of 2022, Article II.

← 146.  Cabinet Decree 56 of 2022, Article I.

← 147.  2017 Executive Regulations, Article 42, as amended by Prime Minister Decree 2300 of 2022, Article I; and Prime Minister Decree 4426 of 2022, Article I.

← 148.  2017 Investment Law, Article 13.

← 149.  2017 Investment Law, Article 9. In that regard, the Egyptian Cabinet recently approved an amendment to the 2017 Investment Law, whereby all businesses – those established before and after the entry into force of the 2017 Investment Law – benefit from incentives under the General Scheme. The adopted text of the amendment was available for consideration at the time of writing in September 2023. See, Cabinet Meeting No. (244), Press Release, 21 June 2023 (last accessed on 12 September 2023).

← 150.  2017 Executive Regulations, Articles 42-43. The existence of this unit is confirmed by the Golden Licence Guidebook; however, its establishing instrument (Prime Minister Decree 1156 of 2020) is not publicly available.

← 151.  2017 Executive Regulations, Article 43; as amended by Prime Minister Decree 2300 of 2022, Article I.

← 152.  2017 Investment Law, Articles 14, 71(4).

← 153.  See e.g., 2017 Executive Regulations, Article 13.

← 154.  In that regard, the ISC Investor Guide provides background as to the formalities for requirements relevant to the Special and Additional Schemes, namely the determination of the start date of the investor’s activity.

← 155.  2017 Investment Law, Article 79.

← 156.  2017 Executive Regulations, Article 126.

← 157.  2017 Investment Law, Article 81; 2017 Executive Regulations, Article 124.

← 158.  2017 Investment Law, Article 83.

← 159.  See the government portal’s webpage on the JIB.

← 160.  OECD (2022), FDI Qualities Review of Jordan, OECD Publishing, Paris, p. 11.

← 161.  World Bank, Doing Business – Economy Profile: Jordan (2020).

← 162.  U.S. Department of State (2021), Investment Climate Statement: Jordan.

← 163.  OECD (2022), FDI Qualities Review of Jordan, OECD Publishing, Paris, p. 11.

← 164.  World Bank (2019), Enterprise Surveys: Jordan.

← 165.  OECD (2022), FDI Qualities Review of Jordan, OECD Publishing, Paris, p. 12.

← 166.  Jordan MoI, Jordan's Investment Ministry Streamlines Processes, Paving the Way for Modern Economic Vision.

← 167.  See for instance the MoI’s press release on the establishment of the MoI.

← 168.  The Jordan Investment Commission (JIC) was established in 2014, against the backdrop of stagnating FDI inflows following the global financial crisis of 2008/2009 as well as the protests of 2011/2012 which diminished investors’ confidence in the stability of the Jordanian business environment. The establishment of the JIC aimed explicitly at streamlining the institutional framework for investment promotion and facilitation. It was entrusted with a broader mandate than its predecessor – the Jordan Investment Board (JIB) – which it absorbed, alongside two other agencies operating in the country: (1) the Export Promotion Department of the Jordan Enterprise and Development Corporation; and (2) the Development and Free Zones Commission. See, OECD (2019), Mapping Investment Promotion Agencies: Middle East and North Africa, OECD Publishing, Paris, p. 22.

← 169.  The 2022 Investment Environment Law does not apply to all investments in Jordan across all economic sectors. The Law’s Article 2 confines the legislation’s material scope to “any industrial, commercial, agricultural, service, tourism, information technology or creative industry activity”, and excludes specifically “banking, money exchange or regulated professional activities as per special legislations” from the scope of the Law’s provisions. In turn, the facilitation mandate of the MoI, as defined by the Law, is limited to investments in certain sectors.

← 170.  Decree 7 of 2023 on the Regulation of the Investment Climate, pursuant to Article 51, para. (a) of the Investment Environment Law (Law 21 of 2022), Official Gazette, Issue No. 5842, 12 February 2023, Article 181.C.

← 171.  2022 Investment Environment Law, Article 8. The MoI published a draft Investment Promotion Strategy developed with the support of the World Bank Group in mid-March 2022.

← 172.  2022 Investment Environment Law, Article 8(C)(6) and 11(D), Instructions No. 5 of 2023.

← 173.  The regulations, instructions and decisions issued under the Investment Law (2014) shall continue to be in effect until they are cancelled, amended, or replaced by others in accordance with the provisions of this Law or its implementing instruments. According to the Regulation, Article 194, 13 regulations have been repealed; these regulations concern (1) the issuance of construction permits in development and free zones, (2) investors’ grievances, (3) the establishment of free and development zones, (4) regulating foreign investments, (5) land recovery in development and free zones, (6) customs’ clearance in development zones, (7) the income tax decrease in the less developed regions, (8) the investment window, (9) the investment incentives, (10) the general sales’ tax in development and free zones, (11) the regulation of the investment environment and registration of establishments in development and free zones, (12) regulation on the employment and employees of development and free zones, and (13) the customs duties procedures in free zones.

← 174.  2022 Investment Environment Law, Article 2.

← 175.  2022 Investment Environment Law, Article 3.

← 176.  The Council of Ministers adopted in 2018 a new code of practices for the governance of governmental policies and legislative instruments to enhance regulatory transparency and predictability. The guidebook accompanying the policy (June 2022), accentuates the role of public consultations for good regulatory practices. See also, the Jordanian Policy on Electronic Participation of 2021.

← 177.  2022 Investment Environment Law, Article 5(A).

