Some unusual facts about repeal in Ethiopia (Part II)

Double Repeal and repeal after indefinite period of time

It is difficult even for law makers to remember each and every law they have amended and repealed. With the ever increasing quantity of legislations issued by the law maker and subordinate organs, sometimes it may happen that a provision of the law be repealed twice. Here are two instances:

A.)  Proclamation No. 287/2002 (Tax on Coffee Exported from Ethiopia (Amendment) Proclamation) is an amendment to Proclamation No.99/1998 (Tax on Coffee Exported from Ethiopia.) One of the provisions of the previous law which was amended by Proclamation No. 287/2002 is Article 4. This Article provides that the rate of Tax payable on Coffee exported from Ethiopia shall be 6.5% (six and point five per cent) of the FOB price. FOB is defined in the proclamation as selling price of coffee quoted at the port of loading, agreed between the Coffee exporter and his customer and approved by the National Bank of Ethiopia, from which freight and insurance costs are excluded.

Article 2(1) of Proclamation No. 287/2002 mainly amends the tax rate lowering  it to zero. It reads:

Article 4 of the proclamation is deleted and replaced by the following new Article 4.

“4. The rate of the Tax which has been 6.5% (six and point five per cent) shall be zero”

However, the deletion and replacement to article 4 of Proclamation No.99/1998 is a double repeal as it has already been deleted by Council of Ministers Regulations No.73/2001(Tax Amendment on Exported Coffee Council of Ministers Regulations.)

Article 2 of the regulation reads:

2. Amendment

Article 4 of the Tax on Coffee Exported from Ethiopia Proclamation No.99/1998 is deleted and replaced by the following new Article 4:

4. Rate of the Tax

1) The Rate of the Tax shall be 6.5% (six and point five per cent) of the FOB price.

2) Notwithstanding the provisions of Sub-Article (1) above, no tax shall be levied if the FOB price of the coffee exported is:

(a) Below 105 cents (one hundred five cents) per pound for washed coffee;

(b) Below 70 cents (seventy cents) per pound for unwashed coffee.

By way conclusion, it means that article 4 of Proclamation No.99/1998 was repealed by Proclamation No. 287/2002 after it [Proclamation No.99/1998] was repealed by Regulations No.73/2001.

B.)  Article 17(1) of the Census Commission Establishment proclamation No. 84/1997 states that the Population and Housing Census Commission Establishment Proclamation No.32/1992 is repealed. However, Proclamation No.32/1992 was again repealed for the second time by article 18(1) of Proclamation No. 180/1999 (Census Commission Establishment Proclamation)

The problem seems to have been created due to failure of parliament to set exact expiry date for Proclamation No.32/1992. Even though it [Proclamation No.32/1992] was expressly repealed by Proclamation No. 180/1999, its applicability was extended for indefinite period of time. According to article 19 of proclamation No. 84/1997, the previous proclamation (32/1992) will remain applicable with respect to census undertakings not completed and until such time that the Secretariat (of the Census Commission) is properly organized. Hence, someone has to wait until he/she is told that the Secretariat (of the Census Commission) is properly organized to verify whether the proclamation is active or not. It is a subjective condition and no one could for sure know that it is actually repealed. When I say no one, it includes the House of People’s Representatives. That is why it repealed the same law twice.

What is more interesting is article 20 of Proclamation No. 180/1999. It reads:

“Notwithstanding the provisions of Article 18 (l) of this proclamation, Proclamation No. 32/1992 shall remain applicable until such time that the Secretariat is properly organized.”

It may be confusing, but this article seems to suggest that Proclamation No. 32/1992 which was repealed twice is still active for some unknown time in the future… until such time that the Secretariat is properly organized! By the way, why was it so difficult to organize the secretariat of the Census Commission? [It took more than two years!]

Repeal for the unusual ground

Why is a law repealed? There may be so many convincing justifications to repeal a law, but definitely the following two cases are wrong [I mean may be unusual] answers to the question.

