Types of Companies in Egypt - Which Type is Right for You?

If you want to start a business in Egypt you need to know the types of companies, and find out which is the best type for your business.

Types of companies: 

Sole Proprietorship

Owned by one person with unlimited personal liability. They are responsible for paying the company’s debts, and in the event of a default the debts are repaid from his/her own property. A sole proprietorship is the easiest to establish in terms of procedures.

Partnerships 

Same as a sole proprietorship except that it is owned by two or more individuals, and if there is a default in paying debts the partners' personal funds are used to pay them off.

Limited Liability Partnership

There can be 2 types of partners in an LLP:

1. General partners: these partners are equally responsible for everything in the company and are legally responsible as well.

2. Limited liability partners: partners share the capital, but do not have any rights to manage the company, and in case of default are only responsible for the company's debts according to their share in it.

Joint stock companies are popular and usually the capital is divided into equal shares among investors.

Joint Venture Company

It is a company created for a specific purpose by two or more people. Once the goal is achieved the partnership ends and the company is liquidated. This type of company does have a legal entity, and can almost be considered a secret partnership.

Joint Stock Company

In a joint stock company the company is owned by the investors with each investor owning a specific number of shares according to their contribution. If the company is in default the investors’ private properties are not affected but they do run the risk of losing the capital they invested.

Company limited by shares

There can be 2 types of partners:

1. General partners: they are responsible for managing the company and must not be less than 2.

2. Shareholders: they contribute to the capital according to their share in the company, but do not have any rights to manage the company. They can not be less than 3.

Limited Liability Company (LLC) 

Similar to an individual company but the number of partners in it cannot exceed 50, and the company can’t issue shares of stock. Also partners in the company cannot sell their shares to anyone outside the company.