Quotation

FORMS OF ENTERPRISE FOR CARRYING OUT INVESTMENTS

Investments may be carried out in one of the following Enterprises:

  • Sole proprietorship;

  • Enterprise established in Ethiopia or abroad;

  • Public Enterprise established in accordance with the relevant law;

  • Cooperative society formed in accordance with the relevant law;

MINIMUM CAPITAL REQUIREMENT FOR INVESTMENT

Foreign investors

  • Any foreign investor, to be allowed to invest under this Proclamation, shall be required to allocate a minimum capital of USD 200,000.00 (two hundred thousand) for a single investment project.

  • The minimum capital required of a foreign investor jointly investing with a domestic investor shall be USD 150,000.00 (one hundred fifty thousand).

  • The minimum capital required of a foreign investor investing in architectural or engineering works or related technical consultancy services, technical testing and analysis or in publishing works shall be:

    • USD 100,000.00 (one hundred thousand) if the investment is made on his own;

    • USD 50,000.00 (fifty thousand) if the investment is made jointly with a domestic investor.

Domestic investor

  • The minimum capital to be considered as an investor and issue investment license in Somali Region has to allocate 1,500,000 Ethiopian Birr

  • Those project whose investment capital is below 1,500,000 Ethiopian Birr is considered as Small and Micro enterprise

SERVICE PROVIDED BY SIIB

  • Provision of pertinent investment information and data

  • Licensing services

  • Renewal suspension and revocation of investment permit

  • Investment Incentives

  • Investment promotion

  • Facilitation and aftercare Services

  • Redresses clients’ grievances or concerns

  • Coordinate diasporas efforts and activities in the region

PROVISION OF PERTIENANT INVESTMENT INFORMATION

Somali Region Investment and Industry Bureau is in charge of providing pertinent information to potential investors regarding the region:

  • Investment potential and opportunities

  • Requirement for issuing license

  • Renewal of investment incentives

  • Land for investment

  • Priority investment area

  • and related information 

REQUIREMENT AND ISSSUANCE OF INVESTMENT PERMIT

The following investors shall be required to obtain investment permits:

  • Foreign investors;

  • Domestic and foreign investors investing jointly;

  • Investors investing as domestic investors pursuant

  • Domestic investors who, investing in areas eligible for incentives, seek to be beneficiaries of such incentives; and

  • An investor seeking to expand or upgrade an existing investment, provided that the investment is eligible for incentives and the investor seeks to be beneficiary of such incentives.

INVESTMENT PERMIT

Investment to be made by Domestic Investor and Ethiopian in Diaspora

The Somali Region Investment and Industry Bureau is responsible to issue investment license only for Domestic Investor and Ethiopian in Diaspora. The investment can be in sole proprietorship, PLC, JV and Share Company business form. However, all shareholders must be Ethiopian or Ethiopian origin. The requirement to issue investment license varies depends on the type of business form in which the investor plan to operate.  

The investment permit application process is simple and it requires only a few steps and requirements to issue investment license for domestic investor and Ethiopian in Diaspora (Ethiopian Origin). These steps are:

Investment made by sole propertorship

Step 1: Collect information from Somali Region Investment and Industry Bureau (SIIB) about the requirements, investment opportunities, potentials, incentives and etc.

Step 2: Collect application form from Somali Region Investment and Industry Bureau

Step 3: Submit filled and signed application form (by the investor or general manager or authorized person)

Step 4: Submit project proposal (business plan),

Step 5: Submit copy of valid ID Card (passport or Yellow card),

Step 6: Submit bank letter that show the financial capacity

Step 7: Submit two recent passport size photographs of the investor,

Step 8: Collect investment permit certificate

Investment made by PLC, JV and Share Company

Step 1: Collect information from Somali Region Investment and Industry Bureau (SIIB) about the requirements, investment opportunities, potentials, incentives and etc.

Step 2: Collect application form from Somali Region Investment and Industry Bureau

Step 3: Submit filled and signed application form (by the investor or general manager or authorized person)

Step 4: Submit project proposal (business plan),

Step 5: Submit copy of authenticated Article of Association and Memorandum of Association

Step 6: Submit copy of valid ID Card (passport or Yellow card) of members,

Step 7: Submit bank letter that show the financial capacity

Step 8: Submit two recent passport size photographs of the Manager,

Step 9: Collect investment permit certificate 

Investment to be made by foreign national and jointly with Ethiopian

As per the Ethiopian investment law, the following investments fall under the jurisdiction of Ethiopian Investment Commission. It includes: –

  • Wholly foreign owned investment;

  • Joint investment made by domestic and foreign investors;

  • Investment made by a foreign national, not Ethiopian by origin, who is treated as a domestic investor

  • Investment made in areas eligible for incentives by a domestic investor who is required to obtain a business license from an appropriate Federal Body

Thus, if the investment is to be made by the above listed investor the investment license is issued by Ethiopian Investment Commission.

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