Egypt: Release Of Egypt's First Central Movable Collateral Registry

Last Updated: 17 June 2019
Article by Fatma Salah and Sama Elbaradei
Most Read Contributor in Egypt, July 2019

The Egyptian Financial Regulatory Authority ("FRA") announced the launch of the Egypt's first central movable collateral registry.

Egypt had its first Movable Collaterals Law on 15 November 2015 (Movable Collaterals Law no. 115/2015), and the Ministry of Investment passed the Executive Regulations On 15 December 2016.

The law introduced an overarching system for taking non-possessory security over diversified movable assets. It aims at facilitating access to credit through a well-defined legal regime that is in line with the international standards, such as those established by the United Nations Commission on International Trade Law (UNCITRAL) and by the World Bank.

What is a Central Movable Collateral Registry and what is its purpose?

A Central Movable Collateral Registry ("Registry") is an electronic system for recording and disseminating the security interests over the collaterals and making any amendments or cancellations to them. The Registry launched its first online version at: http://www.ecr.gov.eg/

The Registry has two main functions, (i) to record security interest over movable property and (ii) to set the priority of creditors with regard to third parties. It will assist in preventing the transfer of collaterals without notice of the creditors, prevent debtors from duplicating lien/s on collaterals or using collaterals that are not their own.

The FRA is the competent authority responsible for creating and running the Registry and has the right to assign such task to another authority or company to be in charge. FRA assigned the task to I-Score, the Egyptian Credit Bureau S.AE., to be responsible for creating and operating the Registry's website; all under the supervision of FRA as it is the only authority which owns the data and information contained in the Registry.

Which movables are acceptable as collateral?

Movables acceptable as collateral in creating non-possessory security shall include present or future tangible assets, and present intangible assets. The Law gave examples to the movables that are permitted to serve as collateral to include, inter alia, the following:

  1. Current and deferred debts.
  2. Bank accounts, whether saving or current accounts.
  3. Negotiable document that embodies a right to delivery of goods such as the bill of lading and warehouse receipts.
  4. Negotiable instruments such as a cheque, bill of exchange, promissory note, bank depositary notes that embodies a right to payment.
  5. Equipment, machinery.
  6. Inventory.
  7. All kinds of intellectual property rights like patent, trademark, trade name, and copy rights.

Who could qualify as secured creditors?

Secured creditors are defined to be banks, financing institutions, and other institutions and individuals granting financing or credit facilities. The executive regulations numerated the categories of such secured creditors to include:

  1. Banks and financial institutions licensed to operate in Egypt.
  2. Companies and entities licensed to run financing leasing activity in Egypt.
  3. Associations and companies licensed to run microfinance activity in Egypt.
  4. Entities licensed to provide financing or credit facilities, or which the nature of their licensed activity so requires;
  5. Entities licensed to carry out movable trade activities.
  6. Entities authorized to grant licenses of using intellectual property rights.

When is a security interest perfected?

A security interest is perfected upon acceptance of the registration, when an electronic confirmation shall be issued, including the date and time of registration, the registration unique number and all information included in the registration process.

What is a security agreement?

A security agreement is agreement contract concluded by and between the creditor and debtor, or the creditor, the debtor and the grantor to regulate the creditor's security interest over the movable(s). The security agreement's purpose is to create and effectuate the security interest between its parties.

Who can apply for the registration?

The applicant is responsible to register, amend, cancel, object to, and search in the Register, either on their own behalf or on behalf of the secured interest holder. Who can access the Registry? And how? Anyone can access the Registry by providing one of the following:

  1. The unique registration number.
  2. The national ID number of the debtor / grantor if it is an Egyptian natural person or the passport number and the country of issue if it is a non-Egyptian natural person or the registration number if it is a legal person as the case may be.

Is the permission of the debtor required for the registration?

The debtor/ grantor must consent to any registration by signing the security agreement or any other document attesting to his approval. The creditor shall be deemed in breach of the provisions of the Law and its Executive Regulations if it signs any registration without obtaining the prior consent of the debtor / grantor.

How can a debtor ensure that the collateral is removed after repayment of the loan?

In case of repayment of the secured loan whether within the time scope of the registration or by making an expedited payment, or the expiry of the secured interest for any other reason the debtor has the right to obtain a copy of the data recorded in the Registry which indicates the abolishment or cancellation of the registration restricting the secured interest. After obtaining such copy, the debtor has the right to dispose of or lease the movables as they wish.

HOW CAN WE HELP?

We can assist you in the following:

  • Review your loan agreements and the associated security documents and advise on the possibility of registration thereof.
  • Registering any collaterals at the Register.
  • Challenging invalid registrations.

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.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions