Home About EGX History

The first attempts to establish the Egyptian Exchange

In 1861, the oldest stock exchange dealing in cotton futures was established in Alexandria. However, the first attempts to establish a stock exchange in Egypt took place in 1890, which was followed by a second attempt in 1898, when the brokers began to form a company that is responsible for the establishment of the stock exchange, determining its appropriate place, in addition to setting rules to organize the exchange’s workflow. Unfortunately, their efforts failed, and their first company went bankrupt within three months of its establishment. However, the brokers continued their transactions in some Cafés or in their own offices. The transactions were not subject to written rules, but were based on traditions and customs agreed upon.

The establishment of the Cairo Stock Exchange in 1903

A company was formed by some high net worth investors and brokers for this purpose, whereby the brokers set up a union and put a law to regulate their affairs similar to the union established by their colleagues in Alexandria in 1902. Then, a stock exchange was established in Cairo in 1904 based on an agreement between the union and the company, and has limited its membership to securities brokers only. Brokers dealing in cotton contracts have established a private union.

Setting the rules governing the stock exchange

The union of securities brokers has set rules to regulate the stock market, including the system of registering brokers in the stock exchange, the criteria for approving and listing securities in the prices' schedules, settling disputes among brokers and examining complaints filed by the investors. Its law was in fact a regulation that governed the stock exchange for seven years until the end of 1910, despite the promulgation of the first law regulating stock exchanges on November 8, 1909. The success of the stock exchange, together with the increase in the number of brokers have encouraged the establishment of a new company on 16 May 1908 containing 64 brokers, which established another premises until it moved on 20 May 1928 to its current premises in Al-Sherifean Street. The premises was established with the funds of a company established by brokers after the expiry of the previous company.

The Establishment of the Alexandria Stock Exchange in Alexandria

Securities brokers were holding their meetings in a Café, until a special partition in the futures exchange was established in 1883, but their dealings during those meeting were not considered part of the stock exchange until 1902 when their union was established and its law came into effect to regulate the transactions. Alexandria Stock Exchange was then the first exchange to be established before the Cairo Stock Exchange.

The Legislative Framework of the Stock Exchange and its Development

Laws and regulations governing the stock exchange were as follows:

a. Decree of November 8, 1909

On 8 November 1909, the decree including the General regulations of the Egyptian stock exchanges was issued, but it came into effect on the first of September 1910, which was considered the beginning of the official license to open these stock exchanges. Laws 23 and 24 were issued, including the proposed legislative amendments to the Civil Trade Act and the Mixed Trade Law. These two laws gave the commodity and securities exchanges in Egypt extensive internal autonomy, thus giving them the necessary flexibility to perform their duties.

Since that date, the stock exchanges operations in Egypt has been based on the following pillars:

1. The new provisions of the Trade Law as per the two laws mentioned above, which included the basic rules regulating exchanges.
2- The general regulations stipulated in these provisions.
3. The internal regulations of each stock exchange.
4- Decisions of the Listing Committee.
5- The prevailing customs in the stock exchange

Under these rules, the Egyptian stock exchanges became official markets that were regulated by decrees, where trading is not valid, unless it took place in accordance with its provisions and conducted by licensed brokers. The abidance of rules and regulations is also monitored by government's delegates.

b. Decree of December 31, 1933

This decree was issued by approving the general regulations of the stock exchanges. The second article included the cancellation of the stock exchange regulations ratified by the decree issued in 1909. This decree is concerned only with dealing in securities exchanges. Other decrees were issued organizing commodities exchanges.

c. Law No. 326 of 1953 regarding Trading of Securities

Law No. 326 of 1953 was subsequently issued, abolishing the decree issued on 31 December 1933. Thus, the stock exchanges started to be regulated by laws instead of amended decrees. This law continued in effect until the stock exchange was reorganized in 1957.

d. The General Regulations of Stock Exchanges as per Law No. 161 of 1957

Law No. 161 stipulating the General Regulations of the Stock Exchanges was issued, which has been in force for nearly twenty four years without any essential amendment. It is considered as the best law issued to regulate all stock exchange affairs.

e. Capital Market Law No. 95 of 1992

Law No. 95 of 1992 was issued on 22 June 1992, known as the Capital Market Law. This law is currently in force, with its Executive Regulations No. 135/1993 issued on 07/04/1993.

f. Presidential Decree No. 51 of 1997

The decision was issued addressing the provisions governing the management of Cairo and Alexandria Stock Exchanges and their financial affairs.

g. Law No. 123 of 2008 amending Law No. 95 of 1992

According to the Law, Cairo & Alexandria Stock Exchanges became one entity called “The Egyptian Exchange”.

h. Presidential Decree No. 191 of 2009

This law regulates the structure and governance of the Egyptian Exchange, in addition to its financial affairs.