The Egyptian parliament passes a law threatening foreign investment

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Last Monday, the Egyptian House of Representatives approved a draft law submitted by the government granting the Supreme Constitutional Court the power to monitor the constitutionality of decisions of international organizations and bodies and foreign court rulings issued against Egypt.

The new legal amendment sparked a wide wave of criticism even from within the parliament itself, where a number of representatives warned of its bad impact on the economy and investment, considering that it “a hidden nationalization” and grants the Supreme Constitutional Court “universal competencies.”

What does the new law state?

The draft law, which President Abdel Fattah al-Sisi is expected to ratify soon, included the addition of two articles to Law No. 48 of 1979 regarding the competencies of the Supreme Constitutional Court. The first states that the Constitutional Court shall supervise the constitutionality of decisions of international organizations and bodies and judgments of foreign courts required to be implemented against the state.

The second article allows the Prime Minister to request the court to rule that decisions and judgments issued by international bodies and foreign courts, or the obligations resulting from their implementation, shall not be considered. Where the head of government submits a case to the “Supreme Constitutional Court” in which everyone concerned is sued, and a copy of the decision or judgment required to be disregarded and a certified translation should be attached to it. The request must indicate the constitutional text or ruling that is alleged to be in violation and the object of the violation, and the court decides on the request expeditiously. Violation of the constitution and a threat to the independence of the “Supreme Constitutional”

Lawyers considered that the new legislation violates the constitution, which obliges the government to respect international conventions, treaties and charters. Egypt’s relationship with international organizations, bodies, and foreign courts is a specific relationship with treaties, agreements and partnership contracts, and each of them includes a mechanism to object to its decisions, and Egypt’s accession to those agreements and treaties is followed by its international commitment, like the rest of the participating countries, in implementing its provisions even in cases of conflict.

The new law makes the Supreme Constitutional Court a tool in the government’s hands to resolve its external disputes, which prompted the head of the Arab Center for the Independence of the Judiciary and the Legal Profession, Nasser Amin, to fear that constitutionality judges would be subjected to political pressure in the matter of estimating or the roles they play for the government, considering The amendments go beyond the constitutionally defined role of the Constitutional Court as an Egyptian court operating under the shadow of the provisions of the Egyptian Constitution in the Egyptian region.

The constitutional jurist, Dr. Mohamed Nour Farhat, stressed that granting the “Supreme Constitutional Court” the competence to monitor the extent to which the decisions of international organizations and bodies are compatible with the Egyptian Constitution is one of the unfamiliar competencies in the laws of constitutional courts around the world, and contradicts Egypt’s international obligations, suggesting that it “may sign it.” Under penalty of international responsibility if it refrains from implementing the decisions of organizations, Egypt is a member of those organizations and is committed to its decisions,” because the rules of international law are superior to internal law.

The opposition parliamentarian, Diaa El-Din Daoud, stressed that the new law is outside the jurisdiction of the court, which is entrusted with monitoring the constitutionality of provisions and laws and obligating the government and state institutions with them so that the government and its organs are under the umbrella of the constitution and the law, pointing out that the amendment included an explicit violation of the text of Article 94 of the constitution.

A threat for foreign investment

away from the extent of the constitutionality of the law or not, a number of members of the House of Representatives warned of the effect of the law on foreign investment, wondering about the secret of pushing this law, which harms Egypt’s reputation at this time.

Member of Parliament Amira Abu Shaqqa said that this law threatens investment because it “represents a hidden nationalization,” stressing that “it can be implemented inside Egypt in accordance with the law and the constitution, but externally it is the same, and it will not be used outside Egypt’s borders.” Besides, she warned that if Egypt refuses to abide by the decisions of international organizations and bodies, its properties abroad will be seized, as happened in previous incidents.

The parliamentary body of the “Egyptian Democratic Party”, consisting of 7 deputies, announced its rejection of the law. The party’s deputy, Maha Abdel Nasser, said that the new law “endangers Egypt’s international reputation,” and was surprised by the timing of the law’s introduction, which comes at a time when “Egypt is facing a real crisis represented by the second filling of the Grand Ethiopian Renaissance Dam, and therefore Egypt seeks to form an international lobby around it to face this danger that threatens its share of the Nile waters, but the issuance of such laws isolates it from the world.”

Representative Sanaa Al-Saeed warned that “the amendments to this law are flawed, and will expose Egypt to international criticism, and eliminate any foreign investments,” noting that “investors will not come to Egypt knowing in advance that its government has signed on to accept international arbitration decisions in international agreements, and rejects their results through judgments by its Constitutional Court “.

Why this law?

None of the supporters to the law gives a compelling reason for its passage; even the Government itself which presented the law to Parliament does not give a compelling reason for advancing it. The government says that the law “aims for the state to deal positively in accordance with national interests also within the framework of the constitution and the law with any of the international decisions that may affect its national security.”

The same justification for “national security” was mentioned by members of the House of Representatives loyal to President Sisi, where Representative Ihab El-Tamawy, Deputy of the Constitutional Affairs Committee, announced his approval of the law, because “many decisions of international bodies and organizations are politicized and may be motivated by groups, organizations or other countries.” Aiming to undermine Egypt’s national security,” the same content was stated by other deputies.

However, this justification remains insufficient to introduce such a controversial law, which leads us to believe that the government has a plan to use this law to undo or suspend the implementation of a particular international obligation in which it believes it may have been implicated. So far, this agreement, which the Government wishes to reverse, remains vague.