The Algerian cabinet has made many decisions aimed at reviving the economy and increasing foreign investment. Where the Council approved the decision to review the rule 49/51, which stipulates that a public or private Algerian partner owns 51% of the assets of the investment stocks to be established in Algeria, except for the strategic sectors and activities of buying and selling products.
The Cabinet also approved raising the source deduction rate for foreign companies operating in service contracts in Algeria from 24% to 30%, with the aim of encouraging them to open offices in Algeria.
The council also agreed to cancel the right of pre-emption and replace it with the prior authorization of foreign investment, and to cancel the mandatory financing of it by resorting to local funds. A "pre-emption right" is a law passed by Algeria a decade ago, which allows the state to interfere and prevent the sale of assets or shares of foreign or local companies to other foreign or local private entities, and gives the state the right to purchase them.
President Abdelmadjid Tebboune stressed the necessity of subjecting the rule of 49/51 to transparent regulatory texts in order to avoid any interpretation or confusion in preserving national wealth. He also gave instructions to take similar action regarding the use of the right of pre-emption provided that it is within the jurisdiction of the Prime Minister after a deep study by experts, the same applies to any assignment of shares between foreign companies operating in Algeria.
Source (The Economic Bulletin site, Edited)
