OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA ያም Year No. 19 ADDIS ABABA - 14 May , 2002 CONTENTS Proclamation No. 272/2002 Re - Enactment of Urban Lands Lease Holding Proclamation Page 1732 PROCLAMATION NO . 272/2002 A PROCLAMATION TO PROVIDE FOR THE RE - ENACTMENT OF LEASE HOLDING OF URBAN LANDS WHEREAS , it is provided by the Constitution of the is a subject of specific regulation by law ; WHEREAS , for the last few years lease has been in to users to the extent possible and in accordance with Master Plan ; WHEREAS , it is believed that transferring urban land investment costs , the special nature of the investment , and the land use specified in conformity with Master Plan ; WHEREAS , it has been found necessary , arising from remove obstacles of and to expediate the process of permit plan made in conformity with Master Plan ; WHEREAS , it has conversely been found necessary to ensure that the order in which the claims of any one alleging and expedient ; NOW , THEREFORE , in accordance with Sub - Article Democratic Republic of Ethiopia , it is hereby proclaimed as follows : The African Law Archive * No. 19 14 May , 2002– Page 1. Short Title This Proclamation may be cited as the " Re - enactment of Urban Lands Lease Holding Proclamation No. 272/2002 . " 2. Definitions In this Proclamation : 1 ) " Lease " means lease - hold system in which use right of urban land is transferred or held contractually ; 2 ) “ Urban land ” means land located within urban boundary ; 3 ) “ Town ” means a place in which a municipality is established , or which a concerned Region designates as a town ; 4 ) “ Region " means a Region indicated under Article 47 ( 1 ) of the Constitution of the Federal Democratic Republic of Ethiopia , 5 ) “ City Government ” means the Addis Ababa City Administration or the Dire Dawa Administrative Council ; 6 ) “ Appropriate Body ” means a body of a Region or a City Administration.vested with the power to clear , permit by lease and administer land ; 7 ) “ Public Interest " means that which an appropriate body determines as a public interest in conformity with Master Plan or development plar in order to continuously ensure the direct or indirect usability of land by peoples , and to progressively enhance urban development ; 8 ) " Person " means any natural person or any body designated as a person by law . 1 ) This Proclamation shall be applicable to an urban land held by the permit system , or by lease - hold system , or by other means prior thereto , as well as to an urvan land permitted hereafter . 2 ) Notwithstanding the provisions of Sub - Article ( 1 ) of this Article , this Proclamation shall be applicable to : ( a ) any urban land which has not been under lease hold system , as per the time and conditions to be set by the concerned Region or City Govern ment ; ( b ) any town , which has not been under lease - hold system , as per the time and conditions to be set by the concerned Region or City government . 4. Lease Hold Permit 1 ) An urban land shall be permitted to be held by lease ( a ) in conformity with plan guidelines where such a plan exists , or , where it does not exist , in conformity with the law which Region or City government makes , as the case may be , and ( b ) on auction or through negotiation ; or ( c ) according to the decision of Region or City government . 2 ) Minimum price shall be determineu IQI I van oud to be permitted on auction , or through negotiation . 3 ) The details of the execution of auction and negotiation shall be specified by Regulations to be issued by a Region or City Government . 5. Lease - hold Title Deed 1 ) Lease - hold title deed shall be conferred on a person to whom an urban land is permitted . 2 ) The details to be contained in the title deed shall be specified by Regulations to be issued by Region or City Government . The African Law Archive 6. Period of Lease 1 ) The period of lease shall vary depending on the level of urban development and sector of development activity or the type of service and shall have the ceiling of : ( a ) in any town 1 ) up to 99 years for housing ( personal and leasable ) , science , technology , research and study , government office , non - profit making philanthropist organization , religious institution ; 2 ) upto 15 years for urban agriculture ; 3 ) as per government agreement for diplomatic missions and international organisations ; ( b ) in Addis Ababa and in a town designated as of the grade of Addis Ababa : 1 ) upto 90 years for education , health , cul ture , sports ; 2 ) upto 60 years for industry ; 3 ) upto 50 years for commerce ; 4 ) upto 50 years for others . ( c ) in other towns not designated as of the Grade of 1 ) upto 99 years for education , health , culture , sports ; 2 ) upto 80 years for industry ; 3 ) upto 70 years for commerce ; 4 ) upto 70 years for others . 