·         National Lottery Administration Re-establishment Proclamation No.535/2007

[Article] 22 Repealed and Inapplicable Laws

1/ The National Lottery Administration Re-establishment Proclamation No. 510/2007 .having not been published as endorsed by the House, is hereby repealed

·         Addis Ababa City Government Revised Charter Proclamation No. 361/2003

[Article] 67. Repealed Laws

1) The Addis Ababa City Government Revised Charter Proclamation No. 311/2003, having been published with its contents changed without following the Legislative Procedure, is hereby deleted and replaced by this Charter

Some unusual facts about repeal in Ethiopia

I was writing an article under a general title ‘Some unusual facts about repeal in Ethiopia’ After writing the first topic I found it good to break it down in to a series of posts. Here is the first part

Repeal of a court decision by law (Legislative review of Court Decisions?)

According to the 1995 Ethiopian Constitution, the House of Federation has a power to interpret the constitution. Although the meaning and scope of the ‘constitutional adjudication’ in general is subject to controversy among some legal scholars, practically we all agree that ordinary courts do not have any power over questions of constitutionality of a proclamation  issued by the House of People’s Representatives. The courts are even reluctant to exercise their power of review over the legality of subordinate legislations (regulations and directives) and administrative decisions.

So, as I have said there is no such thing as judicial review of legislation in Ethiopia. What about legislative review of judicial decisions? I mean what about giving power to the House of People’s Representatives to repeal or invalidate those court decisions which are manifestly erroneous or contrary to public interest. I guess most of you will strongly object to this odd ‘concept.’ Yes it is odd, but there is proof that parliament has repealed or invalidated existing court decisions after they were pronounced.

If you have doubt over the validity of this fact, just read Article 3 sub 2 of Civil Code As Amended Proclamation No. 639/2009. This law was issued in response to the position of courts (including the cassation bench) in giving meaning to article 1723 of the 1960 Ethiopian Civil Code. Sub article 1 of article 1723 provides that a contract creating or assigning rights of ownership or bare ownership on an immovable or an usufruct, servitude or mortgage on an immovable shall be  writing and registered  with a court or notary. To be honest this article is clear and does not need any interpretation. The problem is that it is applicable to mortgage contracts concluded with banks. In practice almost all bank mortgage contracts were not registered with a court or notary. Hence, the fate of such contracts were invalidation by court. This posed a great danger to banks, especially to the commercial Bank of Ethiopia as it results in the loss of huge amount of money not collected from borrowers.

Actually, it was a problem created by the banks, (as they have failed to comply with the requirement of registration) not by the courts. Any ways parliament thought it necessary to act immediately, to reverse the situation. Then it issued Civil Code As Amended Proclamation No. 639/2009. The title of the proclamation seems to suggest that it is amendment to article 1723 of the Civil Code. However, its content clearly goes beyond amendment.

The proclamation contains three important provisions.

1.      Article 2 Amendment

The title of Article 2 talks about amendment, but practically it partially repeals article 1723 sub article 1 of the civil code. Article 2 of the proclamation makes the registration requirement of contract of mortgage concluded to provide security to a loan extended by a bank or a micro-financing institution unnecessary. In effect it makes mortgage contracts concluded with banks and micro-financing institutions valid even though not registered with a court or a public notary. This applies to mortgage contracts concluded after the proclamation became effective.

2.      Article 3(1)  Transitory Provisions (Retroactive measure to previous contracts)

Clearly Article 2 of the proclamation was not sufficient to avert the then existing danger posed to banks. What about mortgage contracts concluded before the issuance of the proclamation? This was dealt in Article 3 sub 1 which reads:

“The validity  of  any  contract  of  mortgage concluded,  prior  to  the  effective  date  of  this Proclamation,  to  provide  security  to  a  loan extended  by  a  bank  or  a  micro-financing institution,  may  not  be  challenged  for  not being  registered  by  a  court  or  notary  in accordance  with  Article  1723  of  the  Civil Code.”

This will force courts to give effect to unregistered mortgage contracts concluded not only after the effective date of the proclamation, but also to those mortgage contracts concluded before the proclamation. You may say this is against the principle of non-retroactivity of laws, but thanks to the F.D.R.E. Constitution, it only provides for non-retroactivity of criminal laws not civil laws.

3.      Article 3(2)  Transitory Provisions (Retroactive measure to court decisions)

Even after amending article 1723 (1) and providing a solution to previous contracts, Parliament did not stop there. Before the issuance of the proclamation, courts have already started invalidating mortgage contracts for lack of registration. No one denies the decision of courts severely affected the interest of banks. So, what should be done? (if anything is possible to be done) What about invalidating (I mean repealing) the existing court decisions? That is too extreme and violation of the constitutional principle of separation of powers. However, principle gave way to saving the banks and the House of People’s Representatives invalidated the existing court decisions, rendered prior to the effective date of this Proclamation.

Here is the full text of the article

Article 3(2) of Civil Code As Amended Proclamation No. 639/200

Any court decision, rendered prior to the effective date of this Proclamation, to invalidate a contract of mortgage concluded to provide security to a loan extended by a bank or a micro-financing institution, for not being registered by a court or notary in accordance with Article 1723 of the Civil Code shall have no effect.


DOWNLOAD Proc no. 674-201 Pesticide Registration and Control Proclamation



WHEREAS, the use of pesticides for different purposes such as for raising crops, animal breeding and the protection of public health has been growing steadily;

WHEREAS, it is necessary to lay down a scheme of control which would minimize the adverse effects that pesticide use might cause to human beings, animals, plants and the environment;

WHEREAS, it is necessary to enact a comprehensive legislation to regulate the manufacture, formulation, import, export, transport, storage, distribution, sale, use and disposal of pesticides and other matters related thereto;

NOW, THEREFORE, in accordance with Article 55 sub article (1) of the Constitution of the Federal Democratic Republic of Ethiopia it is hereby proclaimed as follows:

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Swedes Schibbye and Persson ‘pardoned’ by Ethiopia

BBC News – Swedes Schibbye and Persson ‘pardoned’ by Ethiopia.

Ethiopia has pardoned two Swedish journalists jailed last year for supporting terrorism, an official has said, adding they would be freed soon.

Martin Schibbye and Johan Persson are serving an 11-year jail term after they were captured in July 2011 with rebels in eastern Ethiopia.

Prime Minister Meles Zenawi pardoned the journalists before his death last month, the official said.

They have always argued they were in Ethiopia just to do their job.

Schibbye and Persson appealed for clemency following their conviction in December 2011 for supporting the Ogaden National Liberation Front (ONLF), which Ethiopia regards as a terrorist group.

The official, who spoke on condition of anonymity, said they would be freed this week along with about 1,900 other prisoners.

“It was never the intention of the government to see them languish in jail,” he is quoted by AP news agency as saying.

The Ethiopian New Year – when prisoners are often released – will be celebrated on Tuesday.

‘Weapons training’

Mr Meles, who was in power for 21 years, died last month after a long illness.

The government said his deputy, Hailemariam Desalegn, would be sworn in to serve as prime minister until the next election, due in 2015.

But this has not yet happened, fuelling speculation of a power struggle.

Schibbye and Persson were captured by Ethiopian troops during a clash with ONLF fighters in July 2011.

The men acknowledged during their trial that they had held talks with ONLF leaders in London and Nairobi, before entering Ethiopia from Somalia and meeting about 20 members of the group 40km (25 miles) from the border.

They said their contacts with the ONLF were intended to help them to get into a region the Ethiopian authorities would not allow journalists to enter.

They said they wanted to report on the activities of a Swedish oil company, Lundin Petroleum, in the Ogaden.

Both men denied terrorism charges, including claims that they had been given weapons training.

Rebels in the Ogaden region have been fighting for independence since the 1970s, and the ONLF has been at the forefront of the fight since it was founded in 1984.

The Ogaden is an ethnic Somali part of Ethiopia.

One ONLF faction has signed a peace deal with the government, but another splinter group has continued to fight the army.

Rights groups accuse Ethiopia of trying to cover up abuses by troops in the region.

New Proclamations 2012 (2004 E.C.)

