How are shares formed in Ethiopia?

How are shares formed in Ethiopia?

A share Company will be established as per the 1960 Commercial Code of Ethiopia and the Ethiopian Investment Laws. The minimum number of founders of a share company is five in number. The company can be formed with a minimum capital of ETB 50,000. The share company liability is limited to the assets of the company.

Who traders are under Ethiopian law?

From this we can derive the literal definition of a trader as, a natural person who operates a sole-business (an individual business). That means, artificial persons may not operate a sole-business in Ethiopia.

Is buying bank shares profitable in Ethiopia?

If you buy a stock/share in a bank, you are entitled to a fraction of its profits and you can also sell the share for a higher price in a future time. For example, if you buy a 1000 birr share in an Ethiopian bank, you will get a yearly dividend that ranges from 200 to 300 birr on average.

What is a business organization under Ethiopian law?

Ethiopia is a federal republic with a predominantly civil code legal system. Ethiopia recognizes six forms of business organizations: ordinary partnerships, joint ventures, general partnerships, limited partnerships, share companies, and private limited companies.

How do I start a share company?

The SEBI (Securities and Exchange Board of India) issues a registration certificate. You will also need approval from stock exchanges and clearing corporations. Once you meet SEBI’s ‘Fit and Proper’ criteria, you can apply to stock exchanges via SEBI and obtain a certificate with your unique registration number.

How can I start a trading company in Ethiopia?

Register and obtain the commercial registration certificate from the Ministry of Trade and Industry. Make a company seal. Register the company and employees with the Private Organization Employees’ Pension Fund. Register with the Ethiopian Revenue Authority for Value Added Tax (VAT).

What are the 5 different types of business organization?

There are various forms of organizational structures from a business perspective, including sole proprietorships, cooperatives, partnerships, limited liability companies, and corporations.

What are the 6 types of business ownership?

They are the:

  • sole proprietorship.
  • general partnership.
  • limited liability partnership.
  • limited partnership.
  • limited liability company.
  • business corporation.

Which bank is selling share in Ethiopia?

Amhara Bank
After setting the record for an initial paid up capital for a new entrant bank in the Ethiopian banking industry, Amhara Bank keeps on selling shares to interested Ethiopians and foreigners of Ethiopian Origin.

What should I invest in Ethiopia?

Six Sectors of Investment Opportunities in Ethiopia

  • Transport Infrastructure. Many national and regional projects are currently being undertaken to improve the transportation system for land, air or sea travel.
  • Industrial Sector.
  • Agriculture.
  • Energy.
  • Mining.
  • ICT.

What is the law of business Organisation?

Business organization law refers to the numerous ways a business may be legally formed under state laws. Since each business organization brings with it a specific set of tax, management, and liability benefits and drawbacks, choosing the right type of organization for your business depends on many factors.

What are the types of business organization?

There are various forms of organizational structures from a business perspective, including sole proprietorships, cooperatives, partnerships, limited liability companies, and corporations. All of these structures are for profit, but there are also non-profit corporations and other structures.

Why are share companies not legal in Ethiopia?

This in turn not only creates loss of investors’ confidence in the Ethiopian capital markets but also results in market inefficiency, raises the cost of capitals and inefficient use of scarce resources in the country. Third, the share company law provisions are not supplemented by other legislation.

How does share company law affect share companies?

On one hand, it creates obstacles to form new share companies by less than the legal limits. On the other hand, it compels incorporated companies to winding up by the fact that company’s shareholder memberships are less than the legal limits.

Why are minimum shareholding requirements in Ethiopia confusing?

First, it is blurred and confusing because capital requirements are prone to accounting manipulation. Second, such provision neither protects shareholders nor creditors in the first place. Similarly, minimum shareholding requirement has two shortcomings.

What are the OECD Principles of share ownership?

These are: – right to ownership registrations, right to information, right to pare take and vote in the meetings of shareholders, right to transfer or sale shares and participate in the profits or proceeds of the company. These ownership rights of shareholders are similar to the OECD Principles.