Category: Blog Posts

By Yenatfanta Bekele

Introduction

Our society is dynamic through time. The way of our life evolved through many phases. Importance of law is that it also evolves or changes as we do. Contemporary world is being depended on digital platforms. Most of our activities are intertwined with the internet and digitalization including contracts.[1] Thus laws that can be applicable to such issues are undeniably important. Most countries have such laws. Ethiopia enacted Electronic Signature Proclamation No. 1072/2018 in December 2018 G.C. the reasons are it has become necessary to provide legal recognition to the exchange of electronic messages and determine the rights and obligations of participating parties as provided in the preamble.  

Definition of Electronic Signature

The definition of electronic signature contains almost the same elements in different jurisdictions or states. In the U.S.A it is defined as: “an electronic sound, symbol or process that is attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record”.[2] In Ethiopia it is defined as information in electronic form, affixed to or logically associated with, an electronic message, which may be used to identify the signatory in relation to the electronic message and to indicate the signatory’s approval of the information contained in the electronic message.[3] Simply electronic signature means digital way of signature of electronic message that verifies the intention and acceptance of a certain message with intention to do so. There is also digital signature which is a type of electronic signature that uses asymmetric cryptosystem and is uniquely linked to the signatory; is capable of identifying the signatory; is created using a private key that the signatory has sole control; and is linked to the electronic message to which it relates in such a manner that any subsequent change of the electronic message or the signature is detectable as indicated under article 2(5).

Scope of the Law

As per to article 3 of proclamation No. 1072/2018; this specific law concerning electronic signature applies to any electronic message. In other word any messages or documents that are agreed upon by parties will be under the jurisdiction of law.  Additionally any law or regulation or directive which is not consistent on matters covered and ruled by this proclamation will not be applicable according to article 53. Thus this law applies to any messages that are electronically signed but does not imply to documents but messages only.  In the following paragraph I will try to highlight some of the issues concerned electronic signature based on proclamation No. 1072/2018.

Legality of Electronic Signature

Before the enactment of this proclamation laws, regulations and practices that mandatorily require handwritten signatures and documents.[4] The enactment of Proclamation No.1072/2018 changed this requirement and broadened the acceptance of electronic signatures of messages in legal aspects according to article 5. Thus where any law requires that information shall be in writing, such requirement shall be deemed to have been satisfied if such information is rendered or made available in an electronic form and accessible so as to be usable for subsequent reference as per to article 5(2). Accordingly, the law presumes that the electronic signature is the signature of the subscriber; the electronic signature was affixed by that person with the intention of approving the electronic message; and the electronic message and the signature has not been altered since the specific point in time to which the electronic signature was affixed as per to article 7. However, this presumption rebuttable as the law allows if the contrary can be proven and this is also applicable to digital signature as per to article 8.  

Authority and Certificate Providers

In order for this proclamation to be applied a government authority that executes it must exist. Thus article 9 provides that the Information Network Security Agency (INSA) shall act as the Root Certificate Authority pursuant to the mandate given to it in its establishment Proclamation.  The certified certification will be effective for 5 year unless it is canceled or revoked or returned or terminated as per to the proclamation. Not just domestic certificate providers but also foreign certificate providers can be recognized as long as they comply asper to this law’s requirements as provided under article 20. INSA has different powers and duties concerning the certificate. Generally, INSA has the power and responsibilities to issue license to certificate providers and monitor their activities and operations ensure the trustworthiness and the overall security of the crypto system; issue working procedures and standards that certificate providers shall follow as per to article 10.

Mainly, INSA has the power to suspend, cancel revoke that was issued before which is provided from article 14 up to 16. There are different reasons that are provided in order one’s certificate to be suspended, cancelled or revoked. To list out some of them, for instance; INSA has the power to suspend to examine the occurrence of any of the grounds, which are stated under sub article of Article 15 of this proclamation that result cancelation of certificate provider licenses; or when the Root Certificate Authority considers that the grounds are not suffice to revoke the certificate provider license but defects are required to be corrected within a specified time and other. It also has the power to revoke certificate if the certificate provider breaches the provisions of this Proclamation or regulations and directives issued under this proclamation; it is proved that the license has been given based on falsified information; and other reasons.

In order for recognition there are some requirements that must be fulfilled. Any person may apply to acquire certificate upon satisfying requirements provided under this Proclamation and regulation and directives issued in accordance with this Proclamation and detailed terms and conditions set by the certificate provider. There are different obligations rested upon certificate provider. These responsibilities are to provide a time stamp service declaration that confirms the correct date and time of an act to a specific electronic message, digital signature or authenticity of a certificate; to provide encryption service in accordance with the requirements set by the Root Certificate Authority; to use trustworthy system; to have financial capacity to publish and inform the policy; and to keep custody of information for 2 years and with confidentiality unless agreed otherwise as described from articles 23 up to 29.

Subscribers

Not just the above persons but also subscribers are also provided with obligation as per to article 44. As the rest Root Certificate and certificate provider’s subscribers have responsibilities and right. Subscribers have the obligation to provide accurate information; obligation to safeguard private key; obligation to request suspension or revocation of certificate and acceptance of certificate.

Dispute Remedy

Different persons as natural and legal persons are involved in the application of this proclamation. These are Root Certificate Authority, certificate providers, and subscriber or the users. Any kind of dispute may arise between two of these persons. Thus the law provides different settlement institutions. If a dispute arise between Root Certificate Authority and certificate providers can bring the case to National Crypto Council. If one of the parties needs to take appeal reasoning the decision can take their case to Federal High Court[5]. On the other hand, if the dispute is between certificate providers, and subscriber or the users the dispute shall be settled by Root Certificate Authority. If any of the party need to take an appeal to Federal High Court.[6]  

Conclusion

As contemporary world is being depended on digital platforms and electronic connection, this way of life needed to be regulated which led the Ethiopian government to enact proclamation on electronic signature while broadening the protection of people in their changing world. The law regulates different issues that are concerned with electronic signature starting with requirements to be mate; and regulating how the electronic massages should be protected relaying on a set of responsibilities in order to protect the subscribers. It lays down different responsibilities and protection toward the Root Certificate Authority, Certificate provider and subscriber. Providing and mandating responsibilities towards one of these persons in return protect the rest. Thus the fact that the law  has already regulated electronic signature is appropriate and timely.

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[1]Eyasu Mekonen, Ethiopia enacted a new electronic signature law http://www.flslegalservices.com/2019/12/04/ethiopia-enacted-a-new-electronic-signature-law/#:~:text=The%20law%20stipulates%20that%20no,it%20is%20in%20electronic%20form.

[2]The Electronic Signatures in Global and National

Commerce Act, https://www.fdic.gov/regulations/compliance/manual/10/x-3.1.pdf , March 1, 2001

[3] Electronic Signature Proclamation No. 1072/2018, 24^th Year No.25 February 16, 2018 Art 2(6)

[4]Wossenyeleh Tigu and Abraham Arega, Regulation of E-signature in Ethiopia www.mtalawoffice.com/legal-updates/entry/regulation-of-e-signature-in-ethiopia#:~:text=In%20Ethiopia%2C%20there%20has%20been,the%20Electronic%20Signature%20Proclamation%20No. December, 2018.

[5] Proclamation No. 1072/2018 Art, 50

[6] Id Art, 51

By Dagnachew Tesfaye
Ethiopia has ratified the Convention on the Recognition and and Enforcement of Foreign Arbitral Awards by PROCLAMATION No.1184 /2020, done on 13th day of March 2020.
The Purpose: the purpose for the ratification is because the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the Convention hereafter) as adopted on 10th June 1958 is believed to enhance foreign investment by boosting a country’s goodwill in enforcing contracts of foreign parties;
The Ethiopian Government declares that the Convention will apply when done in the territory of another contracting state and on legal relationships, whether contractual or not, which are considered commercial under the National Law of Ethiopia.
Ethiopia reserves the application of the Convention only to apply with respect to Arbitration Agreements concluded and Arbitral Awards rendered after the date of its accession to the Convention.
With the above reservation, the Convention is ratified and it shall come into force upon publication in the Federal Negarit Gazette.
The Attorney General of the Federal Democratic Republic of Ethiopia is authorized to undertake, in collaboration with the Ministry of Foreign Affairs and other Government Organs, all acts necessary for the implementation of the Convention.

With the ratification by Ethiopia of the Convention in mind, lets look at the highlights of the The Convention on the Recognition and Enforcement of Foreign Arbitral Awards New York 1958.
The objective: the aim of the Convention is to seeks to provide common legislative standards for the recognition of arbitration agreements and court recognition and enforcement of foreign and non-domestic arbitral awards. The term “non-domestic” appears to embrace
awards which, although made in the state of enforcement, are treated as
“foreign” under its law because of some foreign element in the proceedings,
e.g. another State’s procedural laws are applied. Also the aim is to avoid discrimination on foreign and non-domestic arbitral awards. It obliges Parties to the Convention to ensure such awards are recognized and generally capable of enforcement in their jurisdiction in the same way as domestic awards. In addition to the above, arbitration agreements will be given full effect by courts in enforcing the agreed form of dispute settlement which is arbitration.
Application of the Convention: The Convention apply to the recognition and enforcement of arbitral awards made in the territory of a State other than the State where the recognition and enforcement of such awards are sought, and arising out of differences between persons, whether physical or legal. It shall also apply to arbitral awards not considered as domestic awards in the State where their recognition and enforcement are sought. The term “arbitral awards” is defined to include not only awards made by
arbitrators appointed for each case but also those made by permanent arbitral bodies to which the parties have submitted.
Form of Agreement: Each Contracting State shall recognize an agreement in writing under which the parties undertake to submit to arbitration all or any differences which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not, concerning a subject matter capable of settlement by arbitration. The term “agreement in writing” shall include an arbitral clause in a contract or an arbitration agreement, signed by the parties or contained in an exchange of letters or telegrams. However, unless the said agreement is found by the court to be null and void, inoperative or incapable of being performed, the court should direct the parties to arbitration.
The Same Standard of Recognition and Enforceability: parties to the convention should give recognition to the same standard that of domestic ruling and should not burden parties with more onerous conditions or higher fees or charges on the recognition or enforcement of arbitral awards, as opposed to domestic awards.
Submission requirements: (a) The duly authenticated original award or a duly certified copy thereof; (b) The original agreement or a duly certified copy thereof. (c)a translation of these documents into the official language when needed and the translation shall be certified by an official or sworn translator or by a diplomatic or consular agent.
Refusal of Recognition or Enforcement: refusal to recognize or enforce an arbitral award comes at the request of the party in which recognition or enforcement is invoked up on or the competent authority in which recognition or enforcement is requested. Recognition or enforcement may be refused a) if under the law applicable to law, the parties to the arbitral award are under some incapacity, or the said agreement is not valid under the law to which the parties have subjected it or, failing any indication thereon, under the law of the country where the award was made; or (b) the party against whom the award is invoked was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings or was otherwise unable to present his case; or (c) the award deals with a difference not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration, provided that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, that part of the award which contains decisions on matters submitted to arbitration may be recognized and enforced; or (d) the composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties, or, failing such
agreement, was not in accordance with the law of the country where the
arbitration took place; or (e) the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made or (f) the subject matter of the difference is not capable of settlement by arbitration under the law of that country; or (g) the recognition or enforcement of the award would be contrary to
the public policy of that country
Suitable Security: the competent authority that was requested refusal on the terms and conditions mentioned on (e) above, it may adjourn enforcing and may require at the request of a party seeking enforcement, for the other party to produce suitable security.
Multilateral or Bilateral Agreements: the Convention shall not affect the validity of multilateral or bilateral agreements concerning the recognition and enforcement of arbitral awards entered into by the Contracting States nor deprive any interested party of any right he may have to avail himself of an arbitral award in the manner and to the extent allowed by the law or the treaties of the country where such award is sought to be relied upon.
Signature, Ratification, Accession and Deposit: This Convention shall be open for signature until 31 December 1958 for signature. This Convention shall be ratified and the instrument of ratification shall be deposited with the Secretary-General of the United Nations. This Convention shall be open for accession to all States. Accession shall be effected by the deposit of an instrument of accession with the Secretary-General of the United Nation.
Federal or Non-unitary States Application of the Convention: the following provisions shall apply: (a) With respect to those articles of this Convention that come within the legislative jurisdiction of the federal authority, the obligations of the federal Government shall to this extent be the same as those of Contracting States which are not federal States; (b) With respect to those articles of this Convention that come within the legislative jurisdiction of constituent states or provinces which are not, under the constitutional system of the federation, bound to take legislative action, the federal Government shall bring such articles with a favourable recommendation to the notice of the appropriate authorities of constituent states or provinces at the earliest possible moment; (c) A federal State Party to this Convention shall, at the request of any other Contracting State transmitted through the Secretary-General of the United Nations, supply a statement of the law and practice of the federation and its constituent units in regard to any particular provision of this Convention, showing the extent to which effect has been given to that provision by legislative or other action.
Coming into force: This Convention shall come into force on the ninetieth day following the date of deposit of the third instrument of ratification or accession.For each State ratifying or acceding to this Convention after the deposit of the third instrument of ratification or accession, this Convention shall enter into force on the ninetieth day after deposit by such State of its instrument of ratification or accession.
Denunciation: Any Contracting State may denounce this Convention by a written notification to the Secretary-General of the United Nations. Denunciation shall take effect one year after the date of receipt of the notification by the Secretary-General.This Convention shall continue to be applicable to arbitral awards in respect of which recognition or enforcement proceedings have been instituted before the denunciation takes effect.
Languages:This Convention, of which the Chinese, English, French, Russian and Spanish texts shall be equally authentic, shall be deposited in the archives of the United Nations.
Recommendations: 1. that article II, paragraph 2( the term ‘agreements in writing’), of the Convention be applied recognizing that the circumstances described therein are not exhaustive; 2. that article VII, paragraph 1(i.e ‘multilateral or bilateral agreements’), of the Convention, should be applied to allow any interested party to avail itself of rights it may have, under the law or treaties of the country where an arbitration agreement is sought to be relied upon, to seek recognition of the validity of such an arbitration agreement.

By Dagnachew Tesfaye

Ethiopia has adopted a new investment law. The Proclamation is called the Investment Proclamation No.1180/2020(hereafter the Proclamation). It was done on April 2,2020 to be effective on the date of publication in the Federal Negarit Gazettee.
Purposes of the Proclamation: The major purposes of the proclamation are to increase the role of private sector investment in all sectors of the economy, to create fast track economic framework, to increase export performance, expand employment opportunity, to increase and diversify foreign investment inflow and transfer technology, skill and knowledge, to link foreign and domestic investments in broader areas, to promote equitable distribution of investments among the regions of Ethiopia, to leverage foreign capital to promote the competitiveness of domestic investors, to put in place an efficient system to implement the National Investment Objectives and such system to be transparent, predictable, and efficient for investment attraction, retention and expansion.

In the Proclamation, 'Investment' has been defined as expenditure of capital in cash or in kind or in both by an investor to establish a new enterprise or to acquire in part or in all, to expand or upgrade an existing enterprise. 'Capital' is also defined as local or foreign currency, negotiable instrument, machinery or equipment, building, working capital, property right, intellectual property right or other tangible or intangible business assets. 'Investor' is defined as a domestic or foreign investor who has invested capital in Ethiopia. 'Domestic investors' are defined to include among others a foreign national or foreign enterprise treated as domestic investor as pr the Ethiopian law or international treaty Ethiopia has ratified or a foreign national or foreign enterprise accorded a domestic investor investment permit earlier and continues to operate in Ethiopia and descendants of a foreign nationals. 'Export- oriented non-equity based foreign enterprise collaboration' is defined as a collaboration formed by a contractual agreement between a domestic investor and foreign enterprise in which the foreign enterprise provides among others guaranteed external market access, know-how of production of products for export, export business management know-how, export marketing know how and strategies for the supply of raw materials and intermediate inputs needed for export products.
Scope of the Investment Proclamation: The scope of application of the investment proclamation is in all investment sectors in Ethiopia except prospecting, exploration and development of minerals and petroleum.
Powers of EIC: The Ethiopian Investment Commission(here after Commission) is assigned the power to issue, renew, amendment, substitution, replacement and cancellation of investment permits, the issuance of investment permits and the expansion or upgrading permits for wholly foreign owned investments or joint investments by domestic and foreign investors, foreign nationals who are treated as domestic investors and investment areas that are eligible for incentives by a domestic investor. Sectors of investment in air transport services, the generation or transmission or distribution of electric power and the provision of communication services shall be carried out by the Ethiopian Civil Aviation Authority, the Ethiopian Energy Authority and the Ethiopian Communication Authority respectively representing the Commission. These later Authorities shall submit to the Ethiopian Investment Commission a quarterly report regarding services they rendered through delegated powers, and further study potential sector specific investment strategies and engage in investment promotion works. Regional investment organs shall administer investments, that are outside the scope of the Commission or Authorities mentioned above.
Areas of Investment: Areas of investment open to an investor as a principle are any area of investment that are not contrary to law, moral, public health or security. Except areas of investment reserved for joint investment with the government or domestic investors and for joint investment with domestic investors, all other areas of investment shall be open to foreign investors. The list of areas of investments by joint investment with the government or domestic investors, or joint investment with domestic investors or areas of investment open for foreign investors may be revised from time to time by the EIC Board.
Joint Investment with the Government or PPP: The government body assigned to receive interested private investors proposals in areas of joint investment with the government, as public-private partnership, shall be the Public Enterprises Holding Administration. The Agency shall follow procedures under the law and upon approval, designate a public enterprise or establish a new project company to invest as partner in the joint investment.
Forms of Enterprises: Investments may be carried out in the form of sole proprietorship, enterprises established in Ethiopia or abroad, public enterprises established with the relevant law and cooperative societies formed in accordance withe the relevant law. Any investment enterprise established abroad and registered in Ethiopia and all other enterprises registered in Ethiopia shall be governed by the Commercial Code of Ethiopia.
Minimum Capital Requirement: A foreign investor to be allowed to invest shall be required to allocate a minimum capital of USD 200,000.00(Two Hundred Thousand USD) for a single investment project. Where the foreign investor jointly invests with a domestic investor, the minimum capital requirement shall be USD 150,000.00(One Hundred Fifty Thousand). However, if the investment areas is in architectural or engineering works or related technical consultancy services, technical testing and analysis or in publishing works, the minimum capital investment shall be USD 100,000.00(One Hundred Thousand) or USD 50,000.00(Fifty Thousand) if the investment is made jointly with a domestic investor. The minimum capital requirement shall not apply to foreign investors re-investing his profits or dividends generated from his existing enterprise in any investment area open for foreign investors or persons elected as members of board of directors following the change of a private limited company to share company or a foreign investor buying the entirety of an existing enterprise owned by a foreign investor or the shares therein. Any foreign investor bringing investment capital into Ethiopia, need to registered it within one year and the obtain a certificate of registration. Such copy of certificate shall be sent to the National Bank of Ethiopia by the appropriate investment organ.
Investment Permit: foreign investors, domestic and foreign investors investing jointly, investors investing as domestic investors, domestic investors who invest in areas eligible for incentives and who seek to be beneficiary of such incentive and an investor seeking to expand or upgrade an existing investment which is eligible for incentives and the investor seeks to be beneficiary of such incentive shall obtain investment permit. However, a foreign national of Ethiopian origin treated as a domestic investor shall have the right to invest without acquiring investment permit in areas not eligible for incentives or in areas eligible for incentives by waiving his right to claim incentives. Also a foreign investor seeking to buy an existing enterprise in order to operate it in its current state or to buy shares of an existing enterprise shall obtain prior approval from the EIC. The Commission shall not deny or delay the approval without sufficient cause. Nevertheless, no investor is allowed to hold domestic and foreign investor permits simultaneously.
An investment permit is subject for renewal annually until the investor commences marketing his products or services. Once a business licence is acquired, the shall be no need to renew investment permit. The renewal request should be sough within one month after the end of a period of one year for which the permit was valid. Unless the investment organ is convinced of a sufficient cause for delay in commencing or completion of the investment project, the investment permit will be revoked within two years.
Transfer of investment project in the implementation phase: an investor wishing to transfer to another investor a project which is under implementation shall submit his request to the investment organ and obtain approval. The investment organ shall not deny or delay the approval without sufficient cause.
Any investor who is issued an investment permit shall submit a quarterly progress report and provide information concerning his investment whenever requested.
Technology Transfer Agreement: Any investor concluding a technology transfer agreement shall register such agreement with the EIC. Unregistered technology transfer agreement shall have no legal recognition with the EIC.
Collaboration Agreement: Any domestic investor who concludes, in respect of export, a collaboration agreement with a foreign enterprise who does not contribute capital shall have the agreement registered with EIC. A collaboration agreement that is not registered shall have no legal recognition with the EIC.
Investment Incentives: areas of investments, types and amount of investment incentives shall be determined by regulation.
Immovable Property Ownership: a foreign investor or a foreign national treated as domestic investor shall have the right to own immovable property necessary for his investment. Whereas, if such an investor who owns large investment may be allowed to own one dwelling house. The details of the later part shall be decided by a regulation. Immovable property as used in this provisions does not include land and the ownership of immovable property shall apply to investors who invested prior to the adoption of this proclamation.
Expropriation: the government may expropriate any investment for public interest, in conformity with requirements of the law, on a non-discriminatory basis, with adequate compensation corresponding to the prevailing market value paid in advance.
Remittance of Funds: a foreign investor shall have the right in respect of his investment to remit in convertible currency at the prevailing exchange rate on the date of transfer profits and dividends, principal and interest payments on external loans, payments related to technology transfer agreements, payments related to collaboration agreements, proceeds from the transfer of shares or conferral of partial or total ownership of an enterprise to another investor, proceeds from sale, capital reduction or liquidation of an enterprise and compensation paid on expropriation. Expats employed for investments carried out pursuant to this Proclamation whose permanent residence is outside of Ethiopia may remit their salaries accruing from their employment. However, a domestic investor investing jointly with foreign investor shall not be allowed to remit funds earned from the investment out of Ethiopia.
External Loan: An investor may acquires a loan from outside of Ethiopia for his investment and operate a foreign currency account in a bank in Ethiopia for the purpose of its investment following the directives of the National Bank of Ethiopia (NBE).
Expat employment : an investor may employ duly qualified foreigners for his investment in positions of higher management positions including chief executive officer, chief operation officer and chief finance officers as necessary, supervision, trainers and other technical professions. However, foreigners may be employed only when it can be ascertained that Ethiopians possessing similar qualification or experience required by the sector are not available.
Work Permits of Expats: The work permit of top management foreign workers shall be renewed without being required to comply with the conditions specified in this article in respect of other foreign workers. A work permit may be issued for a cohabiting spouse of any investor and a foreign worker employed. A work permit for employment in certain positions may be issued for up to three years and renewed every year. However an investor who employs foreigners shall be responsible for replacing within a limited period of time such foreign workers by Ethiopians by arranging and providing the necessary training. Renewal of work permit shall be done after ascertaining the non-availability of Ethiopian workers with similar qualification and of the concrete measure taken by the investor to train Ethiopian replacements. Where it is ascertained that a foreign worker is no longer required for the position he is employed, the EIC may decide not to renew or to cancel the work permit.
