The main legislation governing arbitration in Egypt is the Egyptian Arbitration Law (issued by virtue of law No.27 of 1994, as amended) (the “EAL”). It is accurate to state that the EAL is the primary legislation that regulates the arbitration process in Egypt.  

Each statutory provision within a given law would have to be considered on its own and, based on its wording, can be categorized as being mandatory or supplementary.  

Mandatory provisions that touch upon arbitration can also be found in other, more specific laws. A common example can be found in the Egyptian Commercial Law (issued by virtue of law No.17 of 1999, as amended). Article 87 thereof provides that it is permissible that the parties agree to settle such disputes through arbitration, on the condition that the arbitration takes place in Egypt (i.e., is seated in Egypt) and in accordance with Egyptian law (i.e., the governing law is Egyptian law). The legislator used wording that makes it clear that the legislator’s intention is for said provision to be mandatory. Thus, any agreement to the contrary between the parties would be null. 

The Arab Republic of Egypt is a signatory to the New York Convention and the date on which the New York Convention has become part of Egypt’s legal system is June 7th, 1959. No reservations were made by Egypt. 

Egypt signed the ICSID convention on February 11th, 1972. It entered into force and became part of Egypt’s legal system in June, 1972. 

Egypt is also a signatory to a number of Bilateral Investment Treaties (“BITs”) with a number of states and has concluded over 115 BITs, of which approximately 74 are currently in force. 

The EAL is mainly derived from the UNCITRAL Model Law. The Egyptian Supreme Court, in one of its rulings, confirmed that the EAL aligns with key international conventions on arbitration, especially for international disputes. It follows the UNCITRAL Model Law (1985), which allows disputes from a defined legal relationship to be referred to arbitration through either a contract clause or a separate agreement, including when a contract refers to another document with an arbitration clause.  

There are some differences between the EAL and the UNCITRAL Model Law. For example, while the latter only applies to ‘international’ ‘commercial’ arbitration, the EAL applies to all arbitrations seated in Egypt and all arbitrations which are not seated in Egypt but which are governed by the EAL due to the disputing parties’ agreement to subject the arbitration proceedings to the EAL. The EAL also authorizes arbitration involving disputes stemming from administrative contracts.  

On the issue of reform, we note that the Minister of Justice issued Decree No.6 of 2022 regarding the formation a committee entrusted with preparing the necessary amendments to the EAL. However, no concrete updates or further developments have been made since then.

The main and leading arbitration institution in Egypt is the Cairo Regional Centre for International Commercial Arbitration (the “CRCICA”). The latest rules were issued and entered into force as of January 15th, 2024.

While there is no specialist arbitration court in Egypt, there are specialized court circuits within Egyptian courts for matters involving arbitration. The EAL provides that jurisdiction for arbitration-related disputes lies with the originally competent court to hear the dispute. Moreover, the jurisdiction to review arbitration-related disputes concerning international commercial arbitration lies with the Cairo Court of Appeal, unless the parties agree to resort to another appeal court. Once identified, the competent court retains exclusive jurisdiction to hear and decide arbitration-related issues until the completion of all arbitration proceedings. This, in our view, is a beneficial jurisdictional rule to adopt with respect to arbitration as it avoids the fragmentation of arbitration-related disputes across two or more different courts.

The EAL requires that the arbitration agreement must be in writing. This requirement can be met through various ways, including documents signed by the parties, correspondence such as letters, telegrams, telex,  and fax.  

The arbitration agreement can take the form of a clause within a contract or a separate, stand-alone agreement. If the arbitration agreement is concluded after a dispute arises, the matters to be resolved by arbitration must be specified in the arbitration agreement or said agreement will be deemed null and void. 

Arbitration is also not valid if no arbitration agreement exists, or if the agreement is null, subject to nullification, or has expired and, if at the time of its conclusion, one of the parties lacked legal capacity or had diminished capacity under the law governing their capacity. 

In addition, the subject matter of the arbitration agreement must be legally valid for adjudication by arbitration. Some issues are considered non-arbitrable under Egyptian law. These include, inter alia, issues concerning personal status, and criminal-liability matters. 

Lastly, the arbitration agreement is not valid if included in administrative contracts unless the competent minister, or in some cases the official assuming his/her authorities and powers, approves it.

