Month: September 2020

Federal Administrative Procedure Proclamation No. 1183/2020 (FAPP) defines “Administrative Decision” as a decision issued by an administrative agency on relating to persons rights or interest in its day-to-day function, excluding issuance of Directives. Administrative Agency means an Executive Organ of the Federal Democratic Republic of Ethiopia duly established by law and includes the Executive Organs of City Administrations accountable to the Federal Government.

FAPP is applicable in all Administrative Agencies except Prosecutor and Police when they perform duties administered by the Criminal Procedure Law and Military and Security Institutions.

Initiation of Administrative Decision: The initiation for an administrative decision can be made either by an applicant or relevant administrative agency.

Manner of Administrative Decision Application: An application for administrative decision shall be made in writing and may be submitted in person, a registered postal address or electronic means. The agency may prepare forms through which an application may be made. In any case a written application of administrative decision shall include: date, name of the applicant or his agent, signature and address; name of the administrative agency to whom the petition is made; the right and interest of the applicant being sought; act that the administrative authority has to do and facts and evidence relevant for the decision.

Record of Applications: Upon receiving an application for administrative decision, the agency shall immediately furnish a written confirmation of application, that contain details of receiving relevant documents attached there.

Principles to follow when making administrative decision include balancing the individual interest with public interest, avoidance of irrelevant matters and interests, rendering of professionalism, proper hearing, good faith, reasoned decision, avoid conflict of interest, equality of customers, timely decision, predictability, and transparency.

Administrative decision may only be rendered by the Head of the Administrative Agency.

Conducting Hearing: Before rendering any administrative decisions shall provide adequate opportunity of hearing. However, decision may render without hearing if there is no arguments of the facts of the case or if it is special privilege or if the administrative agency has alternative decision power ;or the issue is urgent.

Conditions of Hearing: The parties to case has the right to appear in person and have the right to give testimony , to produce evidences to access and examine evidences presented to the Authority .The Agency may use all legal methods to get documents of investigation and any evidences from the party participated in the argument, witnesses and professional persons.

Recusal: A person may be recused from the decision making if he has a direct or indirect interest on the matter or the matter at hand affects a person that has a relation with a decision maker in consanguinity or Affinity, close friend or if he has represented the person regarding whom the decision is being considered, as an agent, attorney or in any other professional capacity or he has made a decision on the matter in another capacity.

In case where one of the grounds listed above are present the person may be recused from decision making process on his own accord, or the petition of the an interested person. If recusal is requested, until the head of administrative decision rendering final decision the person raised matter of recusal shall remain suspended from entertaining the case. The Head accepted the recusal request initiated by the interested person or others shall render decision within five working days to stay or recused .

Administrative Decision: An Agency shall notify the concerned person of its decision with its reason in writing. The decision shall contain date and number of decision, name of the Authority, parties to the case and their address, issues of claim, discretion of evidences, description of fact and Law and decision.

Suspension: The party whose who may incur damage on his right and interest by immediate enforcement of the decision can apply for the suspension of the decision to the authority rendering decision. An administrative agency receiving a petition for suspension may order the case to be seen again or to suspend any part of the decision.

Right to Lodge Complaint: Any person against whom and administrative decision is made has the right to lodge a complaint to the Agency. All administrative agencies shall establish a complaint handling division and notify such establishment to clients.

Stay of Enforcement: Enforcement of any decision of an administrative agency against which a complaint is lodged will be stayed until the complaint is processed and a final decision made. However, the head of the Agency may order the enforcement of the decision where delay in enforcement may cause an irreversible damage to public interest.

Handling of the complaint: The complaint handling body shall properly examine the complaint it has received and present its recommendation to the Head of the Agency or an officer duly authorized by the Head. The decision of the Head of the Agency or an officer duly authorized by the Head of the Agency, after considering the recommendation of the complaint handling body shall be considered as the final decision of the agency. The agency shall notify the petitioner, in writing, the decision made.

Judicial Review of Administrative Decisions: Any interested person can file a petition requesting a judicial review of an administrative decision. However the judicial review shall be sought against a final decision of the administrative agency. A petition for a judicial review should exhaust all remedies available within the Agency before petitioning the court for judicial review. However, the obligation to exhaust remedy shall not apply if the concerned Agency unduly delay decision.