Proclamation No.731/2012 Commercial Registration and Business Licensing /Amendment/

Proclamation No.732/2012 IGAD Convention on Mutual Legal Assistance in Criminal Matters Ratification Proclamation

Proclamation No.733/2012 IGAD Convention on Extradition Ratification Proclamation

Proclamation No.734/2012 International Convention for the Suppression of the Financing of Terrorism Ratification Proclamation

Proclamation No.735/2012 Protocol Against the Illicit Manufacturing of and Trafficking in Firearms, their Parts and Components and Ammunition Ratification Proclamation

Proclamation No.736/2012 Protocol against the Smuggling of Migrants by Land, Sea and Air Ratification Proclamation

Proclamation No. 737/2012 Protocol to Prevent, Suppress and Punish Trafficking in Persons Especially Women and Children Ratification Proclamation

Proclamation No.738/2012 2004 E.C Fiscal Year Federal Government Supplementary Budget

Proclamation No.739/2012 African Development Fund Loan Agreement for Financing Hawassa-Agere Mariam Road Project Ratification Proclamation

Proclamation No.740/2012 African Development Fund Loan Agreement for Financing Bedele-Metu Road Upgrading Project Ratification Proclamation

Proclamation No.741/2012 International Fund for Agricultural Development Loan Agreement for Financing Rural Financial Intermediation Program II Ratification Proclamation

Proclamation No. 742/2012 United Nations Convention on the Law of the Sea Ratification Proclamation

Proclamation No. 743/2012 Revised African Maritime Transport Charter Ratification Proclamation

Proclamation No.744/2012 Agreement on Scientific and Technological Cooperation between the Government of the Federal Democratic Republic of Ethiopia and the Government of the People’s Republic of China

Proclamation No.745/2012   Agreement on Scientific and Technological Cooperation between the Government of the Federal Democratic Republic of Ethiopia and the Government of the Republic of Korea Ratification

Compiled Administrattive Directives

Now You can easily get all directive in ONE.

Use Bookmark or Table of Contents to find a specific directive within the compilation.

Ethiopian Revenue and Customs Authority Consolidated Tax and Customs Directives

የተጠቃለሉ የቀረጥ ግብር እና ጉምሩክ መመሪያዎች

National Bank of Ethiopia




Consolidated Foreign Exchange Directives

National Election Board

Consolidated National Election Board Directives (English)

የኢትዮጵያ ብሔራዊ የምርጫ ቦርድ መመሪያዎች

Ethiopian Broadcasting Authority

Consolidated Ethiopian Broadcasting Authority Directives

የመንግስት ቤቶች ኤጄንሲ (Agency for Government Houses Directive)

(የመንግስት ቤቶች ኤጄንሲ በሚያስተዳድራቸው ቤቶች የተፈፀሙ ህገ-ወጥ ተግባራትን ስርዓት ለማስያዝ እንዲቻል ተሻሽሎ የተዘጋጀ መመሪያ)

Consolidated Ministry of Education Directives

ትምህርት ሚኒስቴር

  • በትምህርት ተቋማት የአምልኮ ሥርዓትን በሚመለከት የወጣ መመሪያ
  • የግል ከፍተኛ ትምህርት ተቋም የመጀመሪያ ዱግሪ ትምህርት የዕውቅና አሰጣጥ መመሪያ
  • ከቴክኒክና ሙያ ትምህርትና ሥልጠና መስክ ወደ ከፍተኛ ትምህርት ተቋም መሸጋገሪያ መመሪያ

Consolidated Ethiopian Investment Agency Directives

የተጠቃለሉ የኢትዮጵያ ኢንቨስትመንት ባለስልጣን መመሪዎች

Consolidated Charities and Societies Agency Directives

የተጠቃለሉ የበጎ አድራጎት ድርጅቶችና ማህበራት ኤጀንሲ መመሪያዎች

Consolidated Ethiopian Athletics Federation Directives

የተጠቃለሉ የኢትዮጵያ አትሌቲክስ ፌዴሬሽን መመሪያዎች

Consolidated Ministry of Construction and Urban Development Directives

የተጠቃለሉ የከተማ ልማትና ኮንስትራክሽን ሚኒስቴር መመሪያዎች

For list of Directives included in Each directives CLICK HERE

Pages: 1 2

The Sport Facilities Administration Proclamation No. 729-2012

The Sport Facilities Administration Proclamation may not be as controversial as the new Urban Land Lease Proclamation; however, an unexpected incident during its adoption has made it somewhat  ‘Historical’ document. An interesting description regarding the incident is found on capital, one of the country’s top business newspapers.

In a rare show of dissident in the House of Peoples’ Representatives whose 546 of 547 seats are filled by the ruling EPRDF and its affiliates, two ruling party Members of Parliament on Thursday abstained while the majority approved a new proclamation for the administration of sport facilities allowing alcohol ads to be placed in stadiums, while at the same time levying punishment on crimes yet to be spelled out.

(Two ruling party MPs abstain as majority approves controversial sport facilities’ bill Monday, 09 January 2012)

The two representatives were unhappy about the criminal sanctions imposed by the proclamation in article 11(3) (b) &(c).  Article 11 (3) (b) of the proclamation makes advertisement in sport facilities about cigarettes or cigarette related substances or liquors with more than 12% alcoholic content a criminal act punishable with imprisonment from six month to one year and with fine from Birr 5,000 to Birr 10,000. This law comes as a  good news for the beer industry as they could advertise their products in every sport facility. (The alcoholic content of beer on average is not more than 12%)

The 12% ceiling was unacceptable for the two MPs. It seems they just wanted the prohibition of any advertisement about alcoholic beverages in sport facilities. As reported by Capital, one of the MPs raised a challenging question regarding the unwanted side effects of the law. He asked “Aren’t we sending the message that the alcohol we know to be harmful to the public is ‘ok’ only because their alcoholic content is below 12 percent?”

The other point of dissent was the way the act constituting a crime in article 11 (3)(c) is stated. According to this article, any person who commits in sport facilities, other acts prohibited by regulation issued for the implementation of this Proclamation; is punishable with imprisonment from six month to one year and with fine from Birr 5,000 to Birr 10,000.

Honestly speaking, it is logically and practically impossible to obey this provision. It lays down a punishment, but you can not for sure know the criminalized act.

This is not the first time parliament has failed to be guided by the basic principles of criminal law in its criminal legislation on specific laws. I have tried to briefly address this issue on my previous post ‘You could be a criminal without committing a crime.’ According to Article 20(6) of Forest Development, Conservation and Utilization Proclamation No.542/2007 anyone will be punished with not less than 6 months and not exceeding 5 years imprisonment and with fine Birr 30,000 if he commits A CRIMINAL ACT NOT SPECIEFIED IN THE PROCLAMATION.


The following is the text of Sport Facilities Administration Proclamation No. 729/2012. You can also download the pdf version of the document Continue reading →

New 2011-12 (2004 E.C.) Proclmations

Proclamation No.720-2011 Ethiopian Federal Police Commission establishment

Proclamation No. 721-2011 Urban Land Lease Proclamation

Proclamation No. 722-2011 Instruments Amending the Constitution and Convention of the
International Telecommunication Union Ratification Proclamation

Proclamation No 723-2011 Definition of Powers and Duties of the Executive Organs of
the Federal Democratic Republic of Ethiopia (Amendment) Proclamation

Proclamation No. 724-2011 Export Import Bank of China Concessional Loan Agreement to Provide Loan for Financing the Bole Ring Road Round About- Meskel Square Road Project Ratification Proclamation Agreement

Proclamation No. 725-2011  International Development Association Additional Financing Agreement for Irrigation and Drainage Project Ratification Proclamation

Proclamation No.726-2011 International Development Association Additional Financing Agreement for the Urban Local Government Development Project Ratification Proclamation

Proclamation No. 727-2011 Statute of the International Renewable Energy Agency Ratification Proclamation

Proclamation No. 728-2011 Veterinary Drug and Feed Administration and Control Proclamation

Proclamation No. 729-2012 Sports Facilities Administration Proclamation

Period of time to dismiss a worker for misconduct (Summary of cassation decisions)


According to Ethiopian labour law, an employer loses his right to dismiss a worker irrespective of a valid ground of dismissal, if he fails to make a decision to terminate the employment contract within 30 working days. The time starts to run from the  date the employer knows the ground for the termination. (Article 27(3) of the labour proclamation 377/2003)

The following is a brief summary of Cassation decisions regarding the application an interpretation Article 27(3.

The meaning of working days

Applicant Ethio-Djibouti Railway

Respondent Teshome Kuma

Cassation File Number 36377

Date: Hidar 2, 2001 E.C.

