~Yo&-A 'l;JtT ;JltlfJ

FEDERAL NEGARIT GAZETA

OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA

h&-+~ 100:,. 4?-rc I'k 4 th Year No. 16

flh..-,.f-A-f d..Y.,t-1\'e Jt'l°h&,(t..f''e &T-fll\.h
hJtil hfl'l-ftit:,. II. cf>'> Hif.1. ADDIS ABABA- l9tJt Feb., 1998
f ihll11 +mtif-'f 9"hC n.:,. mt),t}:,. faJ"I

OI/Orfm}, CONTENTS
h'P~ <hTC 17./'Wr1 'l·9°· Proclamation No. 97/1998
flfl'}h flODJ''lf ill\Tfll 11llT fa>"J Property Mortgaged or Pledged with
h'P~ ...................................................... 1.K"" ifG"~ Banks Proclamation ............................. Page 674

h'P~ <h rC rn/1iH1

1
PROCLAMATION NO. 97/1998
n1nh flor>f"lf il/\•f'.<'11· f"'l~'Jcf>t'tcf>ft.c; A PROCLAMATION TO PROVIDE FOR PROPERTY
MORTGAGED OR PLEDGED WITH BY BANKS
f "'l.14' t'tcf> (t• '>·fl l .Y.:-,~ f m"I h 'P ~
n1nfl1· fl'Pil:,-c; f·f' .r11• f"7~ '>cf>t'tcf>(t.c; f°t '>cf>t'tcf>ft. WHEREAS, it takes rather too long a time to obtain
11ll•r--:.f. hVU'f m• t\<.:c.e.: n.•)· hit h:,Ocn t\"'lilm(t')c; judgement, from courts of law, for sale of property mortgaged
m•lt>.m·19° t\ 0 "/ilt.1.9" fOl/.milf.m• ·ut ll"l9° l~9" (loolf~I or pledged with banks and to subsequently have it executed;
ll<f?mtl 'l'.,11 ooAh hihll11 f{t(l(t0-:,.1c; h+t\f~ WHEREAS, consequently, banking business thriving
r1,-1- .r•ff.:,-1 ·n1111 fl"?llf.c nOI/. •,-f ,v. fmt\~ 1ft on interest payments on loans it provides from public money
f°7.,1·~~"t- '111'1".f· P'&· I\~ h<,:,f•~ +,th'i ll"'llt~"t-t received by way of saving deposits or acquired from other
t\h.l'l'i°1. h '):,Ofl..-,.(1.m• hoo=t; u->.;J- t\Uo<t:mC 'l'Jl'l'f sources, has been adversely affected;
t\+/\.r~ r1°1.e..•c; fA"7.-,. h'>:,.il..-,.t'l. fOl/.{t(!\.r,V. 11~c:'f1 WHEREAS, in order to create a conducive environment
to economic development by enabling banks to collect their
(l,f-cf>l\mt. oo')-,Y,.• f\oo(t-fl(t{I h1Jt'ft\•t; t\m~'-1: T"t-
debts from debtors efficiently and thereby promoting a good
f'J"IY.· hf'l&•C 'ltJA h'JJ;.~11C t\"'l~l°I t\ll'Jh 1l~C floof"lf
business culture, it is necessary to amend the Civil Code
f·f'f'lm· f"7 ~ 'Jcf>t'tcf>(t.c; f"'I. 'Jcf>t'tcf>f'l• 'J-fll.Y.1·'J 7if6J.1' floY.oo
concerning the sale of property mortgaged or pledged with
t\ h·l· llP' t,. I\~ f t\.,)•'J ih·f·f· "7?f ?f Ac; hJtil P'C'¼:,. banks;
OD II C: ;J :,. (1"7 il t.t\"l•:
NOW, THEREFORE, in.accordance with Article 55(1)
ll}l.:'J·f•A•.f d..fo/.-1\'P. Jt'l°ht.•f'l..<''e &T-flt\.h ,n'lOD'J of the Constitution of the Federal Democratic Republic of
"IP'·)· },'Jcf>?t· n;(,i) ODIPl:,- f"'l.h1•t\,V. ;t·m-~:A== Ethiopia, it is hereby proclaimed as follows:
l. Short Title

