By DMLF Team
The Federal Supreme Court of Ethiopia enacted the Federal Courts Costs and Damages Guideline No. 2/2017, which governs the determination of costs and damages across all federal courts and regional courts handling federal cases. This guideline emphasizes that decisions related to costs and damages should be integrated within the main case file that initiated the matter. It stipulates that decision on costs and damages arising during the execution of a judgment has to be determined with the main judgment. Additionally, various circumstances, such as changes in appointment, party disappearances, issues relating to giving of summons, claims amendments, and procedural complications, should also be addressed within the main case regarding costs and damages.
In determining costs and damages, courts must adhere to the guiding principles. These principles are the Principle of reasonableness, whereby courts are required to articulate their rationale in decisions. The focus on fairness dictates that parties must present their claims in a clear and effective manner. Furthermore, the adequacy of costs and damages should reflect the case’s complexity, time involved, and its nature. Courts must weigh the existing conditions and behaviors of the parties, providing evidence and justifications for their determinations.
The determination process entails considering various factors, including the type of claim, time invested, case complexity, the quality and presentation of claims by party, the rationality of the claims, and each party’s efforts toward resolving the dispute amicably through alternative dispute resolution mechanisms (ADR). Integrity, adherence to court orders and the parties’ cooperation with the court are also taken into account. Furthermore, the prevailing market price, situational factors, relationships between parties, and the overall economic context are considered when assessing the final figures.
Costs and damages cover all incurred expenses from the initial claim preparation to the court’s final decision. This includes damages associated with claim preparation, defense, appeals, food, accommodation, transportation, and lawyer fees according to the law, expert costs for executing court orders, court fees, mediator fees, and expenses related to witness testimony or translation services. Any costs associated with document translations, copies, scanning, printing, e-filing services, and injunction orders are also included.
Upon concluding a case, the court is tasked with calculating the total costs and damages based on an established algorithm. This involves instructing the parties to present their claims, considering the case’s complexity, clearly articulating reasons for the amounts, and determining the payment method and sources. Courts must evaluate both parties’ conditions, the context of the case, and other critical factors when determining the exact amount.
If a party fails to submit their claims for costs and damages within the stipulated time, the court is permitted to determine the amounts according to the civil procedure code. Costs and damages may be deemed excessive when, after evaluating the overall circumstances of the case, they appear disproportionate, involve bad faith, are unrelated to the case, or disregard the economic situation of the party in question. In such instances, the court has the discretion to reduce or dismiss these claims.
Intervening third parties may also be liable for costs and damages if the outcome of the judgment is unfavorable to them. In appellate cases, costs and damages are determined following the same principles as in initial proceedings. If a lower court’s decision is reversed or modified, the appellate court may consider the costs already established. However, if the reversal arises from a misinterpretation of the law, each party bears their own expenses. For cassation cases, if the lower court’s decision is upheld, only the costs associated with the cassation bench are assessed. Conversely, reversing the lower court’s ruling requires the cassation to consider the associated costs.
Lastly, the guideline outlines the enforcement of costs and damages decisions. Execution of costs and damages may occur alongside the main ruling or independently. Should the judgment debtor neglect timely payment, legal interest is calculated starting from the decision date. Payments can be drawn from the assets identified by the judgment creditor, but if the debtor refuses to comply, they must disclose alternative assets for settlement. If collateral is involved, the judgment will be executed against such assets.
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By Sinishaw Hailu, Associate at DMLF
The Ethiopian Council of Ministers has recently enacted a significant update with the introduction of Regulation No. 550/2024 here in after the regulation, which establishes new fee rates for services provided by the Immigration and Nationality Service. This regulation repealed the previous Regulation No. 38/2022 and introduces a new fee structure for a variety of immigration services, including passport issuance, visa applications, residence permits, and the provision of vital event certificates from abroad.
Under the new regulation, the fee for obtaining a new passport is set at ETB 5,000, while the replacement of a lost passport will cost ETB 13,000. For those in urgent need, passports can be issued within two days for ETB 25,000 or within five days for ETB 20,000. When applying for passports from abroad, the fees range from 200 USD for issuance at an embassy to 250 USD for online applications and reissues, with urgent requests available for 350 USD.
Visa fees have also been revised. A private work visa now costs 400 USD for a single-entry visa valid for one month, and 1,000 USD for a 90-day multiple-entry visa. Investment visas are categorized by duration, with fees of 60 USD for one month, 150 USD for three months, 250 USD for six months, and 600 USD for one year. Transit visas are available at varying rates depending on the duration of stay, with fees ranging from 25 USD for 12 hours to 60 USD for 72 hours. Additionally, visa extensions carry their own fees, with private work visa extensions priced at 500 USD for one month and 1,500 USD for three months.
For residence permits, individuals seeking a temporary permit valid for one year that is not for work will pay 150 USD, while a work temporary residence permit costs 1,500 USD. Permanent residence permits, valid for five years, are set at 500 USD. Should applicants require expedited processing ( in two days), urgent fees apply, with costs escalating to 1,000 USD for a temporary residence permit and 3,000 USD for a work permit.
The regulation also addresses Ethiopian origin identity cards, where fees for new and renewal applications for a five-year ID are 300 USD and 400 USD, respectively. For children under 18, the fees are 100 USD for ordinary requests and 200 USD for urgent( in two days) processing.
In a significant enhancement to service delivery, the regulation introduces a door-to-door passport distribution system, allowing individuals to have their passports delivered to their homes for an additional fee. This option is particularly beneficial for those unable to attend in person due to health concerns.
Lastly, the regulation outlines fees for vital event certificates issued abroad, including birth, marriage, divorce, death, and adoption, each costing 30 USD, except for death certificates, which are priced at 20 USD.
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By DMLF Team
In a significant move for Ethiopia’s healthcare landscape, The Ethiopian House of People’s Representatives has approved the Health Service Administration Proclamation No. 1362/2017. This new legislation aims to enhance the quality and accessibility of health services. The new law introduces a host of progressive measures that promise to modernize healthcare and better meet the needs of its citizens.
One of the most notable aspects of this proclamation is its approach to end-of-life care. It sets forth clear guidelines for discontinuing life support for patients who are entirely reliant on machines for breathing. Such decisions can only be made under stringent conditions: when both heart and respiratory functions have irreversibly failed or when brain death has been definitively established. This careful consideration reflects a growing understanding of the importance of compassionate care for those facing terminal illnesses.
The Ministry of Health is expected to provide comprehensive guidelines to ensure these new measures are implemented effectively, focusing on supporting individuals with incurable conditions. This initiative marks a pivotal shift towards recognizing and addressing the complexities surrounding end-of-life issues in Ethiopia.
Additionally, the proclamation addresses organ donation, allowing individuals to voluntarily register as donors while ensuring their health is protected throughout the process. It also permits the use of deceased human remains for educational and research purposes, provided that consent was given during their lifetime. In cases where close relatives do not claim a body within seven days, it may be utilized for teaching or research after notifying relevant authorities. However, this provision respects family rights; relatives retain the ability to claim the body and arrange for burial if desired.
This legislation strikes a balance between advancing medical education and honoring cultural values and familial ties. By tackling sensitive topics such as physician-assisted death, organ donation, and technology-assisted reproduction, Ethiopia is taking significant strides toward aligning its healthcare system with global standards while remaining mindful of ethical considerations.
The “Health Service Administration Proclamation” represents a landmark development in Ethiopia’s healthcare history. It not only modernizes health services but also fosters an environment where patients’ rights and dignity are prioritized during some of life’s most challenging moments. As these changes unfold, they promise to create a more compassionate and responsive healthcare system that meets the diverse needs of all Ethiopians.
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By DMLF Team
In a pivotal move, the Ethiopian Parliament has approved Proclamation No. 1322/2024, which establishes guidelines for Special Economic Zones (SEZs). This legislation aims to enhance investment activities through a robust framework of support, including policies that streamline trade, bolster infrastructure, and improve amenities for investors.
Within these SEZs, a variety of specialized zones are set to emerge, such as industrial parks, free trade zones, science and technology centers, service parks, and agriculture and livestock areas. Both domestic and foreign investors interested in establishing operations will need to submit applications to the Ethiopian Investment Commission and secure the necessary investment permits.
The new SEZ Proclamation introduces a host of attractive incentives beyond the existing investment benefits. These include customs exemptions; zero-rate VAT on goods and services transported into SEZs, complete relief from domestic indirect taxes, duty-free imports for construction materials, and tax waivers on dividend income and salaries for foreign workers employed by export-oriented firms for a period of five years.
These initiatives are designed to stimulate foreign investment and promote job creation, establishing Ethiopia’s SEZs as competitive environments for businesses looking to expand and thrive.
To qualify, applicants must invest a minimum of $75 million, sourced through equity, debt, or a combination of both, and they need to allocate at least 75 hectares of land for development. The Industrial Parks Development Corporation will oversee land auctions for housing and infrastructure, while the Ethiopian Investment Commission will have the authority to designate public lands as SEZs.
The law broadens the scope of activities within SEZs, allowing for diverse sectors such as agriculture and services, aligning with Ethiopia’s broader development strategies. Additionally, foreign banks are permitted to operate branches within these zones, and exporters based in SEZs will benefit from prioritized access to various foreign currencies.
In summary, this proclamation not only enhances the investment landscape in Ethiopia but also offers a promising framework for creating vibrant economic hubs that attract both local and international enterprises.
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By DMLF Team
The House of Federation in Ethiopia plays a pivotal role in adjudicating matters that significantly impact the CONSTITUTIONAL rights of citizens, particularly concerning property rights and marriage. Below is an overview of critical decisions rendered by the House, which elucidate the legal framework governing these issue.
Immovable Property as Common Property
In its ruling under Council of Constitutional Inquiry File No. 1607/2008 and House of Federation File No. 022/08, it was determined that immovable property registered in the name of one spouse is classified as common property. The house asserted that any claims suggesting such property belongs to a third party, based solely on witness testimony, contravene established evidentiary principles and infringe upon the common property rights enshrined in the Constitution.
Personal Property Improvements
According to Council of Constitutional Inquiry File No. 6588/2014 and House of Federation File No. 130/16, improvements made by spouses on personal property registered solely in the name of one the spouse do not change its status as personal property( contributions made by spouses towards personal property do not alter its classification as personal property). Even when these enhancements result in a mixture of personal and common property, such improved personal property remains classified as individual property belonging to the spouse in whose name the property is registered.
Unconstitutionality of Conditional Dissolution of Marriage
Under Council of Constitutional Inquiry File No. 473/2003 and House of Federation File No. 49/10, it was ruled that living apart for an extended period does not equate to dissolution of marriage.The federal cassation bench’s prior ruling, which treated living apart as a dissolution, was deemed unconstitutional, violating Articles of the Constitution. Similar conclusions were reached in Council of Constitutional Inquiry File No. 1679/2008 and House of Federation File No. 50/10.
Unconstitutionality of Conditional Marriage
Following a court-ordered dissolution of marriage, any subsequent cohabitation under a written agreement does not constitute a valid marriage according to constitutional standards. Initially recognized by the federal cassation bench under File No. 23021, Volume 5, this principle was later reversed by council of constitutional inquiry under file no. 7203/15 and the House of Federation under File No. 804/16, which stated that creating a marriage through legal interpretation is unconstitutional and deviates from recognized forms for establishing marriage.
Wife’s Right to Partition Property
As established by Council of Constitutional Inquiry File No. 2490/2009 and House of Federation File No. 471/10, a wife possesses an unequivocal right to partition her husband’s estate acquired during their marriage irrespective of her direct contribution to its acquisition or enhancement efforts. This ruling is particularly significant in cases where a husband with multiple wives passes away; it affirms that a wife residing with another wife within a shared household retains rights to partition her deceased husband’s assets since assets acquired by husband is considered as communal property, based on Articles 25 and 40(1)(2) of the Federal Democratic Republic of Ethiopia (FDRE) Constitution.
Conclusion
These landmark decisions underscore the commitment of the Ethiopian judiciary to uphold constitutional principles regarding property rights and marital relationships while ensuring equitable treatment for all parties involved.
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By DMLF Team
The Ethiopia Commercial Code Proclamation Number 1243/2021 defines a joint venture as a business organization established by an agreement among two or more persons. Joint venture has no legal personality and its existence is unknown to third parties. Registration formalities required of other business organizations do not apply to a joint venture.
With respect to formation, business organizations are established through a memorandum of association but a joint venture is established by joint venture agreement. The law does not require the agreement of the partners to be in any particular form. It could be written or oral. Even where it is a written one it is not required to go through the authentication and registration process. Joint venture agreement remains a private contractual document among the partners.
In principle, the provisions of the Commercial Code concerning contribution in general partnership shall apply to a joint venture. Yet, unlike general partnership, joint ventures lack legal personality and hence cannot own property under its own name. Thus, unless otherwise agreed, every partner owns his contribution.
With respect to management, the joint venture belongs to the category of partnership. As per article 238 of the Commercial Code, a joint venture shall be managed by one or more managers who need not be partners, and where no manager is appointed, all the partners shall have the power of managers.
Regarding the relationship of joint ventures with third parties, only the manager of a joint venture is known to third parties. He shall alone be liable for the debts and liabilities of the joint venture. A partner who is not a manager of a joint venture shall meet liabilities towards the manager of such joint venture only to the extent fixed in the agreement between partners. Where a partner who is not a manager takes part in the management of a joint venture, he shall be jointly and severally liable with the manager to third parties. Every partner of a joint venture shall deal with third parties in his own name.
When we come to dissolution, a joint venture shall dissolve due to several reasons including unanimous decision of the partners for dissolution, a request for dissolution by one partner where no fixed term has been specified, or where all the shares are acquired by one partner, death, bankruptcy or incapacity of a partner, in the absence of an agreement to continue the partnership.
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By DMLF Team
In Ethiopia’s judicial system, the decisions made by the Federal Cassation Bench, comprised of five judges, hold binding authority over all courts in the country. This principle is established under Proclamation No. 454/1997 and has been practiced for nearly two decades. Later, Proclamation No. 1234/2013 reaffirmed this binding effect in Articles 10(2) and 25(2), emphasizing the importance of uniformity in judicial decisions across federal and regional courts.
However, over time, differing decisions from the cassation bench have led to inconsistencies, especially regarding the period of limitation. Below are cases that illustrate these contradictions, culminating in resolutions by a larger cassation bench with seven judges and some by the House of Federation.
➢ Period of Limitation for Unlawful Enrichment
Initially, the cassation bench ruled in Volume 6, File No. 34406, that the period of limitation for claims of unlawful enrichment is two years. This decision reasoned that since unlawful enrichment falls under the same title as extra-contractual liabilities, its limitation period should mirror that of extra-contractual claims.
However, the bench later reversed this stance in Volume 22, File No. 78629, declaring the limitation period for unlawful enrichment to be ten years. The rationale was that merely sharing a chapter does not justify applying the same limitations, particularly when different limitations exist for different claims. This decision cited Article 1677(1), which states, “the relevant provision of this title shall apply to obligations notwithstanding that they do not arise out of a contract.”
➢ Court Authority on Period of Limitation
In a significant ruling by the House of Federation, documented in File No. 69/11 during its 5th era, 4th year, 2nd meeting, the house overruled a prior decision from the cassation bench (File No. 119714). The House prohibited courts from rising the period of limitation unless the parties involved raised it themselves. This ruling underscored the need for judicial restraint regarding period of limitations unless the parties raised it.
➢ Partition of Common Property of Spouses
In another significant decision, the House of Federation addressed the partition of common property between spouses during its 5th era, 5th year, in the first meeting documented as File No. 49/10 and 50/10. This ruling nullified a previous cassation decision (File No. 20938, Volume 4), which imposed a limitation period on partition claims. The House articulated that unless a marriage is dissolved through court proceedings, there should be no period of limitation for partitioning of common properties.
➢ Jurisdiction and Period of Limitation
In a notable case concerning jurisdiction, the cassation bench with seven judges addressed contradictory rulings on the interruption of limitation periods. Earlier, in Volume 3, File No. 16648, a decision stated that if a case was presented in a court lacking jurisdiction, the limitation period would not be interrupted. However, this was amended in Volume 9, File No. 36730, affirming that actions taken by the parties could indeed interrupt the period of limitation, even in the absence of jurisdiction.Period of limitation for filing an appeal against the interpretation of a constitution
➢ Period of limitation for filing an appeal against the interpretation of a constitution
The Council of Constitutional Inquiry, under file number 293, previously established a decision regarding the appeals process for constitutional interpretation. According to this decision, appeals against court decisions concerning constitutional interpretation were required to be filed within 90 days of the court’s decision, as stipulated in Article 22, Sub-article 3 of Proclamation No. 250/1993.
In a significant turn of events, the House of Federation has reversed the Council’s decision. The new ruling states that there is no longer a limitation period for filing an appeal against court decisions related to constitutional interpretation. This change marks a pivotal shift in the approach to constitutional inquiries. The recent amendment underscores the importance of timely access to constitutional justice without the constraints of a specific time frame.
Conclusion
The evolving decisions of the Federal Cassation Bench and the House of Federation regarding these legal principles reflect the complexities of Ethiopia’s judicial landscape. Clarity and uniformity remain essential for ensuring justice in the system as courts navigate varying interpretations of period limitation. It is crucial for legal practitioners and parties involved to stay informed about the latest rulings and their implications.
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By DMLF Team
https://youtu.be/X4vN1vbC7LU
In Ethiopia franchise agreement is governed by Commercial Registration and Business Licensing Proclamation (here in after CRBLP), investment law, IPRs protection laws, civil code etc.
‘Franchise agreement’ is defined under the Commercial Registration and Business Licensing Proclamation No. 980/2016 and its amendment No. 1150/19. Accordingly, ‘franchise agreement’ is defined as: an agreement concluded for consideration between the franchiser and the franchisee in order to undertake business activities by using the trade name of the known product or service in order to share the nature and experience of the work under the leadership of the owner of the products and the service that have got recognition.
The other notable aspect of the definition relates to the franchise parties’ joint obligation to engage in a ‘business activity’ in order to constitute franchise business relationship by and between them. Reading of art 2(2) and (3) of the CRBLP along with art 5 of the Commercial Code 1960 provide clarification on who should be regarded as a ‘business-person’ or ‘trader’. It also furnishes exhaustive list of activities that are regarded as business (or commercial) activities. As a result, franchise parties are necessarily required to undertake business activities as defined under both the CRBLP and the Commercial Code 1960, as well as shall carry on such business activities professionally and for gain. Strangely enough, the other noteworthy element under the definition pertains to the exclusive association of ‘trade name’ with franchise agreements. Accordingly, a franchise agreement is concluded between franchise parties to undertake a business activity by using the ‘trade name’ of the known product or service of franchisors. The definition utterly excludes the independent association of other types of IPRs such as trademark, service mark, trade secret copyright and related rights, patent, etc. in franchise business relationships.
The other mentionable issue on the definition relates to the generic leadership authority that the CRBLP grants to franchisors over the franchise business. Pursuant to art 2 (33) of the CRBLP, the franchise business relationship shall proceed under the leadership of the owner of the products and the service that have got recognition, i.e., the franchisor.
The last point relates to the phrases ‘the known product or service . . . that have got recognition’ included under the definition. Accordingly, the franchised products and/or services shall be well-known and well-recognized.
Note that, since franchise agreement is a contract, requirements for validity of a contract specified under the civil code of Ethiopia for general contract law applies for franchise agreement.
Registration Requirements
The CRBLP and its subsidiary legislations require franchise agreements to be registered at the central commercial register, which is established and administered by Ministry of Trade and Industry. The regional organs administering commercial activities and the EIC may also undertake commercial registration as delegated by MoTI while they are duty bound to transfer the data to the central database, Commercial registration of franchise agreements accord legal personality to franchise businesses. Failure to register a franchise agreement at the commercial register would make it void. Therefore, from the very beginning, the existence of franchise agreements absolutely depends on its registration at the commercial register.
The CRBLP and its subsidiary legislations require registration to be conducted after franchise agreements are signed, notarized and authenticated. In this context, registration of franchise agreements is post-facto in terms of protecting prospective franchisees. Contextual reading of the CRBLP and its subsidiary legislations demonstrates that the laws aspire to achieve other goals through the registration requirement, instead of protecting prospective franchisees. Among others, these laws’ registration requirement aims at proper collection of income taxes from the franchise business, assessment of franchise agreements’ impact on trade competition and consumer protection, and ensuring compliance to the investment law of the country.
Commercial Registration, Licensing and Post-Licensing Inspection Directive No. 935/2022 do not explicitly and exclusively give the responsibility to register franchise agreements to franchisors or franchisees or franchise managers. Examination of the Directive implies that application for commercial registration of franchise agreements cannot be made in the absence of a designated franchise manager by the franchise parties and the attachment of the former’s original and copies of valid identification card or passport.
“Application for special certificate of commercial registration of franchising shall be submitted by attaching the following documents with the application form: a notarized franchising contract and authenticated original and copy of the same; a notarized registration certificate of the franchiser; photocopy of the valid trade license of the franchisee; two passport size photographs taken within six months time, which shows clear identity of the franchising manager; original and necessary copies of valid identification card or valid passport of the franchising manager; where the application is submitted by an attorney; original and copy of power of attorney, original and necessary photocopies of valid identification card or passport of the principal and the attorney.”
It appears that the law particularly required attachment of original and necessary photocopies of valid identification card or passport of the franchise manager as he or she is the one who presents himself or herself in front of the register office.
The other notable issue relates to the effect of registration. Registration accords ‘special certificate of commercial registration of franchising’ to the franchise business. Commercial registration of a franchise agreement creates independent legal personality to the franchise business apart from the preceding legal status of the franchise parties.
Most importantly, the register office is given the power to refuse registration of a trade name ‘where the trade name requested for registration is renowned in Ethiopia or around the world even though it is not registered in Ethiopia and no written permission issued to use the name’. Along the same lines, art. 57(2) of the Directive unequivocally extend legal protection to national and international renowned trade names that are not registered at the commercial register. Accordingly, in the event when such renowned trade names have been erroneously registered and up on verification of same fact, the businessperson who registered and is unjustly using such a trade name will be required to change the name within one month time, the failure of which entails cancellation of the commercial trade name from the register.
Conclusion
Ethiopia does not have detailed rules regulating franchises. A franchise must be registered in accordance with the procedures set out under the Commercial Registration and Licensing Proclamation and the Commercial Registration and Licensing Regulation. In addition, the Commercial Registration and Licensing Proclamation impose certain obligations on the franchisee. A franchisee must function to the same standards as the franchiser. Clients must obtain the same product and services from the franchisee as they would from the franchisor. Compensation for termination of franchise agreements is governed by the provisions of general contract law.
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By DMLF Team
The Ethiopian Parliament has approved a significant “Banking Business Proclamation,” This Proclamation cited as the “Banking Business Proclamation No.1360/2024”.which allows foreign banks to operate within the country, marking a trans-formative change in Ethiopia’s financial sector. This legislation provides various pathways for foreign banks to establish a presence, including opening subsidiaries, branches, or representative offices, as well as acquiring shares in local banks.
To qualify for operations, foreign banks must be well-established and financially stable. They can set up fully or partially owned subsidiaries or open branches, while foreign nationals, excluding foreign banks and wholly foreign-owned Ethiopian entities, can also acquire bank shares under specific conditions. Strategic investors are limited to a 40% shareholding in domestic banks, whereas non-strategic foreign investors can hold up to 7%, and foreign legal entities up to 10%. Collectively, foreign ownership in any bank is capped at 49%. The National Bank has the authority to grant exceptions to these limits in cases where strategic investments could enhance economic benefits or assist struggling banks.
Investments must be made in foreign currency, although dividends can be reinvested in Ethiopian Birr, provided ownership limits are adhered to. Earnings from investments, salaries of foreign employees, and proceeds from share sales can be repatriated according to National Bank regulations. Foreign bank subsidiaries and branches are permitted to own property for banking activities, subject to local laws for other types of property. The National Bank will also issue directives to govern corporate governance and prudential standards for these institutions.
For foreign bank subsidiaries, the National Bank will set the minimum initial capital required, and the board must include representatives from the foreign parent bank and local non-shareholders. Foreign banks can open either deposit-taking or non-deposit-taking branches, but not both simultaneously. The National Bank will outline permissible activities for these branches, and foreign banks must ensure that adequate capital is remitted and converted into local currency. They are also responsible for the financial soundness of their branches.
Representative offices are restricted to non-operational roles such as marketing and research, as defined by the National Bank.
A bank, following approval from the National Bank, may recruit or transfer foreign nationals for CEO, Senior Executive Officer, or other specialized positions on a maximum five-year contract. The National Bank may set a limit on the number or percentage of foreign employees in a bank. After five years, the position must be filled by an Ethiopian national. However, the foreign national’s contract may be extended for an additional five years if the bank provides adequate justification and obtains approval from the National Bank.
The foreign bank must ensure knowledge and skill transfer from foreign nationals to Ethiopian nationals, and foreign employees should be assigned in a way that promotes the transfer of knowledge and skills to Ethiopian nationals. If a foreign national is replaced by another foreign national, their service period cannot exceed the remaining term of the original service period. The bank must immediately remove a foreign national or foreign national director who fails to pass the National Bank’s fit and proper tests, is involved in political affairs of Ethiopia, or is convicted of any offense involving a breach of trust or fraud in Ethiopia or elsewhere, and report this to the National Bank. According to the new law The National Bank may issue directives regarding additional conditions for employing or transferring foreign nationals in a bank.
In conclusion, opening the banking sector to foreign investment, when accompanied by a well-structured legal and regulatory framework, is thought to enhance the sector’s competitiveness,efficiency,and knowledge transformation ultimately supporting sustainable economic growth.
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By DMLF Team
The Federal Court Fee Regulation has undergone its first amendment in 72 years, replacing the previous regulation from the era of the Emperor. The new regulation, numbered 1/2024, updates the court fee structure established in 1945 under Regulation no. 177. It is effective immediately upon publication in the Federal Negarit Gazette.
This amendment was deemed necessary because the federal court fees had remained unchanged for over seven decades. The significant increase in fees has surprised many, especially considering the ongoing cost of living challenges. The old regulation failed to address various issues, and the enhancements in federal court services warranted a more equitable fee structure. Drawing on experiences from other countries, the new law aims to modernize the court payment system, making it more efficient and effective. It also seeks to align with current social and economic realities. However, critics argue that it would be more beneficial if the fees collected could be used directly to improve court services, rather than being funneled through the Ministry of Finance. This change could significantly enhance the court system’s responsiveness.
Under the new law, fees have increased dramatically for court users. For instance, court fees for a case valued at two million birr have jumped from 23,000 birr to 82,000 birr. Many critics warn that such steep fees could create substantial barriers for individuals seeking justice. The Federal Supreme Court introduced this new regulation to update more than half a century old fees for court services. It encompasses various aspects, including payment methods, while emphasizing the fundamental right to seek justice. Observers note that the existing service fees do not adequately cover administrative costs, highlighting the need to reassess pricing to ensure the financial stability of the judiciary.
The new regulation imposes higher court fees on petitioners in civil cases, with fees ranging from 1% to 10%, depending on the claim amount. The maximum fee of 10% applies to civil cases involving claims up to 20,000 birr, while the fee decreases for larger claims, dropping to 4.2% for cases between 900,001 and one million birr. For claims exceeding one billion birr, the fee is set at 1%. This could result in courts receiving substantial sums for larger civil suits. These changes represent a significant shift from the previous practices established in 1945. The new regulation imposes to double or more the fees in many cases when we compare it with the previous one.
Certain categories of civil suits, such as family matters, human rights cases involving children, and issues concerning the elderly and women’s rights, are exempt from these fees. Other cases will still incur filing and verdict fees.
Overall, these changes reflect a necessary modernization, but they also raise important questions about access to justice in a challenging economic landscape.
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