On the Failure of a Legal Transplant: The Case of Egyptian Takeover Law

Abstract

This Article analyses the transplantation of French takeover regulations into Egypt. Although Egypt’s modern legal system is derived from French law, the inclusion of French takeover regulations has not been successful. This Article examines the impact of French takeover laws on Egyptian business law, and compares Egypt’s adoption of takeover regulations to three other Middle Eastern jurisdictions that also adopted the French takeover scheme. Egypt’s adoption of the French regulations has been a failure. This is partially due to the motives behind the takeover regulations in both jurisdictions. Egypt’s underdeveloped legal and institutional infrastructure also contributes to the failure. The Egyptian takeover regulations’ shortcomings were discovered soon after their adoption with the country’s first post-adoption takeover case: Mobinil. Legal transplants are an important source of legal development; the success of legal transplants, however, depends on the existence of regulatory states that are able to adjust the imported rules to fit the adopted jurisdiction’s needs.