← 178.  Decree 7 of 2023 on the Regulation of the Investment Climate, pursuant to Article 51, para. (a) of the Investment Environment Law (Law 21 of 2022), Official Gazette, Issue No. 5842, 12 February 2023.

← 179.  See, OECD (2021), Middle East and North Africa Investment Policy Perspectives, OECD Publishing, Paris.

← 180.  2022 Investment Environment Law, Article 3(C).

← 181.  2022 Investment Environment Law, Article 35(B).

← 182.  See, para. 0 on the material scope of the Law.

← 183.  USAID LENS was a five-year project (2014-2019) aimed at supporting small business growth and better economic planning to strengthen Jordanian communities against economic adversity. One of the core objectives of the project was to enhance the business environment in Jordan by improving the business registration process for medium and small enterprises (MSEs). This included upgrading the CCD’s server storage capacity to handle more data for registered businesses and developing a business registration manual. Background information on USAID LENS can be found on the project’s website at: https://jordanlens.org/.

← 184.  2022 Investment Environment Law, Article 37. For a description of these sectors, see, para. 0.

← 185.  2022 Investment Environment Law, Article 37(C).

← 186.  2022 Investment Environment Law, Article 37(B).

← 187.  2022 Investment Environment Law, Article 37(D) and (E).

← 188.  2022 Investment Environment Law, Article 40(A) and (B).

← 189.  Investment Environment Law, Article 40(E).

← 190.  2022 Investment Environment Law, Article 40. Among the prohibited grounds of refusals are the protection of a monopoly or dominant position, or the restriction of an investment.

← 191.  2022 Investment Environment Law, Article 42(C).

← 192.  2022 Investment Environment Law, Article 3.A.

← 193.  2022 Investment Environment Law, Articles 9.B and 51.

← 194.  Regulation 7 of 2023, Article 27.E.

← 195.  Regulation 7 of 2023, Article 32.B.

← 196.  Regulation 7 of 2023, Article 37.E.

← 197.  This inventory was developed by Jordan with the support of the World Bank in 2016. It was available on the Jordan Investment Commission’s (JIC) website and was regularly updated by a dedicated JIC team. Due to recent institutional reshufflings and the JIC’s absorption into the newly created MoI in 2021, the inventory is no longer available and a new inventory reflecting incentives offered under the recent 2022 Investment Environment Law has not yet been developed.

← 198.  The Investment Promotion Strategy (2023-2026), published in June 2023, provides that the MoI “will completely revamp its website drawing from multiple examples of good practice IPA websites around the world” and is expected to launch an electronic platform entitled ‘Invest in Jordan’ (Invest.Jo) which, among others, will highlight the advantages and incentives granted according to the Investment Environment Law, alongside other relevant information on the country’s investment framework (p. 21).

← 199.  The Aqaba SEZ is explicitly excluded from the scope of the Investment Environment Law (see, Article 50) and is governed by the Aqaba Special Economic Zone Law (Law 32 of 2000), as amended, published in issue No. 4453 of the Official Gazette, on 31 August 2000 (p. 3423-3441). See, the Aqaba SEZ official website for more details.

← 200.  It should be noted that even if an economic activity qualifies for the additional advantages, it may not benefit of the subsidisation of energy in case that its operational cost invoice exceeded 20% of the total operational cost, as per Article 29.B, Regulation 7 of the year 2023, op. cit.

← 201.  Investment Environment Law, Article 13.A.

← 202.  Investment Environment Law, Article 14.B.

← 203.  See, para. 0 on the material scope of the Law.

← 204.  Regulation 7 of 2023, Article 2.A.

← 205.  Council of Ministers’ approval on issuing the schedule of fixed assets, production requirements and inputs, and spare parts necessary to exercise the economic activity subject to a zero-rate general sales' tax, published issue No. 5848 of the Official Gazette, on 16 March 2023 (pp. 1336-1420).

← 206.  Regulation 7 of 2023, op. cit., Articles 23.C and 23.D.

← 207.  Regulation 7 of 2023, Article 18.

← 208.  Regulation 7 of 2023, Article 19.

← 209.  Regulation 7 of 2023, Article 22.

← 210.  Regulation 7 of 2023, Article 20.

← 211.  Regulation 7 of 2023, Article 21.

← 212.  Regulation 7 of 2023, Article 28.A. “Strategic economic activities” eligible for additional incentives are defined by reference to two cumulative conditions: (i) they fulfil at least two of the criteria to qualify for the additional incentives, and (ii) they meet minimum capital thresholds that are listed in reference to their economic sector (e.g., agriculture, information technology, renewables, tourism, and education), or set at JOD 100 million in non-listed sectors. The Regulation states two additional conditions specific to the single approval: (i) taking one of the corporate forms available under the Jordanian Companies Law (excluding limited liability companies), and (ii) that the investor has not been convicted of an economic crime (Regulation 7 of 2023, Article 36.A).

Investment Environment Law, Article 13.B.

← 213.  Investment Environment Law, Article 13.B.

← 214.  Regulation 7 of 2023, Article 29.A.

← 215.  Regulation 7 of 2023, Article 26.

← 216.  2022 Investment Environment Law, Article 14.A.

← 217.  Regulation 7 of 2023, Articles 27.E, 32.B, 37.E.

← 218.  Regulation 7 of 2023, Article 15.

← 219.  Regulation 7 of 2023, Article 24.A.

← 220.  Regulation 7 of 2023, Article 23.

← 221.  Regulation 7 of 2023, Article 32.B.

← 222.  Regulation 7 of 2023, Article 26.

← 223.  2022 Investment Environment Law, Article 13.E.

← 224.  Regulation 7 of 2023, Article 36.B.

← 225.  It is unclear if this committee is (or is expected to be) a permanent body under the authority of the MoI or would function on an ad hoc basis. Article 3 of the draft instructions on the revocation of the single approval (published on the official website of the MoI, in Arabic), seems to point towards a permanent committee in charge of assessing single approval applications.

← 226.  2022 Investment Environment Law, Article 13.E and Regulation 7 of 2023, Article 37.

← 227.  Regulation 7 of 2023, Article 37.

← 228.  Regulation 7 of 2023, Article 37.E.

← 229.  In accordance with Schedule No. 2 on the services rendered by the OSS, row 94, in implementation of Regulation 7 of 2023, Article 3.B,

← 230.  Regulation 7 of 2023, Articles 15.B, 15.D, 16 and 17.

← 231.  Regulation 7 of 2023, Article 15.D.

← 232.  Regulation 7 of 2023, Articles 15.D, 16 and 17, in implementation of 2022 Investment Environment Law, Article 11.

← 233.  2022 Investment Environment Law, Article 11.

← 234.  Regulation 7 of 2023, Article 27.E.

← 235.  Regulation 7 of 2023, Article 37.E.

← 236.  Regulation 7 of 202, Article 27.C.

← 237.  2022 Investment Environment Law, Article 11 and Regulation 7 of 2023, Article 17.A.

← 238.  Regulation 7 of 2023, Article 37.D. The draft instructions regarding the revocation of the single approval are available for public consultations on the official website of the MoI, in Arabic.

← 239.  OECD (2021), Middle East and North Africa Investment Policy Perspectives, OECD Publishing, Paris, p. 19.

← 240.  OECD (2018), Examen des statistiques d’investissements directs internationaux au Maroc, OECD Publishing, Paris, p. 13.

← 241.  U.S. Department of State (2023), Investment Climate Statement: Morocco. Compare OECD (2021), Middle East and North Africa Investment Policy Perspectives, OECD Publishing, Paris, p. 22.

← 242.  World Bank, Doing Business – Economy Profile: Morocco (2020).

← 243.  World Bank, Doing Business – Economy Profile: Morocco (2020).

← 244.  In that regard, the Investment Charter clarifies that public policies for investment promotion are defined by the State, which are then subsequently implemented at regional level, both by the competent regional government authorities (including among others the CNI), and the CRIs and CRUIs (Article 3). Law 47-18 in that regard provides that the CRIs contribute, within the limits of their territorial jurisdiction, to the implementation of the State’s policy on the development, promotion and attraction of investment at regional level, and for providing regional level and overall support for businesses, in particular small and medium-sized SME’s and very small enterprises (Article 4). It also specifies in that regard that CRIs, together with the relevant regions and administration, draw up and implement regional development, promotion strategies in accordance with government guidelines and directives among others (Article 4(3)). Law 47-18 also provides that, as part of implementing investment policies, governmental authorities keep CRIs informed of any national, sectoral or cross-sectoral strategies, general guidelines, programmes and development projects decided by the government with a view to promote investment; CRIs are also kept informed of decisions taken by the deliberative bodies of the local authorities relating to investment promotion and the economic development of the said communities (Article 5; see also, Articles 6-7).

← 245.  The AMDIE is Morocco’s nation-wide IPA. It was established in 2017 with the adoption of Decree 1-17-49 of 30 August 2017 promulgating Law 60-16 on the establishment of the AMDIE (Law 60-16) and replaces and merges the mandates of the previous Agence marocaine de development des investissements and the Centre marocain de promotion des exportations and the Office des foires et expositions de Casablanca. Investments in the agriculture, fishing, crafts and tourism sectors fall outside of its mandate. Its mandate does not specifically concern investment facilitation, but rather the implementation of the Government strategy for the development, encouragement, and promotion of national and foreign investments and of exports.

← 246.  Lettre royale relative à la gestion déconcentrée de l’investissement, 9 January 2002 (Royal Letter of 2002).

← 247.  See, the Moroccan Court of Auditors’ Annual Report (2015), specifically the “Evaluation de l’expérience des Centres régionaux d’investissement”, which identified several shortcomings hindering the overall effectiveness of CRIs in facilitating investment in the country since their establishment in 2002. See also, Royaume du Maroc, Le Chef du Gouvernement, Les cahiers des reformes, Réformes des centres régionaux d’investissement – une réforme au service de la promotion de l’investissement dans les régions du Maroc, Edition 2019 (2019).

← 248.  In that regard, a government ministry responsible for investment was established and the supervision of the CRIs was transferred to the Head of Government in order to strengthen synergies and public action between various stakeholders involved in investment at both central and regional levels – see, Decrees 2-23-310 and 2-23-414 of 18 May 2023. The role of CRIs and CRUIs may further evolve as Law 47-18 appears to be currently under review (information corroborated by stakeholder consultations, August 2023).

← 249.  Law 47-18, Articles 4(a)(1), (2), (5) and (6).

← 250.  Among others, Investors may through the CRI-Invest Platform directly (i) submit investment project files to the CRIs (ii) find information relating to relevant administrative establishment and operation formalities and (iii) complete these (save for incentives-related formalities), with the assistance and guidance of a CRI advisor allocated to their project. Investors may follow the CRUI’s review of their investment project file and the issuance of establishment and operation administrative acts and authorisations in real time. Investors may also lodge appeals further to any negative decisions rendered by the relevant CRUI through the platform. See, the CRI-Invest platform User Guide, prepared and published by the Moroccan Government in October 2020.

