What Is Copyright?

Copyright refers to the legal right of the owner of intellectual property. In simpler terms, It is the right to copy. This means that the original creators of products and anyone they give authorization to are the only ones with the exclusive right to reproduce the work.

Copyright-law gives creators of original material the exclusive right to further use and duplicate that material for a given amount of time, at which point the copyrighted item becomes public domain.

Understanding Copyright

When someone creates a product that is viewed as original and that required significant mental activity to create, this product becomes intellectual property that must be protected from unauthorized duplication. Examples of unique creations include computer software, art, poetry, graphic designs, musical lyrics and compositions, novels, film, original architectural designs, website content, etc. One safeguard that can be used to protect an original creation is copyright.

Under it’s law, a work is considered original if the author created it from independent thinking void of duplication. This type of work is known as Original Work of Authorship (OWA). Anyone with an original work of authorship automatically has the copyright to that work, preventing anyone else from using or replicating it. The copyright can be registered voluntarily by the original owner if he or she would like to get an upper hand in the legal system if the need arises.

Not all types of work can be copyrighted. It does not protect ideas, discoveries, concepts, and theories. Brand names, logos, slogans, domain names, and titles also cannot be protected under copyrights law. For an original work to fall under creation, it has to be in tangible form. This means that any speech, discoveries, musical scores, or ideas have to be written down in physical form in order to be protected by copyright.

In the U.S., original owners are protected by copyright-laws all of their lives until 70 years after their death. If the original author of the copyrighted material is a corporation, the copyright protection period will be shorter.

U.S. copyright-law has experienced a number of amendments and changes that have altered the duration of copyright protection. The “life of the author plus 70 years” protection can be attributed to the 1998 Copyright Term Extension Act, (also known as the Mickey Mouse Protection Act or Sonny Bono Act), which generally increased copyright protections by 20 years.

Copyrights vs. Trademarks and Patents

While copyrights-law is not all-encompassing, other laws, such as patent and trademark laws, may impose additional sanctions. Although copyrights, trademarks, and patents are frequently used interchangeably, they are different forms of protection for intellectual property.

Trademark laws protect material that is used to distinguish an individual’s or corporation’s work from another entity. These materials include words, phrases, or symbols—such as logos, slogans, and brand names—which copyrights-laws do not cover. Patents cover inventions for a limited period of time. Patented materials include products such as industrial processes, machines, and chemical positions.

Read more: Short Selling Mechanism


Short Selling Mechanism

Short Selling Mechanism

The Short Selling Mechanism or Empty Sale mechanism; is selling a security before owning it. with an intention to buy it later at a lower value, and thus achieving a profit equivalent to the price difference between the short selling price and the purchase price minus the interest. that the investor pays for borrowing the security in the period between buying and selling.

In other words, this mechanism allows the investor to borrow securities from someone for sale, and then buy them back, to give them back once again to their original owner, and this is in exchange for interest. This policy is usually used only if the investor expects the price of a security to decline as a commercial share or bond in the near future, which is the total opposite of the term “Long Selling” which is buying a security or stock to profit from the price rise in the future.

However, and for what has been going on in the markets from lack of symmetry and stability due to the “zero” transactions, i.e. buying stocks in the morning and then selling them at the end of the session, the security-borrowing mechanism has been activated in Egypt since 2018. Where the provisions of Articles 298 and 289 of the executive regulations of the Capital Market Law no. 95 of 1992 have been amended; and this is to allow securities brokerages to start the securities trading activity for the purpose of selling and to increase the trading rate in the Egyptian market.

This mechanism (Short Selling Mechanism) is a win-win, where the investor benefits from the difference between the two prices, the original owner of the security can benefit by generating him a return, as he lends those securities to a percentage equivalent to the percentage of lending and discount, in addition to the ability to obtain their dividends on periodically; allowing him to achieve new investment goals.

Now, how can you as an investor benefit from this mechanism? Here are some suggestions;

Short selling mechanism benefits

1- As an investor, you better use short selling only on the bearish trend, do not try to use it in profit-taking areas.

