Domestic Adoption Document Requirements

By DMLO in Collaboration with Adoption Advocates Organization(AAO)

Domestic adoption is one way of helping vulnerable children. Domestic adoption document requirements is set out under Foster Family and Domestic Adoption Services Directive No 48/2020. The document requirements are the following:


Interested prospective adoptive families need to register at the institution. The ‘institution’ is a government or charity organization which have the authority and licence from the Federal government to perform domestic adoption and foster care service. The institution will normally include government or licensed private orphanages. The prospective adoptive family should clearly indicate on the registration form the age, gender, health status and other circumstances of the child they want to adopt.

Evidences Compiled for the Child
The evidence compiled for the child include birth certificate, medical certificate, short profile of the child containing the picture of the child as well as the pictures of the guardian or custodian of the child.

Documents Compiled for the Adoptive Parents
The adoptive family shall come up with documents including medical certificate, birth certificates, marriage certificate, income statements, police clearance letter, home study, passport size photographs and id cards or passport copies. Manner of organizing these documents has certain requirements indicated in the Directive.

Adoption Agreement
Adoption agreement signed by the guardian of the child and the adoptive parents or their legal agents. The adoption agreement should show the date of execution of the adoption agreement, the parties to the agreement, the full name, age, sex of the child, clear provisions that contain consent for giving and receiving the adoption, signed by the parties, witnessed by at least two witnesses and stamped with the passport size picture of the child.

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

Major Aspects of the New Foster Family Law: the Case of Ethiopia

By Dagnachew Tesfaye, Founder and Partner at DMLO

Email: dagnachew@dmethiolawyers.com


The Ministry of Women, Children and Youth Affairs (MoWCYA) has come out with a registered directive Directive No 48/2020 namely Directive on Foster Family and Domestic Adoption Services. In this brief article, an attempt shall be made to see what foster care child support looks like only. Domestic adoption process and procedure shall be dealt in another article.

General Provisions

The preamble says foster care is introduced in this directive to fulfill the promise of the government. The government promised to support vulnerable children locally. Foster care is one of the local support programs. The directive declares that it generates its powers from the ratified Child Right Convention and African Charter on the Rights and Welfare of the Child. Thus, before indulging into the details of the Directive, it is important to see the definitions given to foster family care, who a vulnerable child is and who are the institutions to implement the foster care directives.

The scope of the Directive is to apply on appropriate Federal Government institutions and charity organizations authorize to perform foster and adoption services as per the Federal Government. Based on this directive, regions and city administration may prepare their own directive taking in to account their context.


‘Foster family Care’ is one of alternative to providing support and care to children lost their family or vulnerable children. It is a ‘temporary alternative program’. Foster family care can be either for short or long period. The responsibility of the foster family shall be to properly raise the foster child by fulfilling the basic necessity. The support and care cover the psychological and physical health of the child. These responsibility must be completed until the child is re-unified with their biological parents or placed to other permanent alternative program.

‘Vulnerable Child’ is a child whose survival and development is jeopardize by certain circumstances and therefore in need of alternative care services. Those includes: a. Abandoned Children; b. Single or double orphan; c. Non-orphan whose parents are unable to support the child due to illness, physical disability and mental impairment; d. Street children; e. Children living in orphanage; f. Abandon children due to their biological parents displacement; g. Children who are not getting support from their biological parents due to economical deprivation; and h. Children neglected by their biological parents.

‘Institution’ means a government or charity organizations which have an authority and license from federal government to perform domestic adoption and foster care service.

Registration and Eligibility

The first thing to do is registration. Registration at the institution as an interested foster family. The institutions shall have responsibility to prepare registration form to be filled by potential families. The registration must also include the foster family needs, including age, gender, health status and other conditions of the child.

The registered foster care family should fulfill eligibility requirements. The registered foster family must have Ethiopian nationality and solely reside in Ethiopia permanently. They should be above 25 years of age. Unless and otherwise there is no option, the child must only be given to married persons. Priority shall be given to a family who reside in the area where the foster child resides. Family must duly approve their willingness by written consent to foster the child. Family shall have sufficient economical capacity to raise the child. Foster family should be a person who has not convicted by a court of competent jurisdiction for offenses related children. Family must have medical certificate that enables them to raises the child.

Home Study

After making sure that the eligibility requirements are fulfilled, before the concerned authority placed the child to foster family, a home study shall be done. The concerned organ shall assess the foster family by attending home visits to acknowledge their psycho-social and economic conditions in accordance with the check list.

Evidences Concerning the Foster Family

The foster family should produce Ethiopian nationality identification card, birth certificate, medical certificate, police clearance certificate, marriage certificate and income evidences. Medical certificate should confirms they are completely free from transferable or uncured deceased so as to confirm their health capability to properly raise child.

Evidences Concerning the Child

Once the status of the foster family is assessed and completed, then the status of the child shall follow. General information of the child namely gender, age, language, religion (for a child capable of expressing himself/herself), place of birth and other related information, residential address of the child, birth certificate of the child, family status of the child (abandon, single or double orphan) and other related status shall be organized. The child physical, mental, psychological and health status, educational status of a child, economical status of a child, (for example acquiring property through inherits or grant) shall also be identified. If the child is found abandoned, name and address of the person who found the child, date, place and other related information’s must be organized.


Training to the foster family shall be given by the government organ or the institution. Such training mainly consists of proper upbringing and securing children right and other related subjects.

Matching, Attachment and Bonding

The next step is matching. After organizing the evidences of both the foster family and the child, the INSTITUTION shall made matching the child with suitable family.

Then creating attachment and bonding shall follow. Matching and bonding involves introducing physically the child with the foster family, the biological children of the foster family with the child, taking the child to the village of the foster family so as to allow him to be adapt with the community shall be done.

Foster Care Agreement

Once the bonding activity is carried out, legally binding agreement shall be made between the institution and the foster family. If an agreement is signed between the charity institution and the foster family, the concerned governmental institution shall also sign as a witness. After the agreement is concluded, in order to protect economic and social rights of the child, the foster family may present its petition of guardianship to the competent court of law.

Support and Follow up

After the placement is done, the concerned institution shall provide continuous support and follow up to ensure the right and welfare of the child is reasonably maintained.


Transition of foster care service to other alternatives may be implemented. If the biological parents exist while the child is given to the foster family and if the biological parents are capable of raising their child, reunification with biological parents shall be performed by foster care institution.

Termination of Agreement
If the foster family commit child labor, physical or psychological violence, sexual harassment, or any exploitation has been committed by a family member or by others, then if such incidents confirmed by the concerned institution, without the prejudice of legal liability, the contract will be terminated.


To sum up, the MoWCYA has come out for the first time with binding details of foster care implementation procedure. From the registration of interested foster family to required assessments and documents, to signing a foster care contract agreement has been stated under Directive 48/2020. It is a commendable act in the right direction. Publicly announcing of the Directive and effectively implementing the Directive for the benefit of the vulnerable children are equally important steps.

