Ethiopia

General Information Entry and Exit Requirements
Banking Intellectual Property
Business Etiquette Tips Legal and Registration of a Business Entity
Embassy Locations and Registration Safety and Crime
Employment-Legal Requirements Taxes

General Information

EthiopiaEthiopia is one of the oldest countries in the world with a rich extensive history and the reputation of being regarded as the birthplace of mankind. It is a unique and beautiful land that boasts a varied population consisting of nearly 100 different tribes. Ethiopia is an East African country comprised of nine states and two city administrations (Addis Ababa and Dire Dawa). 

There may be political unrest and/or targeted crime against visitors to the country.  Travelers should check with the U.S. State Department Web site for current travel safety information.

Major Cities Capital: Addis Ababa
Major cities: Dire Dawa, Nazret, Gondar, Dessie, Mekelle, Bahir Dar, Jimma, and Awassa
Official Currency Ethiopian birr (ETB)
Time Zone UTC+3 (8 hours ahead of Washington, D.C. during Standard Time)
Language Amharic (official), Tigrinya, Arabic, Guaragigna, Oromigna, English, Somali

 

Legal System and Government

Type of Legal System

The Ethiopian legal system is based on civil law. It is currently a transitional mix of national and regional courts, and it has not accepted compulsory International Court of Justice (ICJ) jurisdiction.

Form of Government

Federal republic

^Top

Banking

Available Banking Services

ATMs
Online banking
Banking in English

Bank Holidays

Orthodox Christmas Day 
Ethiopian New Year (Enkutatash)
Battle of Adowa
Prophet's Anniversary-Eid-Milad Nnabi  
Orthodox Good Friday
Labor Day/May Day    
Patriots' Day   
End of the Military Regime (National Day)  
End of the Military Regime          
Finding of the True Cross (Meskel)    
End of Ramadan     
Eid-ul-Adha-Feast of the Sacrifice       

U.S. and Other Major Banks in Country

(Note: Addresses and contact information subject to change.)

Commercial Bank of Ethiopia
(The largest bank in Ethiopia)
P.O. Box 255,
Addis Ababa, Ethiopia
Phone: +251-11-551 50 04 or 251-11-551 50 00
Fax:   + 251-11-551 45 22 or 251-11-156 46 25
Web:  http://www.combanketh.com/

^Top

Business Etiquette Tips

Business Attire

Businesspeople dress conservatively and wear suits and ties when conducting business.

Proper Greetings

English is widely used for trade purposes, but Italian and French are also useful. Knowledge of a few words of Amharic will impress your hosts. (Some general terms: Tena Yistillign, "Hello"; Ow, "Yes"; Aydellem, "No"; and Sintinew, "How much is this?") Best months for business visits are October to May.

^Top

Embassy Locations and Registration

Americans living or traveling in Ethiopia are encouraged to register with the nearest U.S. embassy or consulate through the State Department's travel registration Web site so that they can obtain updated information on travel and security within Ethiopia. Americans without Internet access may register directly with the nearest U.S. embassy or consulate. By registering, American citizens make it easier for the embassy or consulate to contact them in case of emergency. 

(Note: Addresses and contact information subject to change.)

Ethiopian Embassy in U.S.
3506 International Drive NW
Washington, D.C. 20008
Phone: 202.364.1200
Fax:    202.587.0195
Web:  http://www.ethiopianembassy.org

U.S. Embassy
Entoto Avenue
P.O. Box 1014
Addis Ababa, Ethiopia
Phone: +251-11-124-2424 After hours: +251-11-124-2400
Fax:    +251-11-124-2435
Web: http://ethiopia.usembassy.gov

^Top

Employment-Legal Requirements

A contract of employment is considered formed whenever a person agrees directly or indirectly to perform work for any period of time and payment. Written contracts of employment are recommended. If one is not made prior to the arrangement, the employer will give the employee a written and signed statement listing the agreed-upon terms within 15 days of the conclusion of the agreement. If the contract is for an indefinite period of time, a probationary period is permitted to protect both the employer and employee. 

Terminating Employees

Contracts can be terminated with just cause, death, or upon agreement between the two parties without notice if made within 30 days of becoming aware of the reason for requesting termination. Other terminations require notice and severance payment. Severance payments are 30 days for one year, and longer periods of employment time and/or unfair dismissal warrant payments equal to six months or longer of employment. 