2 ) Notwithstanding the provisions of Sub - Article ( 1 ) of this Article , ( a ) other ceilings may be set by Regulations to be issued by Region or City Government for other development activities or services falling short of specificity . ( b ) a ceiling exceeding not more than half of the ceiling of the lease period set for each activity or service may be set for development activity or service requiring a protracted period of lease on account of its special nature . The criteria and the execution thereof shall be specified by Regulations to be issued by Region or City Government . ( c ) a ceiling of 5 years of lease period shall be applicable to economic and social development undertakings intended to be invested on urban lands not designated for use within a short period of time . It may be renewed for the same period of time where it is necessary . The details of its execution shall be specified by Regulations to be issued by Region or City Government . 7. Renewal of Period of Lease 1 ) Period of lease may , upon the termination thereof , be renewed for the lease - hold possessor as per the agreement to be reached , unless the urban land is wanted for public interest . Where the lease period is not renewed upon termination on account of the land being wanted for public interest however , compen sation shall not be paid to the lease - hold possessor . 2 ) Period of lease shall be renewed for the lease - hold possessor in pursuance with the stipulations of Sub Article ( 1 ) of this Article if only he has applied in writing to the appropriate body to that effect within 10 years and not exceeding 2 years before the termination of the period of lease . 3 ) The appropriate body must notify to the applicant in writing its decision within 1 year after the ap plication has been lodged with it . It shall be deemed as though it has agreed to the renewal if it fails to do so within 1 year after the receipt of the application . The African Lawt Archive 8. Rate of Lease Payment 1 ) The manner of determination of the rate of lease payment shall be stipulated by Regulations to be issued by Region or City Government . 2 ) Region or City government may permit urban land for lease payment down to nil for a development activity , social service - rendering institution , low cost housing , private dwelling houses , and similar undertakings it purports to encourage . 9. Signing Lease Contract 1 ) Any person , to whom lease - hold of urban land is permitted through auction or negotiation , shall be entitled to obtain lease - hold title deed as set forth in Article 5 only after he has signed a contract of lease with the body permitting the land or the appropriate body . 2 ) Conditions of the performance of payment , period of grace and other relevant conditions should be em bodied in the contract . 10. Performance of Payment and Utilization of Incomes 1 ) A person , to whom lease - hold of urban land is permitted , ( a ) may be given a period of payment to be determined by Region or City Government , as the case may be , taking into account the duration needed to recover costs to be incurred ; ( b ) must make advance payment not less than 5 per cent out of the total lease payment ; ( c ) shall make payment every year , and the yearly payment shall amount to the average price of the remaining lease payment divided over the period payment ; ( d ) shall pay interest over the remaining payment as per the rate of interest on loan offered by Bank . ( e ) shall pay penalty fee according to the rate of penalty fee imposed by Bank upon debtors on account of default of loan payment ; The Provisions of ( b ) and ( d ) of Sub - Article ( 1 ) of this Article shall not apply to urban land to be permitted to the extent of free of charge and other than on auction and negotiation according to the provisions of ( c ) of Sub - Article ( 1 ) of Article ( 4 ) . 3 ) Each Region or City Government shall utilize at least 90 per cent of the lease payment it collects , as per this Proclamation by leasing urban land , for the purpose of expanding infra - structures . 11. Period of Grace Any person , to whom lease - hold of urban land is permitted , may be granted a period of grace in con sideration of the type of development or service which he has undertaken . The details of the execution thereof shall be specified by Regulations to be issued by Region or City government . 12. Use of Urban Land 1 ) Any person , to whom lease - hold of urban land is permitted , must begin to use the land for the prescribed activity or service within the period of time set by Regulations to be issued by Region or City Government . 2 ) Notwithstanding the provisions of Sub - Article ( 1 ) of this Article , the land use may be converted as per a permit granted in writing by the appropriate body after application to convert the type of development or service in respect of which lease - hold of the urban land has been permitted is received . 3 ) Period of lease , performance of payment and other conditions shall be varied upon the conversion of the land use as set forth in Sub - Article ( 2 ) of this Article . Surety 1 ) Without prejudice to Article 6 and Sub - Article ( 1 ) of Article 10 , any lease - hold possessor may transfer , or undertake a surety on , his right of lease - hold ; and he may also use it as a capital contribution to the amount of the lease payment he has made . The African Law Archive * 2 ) Unless otherwise stipulated , the building constructed on the urban land and facilities accessory thereto shall together be subjected to surety upon under taking surety in respect of the right of the use of land . Conversely , the right of the use of land shall also be subjected to surety upon undertaking surety over the building and facilities accessory thereto , unless otherwise stipulated . 