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

7 Major Highlights on Civil Society Organizations Registration Proclamation

By Dagnachew Tesfaye

Email: dagnachew@dmethiolawyers.com

Civil Society Organizations are administered by the Organizations of Civil Societies Proclamation No.1113/2019 (hereafter the Proclamation) done on March 12/2019 to be effective from the date of publication in the Federal Negarit Gazette. This brief article attempts to show major highlights of the Civil Society Organization Registration Proclamation. The article is divided into seven parts. Part one shall deal with definitions. Part two shall look upon types of local organization, with emphasis on two of those types. Part three and four shall deal with the requirements for registration of local and foreign civil society organizations. And part five to seven shall state the effects in terms of rights, responsibilities and income generation benefits to such registered civil organizations. A brief conclusion shall follow.

Local and Foreign Organizations

The Proclamation defines local and foreign organizations. “Local Organization” are defined as a civil society organization formed under the laws of Ethiopia by Ethiopians, foreigners resident in Ethiopia or both. Here foreigners resident in Ethiopia are granted the right to establish local organizations. On the other hand “Foreign Organization” is defined as a non-governmental organization formed under the laws of foreign countries and registered to operate in Ethiopia.

Types of Local Organizations

Two or more persons may establish Local Organization. Here on the Article 17 of the Proclamation there is a reference to ‘Indigenous Organization’. There is no definition of Indigenous Organization in the Proclamation. However, the Amharic version of Article 17, which is the prevailing one in terms of interpretation, refers indigenous organizations as ‘Local Organizations’.

There are five types of Local Organizations. These are a/ An Association b/ A Board-led Organization c/ A charitable Endowment d/ A charitable Trust and e/ A Charitable Committee. For the purpose of this article, a focus shall be made on the first two i.e. on an association and a board-led organizations.

An Association and Board-Led Organization

An Association is an organization formed by five or more members and governed by a General Assembly as the supreme decision-making body. For the purpose of this Proclamation, association shall include professional associations. The organizational chart of an association will have a General Assembly at the top and then in hierarchy Executive Committee, Manager, Auditor and other departments as may be necessary. Details regarding the structure and governance of an Association will be determined by the associations internal rules.

One the other hand a board-led organization can be formed by two or more founders. The board is the supreme organ. The Board shall have a minimum of five and a maximum of thirteen members. The first board members shall be designated by the founders. The term of service and appointment procedures for subsequent board members shall be prescribed by the rules of the organization. Here the unique nature of Board-led organization is that persons who are related by consanguinity or affinity with the officers of the organization may not be board members. The organizational chart of a board-led organization shall have a manager accountable to the Board and necessary staff as may be necessary. The particulars shall be determined by the rules of the organization.

Documents Required for Registration of Local and Foreign Organization

An application for registration by Local Organization shall be signed by the founders and should contain the following particulars: a) the minutes of the formative meeting indicating the names, addresses and citizenship of the founders; b) copy of the identity card or passport of the founders; c) the name of the organization and its logo, if it has one; d) the objectives of the organization and its intended sector of operation; e) the Region where it intends to operate; f) the rules of the organization approved by the founders; and g) the organization’s address.

On the other hand an application for registration of a foreign organization shall, in addition to the conditions mentioned from a-g above, be accompanied with the following documents: a) duly authenticated certificate of registration showing its establishment from its country of origin; b) duly authenticated resolution of its competent organ to operate in Ethiopia; c) duly authenticated power of delegation of the country representative; e) letter of recommendation from the embassy in which the charity is incorporated or in the absence of such by a competent authority in the country of origin from Ministry of Foreign Affairs of Federal Democratic Republic of Ethiopia and; f) a work plan for a minimum period of two years.

Effects in Terms of Rights

The Proclamation provides that any organization which registered upon fulfillment the registration requirements provided in the Proclamation : a/ shall have legal personality; b/ can sue, be sued and enter into contracts; c/ without prejudice to laws that require special license, can operate in the sector of its choice; d/ to own, administer and transfer movable and immovable property. However, the proceeds from the disposal of the property may not be transferred as donation for the benefit of members or to another activity which is not its mission; and the Organization which transfer property shall inform to the Agency within 15 days; e/shall have the right to engage in any lawful activity to accomplish its objectives; f/ local organizations shall have the right to operate in Ethiopia or abroad, or implement objectives having global, regional or sub regional nature; g/ can implement project activities on its own or to provide financial and technical support to other organizations; h/ may propose recommendations for the change or amendment of existing laws, policies or practices, or issuance of new laws and policies of those which have relationship with the activities they are performing. However, unless it is permitted with an other law Foreign Organizations and Local Organizations which are established by foreign citizens which are residents of Ethiopia may not engage in lobbying political parties, engage in voters education or election observations; i/ foreign organizations may implement project activities or work in partnership with Local Organizations by providing financial, technical or in kind support; j/ to the extent possible, Foreign Organizations by working in partnership with local and Governmental Organizations, can give support to build the capacity of Local Organizations; o) shall have the right to move its properties from one region to another region or city administration, unless the Project Agreement states that such properties may not be transferred because they are necessary for the sustainability of a specific project it is implementing; p) have the right to engage in any lawful business and investment activity in accordance with the relevant trade and investment laws in order to raise funds for the fulfillment its objectives. However, the profit to be obtained from such activities may not be transferred for the benefit of members; q) shall have the right to solicit, receive and utilize funds from any legal source to attain its objective; r/shall get a written approval of the Agency to open a bank account. The Agency shall respond to requests for such approval within five days from receipt of the request; s/ all financial transactions shall be performed through a bank account opened by an Organization in its name; t/ all banks have the obligation to provide the bank statement of accounts held by any Organization to the Agency when requested. w/ the Bank Account transaction can be done in the context of the Organization rules; x/ no organization may employ a foreign national who is not given work permit under the relevant laws. Notwithstanding the stipulation above, a foreign organization shall not be barred from appointing a foreign national as its country representative; y/ foreign nationals other than the country representative may only be hired if the office granting work permit verifies that the work cannot be performed by Ethiopians. z/ some provisions of the law will not apply to foreign nationals who are not salaried employees but come to Ethiopia to professionally contribute by working as volunteers for a period not exceeding one year.