Visa Services: EIC or a delegated investment organ may facilitate the processing of visa application of foreigners coming into Ethiopia for investment purposes and that of the families (spouses, children and parents) of investors undertaking investments in Ethiopia. Visa may be issued to an investor intending to enter into Ethiopia, from a country that is not his home country, for investment purposes based on a support letter the EIC may offer. An owner or shareholder of an investment under this proclamation may be issued a five-year multiple visa based on the confirmation by the EIC. The general manager, board member or top management of an investment enterprise in Ethiopia and the Parent or holding company of the Enterprise may be issued a three year multiple entry visa based on confirmation by EIC. No single stay of any foreigner entering Ethiopia using multiple entry visa may exceed 90(Ninety) days.
One Stop Service: EIC or regional investment organs shall provide one-stop services to investors by coordinating relevant agencies and synchronize their daily functions.
Complaint Procedure in EIC: Any grievance shall be resolved using speedy, equitable and efficient procedure. Any investor who has grievance shall have the right to submit it to the appropriate investment organ. Such grievance shall follow the administrative chain and get final administrative decision. A written copy of the administrative decision shall be given to investor within 7(Seven) working days from the date from the date of the decision. If the investor has a grievance against the final administrative decision of EIC, then he can submit a complaint to EIC Board within 30(thirty) working days from the date the investor becomes aware of such decision. Then the Board shall give its decision within 90(Ninety) working days from the date of submission of the Complaint and a written Board decision will be given to the investor within 7(seven) working day.
Complaint procedure against Executive Bodies: An investor shall have the right to submit a complaint to the EIC against final administrative decision of any federal government executive body where such decision significantly affects the investment. The Federal executive body shall give to investor within 7(seven) working days a written copy of the final decision. The investor then has 30(thirty) working days to submit the final administrative decision to EIC. EIC shall engage with the government body and propose a recommended solution in writing within 30(thirty) days from the submission of the complaint. A written copy of the proposed solution shall be given to the investor within 7(seven) working days from the date the recommended solution is tabled. Still the investor may file a complaint to EIC Board against the EIC's recommended solution, or the the solution is not accepted by the government body. The complaint to the Board should be presented within 30(thirty) working days from the date the investor is notified of the recommended solution or learns that the government body rejected the recommended solution. The Board shall then give its decision within 90(Ninety) working days. Any Federal government body has a duty to comply with and execute in accordance with the decision of the Board.
Dispute Settlement: without prejudice to the right of access to justice through a competent body with judicial power, any dispute between an investor and the Government involving investments effected pursuant to this Proclamation will be resolved through consultation or negotiation. The Federal government may agree to resolve investment disputes involving foreign investments through arbitration. Where a foreign investor chooses to submit an investment dispute to a competent body with judicial powers or arbitration, the choice shall be deemed final to the exclusion of the other.
Investment Administration Organs: The investment administration organs include the Ethiopian Investment Board, the Ethiopian Investment Commission, the Federal Government and Regional sState Administrations Investment Councils and the Investment Administration organs established pursuant to Regional laws.
Members of the Ethiopian Investment Board are 13(thirteen) including the Prime Minister as chairperson, a government official designated by the Prime Minister as Vice Chair person, EIC Commissioner and Secretary, Eight core or investment related government officials, two private sector representatives.
Council: a council for the cooperation and coordinated administration of investment between the Federal government and Regional state administrations is established by this Proclamation. Members of the Council include the Prime Minister or in his absence the Deputy Prime Minister as chairpersons, Presidents of all regions and Mayors of the Addis Ababa and Dire Dawa City Administrations, EIC Commissioner and heads of investment organs of all Regions and Addis Ababa and Dire Dawa City Administrations and other members designated by the Prime Minister as necessary.
Coordination with Regional States: the Commission shall work in close cooperation with Regional Stat Investment Administration organs and other stakeholders with a view to creating a uniform, coordinated and efficient national investment administration system. Standing regional state investment Desks shall be established.
Provision of Land: Regions shall handle land requests for investments in the manufacturing, agriculture and other sectors in an efficient manner and shall establish a transparent and predictable system for the handling of such requests. Regions shall identify and classify land to be used for investment projects, organize such land centrally under one Regional State Administration body and transfer the information to the appropriate investment organs. The EIC shall coordinate the Regional State Administration and appropriate investment organs to facilitate and follow through the efficient handling of such requests. Regions shall respond to land allocation request of an investor for manufacturing within 60(Sixty) days and 90(Ninety) days where the investment is in other sectors.

Transitory Provisions: rights and entitlements bestowed pursuant to Investment Proclamation no 769/2012 as amended and Regulations and Directives issued there under shall remain applicable in respect of investments approved prior to the coming into force of this Proclamation.

Duty to Observe: all investors have a duty to observe laws of the country and shall give due regard to social and environmental values.

The Ministerial Committee on Covid 19 has come out with a directive namely Covid 19 Directive no.2/2020 to execute the Emergency Proclamation No 3/2020 and Council of Ministers Regulation No 466/2020. It contains four parts. The first part is general conditions. The second part is about the Ministerial committees work, committee members, sub-committees and establishing regional committees. The third part is about religious, death, funeral, abattoir, festivity shopping, employer-employee relationship and usage of lifts. Finally part four is about special provisions.

Under the Directive ‘Employee’ shall mean a worker that is governed under Labor proclamation No 1156/2019 and who works with a person, business organization or non-governmental organizations.

The Directive on Article 23 sub-article 11 state that employment contracts cannot be terminated, salary cannot be blocked, salary cannot be reduced or refused without the knowledge and approval of the Ministry of Labor and Social Affairs.

Employer is obliged to report and hand over an employees that clearly shows Covid 19 symptoms or if there is a suspicion that an employee shows the symptoms on Article 23(12).

Similarly on Article 23(13) the employer SHOULD establish a 5 member committee, that directly respond to the Ministry, that works on the work place response prevention of Covid 19, the head of the organization being the head of the committee.

Finally on Article 23(14) the employer has a duty to report on the work place response performance on Covid 19.

By Mahlet Mesganaw, Partner

Email: mahlet@dmethiolawerys.com

Stamp Duty Proclamation No 110/1998 provides by whom, when and how much stamp duty is paid on employment contracts. Stamp duty is paid by  the Employer and not the Employee. Stamp Duty should be paid before or at the time of signature of the employment contract. Customarily paying stamp duty at the end of probation period is not the acceptable legal way. The amount is 1%(One Percent) of the one month salary.

In addition to this the payment of a stamp duty under Birr 50 shall be effected by affixing stamp of appropriate value to the instrument. When the stamp duty exceeds Birr 50 or where the type and nature of instrument so requires, the Federal Government Revenues Board may by directive provide that stamp duty be paid by means other than affixing stamp. And whoever executes or receives an instrument bearing an adhesive stamp shall at the time of execution cancel the same, so that it cannot be used again.

Thus, stamp duty is a legal requirement for employers to implement when hiring employees. This will avoid confrontation with the regulatory body and possible penalties.

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

1. Definitions

“Sexual harassment” means to persuade or convince another through utterances, signs or any other manner, to submit for sexual favor without his/her consent.
“Sexual violence” means sexual harassment accompanied by force or an attempt thereof.