3 ) A person , who has the right of surety , may make use thereof by transferring the right , the building on the land and facilities accessory to it according to law or by using it on his own where the person undertaking the surety has failed to perform his obligation in the contract of suretyship , or where he is declared by court that he has proved to be bankrupt . 14. Urban Land Held by Lease Notwithstanding the contract of lease already signed , the conditions in which a lease - hold possessor may avail of the modalities of payment and period of grace shall be determined by Regulations to be issued by Region or City Government 15. Termination of Lease - hold and Payment of Compensation 1 ) The lease - hold of urban land shall be terminated : ( a ) where the lease - hold possessor has failed to use the land in accordance with Sub - Article ( 1 ) of Article 12 ; ( b ) where it is decided to use the land for a public interest ; or ( c ) where the period of lease is not renewed in accordance with Sub - Article ( 1 ) of Article 7 . 2 ) The lease payment shall be returned , subject to the reduction of costs incurred and penalty fee , where the lease - hold of urban land is terminated in accor dance with Sub - Article ( 1 ) ( a ) of this Article . Penalty may not , however , be due where the land fell short of use because of force majuere set forth under Article 1793 of the Civil Code . 3 ) Where the lease - hold of urban land is terminated in accordance with Sub - Article ( 1 ) ( b ) of this Article , the lease - hold possessor shall be paid commensurate compensation in conformity with the pleadings institution procedure set forth in Article 17 . 4 ) Where the lease - hold of urban land is terminated in accordance with Sub - Article ( 1 ) ( c ) of this Article , the lease - hold possessor must hand over the land to the body which gave it by removing within one year the property he has on the ground . 5 ) The body , which handed the urban land over to the lease - hold possessor , may take over the land , together with the property thereon without any payment , where the latter has failed to remove the property on the ground within the period of time set forth in Sub - Article ( 4 ) of this Article . It may order the Police where it finds it necessary for the execution thereof . 6 ) Where contract of lease is terminated in accordance with the provisions of this Article , the taking over of the land shall take place pursuant to the provisions of Article 20 . 16. Clearing Urban Land 1 ) The appropriate body may clear and take over an urban land which it decides it is necessary to commit for a public interest by issuing clearance order in writing to the concerned person . It shall also publicize the order through other alternative means . 2 ) The appropriate body may clear urban land with a property thereon from illegal holders by serving a written notice warning the person having illegally held it to move away and without any need of giving him clearance order and compensation in accordance with this Proclamation . It may take over the land illegally held by clearning it from the holder and , where it finds it necessary by using the police force as set forth in Sub - Article ( 3 ) of Article 20 . The African Law Archive 3 ) It is only before the following bodies that any justifiable claim relating to a clearance order or a warning notice may be invoked : primarily only before the body which has issued the order , on appeal before Urban Land Clearance Appeals Com mission , and , on appeal concerning compensation claims only , before the High Court having jurisdic tion over the place where the property is situate or before the Municipal Appellate Court . 17. Institution of Pleadings and Decision - making 1 ) A person , upon whom clearance order is issued as indicated under Sub - Article ( 2 ) of Article 16 , or any other person alleging infringement of his right or benefit , or any person upon whom warning notice is served , may take to the appropriate body his claims , in respect of compensation and any other grievance of a justiciable nature , with substantiation of evidence and reasons . 2 ) The body receiving the pleading brought before it as set forth in Sub - Article ( 1 ) of this Article shall notify in writing to the applicant of : ( a ) its decision to pay commensurate compensation where it proves that the property , which is a subject of compensation claim , is legally built up and , as a result , believes it is worthy of compensation ; or ( b ) the rejection of the claims and the reasons therefor , where it has turned down the pleading . 3 ) The body receiving pleadings must record and keep the estimate as to the amount of compensation , the grounds of assessment and the process followed in its decision upon the claim of compensation in respect of the property in issue under Sub - Article ( 2 ) of this Article 4 ) The period of time for instituting pleadings as set forth in this Article shall be specified by Regulations to be issued by Region or City Government . 1 ) An applicant , who disagrees to the decision rendered according to Sub - Article ( 2 ) of Article 17 , may appeal before the Commission within 30 days as from the date of the decision . It shall , However , be deemed as if he has accepted the decision if he has not appealed within this time , 2 ) The Commission shall examine the appeal , and ( a ) render decision within a short period of time determined by Regulations to be issued by Region or City Government . ( b ) shall notify its decision in writing to the parties . 