The Responsibilities

As there are rights and benefits, corresponding responsibilities are laid down on the Proclamation. The responsibilities include a/ an organization shall make the necessary efforts to ensure that its activities help to bring about sustainable development, contribute to the democratization process, promote the rights and interests of its members or enhance the profession they are engaged in; b/ an organization which is established for the benefit of the general public or third parties shall ensure that its activities take into account the interests of women, Children, persons with disabilities, the elderly and others exposed to threat or vulnerable groups of the society; c/ an organization cannot engage in sectors which require additional permit by law without getting the necessary permit from the relevant government bodies; d/ in performing their duties all members, officers and employees of the Organization have the responsibility to give primacy to the Organization’s interest and take the necessary precaution to avoid conflict of interest; e/the Administrative cost of an Organization established for the benefit of the general public or that of third Parties may not exceed twenty percent of its total income. For the purpose of this provision, “Administrative Expense” shall mean expenses which are not related to the project activities of an organization but are necessary to ensure the continuity of an Organization and related to administrative activities, and shall include: salaries and benefits of administrative employees; purchase of consumables and fixed assets and repair and maintenance expenses related to administrative matters; office rent, parking fees, audit fees, advertisement expenses, bank service fees, fees for electricity, fax, water and internet services; postal and printing expenses; tax, purchase and repair of vehicles for administrative purposes, and procurement of oil and lubricants for the same; insurance costs, penalties and attorney fees. However the Agency may issue Directives regarding organizations exempted from the application of 20% administrative expense rule.

Income Generation Related Benefits

Though civil organizations are established for non-profit making endeavor, in exceptional circumstances such organizations are granted the right to generate income. The income generating activities are granted and operated in the following situations: a/ an organization which engages in income generating activities in may do so by establishing a separate business organization (company), acquiring shares in an existing company, collect public collections or operating its business as a sole proprietorship; b/shall open a separate bank account and keep separate books of account for its business in accordance with the relevant commercial and tax laws; c/ the relevant tax, commercial registration and business licensing, and investment laws shall be applicable to income generation activities under this provision; e/ the income that is generated from income generating activities will be used to cover administrative and program costs of the organization; f/ the income and resources that are acquired from income generating activities shall not be transferred or shared for the benefit of members or workers of the organization; g/ when the organizations collect public collections, they shall inform to the Agency; and h/ an organizations engaged in income generating activities based on this Article shall inform to the Agency within fifteen days.


The Civil Society Proclamation has made registration of civil society organizations easier. The Proclamation incorporated several benefits of registration. Income generation benefit is one of the major benefits. Employment of foreigners shall follow work permit procedures. However foreign citizens are allowed to occupy the position of country representatives. Other foreign nationals can serve up to one year non-salaried professional volunteer position. The Proclamation is a game changer for civil society organisations in a positive way.

Key and New Additions on the Investment Regulation of Ethiopia

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.

Major Contents of the New Investment Law in Ethiopia

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.

18 New Labor Proclamation 1156/2019 Additions

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.


 By DMLF Team

The Commercial Code of Ethiopia Proclamation No. 1243/2021, the Commercial Registration and Business Licensing Proclamation No. 980/2016 (as amended by Proclamation No. 1150/2019), the Commercial Registration and Business Licensing Council of Ministers Regulation No. 392/2017 (as amended) and most importantly the Commercial Registration, Licensing and Post Licensing Inspection Directive No. 935/2022 govern the commercial and business transactions of Ethiopia. This brief article is about the requirements for transfer of business or business organizations.

What is Business?

The Commercial Code of Ethiopia Proclamation No 1243/2021 defines business in what it contains. A business consists mainly of goodwill. A business may consist of other incorporeal elements such as: a) the trade name; b) trademark and any other designation under which the trade is carried on; c) the right to lease the premises in which the trade is carried on; d) intellectual property rights; e) Such special rights as attach to the business itself and not to the trader. A business may consist of corporeal elements such as equipment or goods. On the other hand, A business may normally not include the assets and debts of the trader, with the exception of the right to the lease of the premises. 

What is a Business Organization?

A business organization is an association established through a memorandum of association by persons who bring together contributions for the purpose of undertaking an economic activity in cooperation and of participating in the profit. Nonetheless, a joint venture is formed by an agreement concluded among members that is not disclosed to third parties.The following are types of business organizations: 1/ General partnership; 2/ Limited partnership; 3/ Limited liability partnership; www.abyssinialaw.com 90 4/ Joint venture; 5/ Share company; 6/ Private limited company; 7/ One person private limited company. 

Transfer of Business or Business Organization

The Commercial Registration, Licensing and Post Licensing Inspection Directive No. 935/2022 provides the required documentation for transfer of business or business organization. In order to transfer a business/ business organization by sale or lease, the following documents are required to be submitted: a) an agreement authenticated by a body authorized by law; b) a tax clearance certificate related to the previous business license; and  c) a license issued in the name of the previous owner shall be returned. 

The trader to which the business/business organization/ is transferred by lease or sale shall obtain a business license in his name by submitting a copy of the newspaper or the link of the  newspaper where it is a digital newspaper, having nationwide circulation as evidence. Provided however, if the trader to which the business/business organization/is transferred is already engaged in the same business, he may cause the business to be registered as a branch. If he is not engaged in the same business, he shall obtain a business license on the basis of the previous commercial registration. 

Where the business to be transferred is a business organization, a minute authenticated by a body authorized by law that shows the unanimous agreement of the members to transfer the same shall be submitted. Moreover  an agreement authenticated by a body authorized by law and a tax clearance certificate related to the previous business license  shall be submitted. Then the license issued in the name of the previous owner shall be returned. 

 Where the business is to be transferred to business organization, the memorandum of association of the organization to which a transfer is to be made and a minute authenticated by a body authorized by law which indicates that the transfer is adopted by members with voting rights representing two third (2/3) of the shares of the organization present at the extraordinary meeting is required. An investment permit shall also be submitted where the person to whom the business/business organization/ is being transferred is a foreigner or a business organization in which a foreigner is a member. A verification shall also be made whether the area of investment is open for foreign investors as well. 

You may contact us at info@dmethiolawyers.com for your legal assistance.

World Bank Group- Women, Business and the Law

On March 2, 2023, the World Bank Group-Women, Business and the Law launched their annual studies measuring the laws and regulations that affect women’s economic opportunities in 190 economies. You may read the newsletter by clicking this link: https://openknowledge.worldbank.org/server/api/core/bitstreams/105265e8-311a-4b39-a71b-e455a86dd0ba/content?deliveryName=DM175110

DMLF team are glad to serve as contributors from Ethiopia.


By Dagnachew Tesfaye, Managing Partner at DMLF


This article summarized the cassation decision of the Federal Supreme Court Cassation Division on File No 220042 rendered on 9/12/2022. The case has been between Applicant W/ro Hana Solomon Zenebe and Respondents (1) W/ro Asnakeh Wolde G/mariam and (2) Yeka Sub city Land Development and Management Bureau. The case concentrates on the application of the procedure of the Federal Administrative Proclamation No 1183/2020 on administrative decision making process before any request of cancellation of title deed certificate in courts of law.