← 251.  Law 47-18, Articles 4(a)7, 4(a)9. The CRIs’ websites are listed on the Government’s website through its National Portal for Regional Authorities. To date, all of the 12 CRIs’ websites are up-and-running, namely: the Marrakech − Safi CRI, the Rabat-Salé-Kénitra CRI, the Oriental CRI, the Guelmim Oued-Noun CRI, the Casablanca-Settat CRI, the Beni Mellal-Khenifra CRI, the Fes-Meknes CRI, the Tanger – Tétouan – Al Hoceima CRI, the Souss Massa CRI, the Dakhla Oued Eddahab CRI, the Drâa-Tafilalet CRI, and the Laâyoune – Sakia Al Hamra CRI.

← 252.  Law 47-18, Article 29.

← 253.  Royal Letter of 2002, para. 3.

← 254.  Among others, CRUIs hold meetings on a need-basis, and their membership varies depending on the items which they are expected to discuss at any given meeting and may include any of the representatives envisaged under Law 47-18, including the governor of the relevant prefecture and representatives from regional authorities and administrations. While investors cannot themselves attend CRUI deliberations, they may be invited by the CRUI’s chair to provide information relevant to the CRUI’s review of their investment project file (Law 47-18, Articles 31-39). In that regard, law 47-18 provides that the relevant government authorities shall take the necessary steps to provide heads of decentralised departments under their authority with the prerogatives required to take decisions falling within the remit of their respective administrations in connection with the examination of files relating to investment projects.

← 255.  Law 47-18, Article 33.

← 256.  Law 47-18, Article 29.

← 257.  Royal Letter of 2002, para. 3.

← 258.  Among others, CRUIs hold meetings on a need-basis, and their membership varies depending on the items which they are expected to discuss at any given meeting and may include any of the representatives envisaged under Law 47-18, including the governor of the relevant prefecture and representatives from regional authorities and administrations. While investors cannot themselves attend CRUI deliberations, they may be invited by the CRUI’s chair to provide information relevant to the CRUI’s review of their investment project file (Law 47-18, Articles 31-39). In that regard, law 47-18 provides that the relevant government authorities shall take the necessary steps to provide heads of decentralised departments under their authority with the prerogatives required to take decisions falling within the remit of their respective administrations in connection with the examination of files relating to investment projects.

← 259.  Law 47-18, Article 33.

← 260.  Decree 2-23-1, Articles 18-27. A previous Commission des Investissements had been established under the former investment regime (Loi cadre 18-95).

← 261.  Law 47-18, Articles 40-41. 2022 Investment Charter, Articles 34-36 set out further aspects of the CNI’s mandate, including: carrying out periodic assessments of the effectiveness of the Charter’s new Investment Incentives Regime and, if and when appropriate, put forward possible amendments; and monitoring the implementation of the 2022 Investment Charter and any subsequent decrees adopted for its implementation.

← 262.  The 2022 Investment Charter entered into force on 15 December 2022, as a loi cadre (defined under Moroccan law as legislation that outlines the fundamental objectives of the economic, social, environmental and cultural activity of the State). Instruments adopted to implement the Investment Charter of 1995 remain in force until they are repealed or replaced in accordance with the provisions of the 2022 Investment Charter (2022 Investment Charter, Article 39).

← 263.  The current Moroccan legal and regulatory framework for investment, as considered in this Report, rests on the following instruments: Decree 1-17-49 of 30 August 2017 promulgating Law 60-16, pertaining to the establishment of the AMDIE (Law 60-16); Decree 1-19-18 of 13 February 2019 promulgating Law 47-18, reforming CRIs and establishing CRUIs (Law 47-18) and accompanying Decree 2-19-67 of 17 April 2019 enacting Law 41-18; Decree 1-22-76 of 9 December 2022 promulgating Framework Law 03-22, pertaining to the new investment charter (2022 Investment Charter); Decree 2-23-1 of 16 February 2023, pertaining to the implementing of certain incentive schemes (Decree 2-23-1). See also, Decree 1-20-06 promulgating Law 55-19 of 6 March 2020, pertaining to the streamlining of administrative procedures and formalities (Law 55-19). When relevant, the 2022 Investment Charter and its related instruments and amendments are also hereafter referred to as the “2022 Investment Charter”. As per applicable Moroccan legislation, entry into force of legislation takes place on the date of their publication in the Official Bulletin.

← 264.  2022 Investment Charter, Article 7.

← 265.  2022 Investment Charter, Preamble, Article 39.

← 266.  See, Decree 2-17-618 of 26 December 2017, pertaining to administration decentralisation; Decree 1-20-06 of 6 March 2020 promulgating Law 55-19 and its implementing regulations, pertaining to the streamlining of administrative procedures and formalities. See also, Decree 1-20-103 of 31 December 2020 promulgating Law 76-20, pertaining to the establishment of the Mohammed VI Fund for Investment.

← 267.  2022 Investment Charter, Preamble, Articles 3-5 and 22-30. These include: facilitating access to property for investment projects and the development of special economic zones; improving and facilitating access to finance; and advancing ongoing reforms for the streamlining of investment-related administrative procedures and formalities at the regional level.

← 268.  2022 Investment Charter, Article 2. No implementing decree is adopted – or is foreseen to be adopted – in that regard.

← 269.  See e.g., Law 55-19, which was published in the Arabic version of the Official Bulletin on 19 March 2020, and subsequently published in its French edition on 20 May 2021.