Legally Mandated Benefits and Leave

Annual Vacation Leave 14 days per year, plus 1 day for each additional year
Sick Leave Up to 6 months in any 12-month period with medical proof
Up to 1 month: 100 percent of wages
Second and third months: 50 percent of wages
Next 3 months: Without pay
Holidays 11 days (some with moveable dates)
Maternity Leave 30 days prior to birth and 60 days subsequent leave following birth
Funeral Leave 5 days
Miscellaneous Leave 3 days for newly married

 

^Top

Entry and Exit Requirements

To avoid possible confusion or delays, travelers are advised to obtain a valid Ethiopian visa at the nearest Ethiopian embassy prior to arrival, and they must do so if entering across any land port-of-entry.  U.S. citizens, however, can obtain a visa on arrival at Bole International Airport in Addis Ababa valid for up to three months with a valid U.S. passport. This service is only available at Bole International Airport. Visas obtained upon arrival can be extended by applying at the Main Immigration Office in Addis Ababa. 

Multiple business and tourist visas are available for up to two years through the Embassy of Ethiopia or other acceptable Visa service agencies.

^Top

Intellectual Property

Current protection is limited and involves a lengthy evaluation and verification process in processing patents. Some protection can be secured for trademarks through the Ethiopian Intellectual Property Office (EIPO) and the publication of cautionary notices issued in local newspapers (Ethiopian Herald and Addis Zemen).

The United States Patent and Trademark Office has been active in providing technical assistance and helping to establish guidelines and procedures to the EIPO, Ministry of Justice, and Ethiopian Customs Authority in the areas of copyright, trademarks, and patent infringement. 

Nature of Rights and Available Protection

Regulations for the protection of patents and copyrights are still in the development stages, though progress has been made in the areas of trademark, copyrights, and intellectual property issues. 

Enforcement

The Copyright and Neighboring Rights Protection Proclamation was passed in 2004 to provide protection against copyright infringers. The law imposes financial penalty and imprisonment terms on those who infringe upon the rights of copyright owners.

^Top

Legal and Registration of a Business Entity

If an organization intends to carry out work as a nonprofit entity within Ethiopia it must first submit a written application to the Non-Governmental Office Registration office located within the Ministry of Justice and receive approval. For all other business forms the information below will be of assistance.

Registration Formalities (Including Timing)

The World Bank sets the estimated length of time to establish a business presence in Ethiopia at 12 days with approximately five steps required to complete the process. The streamlined requirements for establishing a branch office in Ethiopia include the following:

  1. Check the company name for uniqueness.
  2. Authentication of the company documents and of the lease agreement at the office of registration of Acts and documents.
  3. Submit documents and obtain a letter from the Commercial Registry to open a bank account.
  4. Open a bank account.
  5. Register and obtain the Commercial registration certificate.
  6.  Make a company seal.
  7.  Register with Ethiopian Inland Revenue Authority and Customs for income tax and VAT.
  8.  Obtain business license.
  9. Install a cash registration machine. 

(Source:  The World Bank, Doing Business - Ethiopia)     

Other forms that may be required for setting up a branch office are an authenticated power of attorney to appoint an approved permanent representative in Ethiopia, a financial reference from the organization's bank, and publication of notice in the official gazette or newspaper announcing the establishing of a branch office.

Below are some additional resources to assist in establishing a presence in Ethiopia:

^Top

Safety and Crime

Travelers are advised to remain vigilant and cautious when visiting prominent public places and landmarks and avoid large demonstrations. Pick-pocketing, "snatch and run," and other petty crimes are common in Addis Ababa but stem from targets of opportunity rather than planned attacks. Visitors should limit the amount of cash they carry and leave valuables, such as passports, jewelry, and airline tickets in a hotel safe or other secure place.

Travelers should also exercise caution when traveling to any remote area of the country, including the borders with Eritrea, Somalia, Kenya, and Sudan. Ethiopian security forces do not have a widespread presence in those regions. In particular, travel via rail is discouraged due to episodes of derailment, sabotage, and bombings. In southern Ethiopia along the Kenyan border, banditry and incidents involving ethnic conflicts are also common.

^Top

Taxes

The principal taxes currently in place are the profit tax, value-added tax (VAT), excise tax, customs duty tax, and income tax from employment.

Individual and Employee Taxation

Determining Tax Residence

Any individual who lives in Ethiopia for more than 183 days during a 12-month period, whether continuously or intermittently, will be regarded as a resident for the entire tax period.

Corporate and Employer Tax Obligations

Every person deriving income from employment is liable to pay tax on that income at the rate specified.

Current laws regarding VAT can be confusing. NGOs are exempt from charging VAT on services. Unfortunately they are not exempt from paying VAT on services or goods purchased. This creates a higher tax burden on NGOs than on tax-paying companies as there is no method of recouping dollars spent.

^Top

Online Resources Used for This Template

^Top