2. Scope of Application
3(1). Without prejudice to Sub-Article (2) of this Article, this Proclamation shall be applicable to employment relations based on a contract of employment that exist between a worker and an employer including recruitment process.
3. Probation
11(3). When the parties agree to have a probation period, the agreement shall be made in writing; in such a case, the probation period shall not exceed 60 working days beginning from the first date of employment.
4. Prohibited Acts
14(2)g). Conduct meeting during working hours in disregard to the time assigned by the collective agreement or without obtaining the permission of the employer; h) Commit sexual harassment or sexual violence at workplace;
i) Physically abuse anyone in a work place.
5. Tardiness
27. 1/ Unless otherwise determined by a collective agreement, a contract of employment shall be terminated without prior notice only on the following grounds :
a) Unless the reason for being late is justified by the collective agreement, work rule or contract of employment, being late for duty eight times in six months period while being warned in writing of such a problem;
6. Absence
27/1/b) Absence from duty for a total five days in six months period while being warned in writing of such a problem; and where the absence cannot be classified in any of the leaves provided under the Proclamation;
7. Performance test
28(2) Any loss of capacity of work referred to in SubArticle (1) (a) of this Article shall, unless otherwise provided by a collective agreement, be verified by a periodical job performance evaluation.
8. Termination without prior notice by Employee
32(1) (b) Where the workers has been a victim of sexual harassment or sexual violence by the employer or a managerial employee;
9. Severance payment
39(1)d. Where the worker resigned due to sexual harassment or sexual violence by the employer or managerial employee; or where such act was committed by a coworker and the incident was reported to the employer but the latter failed to take appropriate measure in due time;
10. Compensation
41(2) However, where the termination is based on Article 32 (1) (b) the worker shall, in addition to severance pay, be entitled to compensation of his daily wage multiplied by ninety. This provision shall also apply to a worker covered by the relevant pension law.
11. Employee to pay compensation to Employer
45. 1/ A worker who terminates his contract of employment in disregard of the provisions of Article 31 or 35(2) of this Proclamation shall be liable to pay compensation to the employer.
2/ However, the compensation payable by the worker in accordance with Sub-Article (1) of this Article shall not exceed 30 days’ wages of the worker and be payable from the remaining payment due to the worker.
12. Deduction from Salary more than 1/3
59. 1/ The employer shall not deduct from, attach or set off the wages of the worker except where it is provided otherwise by law or collective agreement or work rules or in accordance with a court order or a written agreement of the worker concerned.
2/ Unless the worker expresses his consent in writing, the amount that may be deducted at any one time, from the worker’s wage shall in no case exceed one-third of his monthly wage.
13. Overtime Payment
68/ 1/ In addition to his normal wage, a worker who works over-time shall be entitled at least on the following rate of payments:

a) In the case of work done between 6:00 a.m. in the morning and l0:00 p.m. in the evening, at the rate of 1.5 multiplied by the ordinary hourly rate;

b) In the case of night time work between 10 p.m. in the evening and 6 a.m. in the morning, at the rate of 1.75 (one and three fourth) multiplied by the ordinary hourly rate;
14. Weekly Rest
69/4/ Notwithstanding the provisions of Sub Article (1) of this Article, where the nature of his task did not enable the worker to make use of his weekly rest day, the employer shall grant 4 working days of rest in a month.
15. Annual Leave
77(1) A worker pursuant to this Article shall be entitled to uninterrupted annual leave with pay. Such leave shall in no case be less than:
a) Sixteen (16) working days for the first year of service;
b) Sixteen (16) working days plus one working day for every additional two years’ service.
16. Paternity Leave
81/2/ A male employee shall be entitled to three consecutive days paternity leave with full pay
17. Leave for events
81/3/ A worker shall be entitled to leave without pay for up to five consecutive days in the case of exceptional and serious events. However, such leave may be granted only twice in a budget year.
18. Maternity Leave
88/3/ A pregnant worker shall be granted a period of 30 consecutive days of leave with pay of pre-natal leave and a period of 90 consecutive days of leave post- natal.

The Hague Convention on Adoption has the best adoption procedures. Its aim is to protect the best interest of a child. In this regard, Ethiopia can consider this international treaty as an option, as a means to give a meaningful life for a vulnerable child.

In the early 1990s a treaty was drafted, debated, and eventually finalized that would shape the course of international adoption forever. The treaty, later known as The Hague Convention of 29 May 1993 on Protection of Children and Co-operation in Respect of Intercountry Adoption, was actually the second convention put forth by The Hague Conference on Private International Law concerning adoptions. The first, finalized in 1965, was formally denounced by the governments of Austria, Switzerland, and the U.K, and never saw a single country ratify or accede to it. That first convention dealt only with the recognition of adoption decrees and was nowhere near as comprehensive in scope as the convention that would follow in 1993 (commonly referred to as the Hague Convention). However, the 1965 convention did provide a template for the Hague Convention, or at least a warning that for an international adoption treaty to be successful it needed to be broader in scope and have more robust engagement in the drafting stages.

The Hague Convention was the product of many years of debate and negotiation and multiple drafts of nearly every provision. Over 60 countries sent delegations to the session where the Hague Convention was discussed and eventually finalized. However, the document discussed by those delegates was a product of nearly three years of meetings among a smaller group of drafters. After multiple versions were considered over those three years, a proposed draft was submitted before the hundreds of delegates present, representing over 60 countries. As with any treaty, there was much debate and many compromises resulted. Some provisions were intentionally left with ambiguity, allowing for multiple interpretations and permitting different constituencies to all feel satisfied that their desires were achieved. This meant that the text of the convention was in some ways rather malleable. Ultimately, however, the Hague Convention emerged as a successful treaty that currently has over 100 countries as parties to it, including the United States.