Nassef Sawiris, head of Orascom Construction Industries

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Egypt’s richest man sentenced to prison for tax evasion

1 July 2014 | By Rod Sweet | 0 Comments

In a bizarre revival to saga thought to have ended, Egypt’s wealthiest man, construction boss Nassef Sawiris, has been sentenced in absentia to three years in prison and fined approximately $7m (50m Egyptian pounds) for failing to pay tax, Egyptian media report.

Sawiris, aged 53, runs Orascom Construction Industries (OCI), Egypt’s largest construction company and a subsidiary of Dutch company OCI NV.

In March 2013, Egypt’s Tax Authority (ETA), under then-president Mohamed Morsi, accused OCI of tax evasion worth some $2bn over the $12 billion sale of its subsidiary Orascom Building Materials Holding (OBMH) to cement giant Lafarge in 2007.

At the time Sawiris protested publicly that no tax was due but in April that year OCI reached a settlement, with the company agreeing to pay the ETA 7.1 billion Egyptian pounds (nearly $1bn) in 10 instalments to 2017.

The dispute was seen as an attempt by Morsi not only to reel in some much needed cash but also to hit back at companies who profited under the Mubarak regime.

But in January 2014, with Morsi having been ousted as result of a military coup, OCI announced it would stop its repayments. It’s Dutch parent OCI NV later claimed that it had been “fully exonerated” by an Egyptian public prosecutor.

Today, Egypt’s AhramOnline newspaper reported sources at the ETA as saying that Sawiris had been sentenced. The newspaper reported that ETA head, Mostafa Abdel-Kader, had said in April that the authority had never dropped its case against OCI.

Nassef Sawiris remains Egypt’s richest person with a net worth of $6.7 billion, according to the 2014 Forbes list.