In the Federal First Instance Court, where the case was first heard, the respondent claimed reinstatement and 6 months back pay alleging that his contract of employment was terminated unlawfully by the Applicant. However, the applicant employer challenged the claim stating that termination was lawful as it was due to an unlawful act committed by the applicant worker.

The Federal First Instance Court found the termination unlawful on procedural ground without investigating the merit of the case. The Court ruled that the employer (Applicant) has failed to take an action of dismissal within one month as required by the labour proclamation. For this reason, judgment was given in favour of the respondent The court awarded him six months back pay salary and reinstatement.

Applicant lodged an appeal against this decision to the Federal High Court, but it was rejected.

Lastly, the applicant submitted his application to the Federal Supreme Court, Cassation division for review of the lower courts on ground of fundamental error of law.

The cassation division examined the legal issue involved in the case by interpreting article 27 sub 3 of the labour proclamation No.377/2003. Both the federal first instance and high court misread the article in determining the period of time to take dismissal action by the employer. Rather than examining whether 30 working days have passed from the date the employer knew the ground for the termination, they simply counted 30 days to reach at a conclusion.

This was indicated by the cassation division as a manifest error. Accordingly, the case was re-examined based on the facts affirmed in the lower courts in order to determine whether 30 working days have passed. As stated in the decision, the worker allegedly committed fault on Meskerem 24 and 25 1999 E.C. and his contract of employment contract was terminate on Tikimet  25 1999 E.C.  From Meskerem 25 to Tikimet 25 there are four Sundays and assuming that Sunday is not a working day, there are only 24 working days during this time. Based on this calculation, the court reasoned, 30 working days have not passed, which makes the action of the employer valid for the purpose of time requirement.

Consequently, the decisions of the lower courts was reversed by the cassation division and the case was remanded to the federal first instance court to give its own decision on the merit i.e. the legality of termination of employment.

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Ethiopian Public Procurement Law applicable only to the private sector

“this Proclamation does not apply to contracts a public body enters into with another public body for the provision of goods, works, consultancy or other services at cost.”

The Ethiopian Federal Government Procurement and Property administration Proclamation No.649/2009 Article 3(2) (b)

In developing countries like Ethiopia, the provision of services to the citizen is one of the central functions of government. To fully realize it’s in providing services which meet the standard of the best quality, but at the same time with the minimum cost, the government in Ethiopia, uses the best mechanisms available, which may generally be categorized in to two. First, in areas where the private sector is considered to be at an infant stage, the government directly involves itself in the management and operation of the provision of services. The provision of electricity, telecommunication and water for instance, is under the exclusive control of government. Second, in areas which do not require direct involvement of the government, the provision of public services will be realized by involving the private sector for carrying out works and providing goods and services. Even in the second case, the government is not totally out of the picture. Public enterprises and other government business organizations equally participate in this process. Similarly, the direct provision of services by the government, to some extent allows the participation of the private sector. To a certain degree, the private sector plays a role in carrying out public works and providing goods and services in areas under the exclusive control of the government

Irrespective of the role played and the level of participation of the government or the private sector, the provision of the best quality of services with a minimum cost, requires an efficient and effective system of public procurement. “Public procurement is a central instrument to ensure an efficient management of public resources. Promoting good governance in public acquisition system aims at providing best value to its citizens through processes that are transparent and results-oriented”

Irrespective of variations in the existing political, economic and legal environment peculiar to a specific country, an efficient and effective system of public procurement is ultimately built upon four basic pillars: procurement laws and regulations, procurement workforce, procurement process and methods, and procurement organizational structure. Ideally, procurement laws and regulations should be clear, consistent, comprehensive, and flexible. (Khi V. Thai, procurement: concepts and practices, in International handbook of public procurement ed. Khi V. Thai p6-9)

Generally speaking, the regulatory framework of public procurement as tool in the formulation and implementation of an effective and efficient system of public procurement should be guide by some internationally accepted basic principles. These principles are: transparency, accountability, objectivity, fairness and non-discrimination.

The principle of transparency helps to attract a greater number of participation, thereby encouraging competitiveness. It also makes the whole procurement process open and fair, thus avoiding the possibility of favoritism and discrimination. Transparency also makes it easy for procuring entities and officials to be accountable. Most importantly, it is an effective tool to curb corruption.