The Federal High Court(FHC) shall have the jurisdiction for judicial review. The decision of the FHC could be appealed to the Federal Supreme Court. The FHC shall establish special benches to handle petitions of judicial review

Principles of Review: An administrative decision will be revoked by a court where it failed to honor the principles stipulated in FAPP.

Procedure of Judicial Review:A petition to review an administrative decision shall be made within 30 days after the petitioner was
notified of the decision .

If the court finds the petition to review to have merit, the court shall give the concerned administrative organ to give its written response within 15 days. The court has the power to order records to be brought to court pertaining to the decision.

Decision of Judicial Review and Execution: The court should render its decision within a short time possible. The court may confirm, partially or fully reverse the decision submitted for review. When the Court partially or fully invalidate the decision, it may order the administrative agency to revise or reconsider its administrative decision by rectifying the
shortcomings identified through the court’s decision.The decision of the court should be executed immediately.

The legality of the administrative decision that is partially or fully invalidated will be revoked. However, administrative agency's decisions done prior to the date the court made a ruling shall stay valid.

On procedural matters not covered by FAPP, the Civil Procedure Code shall apply. A person who incurred damage as a result of fault committed through the administrative decision is entitled to seek compensation from the administrative authority that is responsible in accordance withe the relevant law.

The Council of Ministers has adopted a State of Emergency following the Covid-19 pandemic. As a result, Companies that administer their employees as per Labor Proclamation 1156/2019 are prohibited from terminating the employment contact of their employees during this time of the state of emergency outside of the procedure identified by the Ministry of Labor and Social Affairs. The Ministry of Labor and Social Affairs is expected to come up with the new directive. For the Amharic version of the Regulation click:- https://mail.google.com/mail/u/0/#inbox?projector=1

The Council of Ministers has enacted Energy Regulation No 447/2019(here after the Regulation), to be effective from the date of publication in the Federal Negarit Gazette. The authority to administer the regulation is the Ethiopian Energy Authority as established under Regulation No 308/2006( here after the Authority). The parent legislation for the Energy Regulation are Energy Proclamation No 810/2013 and Proclamation No 1085/2018 as amended.
The Energy Regulation covers how licences and certificate of competence are applied and acquired. The regulation mentions licences in hydro and geothermal power generation licence, wind, solar, bio-mas, urban waste, thermal and bio-gas power generation licence, transmission licence, distribution and sales licence. It regulates how these licences are requested, acquired, the validity period, renewal, amendment, transfer, suspension or revocation. Similarly the Regulation provides how Certificate of Competency renewed, validity period, suspension or revocation.
The Regulation state in detail the rights and duties of licence holders, certificate of competency holders and customers. Electricity tariff and grid access are also dealt in detail. In addition to the above licences, licencing of energy efficiency and conservation audit, contracting or consultancy service licence requests, renewal, suspension or revocation shall be dealt by the Authority. Electrical equipment and appliances standard shall be set by the Authority. Principles are set out on energy efficiency and conservation in industries and buildings. Energy efficiency and conservation fund is established.
Dispute settlement shall follow amicable settlement, mediation and finally arbitration. Under miscellaneous provisions, the Authority is granted to issue directives. The regulation is done in Addis Ababa on January 28,2019.

By Dagnachew Tesfaye, Founder and Partner at DMLO

Email: dagnachew@dmethiolawyers.com

Introduction

The Federal Administrative Procedure Proclamation No 1183/2020 (hereafter FAPP) paved the way in stating the procedure in adopting directives by administrative organs. Directives are laws that create rights and duties. It has been impossible to access directives. Some directives will go beyond their parent legislation introducing new forms of rules not intended by the higher laws. Directives change frequently. Administrative services were denied awaiting the enactment of a new directive. However FAPP done on 7 th April 2020 to be effective on the day it is published on the Federal Negarit Gazette has changed the game.The major landmarks in FAPP with regard to directives will be briefly discussed beginning with the preamble till the the last part which is judicial review.

General Provisions

The preamble of the FAPP provide that directive making should follow proper law making procedure, should be transparent and accountable. The scope of application of FAPP covers all federal and federal administered cities' administrative agencies except police and prosecutors. The administrative organs enact directives only when delegated by a higher law to adopt directives. It is unlawful to deny service because a directive has not yet issued. Obligation is laid on administrative organs to timely adopt directives.

