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Proclamation No. 116/1998 ,

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Investm~nt (Amendment)

Proclamation

Page 752

PROCLAMATIONNO.116/1998 A PROCLAMATIONTO AMEND THE INVESTMENTPROCLAMATION

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WHEREAS, it has become necessary to amend the Investment Proclamation; NOW, THEREFORE,in accordance with Article 55(1) of the Constitution of the Federal Democratic Republic of 1\'i!'C Cbh Ethiopia, it is hereby proclaimed as follows: f,tJ 1\'P~ uf1\.10h""001"" (OIJ?f?ff)1\'P~
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hydropower; generation and supply of electricity above an installed capacity of 25 megawatts as well as transmission and supply of electrical energy through the Integrated National Grid System; (b) air transport services using aircraft with a seating capacity of more .ban 20 passengers or with a cargo capacity of more than 2,700 kg.; (c) rail transport services; tit) ffJn-t; :"~,}ilTC:" h.1A..,f\oTI (/p) 4.91'} f;r it:f' h 1A..,fto:"'} "'~IJJ.9"C (d) . postal services with the exception of courier services. fTil;t- h1A..,ftoT:: 2) Investors shall be allowed to invest in the I' O~h+t\:':" f P' t. (/Pil\1:fI1t\U1H.:fIt.') 0 ilT follqwing'areas only in partnership with the t\00/f:~"";' fOt:'flrt h(/P,}"'P'T ;JC O(/P~ Government: C;~:,. 11:F~1fC;AI (a) defence industries; U) f(/Phl\hf ~iJ;.ilTtI (b) telecommunicationservices." t\) f1:I\.\1OD-~h."ii'}h1A"'ir'T:I" 3) Article 6 of the Proclamation is hereby deleted and fh'P:( h'}+K' } -rIPCJf OtllJ.h+t\m- hltil h'}~K' } replaced by the following new Article 6: ++h:f;AI "6. Areas of Investment Reserved for "}. t\h1C m-lt1' I1t\Ul1.y.i- f+ht\,... f P' t. Domestic Investors ~ 1) The following investment areas are exIi' ftllJ.h+""T fit. '}OilT(/P'}T (/Pil\1i- It.Tf' clusivelyreservedfor Ethiopian Nationals: kfce H."'~T I1I\Tm- (}t\Ul1.y.:f 11:FfDIJ.I1'lJ;. (a) banking and insurance business; ~1fC;""I (b) excluding generation' of electricity U) fl1'}hC;fit. '}if.t.,}il Pt.I from hydropower; generation and t\) fV~f:r: h.l\.hTth ;}~A "7(/P'}IJJ.T'} supply of electrical energy up to 25 "'~IJJ.9"C I hilt! ?}~ DIJ.;J'PTfh.l\.hTth megawatts; ;}~A fDIJ(/P'}IJJ.TC;fDIJh4-~A P't.I (c) air transport 'services using aircraft with a seating capacity of up to 20 tit) hilh 1} (/P'}1f.7f:f m~9" hilh lilU%f h.fto ~t.9" f(/P6li}.')h~9" I1I\Tm- lbch passengers or with a cargo capacity of t.CJ..} fDIJ.t}~f: fhfC Tt.,}llTC:" h1A up to 2,700 kg.; (d) forwarding and shipping agency ..,fto:"I services; provided, however, where (/p) f~C'PCIt'}..,C; n:~'}.., h.~,}~ h1A.., the Government pennits otherwise, fto.y.:fI 1f'f9" (/P,}"'P'T O+t\f u-~:f' same shall be open for foreign inves~6.~f:t\m-~ I1t\Vl1.y.:f9" hCJ.T tors as well. ~1fC;,...:: 2) The investment areas exclusively reserved I' Oh1C m-la1' I1t\Ul1.y.:fl1:F fDIJ.I1~J;.\lit.'}oil for domestic investors shall be detennined :"(/P'}:" (/pil\1:f 1IClIC ODIJ.~ilTr:i- 9"hC by Regulations issued by the Council of 0.:" OOtmtl) f.,}11 ~m()C;A:: Ministers. f' ftlU h ,}~K' f:'};J1. f h 1C m-it1' I1t\Ul1.y.:f'} 3) Nothing in this Article shall be construed Ol\.fto:f (/Pil\1:f It.'}oil:" hDIJf:~'" h~ht\hl\ to exclude domestic investors from invesTm-9"::" ting in other areas of inve~tment.', fh'P:( h'}+K' Iii '}o-il h'}~K' (g) +IPCJf ODIJ.h+t\m- 4) Sub-Article(4) qfArticle 11 of the Proclamation is h.fLit '}o-il h,}+K' (g) ++h:f;AI hereby deleted and,replaced by the following new sub"g. Olt.,}:(~t,}.., t ohctt1:hTt.A m~9" Article(4): '. n~1\ f1:h~h 9"hc h1A..,ftoTI "4) Th~ minimum capital required of a 0~"'11C; n/tJLT h1A..,f\oT I OTC' ,foreign investor inves~ing in areas of ~b:" 1'C;:"m~9" O,..,f: P't.C; DIJ~1: engineering, '~chiteciural or other technical consultancy services; in accounting (/P'}:" f9"hc h1A..,ftoT (/pilh and audit services; in project studies or 1t.1oil:" fDtff.c.., f~~ I1t\Ul1:" business and. management consultancy fDlJ.mf+m-1I~+~ ft}~:f'A (/pm') lif services shall be 100,000 US Dollars." ilu fhDIJ.tl1') P-I\C~1fC;A:: 5) The following new sub-Article(10) is added under Oh'P:( h'}+K' ?I~P'C fDIJ.h+t\m-~ltil '}o-il h'}+K' Article 28 of the Proclamation: (I) +iu.9"~AI ,

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2) Article 5 of the Proclamation is hereby deleted and replaced by the following new Article 5: "5. Areas of InvestmentReserved for the Government 1)' The following investment areas are exclusively reserved for the Government:

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Whenever it deems it necessary, it shall decide on new or additional incentives, other than what is provided under the Investment Incentives Regulations and submit same to the Council of Ministers for approval." The following new sub-Article(3) is added under Article 37 of the Proclamation: "Notwithstanding the provisions of sub-Articles(1)and (2) of this Article,a foreign investor tipon obtaining the prior consent of the Authority shall, without any restriction,have the right to recruit expatriate employees on top managementpositions of an enterpriseof which he is the sole or major owner." The following new Article 39 is added after Article 3S of the Proclamation: "39. Ownership of Immovable Property Notwithstanding the provisions of Articles 390-393 of the Civil Code, inv~stors of foreign nationality can own immovable property requisite for their investment activities." Articles 39, 40, 41 and 42 of the Proclamation are re-numbered as Article 40,41,42 and 43, respectively. ~ The Schedule on investment areas reserved for domestic investors, attached to the Proclamation,is hereby deleted.

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This Proclamationshall come into force as of the 11th day of June, 1998. Done at Addis Ababa, this 11thday of June, 199~. NEGASO GIDADA(DR.) PRESIDENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA

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