2- Attempting to open short positions at the peaks isn’t the best you can do, you better wait for some sort of confirmation that their stocks are going downwards.

3- Use index documents as they are easier to analyze than stocks at the time of a drop.

4 – Target bearish prices and do not keep the short sale running for long periods.

5- Remember that; while you are conducting short selling deals, you are actually working against the general rule of growth and scarcity, which is the nature of markets.

6- Short selling will change the way usual markets functions on the short term, so try to invest with small quantities.

7 – With Short Selling, the term “hedge” will appear, where the best strategy for a long-term investor who is holding his stocks for one reason or another, is that he can sell their index documents until the bearish trend ends, which allows him to equate the fall-sown of his shares.

Read more: The Financial Regulatory Authority (FRA)


MCDR: Misr for Central Clearing


Misr for Central Cleaning, Depository and Registration (MCDR)

Misr for Central Clearing, Depository and Registry (MCDR) was established according to the provisions of the Capital Market law number #95 of 1992 and was founded by 1- Cairo and Alexandria Stock Exchanges: with 35%, 2- Banks: with 50%,and Brokerage firms: with 15%

MCDR was established within the framework of the programs adopted by the Capital Market Authority (CMA) for developing the capital market mechanisms and applying the central depository system. The main purpose of establishing the company is to perform the activity of clearing and settlement of transactions that take place on securities on the stock exchange and applying the central tenure system for securities. The company is responsible for completing the transfers of ownership for the transactions of sale and purchase that take place on the stock exchange, and also the transfer of the ownership of securities that is made on the basis of the principle of Delivery Versus Payment (DVP).

Later on the 18th of May, 2000, the Central Depository & Registry Law was issued to regulate MCDR activities, establish the relevant legal framework to help MCDR become a self regulatory organization.

The company (MCDR) is mainly responsible for the following:

 • Undertaking clearing and settlement transactions for securities traded on the stock market and the other related services.

•  Applying the Central Depository System in Egypt.

 • Establishing the central registry system.

•  Executing corporate actions on behalf of issuers.

•  Executing pledging operations on the securities registered at the Central Depository System.

•  Managing a fund to guarantee settlement of financial and securities transactions.

•  Managing a securities lending fund.

•  Other supporting  services

•  Act as an interface for Arab and Foreign intermediaries in Egypt.

•  Act as a custodian for some financial institutions.

•  Train employees in the market on the newly introduced systems.

Read more about: The Financial Regulatory Authority (FRA)



The Financial Regulatory Authority (FRA)

The Financial Regulatory Authority

The Financial Regulatory Authority is an Egyptian Governmental Authority that is an integrated agency on its own. It was established in accordance with Law no. 10 of 2009 that was issued on Feb 25, 2009 to replace all of: the Egyptian Insurance Supervisory Authority (EISA), the Capital Market Authority (CMA), and the Mortgage Finance Authority (MFA). And then it became operationally effective on July 1, 2009.

Mainly, it plays a vital role in ensuring stability and solidity for every non-banking financial market. It is responsible of their controlling, supervision and regulation. These markets includes the Capital Market that we have previously talked about in an earlier post besides other transactions; such as Future Exchanges, Derivative Markets on financial assets, Commodities Insurance Activities, Mortgage Finance, Financial Leasing, Factoring, and Securitization. FRA also works on reducing risks resulting from the lack of coordination, in addition to addressing problems emanating from the presence of different regulatory methods.

The authority’s prime goal for is to maintain the development, stability and soundness of the non-banking financial markets while protecting the rights of stakeholders, investors & participants and issuing various means, systems, and rules that ensures efficiency and transparency of these markets.