← 270.  Similar explanatory notes were published with respect to the adoption of Law 47-18. Further, the Minister of Investment presented the draft Decree 2-23-1 before the CGEM in February 2023, after its approval by the Cabinet in January of this year – see e.g., Jazouli presents basic investment support system to CGEM members (unofficial translation from Arabic), Bayane Al Youme, 9 February 2023.

← 271.  House of Representatives Internal Regulations, Article 137; 2011 Moroccan Constitution, Article 33. See also, the website of the Secretary General of the Government, which features a dedicated portal for draft laws and regulations accessible to the public, and which also provides for opportunities for comment.

← 272.  See e.g., A new investment charter and many questions (unofficial translation from French), Tel Quel, 28 February 2022; Interview with Ali Seddiki: “The Investment Charter will reverse the distribution between public and private” (unofficial translation from French), L’Opinion, 30 October 2022.

← 273.  These pertain to the ‘tacit approval’ mechanism (Decrees 2-22-141 and 2-22-387 of 11 May 2023); investment-related administrative acts and decisions which competent authorities (in most instances, Ministries) should issue within the prescribed 30-day timeframe (Decree 2-22-385 of 11 May 2023); and administrative decisions which require technical expertise and/or public inspection and in relation to which the 30-day timeframe may be extended (Decree 2-22-386 of 11 May 2023).

← 274.  See, Open Government Partnership, Morocco Action Plan Review 2021-2023, Digitalization of administrative acts and procedures (last accessed on 11 September 2023). The development of a unified national platform is currently being carried out in collaboration with the Open Government Partnership, with a view to digitalise “a first batch of the most used procedures and formalities, with the aim of completing the digitalisation process of all administrative procedures and formalities by 2025”.

← 275.  See, OECD (2021), Middle East and North Africa Investment Policy Perspectives, OECD Publishing, Paris.

← 276.  See, OECD (2015), Policy Framework for Investment, 2015 Edition, OECD Publishing, Paris.

← 277.  The CRI-Invest Platform provides information on the environmental assessment forming this preliminary evaluation only. Stakeholder consultations with the AMDIE have indicated that, in the context of this preliminary evaluation process, assist and advise investors in the preparation of their investment project applications with a view to ensure that all required pre-conditions are met and approvals are granted by the relevant CRUI.

← 278.  Several legal instruments govern these commercial forms and companies, including but not limited to Law 5-96 pertaining to general partnerships, limited partnerships, partnerships limited by shares, limited liability companies and joint ventures; and Law 17-95 pertaining to public limited companies.

← 279.  Law 47-18, Articles 29(b) and 30.

← 280.  Law 47-18, Article 29(b).

← 281.  See Box A A.1 for the rules pertaining to the CRUI decision-making, relevant timeframes, and appeals procedures.

← 282.  Law 47-18, Article 4(a)(9).

← 283.  Launched further to Law 55-19 to streamline administrative procedures and formalities; see Box A A.1. See also, Guide prepared relative to the streamlining of administrative procedures and formalities (Simplification des procedures et des formalités administratives) prepared by Secretariat de la Commission de la simplification des procedures et des formalités administratives).

← 284.  Decree 2-22-385 of 11 May 2023 sets out an exhaustive list of 281 administrative acts and decisions, along with the relevant competent authorities to which applications must be submitted and estimate timeframes for the processing and delivery of authorisations. This timeframe is subject to the submission of a complete application file and may run longer in instances where the application file is incomplete and/or where the relevant competent authority makes a request for additional information. It is also subject to further extension under specific and limited circumstances. See Law 55-19, Articles 6, 10 and 16-17, Decree 2-22-386 of 11 May 2023.

← 285.  See, Open Government Partnership, Morocco Action Plan Review 2021-2023, Digitalization of administrative acts and procedures (last accessed on 11 September 2023). The development of a unified national platform is currently being carried out in collaboration with the Open Government Partnership, with a view to digitalise “a first batch of the most used procedures and formalities, with the aim of completing the digitalisation process of all administrative procedures and formalities by 2025”.

← 286.  The Idarati platform nevertheless carries a binding effect on public administrations as they cannot request documents from applicants other than those which they list on the platform (Law 55-19, Article 3).

← 287.  2022 Investment Charter, Article 39; Decree 2-23-1, Article 28.

← 288.  2022 Investment Charter, Articles 8, 19-21. The 2022 Investment Charter does not apply to investment projects carried out in the agricultural sector, which are governed by a separate investment and incentives regime. Real estate and trade investment projects are not eligible to the Primary Incentives Schemes (Article 7).

← 289.  Order 3-12-23, 3-13-23 and 3-14-23 of 1 March 2023.

← 290.  2022 Investment Charter, Article 40. These implementing decrees are not considered in this Country Section.

← 291.  2022 Investment Charter, Article 6.

← 292.  2022 Investment Charter, Article 18.

← 293.  2022 Investment Charter, Article 16; Decree 2-23-1, Articles 10-11. Investment projects undertaken with respect to wind, hydraulic or solar power are capped at MAD 30 million of cumulated incentives benefits.

← 294.  The term “steady employment” is defined under Decree 2-23-1 and Prime Minister Order 3-13-23, Article 1.

← 295.  Decree 2-23-1, Article 1, 7-8; 2022 Investment Charter, Article 12-15. These are also further defined in the Decree’s implementing Orders adopted in March 2023.

← 296.  Decree 2-23-1, Article 15.

← 297.  2022 Investment Charter, Article 17.

← 298.  2022 Investment Charter, Article 29.

← 299.  2022 Investment Charter, Article 9.

← 300.  Decree 2-23-1, Articles 23 and 26.