3 ) The decisions which the commission delivers upon disputes of points of law and fact shall be final , save on disputes for higher , or lesser , or undue denial of compensation . 4 ) A person dissatisfied in the decision of the Commis sion upon compensation issues only may appeal within 30 days as from the date of the decision , before the relevant High Court having jurisdiction over the place where the property in issue is situate or where such place is in Addis Ababa before the Municipal Appellate Court . The appeal shall be barred by a period of limitation beyond this time . The decision at this appellate level shall be final . 5 ) The period specified in Sub - Articles ( 1 ) and ( 4 ) of this Article for submission of an appeal shall not include the time taken by the court to produce and submit a copy to the petitioner . 6 ) Where the person upon whom clearance order is issued is appealing against the decision rendered under Sub - Article ( 4 ) of this Article , he may appeal if only he has handed the land over to the body issuing the clearance order thereon and has attached with his appeal a document of receipt given by the body receiving the land in question . The African Law Archive No. 19 14 May , 2002– Page 1738 19. The Commission 1 ) Clearance Order Appeals Commission shall be established as per the decision of the highest organ of power of Region or City Government it shall have jurisdiction over appeals brought before it as set forth in Sub - Article ( 1 ) of Article 18 and shall examine and decide by approving , revoking , or amending the decisions rendered under Sub - Article ( 2 ) of this Article 17 as well as by rendering other necessary orders , as the case may be . 2 ) Each Region may establish more than one Commis sion where it finds it necessary . 3 ) The Commission shall be accountable to the Council of Region or City Government , as the case may be . 4 ) The Commission shall have not less than five members coming from different relevant bodies . 5 ) The Commission may execute its decrees by or dering the Police Force wherever it finds it neces sary , 6 ) The Commission may , wherever it finds it necessary , order any person to give it professional opinion or evidence from a concerned body . 7 ) The Commission shall be free of any influence except the law . 8 ) The Commission shall not be governed by the ordinary Civil Procedure Code while conducting its functions . It shall , however , be governed by ex pedient procedures which shall be determined by Regulations to be issued by Region or City Govern ment . 9 ) The term of office of the Commission shall be determined by the Regulations establishing it . 20. Receipt of Land 1 ) The appropriate body shall take over the land in respect of which clearance order has been issued : ( a ) where the applicant has received it , to whom compensation has been decided ; ( b ) where the applicant has not appealed against the compensation decided for him under Sub - Ar ticle ( 2 ) of Article 17 ; ( c ) Where the Commission has rendered decision ; ( d ) where the person upon whom clearance order has been issued fails to claim compensation . 2 ) Where the applicant has failed to receive the com pensation , or where the person upon whom clearance order has been issued has failed to claim compen sation , the appropriate body receiving the land in accordance with Sub - Article ( 1 ) of this Article must pay the compensation due by the time he appears . 3 ) The appropriate body may order the Police wherever it finds it necessary to use force pending its receipt of land . 21. Duty to Co - operate Any person shall be duty bound to co - operate where he is asked to do so in any operation undertaken to enforce this Prociamation . Obstruction of a measure taken by the appropriate body as set forth in Article 20 so as to receive land in respect of which clearance decision has been made shall entail penalty in accordance with to the relevant Penal Code . 23. Inapplicable Laws 1 ) The Urban Lands Lease Holding Proclamation No. 80/1992 is repealed and replaced by this proclamation . 2 ) Any law or practice going contrary to this Proclamation shall not be applicable to matters covered by this Proclamation . The African Law Archive * 24. Transitional Provisions 1 ) Matters which have been under consideration before any ordinary Court and which are linked to lands permitted by lease as well as matters arising out of administrative orders instructing lawful or unlawful land holders to hand over the land in their use shall be transferred to and adjudicated by the Commission according to this Proclamation as of the time the Regulations establishing each Commission shall have become effective . 2 ) Transfer of matters as set forth in Sub - Article ( 1 ) of this Article shall take effect on the basis of the notification thereof to be made by the appropriate body . 25. Effective Date This Proclamation shall enter into force as of the 14th day of May , 2002 . Done at Addis Ababa , this 14 * day of May , 2002 . PRESIDENT OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA * The African Law Archive