The Ethiopian procurement law is still at an infant stage. In recent years, the Federal government has taken measures to revise the existing law, so as to make it responsive to the growth and expansion of the quantity and quality of provision of public services. Each year, a significant portion of public money is allocated as a result of  award of contracts for the construction of public works, supply of goods and provision of services.

Until 2005, there was no comprehensive procurement law at a national level. There were only few articles in the civil code regulating the procurement procedure. In 2005, the Federal government enacted a law providing a detailed procedure of Public Procurement (providing the procedures of Public Procurement and establishing its Supervisory Agency Proclamation No. 430/2005.) This law also establishes a federal agency empowered with regulating the procurement of works, goods  and services by Federal agencies. Another significant change introduced by this law was that it tried to embrace the basic principles of transparency, accountability, fairness and non-discrimination as its guiding principles.

After four years of the issuance of this law, it was revised and replaced by a new law (The Ethiopian Federal Government Procurement and Property administration Proclamation No.649/2009.) This second proclamation comes with more detailed and clear procedures. It has also widened its scope by providing for the regulation of public property, which was not dealt by the previous proclamation.

In addition to the legislative reforms taken by the legislative organ, the issuance of secondary legislation by the executive organ is also another significant development in the process of creating an efficient and effective legal framework. As a supplement to proclamation no. 649/2009, the Ministry of Finance and Economic Development issued a Federal Procurement Directive in June 2010. A month later, in July 2010, the Council of Ministers issued a regulation providing for public procurement and property disposal services establishment (regulation no. 181/2010)

Since procurement is not an exclusively federal matter, some regional states (e.g. Amhara regional state) including the Addis Ababa and Dire Dawa administrations have followed the footsteps of the federal government in devising their own procurement laws.

So far so good!

From the above brief assessment, you see only the positive side of Ethiopian procurement law. Yes it is true; efforts have been made to make the law clear, comprehensive and flexible. It is also true that the current law embraces basic principles of public procurement. But, it seems,  something big, something fundamental went wrong!

Just look into the scope of this law. According to article 3 of The Ethiopian Federal Government Procurement and Property administration Proclamation No.649/2009, the law is exclusively a federal law and its applicability is limited to Federal Government procurement and property administration. By way of exception article 3(2) (a) excludes procurement affecting national security or national defence. This is acceptable taking in to consideration the sensitive nature of such type of procurement and similar form of exclusions also exist in most jurisdictions. The exclusion also is not absolute because the type of procurement procedure is still to be decided by the Ministry of Finance and Economic development through consultation with relevant authorities.

Then comes article 3(2) (b). This article reads: “this Proclamation does not apply to contracts a public body enters into with another public body for the provision of goods, works, consultancy or other services at cost.” According to article 2 of sub article 6 of the proclamation, Public Body means any public body, which is partly or wholly financed by the Federal Government budget, higher education institutions and public institutions of like nature. So, public bodies are not subject to procurement procedures if they intend to participate in the provision of goods, works, consultancy or other services at cost. They will simply get awarded of a contract without competing with the private sector.  In effect, they will get preferential treatment. Doesn’t this then destroy the principle of fairness and non-discrimination? What is worse, no alternative procedure which ensures transparency and accountability, is devised for  contract of public works, goods and services if it is between two public bodies.

As a result, the procurement proclamation which professes to be rooted in the basic principles of transparency, accountability, fairness and non-discrimination, almost destroys itself by including such ‘suicidal provision.’ Remember, the government widely participates in every activity of undertakings related to carrying out public works, supply of goods and provision of services. When a public body gets a preferential treatment, it surely will not be competitive. This makes achieving the basic objectives of the procurement proclamation unattainable. The ultimate objective of any procurement legislation is the provision of the best quality of service with a minimum cost or to use the statement in the preamble of the proclamation, it is “the utilization of the large sum of public money spent on procurement in a manner that ensures greater economy and efficiency.” In the absence of competition, this is doomed to fail.

The proclamation seems to advance competition, but, as article 3(2)(b) of the proclamation has made it clear, public bodies are an exception to competition. Not only that, they are an exception to the principle of transparency, accountability, fairness and non-discrimination.


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