Investment Procedures in Ethiopia

A foreign investor, domestic investor or a partnership of foreign and domestic investors who plans to engage in investment activities in Ethiopia are expected to follow the investment procedures in Ethiopia. This page presents investment procedures in Ethiopia as laid out in the proclamations and regulations.

Investment Proclamation No. 769/2012 DOWNLOAD
Investment Amendment Proclamation No. 849/2014 DOWNLOAD
Council of Ministers Regulations No. 270/2012 DOWNLOAD
Investment Incentives and Investment Areas Reserved for Domestic Investors and its amendment Regulation No. 312/2014 DOWNLOAD
Commercial Registration and Business Licensing Proclamation No. 980/2016 DOWNLOAD
Industrial Parks Proclamation No. 886/2015 DOWNLOAD
Council of Ministers Regulation No. 417/2017 on Industrial Parks DOWNLOAD

1. Investment Permit

The Ethiopian investment commission is obliged to receive an application for an investment permit and issue the permit upon examination of the intended investment activity in light of the proclamation, regulation and directives, and receipt of the appropriate fee. The commission is required to duly notify the applicant where the application is found unacceptable.

The following investors are required to obtain investment permits: 

  • Foreign investors;
  • Foreign nationals, excluding Ethiopians by birth,
  • Domestic investors investing in areas eligible for incentives;
  • Domestic and foreign investors making investments in partnerships.

Application for Investment Permit

By a domestic investor:

The application shall be made in a form designed for such purpose (can be obtained from the Ethiopian Investment Agency) and submitted together with the following documents (the application form the documents have to be submitted in two copies, where they are submitted to the Agency, or in one copy, where they are submitted to Regional Investment Organs). 

  • Where the application is signed by an agent, a photocopy of his power of attorney;
  • Where the investment is to be made by an individual person, a photocopy of his identity card, or a photocopy of the certificate evidencing his domestic investor status and his recent two passport size photographs;
  • Where the investment is to be made by a business organization, photocopies of its memorandum of association and articles of association; or where the business organization is newly established, in addition, it shall submit photocopies of the shareholders’ identity cards, or photocopies of the certificates evidencing their domestic investor status;
  • Where the investment is to be made by a public enterprise, a photocopy of the Regulation under which it is established or a photocopy of its memorandum of association and articles of association;
  • Where the investment is to be made by a cooperative society, a photocopy of its Articles of Association

By a foreign investor:

The application shall be made in a form designed for such purpose (can be obtained from the Ethiopian Investment Agency) and submitted together with the following documents: (the application form the documents have to be submitted in two copies to the Agency).

  • Where the application is signed by an agent, a photocopy of his power of attorney;
  • Where the investment is to be made by an individual person, a photocopy of the pages of valid passport showing his identity and his recent two passport size photographs;
  • Where the investment is to be made by a business organization, photocopies of its memorandum of association and Articles of Association; or where the business organization is newly established, in addition, it shall submit photocopies of the shareholders’ valid passports showing their identity; and
  • Where the investment is to be made by a branch of a foreign business organization in Ethiopia, photocopies of its memorandum of association and Articles of Association or a similar document of the parent company;

For expansion or upgrading of an existing enterprise:

The application shall be made in a form designed for such purpose (can be obtained from the Ethiopian Investment Commission) and submitted together with the following documents (the application form the documents have to be submitted in two copies, where they are submitted to the Investment Commission), or in one copy, where they are submitted to Regional Investment Organs).

  • Where the application is signed by an agent, a photocopy of his power of attorney;
  • Where the investment is made by a business organization, photocopies of its memorandum of association and Articles of Association; and
  • Photocopy of a valid business license of the existing enterprise.

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Renewal of Investment Permit 

An investment permit is renewed every year until the investor commences marketing of his product or service. However, if the investor has sufficient cause for the delay in the commencement or completion of his project implementation, the commission shall renew the permit.

Investment permits to carry out activities in industrial parks

Investment permit in an industrial park is a permit issued by the commission for industrial park developer, industrial park operator, industrial park enterprise to carry out industrial park related activities as an investor. 

An investor is required to submit, an application form duly signed by the investor or his agent, notarized memorandum and articles of association and if it is a branch, documents ascertaining the registration and legal personality of the parent company in the country of origin. The investor is also required to comply with specific requirements (other than those stipulated above) based on the activity he wishes to engage in. 

Investors who desire to engage as an industrial park developer are required to present, their undertakings to develop a park for industrial park enterprises that engage in prioritized manufacturing sectors, and declaration demonstrating the availability of sufficient capital for implementing the project. Where the commission finds the application legitimate it concludes a memorandum of understanding with the applicant and issue an investment permit within seven days. 

An investor who wishes to become an industrial park operator must submit a detailed declaration demonstrating availability of professional and possession of experience as well as administrative and financial plan. In a different manner an application to establish industrial park enterprise should include; a detailed project proposal, export/import substitution plan contingent upon the type of proposal, declaration of financial standing and a ten year forecast, and environmental impact assessment report.

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2. Commercial Registration and Business licensing 

After obtaining an investment permit, the investor is required to have a business license upon registration in the commercial register. A commercial registration and business license would confer several rights and duties on the investor including the right to commence business operation. (See the article on commercial registration and business licensing). Although the Ministry of Trade and Industry is the major government organ to regulate and administer commercial registration and business license, the Ethiopian Investment Commission administers the commercial registration and business license for investors.

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Exchange Rates

Selling
Buying
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GBP 35.4331  34.7383 
EUR 32.9931  32.3462 
CHF 28.7222  28.1590 
CAD 20.3145  19.9162 
AED 7.3480  7.2039