Federal First Instance Court

The case was first filed to the Federal First Instance Court. The applicant was the plaintiff and the respondents were the defendants. The applicant in an amended claim presented on 28/4/2021 requested the court for revocation of title deed certificate issued by the 2nd respondent to the first respondent on a property located in Yeka Sub city W.06 House No 1168 plot size 692sq.m. The applicant claimed she acquired the property through donation from her late mother. However, the applicant argued the 2nd respondent gave illegally a title deed certificate to the 1st respondent on the 692sq.m on 3/2/2012 with title deed No. Yeka/172834/04. Thus the applicant requested the court for revocation of the title deed certificate.

The 1st respondents gave a statement of defense arguing that the respondent acquired the property through inheritance of her late father and brother. Thus the claim of the applicant is not supported by evidence and the request for revocation of the title deed should be dismissed.

The 2nd respondent has also given a statement of defense. The second respondent argued that it gave the title deed certificate based on Directive 17/2006 and following the right steps including posting a request for any opposition to come forward. There was nobody that came opposing the issuance of the title deed certificate. It further argued that it issued the title deed certificate having seen the necessary documents of the 1st respondent. On the other hand, the 2nd respondent said to the court that the applicant doesn’t have vested interest on the property under question.

The Federal First Instance Court has heard witnesses and seen the file from the land administration office. The court reached the conclusion that the title deed certificate granted to the 1st respondent should not be revoked and made a judgment in favor of the 1st respondent.

Federal High Court

The applicant has appealed to the Federal High Court. However, the appellate court did not accept the appeal.

Federal Supreme Court Cassation Division Three Judges

The Applicant presented an application to the Federal Supreme Court Cassation division stating the lower courts committed fundamental error of law in their ruling of her case. As a result the applicant requested the dismissal of the lower court’s decisions due to the reason that the lower courts did not investigate the necessary files concerning the property and corresponding evidence to the property properly.

The three judges of the Cassation Division after examining the applicant’s application, found merit in the fact that proportionality and measurement of the land holding, evidence presented from AA City Land Administration and Development Buauea on the matter were disregarded by lower courts. Thus the applicant’s case has merit for further examination and the application is seen by five judges of the Cassation Division.

Federal Supreme Court Cassation Division of Five Judges

Consequently, the respondents were invited to present their responses on the application of the applicant and on the accepted merit of the applicant’s case as reiterated by the cassation division three judges. The 1st respondent presented her written response. The 1st respondent argued that the AA City Land Development and Management opposes the way the applicant acquired her title deed certificate and not the one in question. Therefore the lower court decision has no basic error of law and should confirm the lower court’s decision.

The 2nd respondent on his part argued that the title deed certificate issued for the 1st respondent and for that matter for the applicant were as per the AA Land Development and Management Bureau. The Applicant’s claim is not about inheritance but cancellation of title deed certificate, and such a request cannot be entertained by this court. Hence the 2nd respondent requested for the lower court’s decision to be confirmed.

The Applicant also gave a counter-response. The applicant contends by strengthening her application.

The Cassation Division rendered its judgment based on the Federal Administrative Procedure Proclamation No 1183/2020. The court stated that the applicant’s application was presented to the lower court at the time when the Administrative Procedure Proclamation was effective. The Proclamation provides the procedure for how administrative decisions are requested and how dissatisfied persons on an administrative decision can take the matter to court.

In the case at hand, the applicant requested for revocation of the title deed certificate. The power to give or cancel title deed certificates rests upon the land administration office. Cancellation of  title deed certificate is an administrative decision. For such matters, administrative decisions have to be sought first. If there is a complaint on the administrative decision, Article 43 and 44 of the Administrative Procedure Proclamation provide for complaint procedure. If still there is dissatisfaction , then an appeal to the Federal High Court can be adhered to. However, the applicant has come to court without exhausting available remedies as indicated in the Proclamation. Previously, the Cassation Division had rendered on File No 220582 on 5/7/2022 a similar decision. Therefore, the Federal First Instance Court should have first evaluated the case as to whether it has jurisdiction to see revocation of title deed certificate in light of the Proclamation and dismiss the case for lack of jurisdiction. The appellate court should have also said the lower court doesn’t have jurisdiction to entertain a case of revocation of title deed certificate and corrected the error. Thus, the Cassation Division dismissed the Federal First Instance Court and appellate courts’ decisions. The Cassation Division reserved the right for the applicant to follow up her case based on the procedure of the Proclamation.


The request of revocation of title deed certificate is a matter of administrative decision. As an administrative decision, the procedure of how administrative decisions are requested, complained and appealed are stated in the Federal Administrative Procedure Proclamation No 1183/2020. One cannot present such a matter directly to court without exhausting the necessary remedies and a lower court should reject such a claim for matters of jurisdiction.

Though the final conclusion of the Cassation Division is correct, there is a discrepancy between what the cassation division three judges frame as an issue and the conclusion reached by the five judges of the Cassation Division. Article 28(3) of the Federal Court  Proclamation No 1234/2021 provide as follows ‘’ When the Cassation Division to which the application is referred concludes upon examination of the application that the case has a merit, it shall frame issue and send the same with the Cassation application and summon to the respondent to reply in writing.’’ This shows the fact that the 5 judges of the Cassation Division will not be limited and deterred by the framed issue of the 3 judges of the Cassation Division. For the disputant parties, the fact that the 5 judges of the Cassation Division may go beyond the framed issue, will leave these parties not know where the case will be headed. As a result the disputing parties shall be pushed to write and argue their response and counter response beyond the ‘framed issue or issues’.  Indirectly, ‘framing an issue’ will become unnecessary. This will contradict the law.

For any inquires on Ethiopian law, you may contact us at info@dmethiolawyers.com

Airstrip or Heliport Investment

By Mahlet Mesganaw, Partner at DMLF


The Ethiopian Civil Aviation Authority (ECAA) is the authority that regulates and licenses operators of aerodromes. Civil Aviation Proclamation No 616/2008 and its amendment Proclamation No 1179/2020 mandate ECAA with the power among others to review and issue license, certificate or other legal documents to the applicant where it finds satisfactorily that the applicant is ready to operate an aerodrome. To implement the mandate, in September 2022, ECAA has come up with Procedure for the Application and Issuance of Airstrip/Heliport Permit, Approval and Business Licence( the ‘Procedure’ hereafter). In this article a look on the objective of the Procedure, who are eligible to invest and the procedures and requirements needed shall be discussed briefly and a conclusion shall follow.

Aim of the Procedure

The aim of the Procedure is to promote the development of Airstrips and Heliports by private investors. The Procedure intends to establish an efficient and transparent process for application and issuance of airstrip/heliport investment permit, construction & operation approval.The number of standard airports has to increase. Thus private sector  involvement for expansion of small airports as an investment is believed to expedite the overall growth of the country.

Who Could Invest in Airstrip/Heliport?

