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Country Commercial Guides for FY 2000: Ethiopia Report prepared by U.S. Embassy Addis Ababa, released July, 1999 Note*

CHAPTER VI. TRADE REGULATION AND STANDARDS

A. TRADE BARRIERS:

Sales tax rates are 4% for a selected list of agricultural goods and "essential" items, such as pharmaceuticals, books, and printed matter, hides/skins, and cotton. For all other goods, the sales tax is 12%. There are ten excise tax brackets, applied equally to domestically produced and imported goods, ranging from 10% for textiles and electronic products to 200% for alcoholic beverages.

B. CUSTOMS REGULATIONS:

Ethiopia's new pre-shipment inspection law requiring that all imports coming into the country must be checked for type, quality, origin, quantity and price in conformity with sales contracts before entering the country. Ethiopia signed a two-year pre-shipment inspection agreement with the Swiss-based, SGS. Beginning in October 1999, any consignment which has not been inspected by SGS cannot get clearance from the Customs Authority. C. TARIFF RATES:

Ethiopia has reduced customs duties on a wide range of imports over the last three years. The most recent tariff reductions in January 1997 offer considerable decreases in most duties, but especially targets imported goods that enhance exports. Tariff rates range from 0 to 50%, with an average tariff rate approximately 20%. The government plans to reduce the maximum rate to 30% and the average tariff rate to 17-18% within the next three years.

D. IMPORT TAXES:

None other than those listed above.

E. IMPORT LICENSES:

All imports require permits from the exchange controller of the National Bank which are obtainable upon presentation of a valid import license and the provision of satisfactory information on costs and payment terms.

F. TEMPORARY ENTRY:

Bonded warehouse storage facilities are available for periods up to six months.

G. SPECIAL IMPORT/EXPORT REQUIREMENTS AND CERTIFICATIONS:

All exports require permit from the exchange controller of the National Bank. When applying for a permit an exporter must specify the goods to be exported its destination and value. The granting of a permit by the exchange controller enables the goods to pass through customs. The licensing system is used to ensure that foreign exchange receipts are transferred to the National Bank.

Most imports to Ethiopia require; (1) three certified copies of the commercial invoice, (2) two detailed copies of the manufacturers invoice, (3) a bill of lading or airway bill, and (4) pro-forma invoices.

Documents that should accompany exports include; (1) export declaration, (2) sales contract, (3) invoice, and (4) insurance certificate or policy.

H. LABELING, MARKING REQUIREMENTS:

Shipping marks and labeling are required in all imported goods and should be identical on all documents.

I. PROHIBITED IMPORTS:

The Ministry of Trade and Industry has the power to restrict and/or limit imports and exports. There are restrictions on the importation of products that compete with locally produced goods, particularly in agricultural sectors. Automobile or motor vehicle imports require approval from the Ministry of Transport and Communications. The import of arms and ammunitions, except by the Ministry of National Defense, is totally prohibited.

J. WARRANTY AND NON-WARRANTY REPAIRS

Regulations in this category are applicable only to the terms of the sales or services contract.

K. EXPORT CONTROLS:

Ethiopia maintains restrictions and taxes on the export of coffee and chat and regulates the sale of petroleum products.

L. STANDARDS:

The Ethiopian Quality and Standards Institute regulates all exports and imports. Standards are consistent with international norms and do not act as a barrier to U.S. products. Government procurement is by competitive bidding. There are no burdensome administrative procedures or special document requirements.

M. FREE TRADE ZONES:

Ethiopia does not operate or allow the development of free-trade zones, although a transshipment port is available in Djibouti.

N. MEMBERSHIP IN FREE TRADE ARRANGEMENTS:

In 1992, Ethiopia became eligible to participate in the Generalized System of Preferences (GSP). Ethiopia is considering applying for membership in the World Trade Organization (WTO). It is a member of the Common Market for Eastern and Southern Africa (COMESA).

O. CUSTOMS CONTACT INFORMATION:

The Customs Authority is a branch of the Ministry of Finance. The General Manager is Yeshitila Aytenfisu (Tel: 251-1-511639; Fax: 251-1-551355).