← 301.  2022 Investment Charter, Article 10.

← 302.  Decree 2-23-1, Articles 3-4.

← 303.  According to the Foreign Investment Promotion Agency (FIPA), the privatisation of Tunisie Telecom accounted for 67.5% of total FDI inflow in 2006.

← 304.  OECD (2020), OECD Review of Foreign Direct Investment Statistics: Tunisia, OECD Publishing, Paris, p. 10 and 22.

← 305.  OECD (2021), Middle East and North Africa Investment Policy Perspectives, OECD Publishing, Paris, p. 22.

← 306.  World Bank, Doing Business – Economy Profile: Tunisia (2020).

← 307.  U.S. Department of State (2023), Investment Climate Statement: Tunisia.

← 308.  World Bank (2020), Enterprise Surveys: Tunisia.

← 309.  OECD (2021), Middle East and North Africa Investment Policy Perspectives, OECD Publishing, Paris, p. 65.

← 310. http://www.mdici.gov.tn/wp-content/uploads/2023/01/Strategie_nationale_pour_l_amelioration_du_climat_des_affaires-1.pdf, p. 36-37.

← 311.  The Foreign Investment Promotion Agency (FIPA) is one of Tunisia’s investment promotion agencies. It was established in 1995, as a publish institution, under the Ministry of Development, Investment and International Cooperation. Its mandate is narrow, and it focuses on investment promotion activities. It does not carry any investment facilitation mandate, nor does it perform any such functions. More specifically, it promotes inward foreign investment, as well as innovation and regional development, and acts primarily as an “image builder”. For more information, see OECD (2019), Mapping of Investment Promotion Agencies: Middle East and North Africa, OECD Publishing, Paris.

← 312.  Law 2016-71 of 30 September 2017 promulgating the investment law.

← 313.  Equivalent at the time of writing in September to +/- EUR 4.5 million.

← 314.  These include among others the Agency for the Promotion of Agricultural Investment (whose main mission is to promote private investment in the fields of agriculture, fishing and associated services, as well as in primary processing activities integrated into agricultural and fishing projects); the Tunisian National Tourist Office, the Tunisian National Office for Handicrafts (ONAT implements the State’s strategy for safeguarding and developing the Tunisian craft sector, notably by promoting investment and supporting job creation, innovation and creativity, as well as developing policies for preserving the country's craft heritage; the body provides limited facilitation services, including business registration, access to finance, and specific sectoral incentives); and the Tunisian Export Promotion Centre. These agencies fall under the remit of different Ministries and have a different sector-based mandates.

← 315.  Government Decree 2017-388 of 9 March 2017, establishing the structure and organisation of the High Council for Investment, the administrative and financial organisation of the TIA and the Tunisian Fund for Investment. The TIA’s governance structure is set out in Decree 2017-388 of 9 March 2017, Articles 8-22. Among others, its Executive Body encompasses several units mandated with investment policy advocacy (pôle des politiques d’investissement et des réformes), assessing investment incentives applications and post-execution monitoring, (pôle des primes et des incitations, pôle de l’évaluation et du contrôle des primes et des incitations), and providing investor support (pôle d’encadrement de l’investisseur) in respect of the services provided by the TIA’s Interlocuteur unique de l’investisseur, or OSS. See also, the TIA’s organisation chart.

← 316.  2016 Investment Law, Article 14; Decree 2017-388 of 9 March 2017, Article 7; Law 2019-47 of 3 June 2019, Article 11.

← 317.  Decree 2017-388 of 9 March 2017, Article 40.

← 318.  The TIA specifies that facilitation for projects whose capital falls under the TND 15 million threshold is carried out by the APII (see, here with respect to investment declarations; although the French and Arabic versions of the website do not provide the same; and here with respect to the mandate of the Commission for licences and approvals). The APII does not define the scope of its mandate by reference to capital threshold however. Further, the FIPA exclusively refers to the APII’s OSS with respect to legal incorporation in Tunisia, irrespective of the value of the investment project. See also, the TIA’s institutional brochure, which provides that the TIA delivers different services “depending on the capital value of the investment”, and that it provides assistance, guidance and advice only to projects under a TND 15 million threshold; whereas investment projects whose value exceeds this threshold enjoy a streamlining of administrative and other procedures, the direct processing (on behalf of investors) of applications, operation and aftercare, among others.

← 319.  2016 Investment Law, Article 15; 2019-47 of 3 June 2019, Article 11.

← 320.  Law 91-38 of 8 June 1981 establishing the APII, as amended including by Decree 2003-178 of 21 January 2003 and Decree 2001-1567 of 2 July 2001. See also, OECD (2019), Mapping of Investment Promotion Agencies: Middle East and North Africa, OECD Publishing, Paris.

← 321.  The APII also provides “other types of services” through three of its branches (Tunis, Sousse and Sfax), including customs-related formalities, issuance of residence permits, and employment-related formalities.

← 322.  Decree 2017-389 of 9 March 2019.

← 323.  2016 Investment Law, Articles 27 et seq.