Any Ethiopian national above the age of 18 and/or domestic investor as defined by Investment Proclamation No.1180/2020 are eligible for investment permit application for airstip/heliport construction and operation. Any domestic investors interested in engaging on Airstrip/Heliport operation for commercial purposes are eligible to apply. Domestic investor as defined by the Investment Proclamation No 1180/2020 Article 2(5) include  ‘’a) An Ethiopian National; b) An Enterprise incorporated in Ethiopia and wholly owned by Ethiopian National; c) The Government; d) a Public Enterprise  e) a cooperative society established as per the relevant law; f) A Foreign National or Foreign Enterprise treated as domestic investor as per the relevant law or international treaty ratified by Ethiopia; g) An Enterprise incorporated in Ethiopia jointly between any of the investors specified … paragraphs (a) to (f) of this Article; h) A Foreign National or Foreign Enterprise accorded a domestic investor investment permit as per laws….i) Descendant of a foreign national specified under Sub-article (5) paragraph (h) of this Article, provided that this applies only in respect of investments specified in the same Sub-article.’’ According to this Procedure, Foreign investors either alone or in collaboration with domestic investors are excluded from the construction and operation of airstrip and heliport. 

Application Procedure

Airstrip/Heliport investment process commences by applying simultaneously to ECAA and to the Ethiopian Investment Commission (EIC). The interested party will submit the following documents: a) Completed application form of EIC; b) Completed application form of ECAA and other documentation as detailed in the Application Form. The Application Form indicate details such as rights held in relation to the site, written evidence to show permission has been obtained for the site to be used by the applicant as an airstrip or heliport and Environmental Impact Assessment for the development of Airstrip/Heliport approved by the appropriate authority; c) Certificate of Principal Registration; d) Original and necessary copies of valid identity card or passport of the applicant; e) Two passport size photographs taken within six months, which shows the clear identity of the applicant; and f)Where the application is submitted by an attorney; original and copy of power of attorney given by all of the founders, copies of valid identity card or passport of the attorney and the manager. 

Approval to Build, Operate and Registration

When the Applicant has met the necessary aerodrome and flight operation standards of the site, then ECAA shall give a green light to build. ECAA shall inspect the completion of the construction for compliance and upon satisfaction issue Compliance Certificate. Then when the requirements of safe air navigation are met, ECAA shall issue an approval to operate. Consequently, the airstrip or heliport which successfully obtained approval to operate shall be registered.

Business License Issuance and Renewal

The Commercial Registration and Licencing Proclamation No 980/2016 on Article 21(4) (d) provides air transport services and other aviation service business licenses to be issued by relevant government organs. ECAA is  the authority duly mandated to issue business licenses for aviation related services. Thus the Procedure authorizes ECAA for issuance of business license for airstrip or heliport and the renewal of the same by ECAA.


The participation of the domestic private sector including regional governments or city administrations in the construction and operation of airstrips and heliports will give multiple benefits not only to the investors but also to the economy. The ECAA Procedure, though not a Directive, has put transparent procedure as to the regulatory, administrative and technical activities needed to build, operate and register airstrip and heliport.

For your investment inquires on airstip/heliport, you may contact us at info@dmethiolawyers.com

Accessibility of Directives on Websites of Administrative Agencies

By DMLF Team

One of the issues in the promulgation of the Administrative Procedure Proclamation was the fact that Directives were not accessible to end users. Moreover, directives were not issued in a timely manner and due such fact administrative tasks were kept on hold. The Federal Administrative Procedure Proclamation No 1183/2020 (the Proclamation) is issued to address these and other issues. The Proclamation defines Directives on Article 2(2) as ‘’a legislative document that is issued by an administrative agency based on delegation of Power bestowed upon it by the Legislator which affects people’s Rights and Interests’’. Thus Directives are laws. In the  hierarchy of laws Directives can be put as the lowest form of legislation after Proclamation and Regulation. Directives are issued by administrative agencies and the Proclamation defines Administrative Agencies as ‘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.(Article 2(1)).

When should a Directive be Issued?

If the Directive is mandatory, the administrative agency has to adopt a directive indicated in the  mother law  within 90 days. The aim is to prevent procrastination by administrative agencies in coming up with a working Directive. If the Directive is not mandatory, the administrative authority should ratify within a reasonable period of time. In any case, an administrative authority cannot deny service or shy away from giving an administrative decision for failure on the part of an administrative agency to issue Directives legally empowered to adopt. 

Filing of Old Directive 

All administrative agencies, within three months after the coming into force of this Proclamation, are obliged to file Directives they have adopted previously. The agencies should send copies to the Federal Attorney General(now the Ministry of Justice). The Proclamation came into force around April 2020. Thus all administrative agencies by now are assumed to have duly filed their existing directives with  the Ministry of Justice. Otherwise a directive that has not been filed this way may not be enforced. For newly adopted directives as per the Proclamation,  the administrative organ should send the copies of the Directive and accompanying explanatory statement to the Ministry of Justice. The Ministry will give a serial identification number and record the Directives.  Then the Ministry will  immediately inform the administrative agency about the status of registration.  

Accessibility of Directives

Customers or interested parties have access to the Directives online or can acquire them in hard copy. The Ministry of Justice and the administrative organ shall post directives on their own website. In addition to this, the administrative organ should print and disseminate the registered Directive to Governmental and other Stakeholders.  Any person who is interested can request to have a look and observe the Directive in the office of the administrative organ or may get a copy of the directive subject to payment of expenses. Otherwise a directive that has not been posted on the website of the administrative agency  may not be enforced. 

To sum up, administrative agencies are obliged to timely enact directives, follow the legislative procedure indicated in the Proclamation, file old and new  Directives to the Ministry of Justice and upon registration, post them on their websites. Failure to file to the Ministry or failure to post the Directives on their websites shall render the Directive or directives unenforceable. Impliedly Administrative agencies including the Ministry of Justices are required to have working websites and Directives and other relevant laws governing their administrative tasks should be posted on those websites. Administrative agencies leaders should make their agencies abide by the Administrative Procedure Proclamation and guarantee transparency and accountability.

For your legal inquiries you may contact us at info@dmethiolawyers.com

Investment in Airstrips, Heliports and Drone Assembly

Ethiopian Civil Aviation Authority (ECAA) has amended legal directives that allows Ethiopian private sectors, regional and city administrations as well as NGO’s to construct, manage and administer airstrips and heliports. 

In addition to the above, ECAA has said it gives green light to the private sector’s investment in drone assembly drone technology, drone services, aerospace manufacturing and related activities by formulating a regulation. Source: The Ethiopian Herald February 24,2023 and the Ethiopian Broadcasting Corporation.

