It is important to register at the Egyptian Federation for Construction & Building Contractors to practice the activity of construction and contracting in Egypt otherwise the practicing of the said activity is punishable under the Egyptian law.
Article 8 of the Executive Regulation of Law No.104 of 1992 stated that:
Any person engaged in construction, buildings, public works, land reclamation, installation, marine construction and any other works of the same nature, whether natural or juristic person, whatever legal system he may be subject to, shall apply for membership of the federation;
Article 7 of Law No. 104 of 1992 of the Egyptian Federation for Construction and Building Contractors states that:
It shall not be permissible to assign or conduct any acts within the contracting activity in excess of fifty thousand pounds per each operation to members out of the federation;
Article 46 of the same law stipulates that:
Without prejudice to any more severe penalty provided for in the Penal Code or any other law, whoever committed any of the following acts shall be punished by a fine not less than one thousand pounds and not more than ten thousand pounds;
1- Initiated or entered into a contracting agreement that exceeds fifty thousand pounds in the contract without being listed at the federation at the time of his contracting to perform that work, or have been removed or excluded in accordance with the provisions of this law.
2. hired or ordered to hire one of the non-members of the Union to carry out the contracting work or assigned contracting works to them that they may not conduct in accordance with the provisions of this law. In all cases, the court shall rule with the annulment of contracts concluded as a result of one of these acts.
Article 59 of the executive regulations of Law No. 4 states also:
"The member of the Union who is charged with committing any of the offenses stipulated in the law shall be referred to the disciplinary body of the Union at the request of the concerned Minister, the General Assembly of the Union, the Board of Directors or the Chairman of the board.
Moreover, Article 6 of the Executive Regulations of Law No. 4 of 1992 stated that:
The contract of a contractor or a part thereof may not be assigned except to a contractor listed in the federation in the same division and classified in the same category as the original contractor or the category below it in case of a waiver of part of the contract of the contracting agreement.
The articles above clarify that the legislator provided for strict penalties in case of violation of the registration requirement or in the case of a company makes contracts under a category that it is not listed in. The legislator also provided for an express punishment of cancellation of the contact subject matter, which is an explicit text that cannot be violated.
In the appeal no 931 of the year 45 judicial held on May 5, 1997,it is already established that in case the legislative text or its significance indicated an approach that the legal rule of which was determined by the legislator in order to regulate a certain condition according to a certain manner that can't be violated in commitment to the requirements of public interest and preferring it over any other private interests that might belong to other individuals , thus, this rule is one of the commanding rules related to public law.
The same principle was established by the appeal no 326 of the year 48 judicial
"Since this contestation is refutable as it is already established that in case the legislative text or its significance indicated an approach the legal rule of which was determined by the legislator in order to regulate a certain condition according to a certain manner that can't be violated in commitment to the requirements of public interest and preferring it over any other private interests that might belong to other individuals , thus, this rule is one of the commanding rules related to public law.
As we pointed out, the legislator is so committed to preventing any construction companies from performing construction works without registering with the Federation - moreover, the legislator divided contractors into different classifications and prohibited registered companies from performing works with a value which exceeds the amounts mentioned in its classification.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.