BY TSEGAYE TILAHUN
ADDIS ABABA – The new Commercial Code of Ethiopia has improved the protection of the interests and rights of minority shareholder and encourages the masses to invest, said Law Expert.
On Thursday, Addis Ababa Chamber of Commerce and Sectoral Associations held a forum on “The new company law of Ethiopia and its implication on business formation and operations.”
On the occasion, Law Expert Fekadu Petros said that for many years, Ethiopia’s Commercial Code remained weaker in terms of protecting the rights of minority investors in companies. The new Ethiopian Commercial Code Proclamation No. 1243/2021 registered remarkable improvements including FDI promotion perspective and desire of improving the doing business rank.
The new Commercial Code of Ethiopia is believed to address exploitation by the block holders. It provided a special right to convene a general meeting for the 5%, the right to include agenda items for a GM, and special audit or investigation and access to information, he highlighted.
The new commercial code encourages the masses to invest and improves the protection of the interests and rights of minority shareholders in a share company. Many important changes were introduced. The logic investor protection in a new code encourages the masses to invest and process the sales of assets of the debtor and discharge of debtors.
The amendment of the Commercial Code encourages the expansion of professional businesses such as lawyers, auditors, architects and others to form partnerships. The limited liability members and creditors are protected by insurance schemes, he stated.
There are a number of provisions in the new code that improve minority shareholder protection. The revised law has been bolstering commerce to improve the standard of living.
The Council of Ministers adopted the code in 2021. The Commercial Code of Ethiopia Proclamation No. 1243/2021 partially has repealed its predecessor, the Commercial Code of No. 166/1960, it was learnt.
The Ethiopian Herald 18 June 2023
