Ethiopia has not adopted national legislation based on or influenced by the United Nations Commission on International Trade Law (UNCITRAL) Model Law on Electronic Commerce.

Ethiopia has not adopted national legislation based on or influenced by the United Nations Commission on International Trade Law (UNCITRAL) Model Law on Electronic Signatures.

According to Art. 82.1 of the Commercial Code No. 1243/2021 and Arts. 5.1 & 22 of the Commercial Registration & Licensing Proclamation No. 980/2016, any Ethiopian or foreign person or company carrying out commercial activities within Ethiopia shall be registered and then licensed.

The importation of telecommunication equipment requires authorisation by the government. The Communication Services Proclamation No. 1148, under Art. 23, gives broad powers to the Ethiopian Communication Authority to regulate the importing of any telecommunication equipment to the country. It is prohibited to manufacture, import, or distribute radiocommunications and telecommunications equipment that requires the Authority’s technical efficacy assurance without obtaining prior approval of the Authority.

Proclamation 808/2013 mandates the Information Network Security Agency (INSA) to control the import and export of information technologies, build an IT testing and evaluation laboratory centre and regulate cryptographic products and their transactions.

According to Art. 3 of the Telecom Fraud Offences Proclamation, the import, assembly, sale, manufacturing, or even use of any telecom equipment (which includes any apparatus and software used for telecom services) without a prior permit from the government is prohibited. Failure to comply with this rule is a crime punishable with imprisonment and a fine.

Ethiopia is reported to experience regular logistical delays due in part to inefficiencies in the customs process, which significantly affect the import process. In addition, monopolistic conditions in the multimodal transport market and insufficient infrastructure make it difficult for private-sector logistics companies to operate. Logistics costs usually represent between 22% and 27% of the final cost of the product, and transport and freight costs are 60% higher than in neighbouring countries. Customs administrative difficulties are compounded by the fact that Ethiopia is landlocked, and more than 90% of its foreign trade depends on a single port in Djibouti, which suffers from inadequate infrastructure and inefficient customs procedures.

The legal framework on standards does not allow for self-certification for radio transmission, electromagnetic interference (EMI) or electromagnetic compatibility (EMC) through a Supplier Declaration of Conformity (SDoC) for both domestic and foreign business. However, Article 23.5 of the Communications Proclamation No. 1148/2019 states that the Authority may conduct a stakeholder consultation to permit the importation and use of radiocommunication and telecommunications equipment that has been approved by internationally recognised testing bodies that the Authority may designate by a Directive.

According to Art. 41 of the Electronic Transaction Proclamation, e-commerce operators are regarded as one form of commercial entity. Hence, the laws that regulate other commercial activities apply, including the Commercial Code, which requires a licence to operate.

It is reported that importers face difficulty in obtaining foreign exchange, particularly those that import goods for domestic sale. The National Bank of Ethiopia (NBE) administers a strict foreign currency regulatory regime. Furthermore, while larger firms, state-owned enterprises, and manufacturing industries are reported to have not faced major problems in obtaining foreign exchange, the remaining firms face burdensome delays in arranging trade-related payments. An importer must apply for an import permit and obtain a letter of credit for the total value of the imports before an order can be placed.

It is reported that the national standards for payment security deviate from international standards as there is no clearly prescribed standard that financial institutions need to apply. The laws that regulate the banking or payment systems in Ethiopia do not refer to international standards such as ISO/IEC, EMV, payment tokens or 3D Secure. Furthermore, neither the National Digital Payment Strategy nor the Revised Bank Risk Management Guideline of the National Bank of Ethiopia explicitly states that the above-mentioned international standards are applied locally.

It is reported that the de minimis threshold, that is the minimum value of goods below which customs do not charge duties, is USD 25, below the 200 USD threshold recommended by the International Chamber of Commerce (ICC).

Art. 5 (1. e) of Investment Regulation No. 474/2020 (which implements the Investment Proclamation No. 1180/2020) reserves some areas of investment, including advertisement and promotion for joint investment with domestic investors only. According to Section 3.3 of the regulation, the scope of the law includes advertisements disseminated through the internet website being designed in Ethiopia or abroad. Previously, there was a ban on foreign investment in the advertising sector.

It is reported that Ethiopia does not mandate functional separation for operators with significant market power (SMP) in the telecom market. However, there is an obligation of accounting separation.

The Ethiopian Communication Authority is mandated to limit the number and pre-conditions of new licenses to be given for investors based on Art. 6.7 and 19.2 of the Communications Service Proclamation No. 1148/2019. In other words, investors can only apply to be given a license when the government announces a call for bids. Based on these provisions, the government has only given out one license to a foreign investor so far. In June 2021, the Ethiopian Communications Authority (ECA) licensed the Global Partnership for Ethiopia (Safaricom) as the country’s second telecommunications provider even though it has not started its operations yet. Hence, the only telecom service provider in Ethiopia now is the government owned Ethio-telecom which has a monopoly of the market. The detailed procedures for getting a license are laid out in the Telecommunication Licensing Directive No. 792/2021.