~IJ h'P:~: "llll'Jh noo.r"lr ilt\+J'll ')-fll:,• faJflJ h'P~ This Proclamation may be cited as the ''property
<h 1
rc: 17./ rnn" ·t•-flt\ 0
t\.mcf>il ~1-1\A== Mortgaged or Pledged with Banks Proclamation No. 97/
1998."
,f"}P,. 'P ;J i!•"ii:{i
~;Jk"t- ;JJl."J 7·"1·•1!·
Unit Price 230 Negarit G.P.O.Box 80,001
1
·1x· ir.(t?; &..Yut•/:\ ~;,t•l· ;JIL"I •ll'l'C: Ii f'1·1:·l· rn <f•1 Ii!fj 1·9°· Federal Negarit Gazeta- No. 16 19°' February, 1998-Page 675

I· :,.c::\"'L 2. Definition

mu, tt'P~ m•il'f' "1o~il:,-1,.c" IP/I\:,- nfl7.e.'>cf>'1cf>il In this Proclamation ''Registrar'' means in the case
1-0l:,. l\,e. .fl\ oP-fl:,•'} fM·oPl\h-,. ffl'/f,"}cf>/\cf>il 1-0l:,. of mortgage, a Regional or City organ responsible
foPoP111·fl ~I\.C.Ff• .fl\lD• fhAA m,e.'J° fh-,.11'/ n'1A for registering an immovable property or in the
m,e.'J° flfl'/.1cf>/\cf>il 1•fll:,. l\,e. .fl\ oP-fl:,.'} fl-,.oPl\h-,.
case of pledge, an organ with the power to witness
fil'J°'J°H:1 oPLl'J° ffl'/.•f l.?°lmm-<; il'J°'J"',-f:'} f°t!
the signing of a contract of pledge and deposit
ilcf>'J°mlD• fhAA m,e.9° fh·f•fl'/ n'1A 'Im•::
same.
r.· ruri,e. '}cf>/\cf>il m,e.'J° f"7.1cf>/\cf>il
'}-fll:,. rlP.f'lf il'J°'J0 ' , • }
3. Contract of Mortgage or Pledge
r:rnt2« r,.::,•th-Oth.c: ~ 0 1 n'>cf>?i 1n:i~2?i "c; n'>cf>?i
Notwithstanding the provisions of Articles 2851
tif.t Y:1;,1. fl.'iC'J 0 : f"'/,e.'}cf>/\cf>il mf,'J° f°t1cf>'1cf>il
1-0l:,• fl'Pi}:,.c; f fH 1ll\11H-0 1)'})1 f"7.t.A 'llD- "~lD• and 3060 of the Civil Code, an agreement
authorizing a creditor bank with which a property
"'}~h.C.A n-,.ro(l',m· 1.tL /\,e.ht.l\m- 0.cf>C hwl\/\ -,.c;:,.
.fl\ 'l(l 11'/ilm'>cf><I!! l\•11\b~m• floPilm.-,. floP y-.r
has been mortgaged or pledged and whose claim is
f,fHm•'} f"7f,1cf>/\cf>il m,e.'J° f°t1cf>'1cf>il 1-0l:,. not paid within the time stipulated in the contract,
fltht.-~ l\oPil1''i f 'll\fl.:,•'1:,- oP-fl-f:'}'J° l\11cm- to sell the said property by auction upon giving a
l\fl'/tf mc: m,e.'J° l\u--1\•t·~: 1.1L nm"l f l(ht,,: 11'/il;t-m,tf prior notice of at least 30 days to the debtor and to
oP1Pl•1· -,:-,·r '1Acf>ln 1-fll-t:1 n-01.·c m•I\- m•il1' transfer the ownership of the property to the buyer,
(l(lt.llD· f'P ;J °l'J°:,. oPi>•I.•)· l\oP(D•(lf.·<; f'l/\0.:,.'I:,. shall be valid.
oP-fl-f: niloo• "'~•1mc:l\:i• I\IP/1:l°l h'll\b~m· ;JC
f"7..ff.C:1lD• il'J°'J°'I:,. ·f·.C.?."7. .,:,. f,'i l'PA:: 4. Claim on Mortgaged or Pledged Property
nfl7 ,e.1.,. ".,. il m ,e.'J° n "7. ">.,. '1.,. il 1-0 1. .-,. I\ ,e. ! I\ A creditor bank which, prior the effective date of
this Proclamation, has a claim on property mort-
,e.u n'PJ~· hoP?i'i-f: n,.:,. ffl7.e.'>cf>'1cf>il m,e.'J° f°t'>cf> gaged or pledged with it, may sell the property by
/\cf>il 1-01.:,. n(ID.f'lf f.fHt; b~m- "'~hLA n-,.m auction upou giving a prior notice of at least 30
(l',(D• 1.IL ,fA.,.ht.l\(D• l)l\11U-0 l)'}h l\'11\b~m- days and transfer the ownership of the property to
hwl\l\ -,.c;:,. J'l\'l(l "'lilm1cf><I!! (l(IDi\m:,. (l(IDf'lf
the buyer.
f .f H(D•'} f "'I.e.'} cf> '1 cf> il m,e.'J° f "7.1 cf> '1 cf> il '}-fl I.:,.
fltht-:e: l\(1Dil1''i flll\O.•)·',,f:'}'J° (ID-o:,- /\11cm·
5 Relationship between the Bank and the Debtor
f\fl'/tfmc: m,e.'J° l\U--1\-t·~ 1.lL fm"l ftht,,:"?il;t-m,tf ·
(ID,,, 1.-1· 11c ta A.,. 1. n 1-n 1.1:1 n-o 1.·c m•I\- m-ll'I' The sale made in accordance with Article 3 and 4 of
fl(lLl.lD· f'P ;J °l'J°:,. (IDfP/.:,. {\(IDm,(lf;t; f'll\0.:,.',:,. this Proclamation shall be deemed to have been
(ID-(1,f: (l{loo• "'}~tfmc:I\:,• l\11'/f:l.°l ,e.l-l\A1: executed on behalf of the debtor.
?;· fl'l'}h<; fl'll\b~m- (ID'1hA lll\°t'iC °lTf·'I.-,.
fltLlJ 1"-t'P,: 1"-t'>cf>?i f. "c; ~ (IDfPt,.:,. fl'l'}h f-,.1.l'l 1if6P 6. Application of the Civil Procedure code to Auction
'll\b~m-1 (l(IDfDhA "'}f.•f•t.2\(ID ,e.4'mt•A== The Provisions of Article 394-449 of the Civil
fltht•~ 'li.f611' l\,e. f<.:•)·th-Oth.C P''I P'C'¼:,. ~°I
procedure''i Code shall, mutatis mutandis, be ap-
.,. ,_,."7. ., ·)· plicable while the Bank is exercising its power of
selling the mortgaged or pledged property by
'11h fl(ID.f'lf f.fHm·'} f"'/,e.'}cf>/\cf>ll m,e.'J° f"7.1cf>
auction.
/\cf>ll 1-fll.·)· fltht.-~ f(IDil1' P'AIIJ'} flP't.• l\f,
fl"7.fm•Afl.-,. 1.H, n~:,•,h-0,h.C ,..,., P'C'¼.-,. ~°I
Liability of the Bank
....... ,. ....... _... f•f-(IDl\hi:.-,. f.·'};,1.?'l- "11.1'°1
h+.1'C i~r'Jo-ofuiii '
7.
•l-O'l;J·=t:m. -,.,.~ai'I:,- ,e.'it,=J!'PA•1 The Bank shall be liable for any damage it causes to
lll\'11h -,.m.f,t'I:,. the debtor in the process of selling by auction in
violation of the relevant provisions of the Civil
'l'>h nrtu n'P,: n'>cf>?i i f·f-m+"':,.1 n°l'l-O J'f\=J!a,-1
1.·1;,1.?'":f· n(ID-t-1\l\{j: 1i.r,L1:1 o(ID,.2\,,.,. fl'll\b~m• l\f,
Procedure Code specified under Article 6 of this
l\"7..ff.C:(llD• 1-~:,. fl:'Jl\t•.,_-,. •f-mf<I! ,e.1ft;A1: Proclamation.
\
1~· j}'.<f.4 t ..fol.•A ~;,t.-l· ;>11."1 •fvrc; ):j ft11;:,. I!{ <l•'J Iii.f.i '¼·9°· Federal Negarit Gazeta- No. 16 19°' February, 1998-Page 676