Procedure to follow before adoption of a directive

 The administrative agency should keep record about the directive for any interested person to inspect. The Agency should publish notices on a newspaper or website or other media as to where, when, and how to get access to draft directive and give comment. The administrative organ should solicit directly for comment from relevant stakeholders and it should organize a public forum.

There are exceptions to all of the above procedures. For example National Bank of Ethiopia will not be required to be follow the above procedure by regarding issuing exchange rate, interest rate and other similar matters. Such procedure can be skipped in case of emergencies, when following the procedure affects public interest or undermines implementation of the directive.

Ratification and Effectiveness

Prior to ratification, Federal Attorney General (FAG) should be asked for FAG's opinion. FAG should respond within 15 working days and if FAG do not respond, it will be assumed as FAG does not have an opinion. The administrative organ cannot ratify a directive that is substantially different from the draft publicized through its notice. The final ratified Directive shall have an additional explanatory statement. The final ratified directive shall be prepared in Amharic and English.

The administrative organ shall send a copy of the ratified directive with the explanatory note to FAG to be registered and published. All administrative organs shall send within 90 days after the effective date of this proclamation all prior directives they have adopted to FAG. FAG shall make all directives accessible The concerned administrative agency shall print and disseminate to governmental and other stakeholders and post it on its website.

Any person who is interested can come in person and read at the administrative agency the directives or may get a copy of the directive subject to payment of expenses. A directive that has not been filed to FAG or the website of the administrative agency are unenforceable.

Judicial Review of Directives

Any interested person can file a petition requesting a judicial review of a directive. However the judicial review shall be sought against a final decision of the administrative agency. A petition for a judicial review should exhaust all remedies available within the Agency before petitioning the court for judicial review. However, the obligation to exhaust remedy shall not apply if the concerned Agency unduly delay decision.

The Federal High Court(FHC) shall have the jurisdiction for judicial review. The decision of the FHC could be appealed to the Federal Supreme Court. The FHC shall establish special benches to handle petitions of judicial review

Principles of Review

A directive will be revoked by a court where it failed to honor the procedures stipulated in FAPP or if it is ultravirus or it is contrary to other higher laws.

Procedure of Judicial Review

A petition for judicial review on ultravirus or contrary to higher law can be filed any time, whereas a judicial review on not honoring the procedure for enactment under FAPP should be filed within 90 days of its enactment into law.

If the court finds the petition to review to have merit, the court shall give the concerned administrative organ to give its written response within 15 days. The court has the power to order records to be brought to court pertaining to the directive.

Decision of Judicial Review and Execution

 The court should render its decision within a short time possible. The court may confirm, partially or fully reverse the directive submitted for review. When the Court partially or fully invalidate the directive, it may order the administrative agency to revise or reenact the directive. The decision of the court should be executed immediately.

The legality of the directive that is partially or fully invalidated will be revoked. However, administrative agency's decisions done prior to the date the court made a ruling shall stay valid

On procedural matters not covered by FAPP, the Civil Procedure Code shall apply. A person who incurred damage as a result of fault committed through issuance of directive is entitled to seek compensation from the administrative authority that is responsible in accordance withe the relevant law.

Conclusions 

Therefore, the manner in which a directive becomes a binding law has been cleared out. Accessing directives has become easier. This is a huge step for lawyers, judges, law professors and students and the general public. Judicial review procedure, principles and execution, against directives opens up the previously closed doors and empowers judicial activism.

For any additional information you may contact us at info@dmethiolawyers.com

By Dagnachew Tesfaye

The Investment Regulation No.474/2020 (hereafter the Regulation) was enacted following the Investment Proclamation No 1180/2020. It was done on the 2nd day of September 2020, to be effective on the date of publication in the Federal Negarit Gazette.

The Regulation is divided into eight parts that cover investment areas, investment permit, acquisition of existing enterprise and transfer of investment projects under implementation, procedure for suspension and revocation of investment permits, registration of technology transfer and collaboration agreements, condition for owning a dwelling house, provision of one-stop service, training and transfer of knowledge and skill to Ethiopian employees and repealed and inapplicable laws.

Any foreign investor can investment in investment areas that are not listed and reserved for a) joint investment with the Government, b)investment areas reserved for domestic investors, and c) investment areas reserved for joint investment with domestic and foreign investors.

