“This is getting off limits. When a family with the weight of Sawiris faces such an ordeal, this means that the whole business environment has become toxic,” one Egyptian businessman said on condition of anonymity in response to news that members of the Sawiris business family had been banned from travelling abroad. “The family is well-known and respected internationally. Putting a travel ban on two of its members conveys a very negative message on the way businessmen are being treated in Egypt and such a message will drive investors away,” he added. A senior official in the office of the prosecutor-general told news agencies on Sunday that both Nassef Sawiris, chief executive of Orascom Construction Industries (OCI), and Onsi Sawiris, founder of the Orascom empire of companies and former chairman of OCI, had been banned from travelling. The decision came after Egypt's finance minister requested that a criminal case be expedited against the father and his youngest son allegedly for owing LE14 billion ($2.1 billion) in back taxes. OCI, which has construction and fertiliser units, represents about a quarter of the EGX 30 stock index. The alleged tax evasion is related to a deal that OCI finalised in December 2007 through which it sold its cement unit to the French firm Lafarge for $11.5 billion. A source close to the family told Al-Ahram Weekly that both father and son were not in Egypt and were probably in London. The Sawiris family is Egypt's version of the Rockefellers, with a business empire that extends from telecommunications to fertilisers, construction and tourism. According to Forbes, Nassef Sawiris is the wealthiest man in Egypt and the fourth wealthiest in Africa with a net worth of $6.5billion. The prosecutor-general has put both father and son on the arrival watch list, which means they will be detained if they return to Egypt. “The news contradicts the government's recently announced initiatives to resolve outstanding disputes with investors in an attempt to create an investor friendly environment,” commented Beltone Financial in its daily news report on Monday. Egypt is presently in dire need of investment after political unrest has deprived it of a significant chunk of foreign investments and tourism revenues. Last month, Muslim Brotherhood businessman Hassan Malek launched a campaign to reconcile Mubarak-era business tycoons with the country's new regime, meeting in London with wealthy exiles including Travco Travel Company head Hamed Al-Chiati and Yassin Mansour, whose family has interests in the automotive, banking and retail industries. Malek was believed to be in talks with Nassef Sawiris after it was rumoured that the latter was planning to quit the country on the back of a business deal that saw him transfer the listing of most of OCI's shares to NYSE Euronext in Amsterdam. Media reports have speculated that Nassef Sawiris left the country due to problems relating to the tax claims, together with an arbitration case that the state holding company for natural gas (EGAS) has filed against him. EGAS claims that the fertilisers unit affiliated to OCI has been buying gas at the subsidised price of $1mmbtu and selling its production at international prices. Osama Saleh, the minister of investment, told the state-run MENA news agency on Thursday that the government was holding negotiations with OCI in an attempt to convince the company not to delist from the Egyptian EGX exchange. While the Weekly was not able to reach any member of the Sawiris family or spokesman for OCI for comment, a company statement released on Monday denied receiving any formal notification of the travel bans. It noted that the Tax Authority had previously submitted a tax claim to the company of only LE4.7 billion and that no additional claims had been received. The company added that all capital gains resulting from the sale of shares listed on the Egyptian EGX exchange were tax exempt in accordance with Law 91/2005 and accordingly it should not be charged tax on the sale. The company said that it had submitted an appeal challenging the claim and that this was currently under review. Hani Sarieddin, one of OCI's lawyers, was quoted by Al-Ahram as saying he was “surprised” by the government's decision. Sarieddin said that there were ongoing negotiations about the outstanding taxes and “there was nothing suggesting a dead end in the negotiations.” Mona Al-Shazli, an analyst at Pharos Holdings, described the effect of the travel ban as “outright negative.” The ban “shows that OCI has failed to reach an amicable solution with the government, which has raised the tax claim to LE14 billion from the original figure of LE4.7 billion including accrued interest and delay penalties,” Al-Shazli wrote in a Pharos report. The decision may put the company's buyout offer from Dutch-listed subsidiary OCI NV in jeopardy. OCI NV offered in January to acquire all the ordinary shares of OCI through a swap for its shares in Amsterdam and gave investors the option to sell at LE280 per share. “The execution of the exchange offer will most likely be delayed until the claim is resolved,” Al-Shazli wrote. She said the delay in the execution of OCI's ordinary shares deal and the legal overhang could trigger panic among investors. OCI, the largest listed company in Egypt, lost 5.69 per cent of its value on both Monday and Tuesday to reach LE248.1, dragging the market down by almost five per cent during the two sessions. Al-Shazli said it was hard to speculate on the timeframe for the shares deal, hinting that it could be delayed in like manner to that of Q-invest and EFG-Hermes Holding. The latter deal, in which Q-invest was to buy most of EFG-Hermes's activities, was announced last March but has not yet been executed. The co-CEO of EFG-Hermes Holding, Hassan Heikal, is currently in London and is formally subject to a travel ban. Accordingly, Pharos has recommended current shareholders to sell their holdings in OCI at the current price, which is seven per cent less than the LE280 offered by OCI NV, as the seven per cent difference does not justify the current risks.