Termination of Employment Relationship

By Mahlet Mesganaw, Partner at DMLF

The Ethiopian Labour Proclamation No 1156/2019(hereafter the Proclamation)  governs the private sector employer-employee relationship. According to this labor Proclamation, employment relationships might be terminated in three ways namely  by operation of the law, by agreement of the employee and employer and by the initiation of either the employer or the employee. A brief look on each of these employment termination conditions shall be the focus of this article.

Termination of contract of Employment by the Operations of the Law 

The conditions under which a contract of employment is terminated by operation of the law are provided under Article 24 of the Proclamation. The grounds for termination by the law include a) on the completion of the work where the contract of employment is for a specified work; b) up on the death of the worker; c) up on the retirement of the worker in accordance with the relevant law; d)when the undertaking ceases operation permanently due to bankruptcy or for any other cause; and e) when the worker is unable to work due to partial or total permanent incapacity. Hence the existence of these five conditions guarantee the termination of the employment by operation of the law.

Termination of Contract of Employment by Agreement

The second way to terminate a contract of employment is by agreement of the employee and employer.  The employee and employer may terminate their contract of employment by agreement.  However, such an agreement cannot override the right  an employee has under the labour law. Thus any agreement by the employee to  waive any of his rights under the law shall have no legal effect. The legal format requirement for termination of employment by agreement is to make the agreement to terminate the employment relationship  in writing. Otherwise oral agreement shall not be effective and binding on the employee.

Termination of Contract of Employment by the Initiation of the Parties

The third way of termination of an employment contract is by the initiation of the employer or the employee. The major parties to an employment agreement are the employer and employee. Either the employer or the employee may seek the termination of the employment contract. Thus we shall see the legal requirements and conditions under which the employer or employee initiates the termination of their contract of employment here below.

A)Termination of Contract of Employment by the Employer:  An employer is entitled to terminate a contract of employment either without prior notice or with prior notice. Article 26 of the Labour Proclamation provides the principle under which a contract of employment is terminated by the employer. The article states ‘’a contract of employment may only be terminated where there are grounds attributed to the worker’s conduct or with objective circumstances arising from his ability to do his work or the organizational or operational requirements of the undertaking’’ . Thus termination of contract of employment by the employer can be executed either without prior notice or with prior notice. 

i)Termination of Contract of Employment by the Employer without Prior Notice: The conditions under which an employer can terminate a contract of employment without prior notice i.e automatically when these conditions happen include the following 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; 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; c) deceitful or fraudulent conduct in carrying out his duties; d) Misappropriation of the property or fund of the employer with intent to procure for himself or to a third person unlawful enrichment; e) performance result of a worker, despite his potential, is persistently below the qualities and quantities stipulated in the collective agreement or determined by the agreement of the parties; f) being responsible for brawls or quarrels at work, having regard to the gravity of the case; g) conviction for an offence where such conviction renders him incompatible for the post which he holds; h) being responsible for causing damage intentionally or through gross negligence to any property of the employer or to another property which is directly connected with the work of the Undertaking; i) commission of any of the prohibited acts under Article 14 (2) of this Proclamation namely Intentionally commit in the workplace any act which endangers life or property;  take away property from the work place without the express authorization of the employer; making use of falsified document or an attempt thereof; to use drugs prohibited by law or use alcoholic beverges and have impared physical and mental status at the work place; except for HIV/AIDS test, refuse to submit himself for medical examination when required by law or by the employer for good cause; refuse to observe safety and accident prevention rules and to take the necessary safety precautions;  conduct meeting during working hours in disregard to the time assigned by the collective agreement or without obtaining the permission of the employer; commit sexual harassment or sexual violence at workplace; and physically abuse anyone in a work place; j) absence from work due to a court sentence passed against the worker for more than Thirty days; k) commission of other violations stipulated in a collective agreement as grounds for terminating contract of employment without notice. These detailed conditions to terminate an employment contract by employer without prior notice are exhaustive. However, a collective agreement may include or exclude these conditions and the law gives priority to the conditions mentioned in the collective agreement.

 Where an employer terminates a contract of employment without prior notice as per the conditions laid down above, the employer is required to render to the employee a written statement specifying the reasons for and the date of termination. The right of an employer to terminate a contract of employment without prior written notice has a period of limitation. The employer should take the decision to terminate within thirty working days from the date the employer knew the existence of a ground for the termination. Otherwise, the ground for termination without prior notice shall lapse after thirty working days.

ii)Termination of contract of Employment by Employer with Prior Notice: The following two grounds guarantee good cause to  termination of employment of contract by employer with prior notice. The first ground as stated in Article 28(1) is ‘’.. the loss of capacity of, and situations affecting, the worker.’’ The second ground that constitutes good cause is attributable to the organizational or operational requirements of an undertaking. 

With regard to the first ground, i.e. loss of capacity of the employee or the situation affecting the employee that substantiate as a good cause for termination with notice include: a) The worker’s manifest loss of capacity to perform the work to which he has been assigned; and his lack of skill to continue his work as a result of his refusal or inability to make use of an opportunity of training arranged by the employer to upgrade his skill or after having been trained, his inability to acquire the necessary skill; b) The worker is, for reasons of health or disability, permanently unable to carry out his obligation under the contract of employment; c) The worker’s unwillingness to move to a locality where the undertaking relocates; d) The post of the worker is canceled for good cause and the worker cannot be transferred to another job position.(Article 28(1)). However, to protect the employee and to impose a duty of proof on the employer, the condition under which the employee manifests loss of capacity to perform work referred as (a) above needs to be verified by a periodical job performance evaluation. 

The second ground relates  to the organizational or operational requirements of an undertaking. As per Article 28(3) such an organizational or operational requirement constitute good causes for the termination of a contract of employment with prior notice when  a) any event which entails direct and permanent cessation of the worker’s activities in part or in whole resulting in the necessity of a terminating a contract of employment; b) ‘….fall in demand for the products or services of the employer resulting in the reduction of the volume of the work or profit of the undertaking and thereby requiring termination of a contract of employment; c) a decision to alter work methods or introduce new technology with a view to raise productivity resulting in termination of a contract of employment.  

B) Termination of Contract of Employment by the Employee: Similar to an employer, an employee is entitled to terminate his/her employment contract either with prior notice or without prior notice. We shall look at each of them briefly. 

i)Termination of Contract of Employment without prior notice: The employee can terminate his employment of contract without prior notice and such termination is considered as justified  where a) the employer has committed any act contrary to human dignity and morals or other acts punishable under the Criminal Law against the worker; b)  the workers has been a victim of sexual harassment or sexual violence by the employer or a managerial employee; c) In the case of imminent danger threatening the worker’s safety or health, where the employer, having been made aware of such danger, failed to act within the time limit in accordance with the early warning given by the competent authority or appropriatetrade union or the worker himself to avert the danger; d) the employer has repeatedly failed to fulfill his basic obligations towards the worker as prescribed under this Proclamation, collective agreement, work rules or other relevant laws. However, the employee cannot orally quit his work. The employee has to inform the employer in writing the reasons for termination and the date on which the termination is to take effect. In addition to the above, the employee’s right to terminate his contract of employment in accordance without prior notice shall lapse after fifteen working days from the date on which the act occurred or ceased to exist. 

ii)Termination of Contract of Employment by Employee with Prior Notice: without prejudice to  conditions mentioned as good cause for termination without notice, any employee who has completed his/her probation period may, by giving thirty days prior notice to the employer, terminate his/her contract of employment. 