The Financial Regulatory Authority is also responsible for licensing and inspecting entities operating in non-banking financial activities, regulating the dissemination of information related to non-banking financial markets while ensuring transparency and competitiveness of non-banking financial services through applying sound rules and regulations and taking necessary actions to curb market manipulation and fraud. This is in addition to the roles and terms of references mentioned in each of: the Supervision and Regulation of Insurance Law no. 10 of 1981, the Capital Market Law no. 95 of 1992, the Depository and Central registry Law no. 93 of 2000, the Mortgage Finance Law no. 148 of 2001, Microfinance Law no. 141 of 2014, and Financial Leasing and Factoring Law no. 176 of 2018.

For more info about investment: INVESTMENT REGIMES IN EGYPT




Investments Incentives

1.1 General Incentives

All investments projects (other than free zone projects) benefit from General Incentives under the New Investment Law. These incentives include a fixed 2% customs fee on all imported machinery and equipment, an exemption from stamp tax and registration fees on all incorporation contracts as well as finance and mortgage contracts for 5 years from registration in the Commercial Register.

1.2 Special Incentives

  1. Sector A Projects: Investments projects executed in the underdeveloped geographical areas specified in the Investments Map benefit from a deduction from the taxable net profits, at the rate of 50% calculated on the investment costs of the project.
  2. Sector B Projects: Certain types of investments projects benefit from a deduction from the taxable net profits, at the rate of 30% calculated on the investment costs.

To enjoy the Special Incentives the conditions include incorporating a new project company for the investment project within 3 years from the effective date of the Executive Regulations of the Law 72 of 2017, extendable for one year only, and holding of regular and proper books of account.

The foregoing tax incentives shall not in any case exceed 80% of the paid-up capital of the company. However, it is not applied for more than 7 years from the date of commencement of the activity of the project.

1.3 Additional Incentives

Upon a Cabinet’s decree, investment projects may be provided the following incentives:

  1. Allowing the project to establish special custom ports for its own imports and exports.
  2. The state may, after the commencement of the project, refund the investor with all or part of the expenses borne by him to extend the infrastructure facilities to the project.
  3. The state may partially finance the costs of the employee’s technical training.
  4. Refunding half the value of the land designated to industrial projects, in case of commencement of the production within 2 years from the date of handing over such land.
  5. Allocating free lands for strategic industries.

2. Investor Services Center (ISC)

As an exception to all other laws, the representatives of all licensing authorities in the ISC are subject to GAFI supervision and have all the powers to address all administrative and legal matters, allocate lands and issue all licenses to the project company for the life of the investment project.

Fixing time limits for the ISC to issue licenses: decisions must be taken within a maximum of 60 days from submission of application. In case of no reply within such period, this will be deemed an approval, to be issued by the CEO of GAFI.

3. Accreditation Offices

Such offices will be licensed by GAFI to review documents required for obtaining licenses for the project, its operations and expansion, to confirm compliance with technical, financial and other requirements under the relevant laws.

The Accreditation Office certificate is an official certificate valid for 1 year and is recognized by ISC and GAFI. Such certificate is deemed final if no justified objection is made within 10 business days from the date of submission. Hence, the investors may obtain their licenses and approvals immediately thereafter.

4. The One-Approval Businesses

Upon the Cabinet’s Decree, corporates established to carry out national or strategic projects contributing to the development process or “Public-Private Partnerships” (PPPs) in specific fields may be provided one approval. Such approval is sufficient to establish, run and manage the project and it is self-enforceable without requiring any other procedures.

5. Amicable Dispute Resolution Means

Law 72 provides for ADR mechanisms that ensure efficient and fair resolution of disputes, in addition to protecting the investors. Final decisions taken are binding to the Administration, while the investor retains the right to appeal such decisions before the competent courts. The ADR mechanisms include:

  1. The Grievance Committee.
  2. The Ministerial Committee for Resolution of Investment Disputes.
  3. The Ministerial Committee for Settlement of Investment Contracts Disputes.
  4. Arbitration and Mediation Center.

For more info about investment: INVESTMENT REGIMES IN EGYPT

Investment Guarantees Foreign Investment

1 2 3 4 5