← 324.  The current Tunisian legal and regulatory framework for investment, as considered in this Report, rests on the following instruments: Law 2016-71 of 30 September 2016 promulgating the investment law (2016 Investment Law), which entered into force on 1 April 2017; Government Decree 2017-388 of 9 March 2017, establishing the structure and organisation of the High Council for Investment, the administrative and financial organisation of the TIA and the Tunisian Fund for Investment (Decree 2017-388); Government Decree 2017-389 of 9 March 2017, relating to financial incentives for investments established within the framework of the 2016 Investment Law, complemented by the Joint Ministerial Order of the Minister of Development, Investment, and International Cooperation, the Minister of Finance, the Minister of Industry and Commerce, the Minister of Agriculture, and the Minister of Tourism, Arts and Crafts of 28 April 2017 (Decree 2017-389, Joint Ministerial Order of 2017); Government Decree 2017-390 of 9 March 2017, establishing and setting out the organisation of a management unit for the review of authorisation required to carry out certain economic activities (Decree 2017-390); Government Decree 2018-47 of 11 May 2018, publishing the exclusive list of economic activities subject to authorisation and the list of administrative authorisations for the implementation of projects and their streamlining (Decree 2018-47), as amended by Presidential Decree 2022-317 of 8 April 2022 (Decree 2022-317); Order of the Minister of Development, Investment and International Cooperation of 8 November 2019, setting out the composition and organisation of the Commission for licences and approvals (including the relevant timeframes for the granting of authorisations) (Order of 2019); and Law 2019-47 of 29 May 2019, relating to the improvement of the business climate (Law 2019-47). When relevant, the 2016 Investment Law and its related instruments and amendments are also hereafter referred to as the “2016 Investment Law”.

← 325.  2016 Investment Law, Article 3.

← 326.  2016 Investment Law, Articles 4 and 7.

← 327.  2016 Investment Law, Articles 8 et seq. In some instances, the transfer of foreign currency abroad may require the prior authorisation of the Central Bank of Tunisia. Decree 2018-417 provides in that regard that the Central Bank should address requests for the authorisation of transfer of capital in foreign currency abroad within 90 days of the submission of the request. If this time period lapses without the Central Bank issuing a decision as to the authorisation request, then the ‘tacit approval’ provided for under Decree 2018-417 will apply.

← 328.  See, Règlement intérieur de l’Assemblée des représentants du peuple du 2 mai 2023, Articles 66-67 (last accessed on 18 September 2023).

← 329.  See, Tunisia Country Section, para. 0 et seq. It is worth noting that Tunisia has in recent years undertaken a number of commitments in collaboration with the Open Government Partnership. These include a right to information commitment in 2018, which sought to strengthen the right of access to information, which yielded overall moderate results. Tunisia has also committed, between 2016 and 2018, to reform its open data legal and regulatory framework at national level with the establishment of an online open data portal, as well as modernise its regulatory framework to enforce the right to access to information. The objectives underlying these two commitments were not fully met by Tunisia.

← 330.  Assembly of the Representatives of the People, Internal Regulations, Article 143 (“questions essentielles qui déterminent les choix stratégiques”).

← 331.  The document was located on the website of Tustex, a Tunisian media platform dedicated to financial and economic reporting. The veracity and accuracy of this document was not confirmed.

← 332.  Government Decree 2020-310 of 15 May 2020, relating to the streamlining of administrative procedures, the shortening of timeframes, the use of modern means of communication and the adoption of transparency in respect of public bodies-investor relations.

← 333.  Tunisia has launched a nation-wide public e-consultation process and a wider public-private dialogue with the aim of addressing perceived obstacles to an improved business climate and to identify relevant structural reforms, ultimately with a view to stimulate investment. These discussions are inter alia articulated around the 13 policy areas identified in the World Bank’s B-Ready Project (formerly Doing Business) While this has not been explicitly highlighted, this process may ultimately result in reforming Law 2019-47. See, E-Consultation - Portail de la participation publique (e-participation.tn) for more information (last accessed on 28 July 2023).

← 334.  Decree 2020-310, Commission de suivi et de coordination des mécanismes de simplification des procédures administratives au profit des investisseurs et des entreprises économiques.

← 335.  See, OECD (2021), Middle East and North Africa Investment Policy Perspectives, OECD Publishing, Paris.

← 336.  See, OECD (2015), Policy Framework for Investment, 2015 Edition, OECD Publishing, Paris.

← 337.  Decree 2018-417, Annex 1. These restrictions concern notably activities pertaining to the natural resources, land, sea and air transport, banking and finance, insurance and financial markets, health, education, telecommunications sectors, and other economic activities related to certain services and commercial activities.

← 338.  The conditions relating to the application for and issuance of a “foreign merchant card” are set out in Decree-Law 61-14 of 30 August 1961, as amended, and related Order of 14 September 1961. The relevant authority mandated to consider applications for foreign merchant cards and their issuance enjoy a degree of discretionary power in its decision-making process.

← 339.  Additional entities may also provide facilitation services relating to some aspects of establishment requirements, namely APIA, ONTT, ONA and CEPEX, yet their roles are more limited and they do not operate specific OSS.

← 340.  2016 Investment Law, Article 15; Decree 2017-388, Chapter I.

← 341.  The characteristics, requirements and other matters relating to the constitution of companies are governed by the Code des sociétés commerciales of 2000, as amended. Law 2019-47 has introduced new provisions amending and repealing provisions of the Code with a view to streamline procedures and requirements for the legal incorporation of companies.

← 342.  2016 Investment Law, Article 4; Decree 2018-417, Annex 1. The 2016 Investment Law has alleviated several licensing requirements for a number of activities in controlled economic sectors. These liberalised activities, as listed in Annex 2 of Decree 2018-417, have been open to private investment at least since 1 January 2019 (Decree 2018-417, Article 4).

← 343.  Decree 2018-417 of 2017, Article 3. Decree 2018-417 also sets out some establishment conditions and requirements relating to the exercise of a number of economic activities.

