African Law Archive -

FEDERAL NEGARIT GAZETA

OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA

2^nd Year No. 5 ADDIS ABABA - 13^thFebruary, 1996

CONTENTS

Proclamation No. 17/1996

Establishment of the Board of Trustee for Privatized Public Enterprises Proclamation

PROCLAMATION NO. 17/l996

A PROCLAMATION TO PROVIDE FOR THE ESTABLISHMENT OF THE BOARD OF TRUSTEE FOR PRIVATIZED PUBLIC ENTERPRISES

WHEREAS, enterprises, other than those to remain under government ownership, are to be privatized pursuant to the Economic Policy;

WHEREAS, it is found necessary to establish an organ, having legal personality, to follow-up and handle receivables, debts and obligations as well as legal cases pending after the sale and transfer of enterprises privatized in consequence thereof;

NOW, THEREFORE, in accordance with Article 55 (1) of the Constitution of the Federal Democratic Republic of Ethiopia, it is hereby proclaimed as follows:

1. Short Title

This Poclamation may be cited as the "Establishment of the Board of Trustee for Privatized Public Enterprises Proclamation No. 17/1996."

2. Definition

"Enterprise" means a public enterprise established under Proclamation No. 25/1992 or under a similar legislation and privatized pursuant to the Ethiopian Privatization Agency Establishment Proclamation No. 87/1994, or a branch thereof.

3. Establishment

1) There is hereby established the Board of Trustee for Privatized Public Entrprises (hereinafter "the Board") as an autonomous Public Agency having its own legal personality.

2) The Board shall be accountable to the Prime Minister.

4. Head Office

The Board shall have its head office in Addis Ababa and may have branch offices elsewhere, as necessary.

5. Objective

The objective of the Board shall be to conect receivables, takeover debts and obligations and follow-up legal cases not transferred to the buyer upon privatization of a public enterprise as well as to efficiently work towards the attainment of same.

6. Powers and Duties of the Board

The Board shall have the following powers and duties:

1) to ensure, upon commencement of handover of an enterprise to the new owner, that all cash held at hand by the enterprise is counted and deposited in a bank account to be designated in advance, reconcile same with bank statements and other financial documents;

2) to cause inspection and supervision for item-by-item tallying and reconciliation as to whether the quantity and condition of fixed assets, stock, raw materials and finished products during handover, effected by the Ministry of Finance, corresponds with what is shown in the books of the enterprise;

3) unless otherwise provided in the contract concluded between the Ethiopian Privatization Agency and the new owner of the enterprise:

(a) to collect receivables outstanding as at the date of privatization of the enterprise, take appropriate measures for collection thereof;

(b) to submit to the government, and have settled, the debts of the enterprise, settle same itself upon approval, and discharge its other obligations;

(d) to takeover and follow-up, by way of substitution, court cases relating to the enterprise, effect out-of-court settlement as appropriate;

4) to call upon creditors in accordance with its own schedule and plan, receive their claims together with supporting documents, give decision thereon after due inspection and verification;

5) to issue the final balance sheet of the privatized public enterprise, transmit copies of same to the Ministry of Finance and to the Auditor-General;

6) to submit to the Prime Minister detailed reports on receivables and payables as well as pending court cases of the enterprise, send a copy of same to the Ethiopian Privatization Agency;

7) to own property, enter into contracts, sue and be sued in its own name, as attributes of its legal personality;

8) carry out other activities as are necessary for the attainment of its objective.

7. Organization of the Board

The Board shall have:

1) a Board of Management,

2) a General Manager; and

3) the necessary staff.

8. Members of the Board of Management

The Board of Management shall have the following five members:

1) an Appointee of the Prime Minister………………………………………………Chairman

2) a representative of the Ministry of Finance……………………………………….member

3) a representative of the Supervising Authority of Public Enterprises……………...member

4) a representative of the Ethiopian Privatization Agency………………………….. member

5) the General Manager of the Board, to be appointed by the Prime Minister upon

recommendation of the Board………………………………………member & Secretary

9. Powers and Duties of the Board of Management

The Board of Management shall have the following powers and duties:

1) to direct, as the superior authority, and supervise the activities of the Board;

2) to ensure and supervise the collection of receivables outstanding as at the date of privatization of the enterprise;

3) to submit to the government, and obtain approval for, the settlement of the debts of the enterprise, ensure and supervise due settlement of same upon approval;

4) to undertake proper follow-up and supervision on the settlement of legal cases relating to the enterprise in or out-of-court;

5) to approve the annual budget and work programme of the Board to be submitted to the Government;

6) to undertake whatever it deems necessary for the attainment of the objective of the Board.

10 Liability of Members of the Board of Management

1) Members of the Board of Management shall carry out their duties under this Proclamation with due care.

2) They shall be jointly and severally liable to the Board for damage caused to it by their failure to properly carry out their duties.

11. Meetings of the Board of Management

1 ) The Board of Management shall meet, at least, once in a month; provided that it may meet at any time, as necessary, where called upon by the Chairman.

2) There shall be a quorum where more than half of its members are present at a meeting.

3) Decisions of the Board of Management shall be made by a majority vote; in case of a tie, however, the Chairman shall have a casting vote.

4) The Board of Management shall draw-up its own rules of procedure.

12. Powers and Duties of the General Manager

1) The General Manager shall, subject to the directives of the Board of Management, direct and arlminister the activities of the Beard.

2) Without limiting the generality stated in sub-Article (1) of this Article, the General Manager shall:

(a) serve as member and secretary of the Board of Management;

(b) execute the directives of the Board of Management issued to him in accordance with the powers and duties of the Board specified under Article 6 herein;

(d) prepare and submit to the Board of Management the budget and work programme of the Board;

(e) effect expenditure in accordance with the approved budget and work programme of the Board;

(f) represent the Board in all its dealings with third parties;

(g) prepare and submit to the Board of Management the operational and financial reports of the Board;

3) The General Manager may delegate part of his powers and duties to subordinate officials and other employees to the extent necessary for the efficient performance of the activities of the Board; however, in the case of an official who acts on his behalf for more than thirty days, prior approval by the Board of Management shall be required.

13. Budget

The annual budget of the Board shall be allocated by the Federal Government.

14. Transfer of Rights and Obligations

l) The legal personality of a public enterprise, privatized pursuant to Proclamation No. 87/1994, shall be revoked upon completion of its handover to the new owner; and its existence as a Public Enterprise shall cease thereupon.

2) Rights and obligations of an enterprise as at the final date of handover shall be transferred to the Board established hereunder.

3) The Board shall publicize the privatization of an enterprise, with a view to notifying third parties of the sale, through a newspaper having wide circulation or other mass media upon completion of its handover.

15. Power and Duty of Winding-up

The provisions of Articles 41-45 of the Public Enterprises Proclamation No. 25/1992 shall apply, mutatis mutandis, for purposes of this Proclamation. The powers and duties of the Supervising Authority of Public Enterprises provided under these provisions, regarding the winding-up of public enterprises, are hereby transferred to the Board with respect to privatized public enterprises.

16 Effective Date

This Proclamation shall enter into force as of the 13^thday of February, 1996.

Done at Addis Ababa, this 13^thday of February, 1996.

NEGASO GIDADA (DR.)

PRESIDENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA