Establishing Postal Shipping Companies in Egypt: Types, Procedures, and Postal Licensing

With the significant growth of the e-commerce sector in Egypt, postal shipping companies have become a vital component of market movement and delivery services. Establishing such companies requires adherence to specific legal procedures and compliance with regulations set by the relevant authorities, primarily the National Telecommunications Regulatory Authority (NTRA) and the National Postal Authority. This is clearly reflected in the legislative framework, particularly Law No. 16 of 1970 (the Egyptian Postal Law) and Companies Law No. 159 of 1981.

This article presents the following:

• The types of postal shipping companies in Egypt.
• The legal steps for establishing postal shipping companies.
• The formation of each type of the shipping companies based on its legal structure.
• The procedures for obtaining a postal license.

Types of Postal Shipping Companies in Egypt

Shipping companies are categorized based on the type of service and geographical zone into:

1- Fast local Courier Service Companies

Operate within a specific geographic zone (e.g., only in Egypt)

Deliver documents or small parcels

2- International Courier Companies

Licensed to deliver mail between countries

Require broader approvals and registration with international organizations

3- Parcel Delivery / Non-Postal Freight Shipping Companies

Deliver products for companies or individuals; may not be classified as “postal” in the traditional sense

4- E-commerce Platforms with In-house Shipping Services

Platforms like Jumia or Amazon, which have their own shipping arms

Market Opportunities for Establishing a Shipping Company

With the rise of e-commerce and online sales, there is a growing demand for fast and reliable shipping services to ensure timely delivery to customers. Both the international and local markets are experiencing a prosper in import and export activity, creating opportunities to expand services to include cross-border and domestic freight shipping.

Governments are promoting investments in the logistics and transportation sector, which may offer incentives such as tax exemptions and streamlined licensing procedures. Ongoing developments in port, airport, and road infrastructure are increasing operational efficiency and reducing transportation costs, thereby enhancing the competitiveness of shipping companies.

Challenges You May Face Initially

• Entering the market may require competing with established shipping companies that have extensive experience and resources, making it necessary to offer value-added services to differentiate the new company.
• Establishing a shipping company requires significant capital to build a fleet of vehicles, secure logistics utilities, and implement modern shipment management systems.
• Obtaining all the required licenses and permits from the relevant authorities can be a complex process that demands strict adherence to legal procedures.
• Effectively organizing and tracking shipments and managing inventory is a major operational challenge, especially when dealing with multi-destination deliveries and tight delivery schedules.
• Fluctuations in fuel prices, maintenance and insurance costs, can impact profitability, requiring flexible financial planning and strategies to navigate economic downturns.

Legal Procedures for Establishing a Postal Shipping Company

These companies are registered in accordance with the Egyptian Companies Law No. 159 of 1981 or the Commercial Registry Law, depending on the chosen legal form (joint stock company, limited liability company, etc.).

Procedures:

Choosing the Legal Form: It is preferable to choose a Limited Liability Company (LLC) or a Joint Stock Company (JSC) depending on the scale of the business.

Preparing the Basic Incorporation Documents: Articles of incorporation of the company, Identification documents for the founders, non-confusion Certificate for the trade name, and Determination of capital and business activity (must explicitly include shipping or postal services).

Submitting Documents to the General Authority for Investment and Free Zones (GAFI): To obtain the Commercial Register, extracting the tax card, Registration with the Chamber of Commerce, and Social insurance registration.

Establishing Each Type of Postal Shipping Company Based on Legal Form

1- Sole company

Procedures:

• Heading to the Commercial Registry Office
• Submit: (copy of national ID, lease or ownership contract of the premises)
• Apply for opening a commercial register
• extracting: (Commercial Register, Tax Card)
• No Articles of Incorporation required

2- Limited Liability Company (LLC) – Most Suitable for Small and Medium Enterprises

Procedures:

• Prepare: (Articles of Incorporation, Partners Information, Capital Proof — capital deposit is not mandatory except in certain cases))
• Submit the application to GAFI
• Extracting: (Commercial Registry, Tax Card, Import License — if involved in international shipping)
• Open a social insurance file

3- Joint Stock Company – Most Suitable type for International Shipping

Procedures:

• Minimum capital: EGP 250,000 (10% must be paid upon incorporation)
• Incorporation through GAFI
• Submit: (Article of Association, Incorporation Minutes, Names of Founders and Board Members, Bank Certificate confirming capital deposit)
• After establishing process: (Register the company on the Egyptian Exchange — if required, Appoint an auditor, Obtain postal license)

Obtaining a Postal License – From the National Postal Authority

It is not permitted to engage in postal shipping activities without an official license from the National Postal Authority (or the Postal Regulatory Body under the Ministry of Communications).

Basic Procedures:

Submit a License Application including:

1. Company information
2. Commercial register
3. Tax card
4. Operation address
5. Operation plan and activity details

Payment of Licensing Fees:

1. Fees vary depending on the type of service (local, international, etc.)

Authority Review:

1. A site inspection of the operational premises may be required
2. Review of operational, storage, and security systems

Obtaining approval:

1. The authority issues a time-limited license that is renewable

Important Considerations When Establishing a Shipping Company

• Adopt a comprehensive marketing plan that is transparent and legally compliant to build trust and credibility
• Develop an effective marketing strategy to attract customers and raise awareness of the services offered, alongside a financial plan to support well-informed investment decisions
• Utilize modern digital marketing techniques to reach a wider and more diverse audience and leverage technological advancements
• Choose a distinctive trade name and logo that enhances corporate identity and differentiate the company from competitors, increasing customer engagement
• Promote the company’s services through diverse media channels to raise brand awareness and attract a broader customer base, maximizing promotional campaign impact
• Hire employees with strong communication and high professionalism to ensure excellent customer service and build long-term business relationships aligned with the company’s strategic and commercial goals
• Stay up to date with market developments and continuously update services to meet evolving customer needs

In conclusion, establishing a postal shipping company in Egypt presents a promising opportunity, but it requires strict legal compliance. It is essential to fully understand the legal procedures and licensing requirements to ensure the company remains law-abiding and earns the trust of the market and its clients.