This approach is a major shift from the previous investment regulation. The previous investment regulation lists down exhaustively areas of investment open for foreign investors. Foreign investors could not invest outside the listed investment areas. Now foreign investors can invest in all other areas of investment except those reserved for the joint investment with government and joint investment with domestic investors or areas of investment reserved for domestic investors.

“Domestic Investor” has been defined under the Investment Proclamation No 1180/2020 as an Ethiopian National; or an Enterprise incorporated Ethiopia and wholly owned by Ethiopian National; or the Government; or a Public Enterprise; or a cooperative society established as per the relevant law; or a Foreign National or Foreign Enterprise treated as domestic investor as per the relevant law or international treaty ratified by Ethiopia; pr an Enterprise incorporated in Ethiopia jointly between any of the investors specified above; or a Foreign National or Foreign Enterprise accorded a domestic investor investment permit as per laws which were in effect when the permit was issued and continues to operate in Ethiopia, provided that this applies only in respect of investments that are operational at the time of enactment of this Proclamation; or descendant of a foreign national that is accorded investment permit provided that this applies only in respect of investments specified in the same Sub-article;

On the other hand, on the same Investment Proclamation a ''Foreign Investor” has been defined as a Foreign National; or an Enterprise in which a Foreign National has an ownership stake; or an Enterprise incorporated outside of Ethiopia by any investor; or an Enterprise established jointly by any of the investors mentioned above ; or an Ethiopian permanently residing abroad and preferring treatment as a Foreign investor;

Areas of investment open for any investor to invest JOINTLY with the Government are: manufacturing of weapons, ammunition and explosives used as weapons or to make weapons, import and export of electrical energy, international air transport services, bus rapid transit services and postal services excluding courier services.

Investment areas RESERVED for DOMESTIC investors include banking, insurance, microfinance excluding capital goods finance business, transmission and distribution of electrical energy through integrated national grid system, primary and middle level health services, wholesale trade, petroleum, petroleum products, wholesale of own products produced in Ethiopia, excluding wholesale of electronic commerce; retail trade excluding retail of own products produced in Ethiopia, import trade excluding liqudified petroleum gas and bitumen, export trade of raw coffee, khat, oil seeds, pulses, minerals, hides and skins, products of natural forest, chicken and livestock including pack animals brought on the market; construction and drilling services below Grade 1, hotel, lodge, resort, motel, guesthouse, pension services excluding those that are star-designated, restaurant, tearoom, coffee shops, bars, nightclubs and catering services excluding star designated national cuisine restaurant services, travel agency, travel ticket sales and trade auxiliary services, tour operation, operating lease of equipment, machinery and vehicles, excluding industry specific heavy equipment, machinery and specialized vehicles; transport services excluding railway transport, cable-car transport, cold-chain transport, freight transport having a capacity of more than 25 tons and transport services reserved for joint investment with the government or domestic investors; making indigenous traditional medicines, producing bakery products and pastries for domestic market, grinding mills, barbershops and beauty salon services, smithery and tailoring except by garment factories, maintenance and repair services including aircraft maintenance repair and overhaul(MRO), but excluding repair and maintenance of heavy industry machinery and medical equipment, aircraft ground handling and other related services, saw milling, timber manufacturing and assembling of semi-finished wood products; medical services, customs clearance service, brick and block manufacturing, quarrying, lottery and sports betting, laundry services excluding those provided on industrial scale, translation and secretarial services, security services, brokerage services, attorney and legal consultancy services, and private employment agency services excluding such services for employment of seafarers and other similar professionals that require high expertise and international experience and network.

Lastly investment areas reserved for JOINT investment with domestic and foreign investors are feight forwarding and shipping agency services, domestic air transport services, cross country public transport services using buses with a seating capacity of more than 45 passengers, urban mass transport service with large carrying capacity, advertisement and promotion services, audiovisual services such as motion picture and video recording, production and distribution and finally accounting and auditing servises.

However a foreign investor jointly investing with a domestic investor on the above listed businesses cannot own more than 49% of the share capital of the newly formed joint investment company.

Therefore, except areas of investment reserved for joint investment with the Government, or investment areas reserved for domestic investors, or investment areas reserved for joint investment with domestic and foreign investors, the rest are open to foreign investors to invest.