The EAL emphasizes the separability of the arbitration clause. The Egyptian Court of Cassation has affirmed in a number of rulings that an arbitration clause is independent from the rest of the contract. The nullity, termination, or rescission of the main contract does not affect a valid arbitration clause contained in such contract.

While adopting a validation principle is a positive sign of an arbitration-friendly jurisdiction, Egyptian law does not apply any validation principle. As such, if an arbitration agreement is deemed governed by Egyptian law, Egyptian courts would proceed to examine the validity of such arbitration agreement using an Egyptian law lens. If the arbitration agreement in question is found invalid under Egyptian law, Egyptian courts would proceed to deal with the dispute as if no valid arbitration agreement exists.

In Egypt, asymmetric arbitration clauses are not deemed valid. The position of Egyptian courts on this issue is aligned with the position adopted in other jurisdictions, such as that of the United Arab Emirates. The position in Egypt stems from the fact that arbitration is a dispute resolution mechanism that is alternative to litigation. Further, in order for a valid arbitration agreement to be deemed to exist, one of the requirements that must be fulfilled is that the common intention of the contracting parties must be clear that it is aligned on opting for arbitration as the dispute resolution mechanism of choice. Thus, where one party has the right to choose between arbitration and litigation, while the other party does not have said option, Egyptian courts had found that no valid arbitration agreement exists. Hence, the only available dispute resolution forum would be courts, unless the disputing parties conclude a valid arbitration agreement.

Third parties or non-signatories can be deemed bound by an arbitration agreement in various cases. This includes cases where the third party / non-signatory was involved in the implementation of, at least, a considerable part of the contract. It also includes cases where the third party / non-signatory is found to have been represented by one of the contracting parties when entering into the relevant contract. Another instance is where a third party succeeds by law or assignment to a contracting party’s rights and obligations stemming from the relevant contract. A third-party beneficiary, when exercising rights stemming from a contract it did not sign, could also be deemed bound by the arbitration clause embedded within such a contract. Thus, a third party who wishes to exercise a right that is granted to it pursuant, for example, to an insurance policy or a subcontract, should examine the issue of forum as part of its overall strategy prior to launching a court case. Egyptian courts, however, have been hesitant to fully adopt the doctrine of piercing the corporate veil when it comes to arbitration and binding a third party, non-signatory to an arbitration agreement. Said hesitance has been witnessed by practitioners in both litigation and arbitration cases governed by Egyptian law. In a 2018 ruling, the Egyptian Cassation Court allowed extension of an arbitration clause to a third party, non-signatory on the basis of the Group of Companies doctrine. The court’s rationale was that the non-signatory company had contributed to the formation, execution, and completion of the underlying contract. This is a positive development as it shows that Egyptian courts are willing to go beyond and depart from the fixed parameters of a contract when the factual matrix allows for such departure to take place.

Egyptian courts, when faced with a lacuna in the arbitration agreement itself concerning the applicable law to said agreement, resort to a hierarchy of connecting factors. Said factors are drawn from both case law and private international law principles. First, Egyptian courts would look for an implied choice of law. For instance, if the parties have opted for Egyptian law to govern the merits of their dispute, then courts would, in the absence of strong evidence of a contrary intention, often deduce that the same law governs the arbitration clause. Further, if the arbitration is seated in Egypt, Egyptian courts may deduce an implied intention to apply Egyptian law to the arbitration agreement. Second, if no choice (whether express or implied) can be found, Egyptian courts would consider applying the law of the seat of arbitration to the arbitration agreement itself. Such an approach carries the advantage of increasing the likelihood that no conflict exists between different laws pertaining to different jurisdictions. Third, Egyptian courts would, in a situation where neither the seat nor the underlying contract’s choice of law clause provides a helpful, clear answer, resort to a third connecting factor; namely, the law most closely connected to the arbitration agreement. In this third layer, an Egyptian court would consider a number of factors, including the nationality and domicile / residence of the contracting parties, the place of conclusion of the agreement, the place of performance of the agreement, and the overall economic connection of the project / relationship to any of the relevant jurisdictions. In 2004, the Cairo Appeal Court had confirmed that, where the parties have no expressly designated a law to govern the arbitration clause, and the arbitration happens to be seated in the Arab Republic of Egypt, the arbitration agreement would be deemed governed by Egyptian law. In 2011, the Cairo Appeal Court found that, in the absence of express agreement by the parties, an arbitration clause shall be deemed governed by the governing law of the merits, unless the parties’ implied  intention or the relevant circumstances indicate otherwise.

This issue is subject to the autonomy of the parties. The Egyptian Cassation Court issued a ruling in 2023 emphasizing that, pursuant to article 39 and 53 of the EAL, the arbitral tribunal must primarily apply the rules agreed upon by the parties, and if they agreed to apply the laws of a certain country, the substantive law of this country is to be applied unless agreed otherwise. The court specifically stated that: “According to Articles 39 and 53(1)(d) of the Arbitration Law, when the parties agree on the legal rules governing their dispute, the arbitral tribunal must adhere to and apply those rules, considering the contract terms and trade customs. If the parties agree to apply the law of a specific state, the tribunal must apply its substantive rules rather than its conflict of laws rules, unless otherwise agreed. Where only the state law is specified without designating a particular branch, the tribunal may apply the branch it deems most connected to the dispute. The tribunal cannot disregard the agreed legal rules and replace them with principles of equity and fairness even if the tribunal is entrusted with conciliation” (The Egyptian Cour de cassation challenge No.13996 of JY-91 issued in 2023). In the absence of agreement between the parties, the arbitral tribunal would have to determine which law governs the merits of the dispute, taking into consideration all the relevant connecting factors.

The EAL places certain restrictions on the appointment of arbitrator. An arbitrator must not be a minor, legally incapacitated, deprived of civil rights due to a criminal offence, or misdemeanor prejudicial to honor or declared bankrupt unless rehabilitated. There are no nationality or gender or religious requirements unless agreed by the parties or specified by law. Acceptance of the role must be in writing, and the arbitrator must disclose and declare any circumstances that could raise unjustifiable doubts about their independence or impartiality. In addition, a permit is required from the employer for an employee in a public entity to sit as arbitrator and from the supreme judicial council for judges to sit as arbitrators as an exception and in limited situations.

Egyptian courts would only intervene in the selection of arbitrators if (a) the parties agree that Egyptian courts would act as an appointing authority in case no agreement is reached between the parties on the appointment of arbitrators, (b) if no agreement is reached by the parties on an appointing authority and one of the parties fail to appoint an arbitrator within the applicable deadline, and (c) recusal of an arbitrator is pursued by one of the parties and the arbitration in question does not unilaterally resign.

The EAL allows challenging an arbitrator if there exist circumstances that give rise to serious, justifiable doubts in relation to his/her impartiality and/or independence. However, a party to the arbitration is not allowed to challenge his/her appointed arbitrator except for a reason that becomes clear after the appointment has been made. 

The EAL has regulated the procedures for filing a challenge against an arbitrator, where it stated that the challenge request must be submitted, in writing, to the arbitral tribunal including the reasons for such challenge. The challenge should be filed within 15 days from the date on which the challenging party becomes aware of the tribunal’s formation or the circumstances justifying the challenge. If the arbitrator does not withdraw within 15 days of receiving the challenge, the EAL refers the issue to the competent court. The court’s decision is final and binding. The submission of the challenge request does not suspend the arbitration proceedings, however, if the arbitrator is removed, all arbitration proceedings conducted by the challenged arbitrator are to be considered null and void. 

The CRCICA rules include provisions for challenging an arbitrator. The Center requests comments on the challenge from the parties. Should the challenged arbitrator refrain from withdrawing or the parties do not agree to remove the challenged arbitrator, the challenge is refereed to an ad hoc committee, including members of the CRCICA’s Advisory Committee, for a decision on the challenge.

In a 2022 ruling, the Egyptian Cassation Court emphasized on the application of the IBA Guidelines on Conflicts of Interest in International Arbitration (2014)in relation to the duty of impartiality and independence and the duty of disclosure. The Court stated that the Orange List contained in the IBA Guidelines, which serves as persuasive authority for courts in many jurisdictions, provides non-exhaustive examples of situations that may give rise to justifiable doubts regarding an arbitrator’s independence or impartiality, thereby requiring disclosure. This is an important development because, on the one hand, it signals Egyptian court’s attention to what is happening on the global arena and its attention to soft law instruments, and on the other hand, it signals Egyptian courts’ comfort and ability to interpret and apply soft law instruments such as the IBA Guidelines in a manner that is consistent with the intended goals behind arbitration.

Egyptian law does not provide for arbitrators’ immunity. However, in practice, an arbitrator could be held liable for the harm caused due to said arbitrator’s gross fault and/or gross negligence. The party pursuing a claim against an arbitrator would carry the burden of proving that the arbitrator committed a gross fault and/or gross negligence, that the claimant suffered harm, and that there is causality between the fault and the harm.

The principle of competence-competence is well recognized under the EAL. Article 22(1) of which grants the tribunal the authority to rule on its own jurisdiction. This includes the power to decide on objections based on the non-existence, lapse, invalidity, or inapplicability of the arbitration agreement to the subject matter of the dispute.

Egyptian courts would wait for the defendant / respondent to either accept the court’s jurisdiction thereby waiving the arbitration agreement, or to object to the court’s jurisdiction based on the existence of a valid arbitration agreement. If the latter scenario crystalizes, court would then proceed to examine the arbitration agreement to determine whether or not it is valid. If court concludes that the arbitration agreement is invalid, then court would proceed to hear and decide on the dispute. This, however, is inconsistent with the competence-competence principle. One way of removing such inconsistency is for courts, when faced with a valid arbitration agreement that is being invoked by the respondent, to stay the proceedings until the parties go to arbitration and get a decision from the arbitral tribunal on the issue of the validity of the arbitration agreement. If the arbitral tribunal decides that it does have jurisdiction based on a valid arbitration agreement, then court should accept the respondent’s argument and find the case inadmissible due to the existence of a valid arbitration agreement.  

The EAL provides that the arbitral tribunal shall proceed with the arbitration proceedings even if the respondent fails to submit its defense as per article 30(2), and such failure shall not be deemed an admission of the claimant’s claims, unless otherwise agreed by the parties. Although, it is not clearly stated under the EAL, the tribunal, in accordance with the principles of transparency, equality and without prejudice to the right to defend, must notify the parties with all what has been submitted during the proceedings.

The EAL does not regulate the joinder of third parties to the arbitration proceedings. It is clearly stated under Egyptian law that the contracts only bind their parties, and by extension, the arbitration agreement itself is only binding to the parties who consented to it. However, third parties may only join arbitration proceedings if all parties to the arbitration agreement consent. 

The joinder of third parties to the arbitration proceedings has been recognized in summary by the new CRCICA rules of 2024. Article 17.5 thereof provides that the arbitral tribunal may permit third parties to join the arbitration if they are parties to the arbitration agreement, provided no party suffers prejudice and all parties, including the third party, are heard. Such joinder does not affect the tribunal’s composition, and the tribunal may issue one or multiple awards covering all parties involved. 

If all parties do not agree to the intervention, the arbitral tribunal could still allow it provided that the intervening party successfully proves that the scope of the arbitration agreement somehow extends thereto (i.e., to the intervening party).

Interim measures are not exhaustively listed under Egyptian law. As such, a court or tribunal could order whatever interim relief is necessary for the intended purpose mainly revolves around the preservation of the status quo or the creation of a temporary situation where assets are preserved in a way that protects the applicant and prevents asset dissipation.  

Local courts would issue interim measures pending the constitution of the tribunal, provided that court is satisfied that there exists a real, imminent threat that needs to be addressed in a manner that does not affect the merits of the dispute.  

Anti-suit and/or anti-arbitration injunctions are not available and unenforceable in Egypt. The right to resort to litigation is considered a basic right under the constitution and, thus, a party can always file a court case before an Egyptian court. The defendant can, naturally, raise any and all jurisdictional, admissibility-related, and/or merits related arguments that it may wish to raise.

Evidentiary matters in arbitration under Egyptian law are subject to the same general framework as before national courts, which are governed by the Egyptian Evidentiary Law No. 25 of 1968, unless the parties agree otherwise. The arbitral tribunal has discretionary power to assess the admissibility, relevance, and value of evidence, while considering the agreed upon evidentiary procedures, including the parties’ agreement to apply institutional rules such as the IBA Rules on the Taking of Evidence in International Arbitration. Judicial assistance may be sought when coercive powers are required, as arbitrators themselves lack authority to compel parties to produce evidence or appear as witnesses.

The Egyptian Bar Association Law No.17 of JY-1980 regulates the conduct of lawyers including the professional ethics, confidentiality, duty of honesty and integrity in addition to the requirement of informing the client (the party being represented by the counsel in the arbitration) with all the developments and procedures. Furthermore, the IBA Guidelines on Party Representation in International Arbitration offer guidance for counsel’s ethical duties.

Confidentiality of arbitration proceedings is recognized in the EAL. Thus, arbitral awards are confidential and may not be published without the consent of the parties. Also, this entails that arbitration proceedings also are covered by confidentiality. 

These are seen by Egyptian courts as soft law instruments. Thus, Egyptian courts do take sources such as the IBA Guidelines on Conflicts of Interest into consideration when deciding on cases and frequently apply them. Egyptian courts also look at court rulings from other jurisdiction to see how other jurisdictions have interpreted and applied such soft law instruments.  

A differentiation should be made in this respect between ad hoc arbitration and institutional arbitration. In the latter, the relevant rules usually regulate the issue by providing for a set of rules for the estimation and allocation of the arbitration costs and fees. The EAL does not regulate this issue. As such, arbitral tribunals enjoy a wide level of discretion when allocating said costs. In case of ad hoc arbitration, the parties usually agree on the fees and the expenses of the arbitrator which is to be divided among them until a final award is issued ordering the losing party to pay all the fees and expenses. 

Pre-award interest can only be included on the principal claim. With respect to costs incurred, interest can only start running from the date of the award.  

Applications for security for costs are rarely granted in Egypt. These are viewed with caution by arbitral tribunal and courts. During the proceedings, parties are expected to bear their own legal expenses and costs, with the possibility of recovering all or part of such expenses if / when they prevail at the end of the proceedings. 

In Egypt, arbitral awards are subject to certain requirements to ensure their validity and enforceability. For instance, the award must be issued in writing and signed by the arbitrators; in the case of a multi-member tribunal, the signatures of the majority are sufficient, provided the reasons for any missing signature(s) are stated in the award. As to the reasoning of the award, the EAL states that the award must be reasoned unless otherwise agreed by the parties. The award must include the names, addresses, nationalities, and capacities of the parties and arbitrators. A copy of the arbitration agreement, a summary of the parties’ claims, statements, and documents, the dispositive part of the award, and the date and place of issuance must be included in the award. 

The party in whose favor the arbitral award was issued must deposit the original award or a signed copy thereof, along with an official Arabic translation if the award is issued in a foreign language with the competent court.

An estimate could be said to be 10 to 14 months. A party can bring a motion for the recognition and enforcement of an award on an ex parte basis, provided that the EAL is applicable. If the EAL is not applicable, then the Egyptian Civil and Commercial Procedures Law would fill in the lacuna; it provides for the filing of a regular court case where the losing party is notified of the case so that it has an opportunity to attend the hearings and put forward its case. The standard of review is the same for domestic and international awards.

If Egypt is the seat of arbitration or the EAL is agreed by the parties to govern the arbitration proceedings despite the latter taking place outside of Egypt, then the losing party may pursue a nullity action of the arbitration award in front of Egyptian courts. The grounds for nullity, as exhaustively laid out in the EAL, are limited to procedural irregularities. A nullity action of an award is filed in the same way a regular court case is filed in Egypt and the case is then heard in various court hearings until court proceeds to issue its ruling. Parties may validly waive the right to challenge an award by agreement, provided that such waiver is issued post-award. 

In Egypt, the legal power of an award is always limited to the parties of the arbitration. No third party or non-signatory can ever be bound by an award issued in arbitration proceedings to which said party was not a party. As such, third parties would have no standing to challenge the recognition of an award. 

There have not been any court rulings or rules regulating or prohibiting third party funding of arbitration proceedings.  

Pursuant to the new CRCICA Arbitration Rules, emergency arbitration has become available. Decisions made by emergency arbitrators undergo the same process for enforcement that awards issued by normal arbitral tribunals undergo.

No, there are no laws or rules that provide for simplified or expedited procedures for claims under a certain value.

We have not come across any such court decisions.

There have been no recent court decisions considering the issue of corruption. In the absence of specific provisions on the burden of proof, general legal principles apply. Hence, the party alleging corruption must provide evidence supporting its claim, as the burden rests with the party asserting a fact contrary to the origin. 

There have not been any court decisions with respect to this issue.

Arbitral tribunals have become more inclined to hold virtual hearings and to accept electronic submissions. This has helped cut expenses incurred by the disputing parties.  

There have not been any court decisions with respect to these issues.

No.

No.