Legal Framework

1.What are the legal frameworks governing foreign direct investment in Ethiopia?

There are several laws pertaining to foreign direct investment in Ethiopia. The following are, among many others, the most widely used.

A) Investment Laws

  • Investment Proclamation (No. 769/2012)
  • Investment (Amendment) Proclamation (No. 849/2014)
    • Investment Incentives and Investment Areas Reserved for Domestic Investors Council of Ministers Regulation (No. 270/2012)
    • Investment Incentives and Investment Areas Reserved for Domestic Investors Council of Ministers (Amendment) Regulation (No. 312/2014)
    • Export Trade Duty Incentive Schemes Proclamation (No 768/2012)

B) Industrial Park Laws

  • Industrial Parks Proclamation (No. 886/2015)
  • Industrial Parks Council of Ministers Regulation (No.417/2017)

C) Foreign Exchange Laws

  • Directive on Transparency in Foreign Currency Allocation and Foreign Exchange Management (No. FXD/46/2017).
  • Directive for the Amendment of External Load and Supplier Credit No FXD/47/2017,
  • Directive for the Amendment of Retention and Utilization of Export Earnings and Inward Remittance No FXD/48/2017

D) Tax Laws

  • Income Tax Proclamation No. 979/2016,
  • Income Tax Regulation No. 410/2017,
  • Value Added Tax Proclamation No 285/2002,
  • Value Added Tax (Amendment) Proclamation No 609/2008,
  • Value Added Tax Regulation No 79/2002,
  • Excise Tax Proclamation No 307/2002,
  • Excise Tax (Amendment) Proclamation No 570/2008,
  • Excise Tax (Amendment) Proclamation No 610/2008,
  • Turn Over Tax Proclamation No 308/2002,
  • Turn Over Tax (Amendment) Proclamation No 611/2008,

E) Labor Laws

  • Labor Law Proclamation No. 377/2003,
  • Labor Law Proclamation (Amendment) No. 494/2006

F) Commercial Matters

  • Commercial Registration and Business Licensing Proclamation no. 980/2016,
  • Trade Practices and Consumer Protection No. 813/2013,
  • Commercial Code of Ethiopia, Proclamation No.166/1960,
  • Civil Code of Ethiopia 1960,