To sum up, the Ethiopian Labour Proclamation 1156/2019 incorporates termination of employment conditions either by operation of the law, by the agreement of the parties  or by the initiation of the employer and employee. Where the majority of termination of employment occurs as a result of initiation by employer or employee, the law has put rules of conditions of termination with prior notice or without prior notice. What the law considers justified causes of termination of employment has also been exhaustively included in the labour law for both the employer and employee to take action accordingly. 

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Adoption by Foreigners of Ethiopian Origin

By Dagnachew Tesfaye, Managing Partner at DMLF

The Ethiopian Constitution Proclamation No 1/1995 under Article 36 Sub-Article 5 provides the obligation of the state as follows: ‘’the state shall accord special protection to orphans and encourage the establishment of institutions which ensure and promote their adoption.’’ The Ethiopian government assumed a duty to support organizations that care for orphans. Such orphans need to be supported to the extent of adoption. The constitutionally recommended solution is not foster care or institutional care but adoption. This is because adoption, unlike foster care or institutional care, is a permanent solution. The Constitution chose adoption for purposes of guaranteeing permanent solutions to problems of orphans. Adoption is a legally framed family creation mechanism next to blood relationship and marriage. Thus the Ethiopian Constitution is propagating that orphan children should be placed back into the family unit through adoption.

Following the Constitution, the House of Peoples’ Representative enacted the Revised Family Code Proclamation No 213/2000. The Revised Family Law from Articles 180-196 incorporates detailed rules on who can be adopted and who can adopt, the rights of family of origin and orphanages, what procedure to follow when the adopter is a foreigner and finally the principle of non-revocability of approved adoption.

The implementation of the law led to the establishment of several public and private orphanages and adoption agencies. Many vulnerable children including orphans and abandoned children have benefited through adoption by Ethiopians, foreign nationals of Ethiopian origins and foreigners.

The Ethiopian government claimed that foreigners adopting Ethiopian children has resulted in an identity crisis that affects the adopted children psychologically and socially.  As a result, the government coined a policy namely  FDRE National Children’s Policy. The National Children’s Policy envisages the shift from inter-country adoption to a focus on domestic alternative care options. To fulfill the policy goal, the Ethiopian government promulgated the Revised Family Code Amendment Proclamation No 1070/2018. The preamble of this Proclamation states the fact that the Proclamation is needed to harmonize the Revised Family Code with the National Children’s Policy. This is the sole preamble in the Proclamation. The content of Proclamation is short. It simply deletes the articles that incorporate ‘foreigner’ from the Revised Family Code. Consequently,  Article 193 and 194(3)(d) of the Revised Family Code are declared deleted. With this, foreigners adopting Ethiopian children were reported to have been banned, though there is no clear indication in the Proclamation that the intention is to ban inter-country adoption.

Following the reported ban on inter-country adoption, the Ministry of Women, Children and Youth Affairs came up with a directive namely Directive on Foster Family and Domestic Adoption Services No 48/2020. The directive provides detailed rules and procedures on foster care and domestic adoption.

Foreigners of Ethiopian origin kept fighting the prohibition on them from adopting Ethiopian children. Their legal fight bears fruit. The reported ban on all ‘foreigners’  from adopting Ethiopian children has been found to have basic errors of law. The Amendment Proclamation No 1070/2018 to the Revised Family Code was subjected to interpretation by the Federal Supreme Court and found out to incorporate fundamental error of law. The Federal Supreme Court on Cassation File No 189201 Volume 24 on March 11,2020, gave a binding legal decision about the ban and said that the ban on foreigners adopting Ethiopian children is not applicable to foreigners of Ethiopian origin. Such a decision by the Federal Supreme Court is a binding precedent to all levels of the federal and regional courts.

Hence such a binding decision by the highest court of the land made inter-country adoption by foreigners of Ethiopian origin possible in the courtroom. However, inter-country adoption by foreigners of Ethiopian origin requires the administrative and executive organ of the Federal Government and the concerned organ of the foreign country to work in consortium. 

The FDRE Ministry of Foreign Affairs together with its embassies and consular offices is required to handle issues of foreigners of Ethiopian origin in the adoption process. The Ministry should elaborate the possibility and permissiveness of inter-country adoption by foreigners of Ethiopian origin to the foreign government concerned organs or their embassies located in Addis Ababa. Some of  these foreign countries  require prior approval for foreigners of Ethiopian origin before they commit to adopt an Ethiopian child. To get this prior approval, these foreign countries need to be notified of the option for adoption being opened up for foreigners of Ethiopian origin. The ambiguous news that Ethiopia has banned foreigners from adopting Ethiopian children is later clarified by rule of law that the ban is non-applicable to foreigners of Ethiopian origin. This information should be clearly amplified by the Ministry of Foreign Affairs and our embassies. Moreover the Ministry should  give support in authentication of documentations of foreigners of Ethiopian origin in their adoption process. On the other hand, the FDRE Ministry of Women and Social Affairs is the organ of the government concerned about Ethiopian children care and adoption. The Ministry should render support to court approved adoption decisions in getting the necessary vital records such as birth certificates and passports.

Foreigners of Ethiopian origin could be single parent or married couples. When they are married couples, one of them could be foreigners of Ethiopian origin or both of them could be foreigners of Ethiopian origin. The place where foreigners of Ethiopian origin live could be in Ethiopia or elsewhere. The adoption requested could be relative or kinship adoption or adoption from orphanages or adoption by step dad or step mom. The adopted child could be an orphan or an abandoned child or vulnerable child or the child of the other spouse. The fear of identity crisis, which has been the core source for banning inter-country adoption will be non-existent when the adoptive parents or at least one of them is a foreigner of Ethiopian origin.

Therefore, the Ethiopian Constitution encourages adoption. The Federal Supreme Court of Ethiopia, as the highest court of the land, by interpretation allowed foreigners of Ethiopian origin to adopt Ethiopian children. Proclamation No 1070/2018 doesn’t ban foreigners of Ethiopian origin from adopting Ethiopian children. So long as the adoption serves the best interest of the child, the executive organs of the government of Ethiopia should pave the way to realizing that goal. It is their constitutional duty.  The FDRE Constitution on Article 36 sub-article 2 provide as follows: ‘’In all actions concerning children undertaken by public and private welfare institutions, courts of law, administrative authorities or legislative bodies, the primary consideration shall be the best interests of the child.’’