← 344.  Presidential Decree 2022-317, Annexes 1 and 2. In 2017, it set up a special management unit tasked with identifying and phasing out additional licensing requirements, in coordination with relevant Ministries and government agencies (Decree 2017-390).

← 345.  Decree 2018-417, Article 6.

← 346.  2016 Investment Law, Article 4.

← 347.  2016 Investment Law, Article 14; Decree 2017-388 of 9 March 2017, Article 7; Law 2019-47 of 3 June 2019, Article 11. Initially, the TIA’s OSS was mandated with liaising with the relevant authorities and agencies on behalf of the investor to obtain relevant licences and permits for the implementation of projects (2016 Investment Law, Article 15). Are excluded from the Commission’s mandate those activities or investment projects pertaining to the hydrocarbons, energy and air transport sectors, or those requiring licences or authorisations granted by regulatory authorities (e.g., the Bank of Tunisia, the Financial Market Council, or the General Insurance Committee) – see, Order of 2019.

← 348.  2016 Investment Law, Article 15bis; Law 2019-47, Article 11.

← 349.  Decree 2018-417, Article 9; Law 2019-47, Article 15. See also, the TIA Investor Guide portal. The ‘tacit approval’ principle does not apply with respect to two categories of activities, namely: activities which require licensing by sectoral regulatory authorities (“competent authorities” as defined under the Decree 2018-417), such as the Central Bank of Tunisia, the Financial Market Council, or the General Insurance Committee (Decree 2018-417, Article 2); and licences for activities specified under Annex 4 of Decree 2018-417, which include the production and distribution of defence and military equipment, oil exploration, telecommunications, the production and distribution of medicine and pharmaceutical products, and transport activities, inter alia.

← 350.  See, WTO, Trade Policy Review: Tunisia (2016), Report by the Secretariat, 10 October 2016, WT/TPR/S/341/Rev.1, p.36. The Review accounts for 30 amendments to the Investment Incentives Code since its adoption in 1993, and 150 amendments to the Code’s 33 implementing Decrees.

← 351.  Decree 2017-389, Article 15.

← 352.  Decree 2017-389, Article 21(4). Foreign natural persons are not eligible to obtain incentives for equity participation by the Tunisian Investment Fund (TIF).

← 353.  2016 Investment Law, Article 19.

← 354.  2016 Investment Law, Article 27.

← 355.  2016 Investment Law, Article 20.

← 356.  Decree 317-389. It should be noted that an English translation of the Decree is available in the JORT, but does not include its Annexes.

← 357.  Joint Ministerial Order of 2017.

← 358.  See e.g., the 2016 Investment Law, Article 19, allows for cumulation of premiums provided the combined value of granted premiums does not exceed one third of the investment costs. This calculation does not take into account the State’s spending on infrastructure, or other premiums granted under some specific schemes.

← 359.  The qualification of an investment as a “project of national interest” allows the investment to benefit from a bundle of incentives ranging from tax deductions to grants for infrastructure development (2016 Investment Law, Article 20).

← 360.  2016 Investment Law, Article 22.

← 361.  2016 Investment Law, Article 19(1).

← 362.  Decree 2017-389, Article 3(3).

← 363.  Decree 2017-389, Annex 1, I.

← 364.  Decree 2017-389, Annex 1, I (“Liste des secteurs prioritaires”).

← 365.  Decree 2017-389, Annex 1, II (“Liste des filières économiques”).

← 366.  Decree 2017-389, Annex 1, III (“Liste des activités exceptées du bénéfice des incitations du développement régional”).

← 367.  Decree 2017-389, Article 3(4).

← 368.  Decree 2017-389, Article 16. These national economic priorities are vaguely described in Article 1 of the 2016 Investment Law as including the increase of the added value and competitiveness of the Tunisian economy at the regional and global scales, especially by developing identified priority sectors (as listed in Annex 1 of the Decree 2017-389); creating employment; promoting an equal regional development; and contributing to the country’s SDG’s.

← 369.  Decree 2017-389, Article 24: The repayment term agricultural land loans is fixed at 25 years, including a 7-year grace period, and the interest rate is fixed at 3%. The interest amounts for the 7-year grace period shall be distributed over the 18 annuities of repayment.

← 370.  Decree 2017-389, Article 17: Incentives for PNIs may not exceed one third of the investment costs or TND 30 million (equivalent at the time of writing in September 2023 to EUR 9 million). This calculation considers the State’s funding granted for infrastructure work.

← 371.  Decree 2017-389, Article 2, 18. See also, 2016 Investment Law, Article 12.

← 372.  2016 Investment Law, Article 20; Decree 2017-388, Article 7(4).

← 373.  Decree 2017-389, Articles 9-10.

← 374.  Decree 2017-389, Article 11.

← 375.  Joint Ministerial Order of 2017, Article 12. The decision to postpone the examination of the application could be signed by the president of the committee in case of an existing delegation.

← 376.  Decree 2017-389, Article 11.

← 377.  Decree 2017-389, Article 11.

← 378.  2016 Investment Law, Article 12.

← 379.  Decree 2017-389, Article 9. The composition, powers, and functioning of these committees are set out in Joint Ministerial Order of 2017.

← 380.  Decree 2017-389, Article 9; Joint Ministerial Order of 2017, Article 2.

← 381.  2016 Investment Law, Article 20.

← 382.  Decree 2017-389, Article 10.

← 383.  Decree 2017-389, Article 14.

← 384.  2016 Investment Law, Article 22.

← 385.  This delay can be exceptionally extended once, for two additional years after an administrative decision is adopted to that effect.

← 386.  2016 Investment Law, Article 22.