Articles | Tuesday - 08 / 07 / 2025 - 4:00 pm
: Many entrepreneurs start their ventures as sole proprietorships due to the ease of establishment and low costs. However, as the business evolves and operations expand, the need to convert the proprietorship into a legal company becomes urgent. In this article, we’ll outline the legal steps you must follow to convert your sole proprietorship into a formal company in Egypt.
1. Review the Current Legal Status of the Proprietorship
Before you begin, ensure that your proprietorship is free of any outstanding legal or financial obligations, such as overdue taxes or unfinished contracts. This step is crucial to avoid any future issues during the conversion process.
2. Choose the New Legal Form for the Company
Determine the appropriate type of company for your project’s stage of development. Options include:
Choose the form based on the number of partners, capital, and the nature of the business activity.
3. Prepare the Company’s Articles of Association
The articles of association include details of the partners, distribution of shares, capital, and company management. It must be prepared by a specialized lawyer to ensure its compliance with Egyptian law.
4. Submit the Entity Conversion Application to the General Authority for Investment (GAFI)
The application is submitted along with the following documents:
5. Deregister the Proprietorship from the Commercial Register
After the new company is registered, the sole proprietorship is deregistered from the Commercial Register to legally cease its operations.
6. Obtain the Commercial Register and Tax Card for the Company
After the application is approved by the General Authority for Investment, a new commercial register and tax card will be issued in the company’s name.
7. Update Contracts and Business Relationships
Officially inform your clients and suppliers about the conversion of the proprietorship into a company, and update all contracts and financial relationships to be under the name of the new entity.
Converting a sole proprietorship into a company is a strategic step to expand your business scope and build greater trust with clients and investors. Don’t delay it if you aspire to grow, and start the legal procedures with precision and awareness.