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Overseas Employment for Ethiopians

By Dagnachew Tesfaye, Managing Partner at DMLF

Overseas Employment is governed by Ethiopia’s Overseas Employment Proclamation No 923/2016 and it’s amendment Proclamation No 1246/2021. This Proclamation No 923/2016 came into force repealing the Employment Exchange Service Proclamation No 632/2009. Nowadays many countries in the world are looking for skilled and non-skilled immigrant workers for job openings in many different sectors. This brief article will look into the major contents of the Proclamation and it’s amendment and a brief conclusion shall follow.

The aim of the Proclamation as is seen from its preamble is to ensure the rights, dignity and safety of Ethiopian workers overseas. Accordingly, the Proclamation mentions three (3) ways in which employment overseas could be conducted. These are first through public employment exchanges, second is through private agencies and third is through direct employment. 

Public employment exchange service is an overseas employment service conducted through government to government. The Ethiopian government organ responsible for public employment exchange is the Ministry of Labour and Skills (formerly Ministry of Labour and Social Affairs). The Ministry of Labour and Skills (the Ministry) will provide recruitment  and placement services to government organizations in recipient countries based on government to government agreement. The tasks the Ministry undergo include interviewing and selection; causing medical examinations; approval of employment contracts, provision of pre-employment and pre-departure orientations, facilitation of departure of employed workers and other similar services. The Ministry is required by the Proclamation to undertake a deposit into the Foreigner Employers’ Guarantee Fund of USD$ 100 per worker from the foreign employer. The aim is for covering claims of workers that may arise from breach of contract of employment.

The second form of overseas employment exchange service is through a private employment agency. Private Employment Agency or Agency is defined in the Proclamation as ‘’any person other than a Government body, which makes a worker available to an overseas employer by concluding a contract of employment with such a worker.’’ Thus a Private Employment Agency can be a sole proprietor or a business organization.  Engagement in the  business of private employment agencies is permitted for Ethiopian nationals, foreign nationals of Ethiopian origin or foreigners. However the later two I.e. Foriegn nationals of Ethiopian origin and foreigners can engage in overseas employment together with Ethiopian nationals for skilled manpower. The minimum paid up capital should be not less than ETB 1,000,000 (One Million Birr) for fully Ethiopian owned agency. Foreign nationals of Ethiopian origin can own up to 25% of the shares. These 25%shares shall not be less than 2,000,000(Two Million Birr). Whereas when the member of the company is a foreigner, he can own only up to 20 % whereby the value in Birr shall not be less than 2 million Birr. In addition to this, one of the eligibility requirements for a private employment agency is to deposit a financial guarantee of USD$100,000 (mandatory in USD for foreigners and foreign nationals of Ethiopian origin) or its equivalent in Ethiopian Birr (for Ethiopias) in a blocked account. The purpose of such a guarantee is to ensure the protection of the rights and safety of deployed workers.

The last form of overseas employment exchange is through direct employment. Direct employment is defined in the Proclamation as an ‘’employment relationship between an employer and a worker without the involvement of a Government organ or an Agency’’. However, contrary to the definition, the Proclamation indicates the involvement of the Ministry for approval of direct employment. Article 6 states the fact that the Ministry may permit direct employment on grounds of ”…a) where the employer is a staff of an Ethiopian Mission; b) where the employer is an International organization; and c) where the job seeker acquires a job opportunity by his own accord in job positions other than house maid services.” Those employers who are entitled to undertake direct employment are required to deposit a foreign employer’s guarantee of USD$100 per worker into the Foreigner Employers’ Guarantee Fund administered by the Ministry.

In general the Proclamation prohibits no overseas deployment of workers without a certificate of occupational competence. The educational requirement of completion of 8th grade has been left out in the amendment Proclamation. Similarly the amendment Proclamation changed the requirement of mandatory existence of bilateral agreement with receiving state for deployment of overseas workers. Deployment of overseas workers is allowed to countries where there is bilateral agreement or as the case may be a Memorandum of Understanding with the receiving country. However, where there is no bilateral agreement or MoU, if the employment agency managed to acquire job opportunities for skilled workers, the government may render green light to proceed by signing an agreement with the receiving country’s company.

Moreover, the employer is obliged by law to buy from the domestic market insurance for life and disability for the benefit of the worker deployed overseas. Other than domestic workers, skilled workers who are employed overseas through an agency shall pay the agency an amount of one month salary over four payment periods.

In conclusion, Ethiopia’s Overseas Employment Proclamation and amendment are enacted with the purpose of protecting the rights, dignity and safety of Ethiopian workers abroad. The vehicles through which employment overseas were conducted include public employment exchange, private agencies and direct employment. The Proclamation was amended in its several parts which begs the question that rather than amendment, a new Proclamation could have been valid. Nowadays, the need to migrate and work overseas has expanded in terms of skills and recipient countries. The government needs to take proactive measures and sign and execute as many bilateral agreements as possible. There is a need to devise a way to work through the Proclamation to meet the timely needs of millions of Ethiopians who wish to migrate overseas and work.

You may contact us for employment related inquiries at info@dmethiolawyers.com

Social Dialogue: Alternative Dispute Settlement Mechanism for Labour Issues

By Dagnachew Tesfaye, Partner at DMLF

The Labour Proclamation No 1156/2019 (the Proclamation hereafter) has introduced a new dispute resolution mechanism namely ‘Social Dialogue’. This concept of Social Dialogue was not known and was non-existent in the previously repealed Labour Proclamation No 377/2003. Only conciliation and arbitration were the two known  alternative dispute settlement mechanisms. Now in addition to conciliation and arbitration, social dialogue is included as one form of alternative dispute settlement mechanism pertaining to labour issues.

Social Dialogue is defined in the Proclamation as a process of information exchange, dialogue or negotiation of bilateral or tripartite nature between employer and employee or involving the government on economic and social issues of mutual interest towards arriving at common understanding.

The Ethiopian Government has given due attention to the concept of social dialogue by incorporating social dialogue in the preamble of the Proclamation. The second paragraph of the Preamble of the Proclamation provides ‘it has been found necessary to lay down a working system that guarantees the rights of workers and employers to freely establish their respective associations and to engage, through their duly authorized representatives, in social dialogue and collective bargaining, as well as to draw up procedures for the expeditious settlement of labour disputes, which arise between them.(underline included for emphasis).

Employers and employees or their respective associations namely trade unions or employers associations, federation or confederations may introduce social dialogue into their employment agreements, work rules, collective agreements in order to legally prevent and resolve labour disputes amicably.

Therefore the introduction of social dialogue as one form of ADR for labour issues is a significant endeavor for the Ethiopian legal regime.  This new concept of social dialogue needs action for its implementation and realization of the benefits that come with it.

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