i· f OI/ J', 'J cf> ta cf> fl mJ', 9° f Ol/. 'J cf> ta cf> fl 'J -fl l -l- oo .r-ir 8. Powers and Duties of the Registrar
0011;,o. FA"J'J'i ;.,1\/..~•l· l. The Registrar shall have the powers and duties to take
Ii · lo~:,. I,.~ /\ OI/ J', '} cf> ta cf> fl mJ','J° /\ OI/. '} cf> ta cf> fl '}-fl l -l- the necessary measures for carrying out the sale by
f J,1,.:~ "liJ't>J.b h./..~?t'J f"'l.l>',. h.il/..1\1. ~C'J°~9>'f'J
0
auction.
.
foom•(l.~· P'Annc,· ;.,1\/.. ~:,- f.'i l'PA:: 2. If the Registrar, while taking action in accordance
~- fHLU >, '}<f>7t• '} O·il >, '}<f>?t• (/i) ODlPl :,. 1o:~fl,}1,.~ with sub-Article(!) of this Article, finds it necessary
/\Ol/.mM'.m• ,,c'J";1, f ?"/\.fl ;.,J',A oom<f>'J0 h.il/..1\1. to use police force, he may order the police.
rr'i .r1·fm• ~1.v.rr~ ;,•/\.fl'J Ol/1111 f.'fl\A== 9. Cases Pending before Court ,

ii· nr.:c.f.: n.•l· noo :J·f :i• l\f. ill\/\• ·1-Paf·'f Any suit or decree on execution pending before a court
fOI/ f. 'J cf> ta cf> fl mJ','J° f Ol/.'J cf> ta cf> fl 111 l :,. fl 'P il-l-'i n.r 11 prior to the coming into force of this Proclamation may
be terminated upon application by the creditor bank with
•1/\111111 •nh tt00Ati1-~:,- J',u h.'P~ hooK-'i+. n4'--l-
which the property has been mortgaged or pledged and
fl~C.f.: O.·l· floo;t•f-l- l\s.', .r/\ hit <DJ','J° h./..KR'J° +*c'"
the bank may sell and transfer the property to the buyer
mtu h.'P~ ODlPl:,- •nh 'J-Ol+.'J nm&-~ /\ODifT'i
in accordance with this Proclamation.
ff}/\0.·l·H:'J'J 0011:,- /\11,: /\Ol/il-f•I\/\~ J',1·1\A==
0

·,. f·f•7il ;Ji 1 0

10. Repealed Law
The Civil Code (Amendment) Proclamation No. 65/
fr.::,•J,1ld1.C ;Ji°I (t11/7i7iJ') h.'P~ ¢TC xE/rfirii"fi
1997 is hereby repealed.
IHLU h'P:f ·Fli~A::
11. Transitional Provision
Hi· ooif;,11..r .f.:'J;,1.
Any action taken in accordance with the Civil Code
,_,,., h.'P~ hooK-'i-f: n,.:,. f~-l-m-flm.c ;Ji°I (Ol/i'fi'f.r) (Amendment) Proclamation No. 65/1997 prior to the
h.'P~ ¢TC ;i:E/, uv·,ru DDlPl-l- flh/..KR'J° l\s.', .rtt.- effective date of this Proclamation shall be governed by
1-~f-1• lllllJ h.'P~ ODlPl:,- J',ODl,.ft.-:: this Proclamation.
II· ·t·/..KOl/.~-l- fOI/J','i1,.:1=m• ;Ji-)'f 12. Inapplicable Laws
.f>IJ'J'J h'P~ fOl/.:Pl'J Ol/'iT<D-'J° ;Ji°I +/..~Ol/.~-l- Any law which is inconsistent with this Proclamation
h.J','i lID·'J 0
:: shall not be applicable.
13. Effective Date
Ir.· h.'P~ fOI/.R'ifl-l- "LIL
This Proclamation shall enter into force as of the I 9 1h
J',U h'P~ hftit:i• :,]{ <f>'J Iilf.:l 'i·'J°· "f.'J°C: f~'i day of February, 1998.
J',l.f'iA:: Done at Addis Ababa, this I 9 th day of February, 1998.

NEGASO GIDADA (DR.)

PRESIDENT OF THE FEDERAL DEMOCRATIC
,.;c ~;,i' 1.PaPa REPUBLIC OF ETHIOPIA
fh.Jl·f·kf d..1..t-1\'P. ~'l"ht-1\.f'P. I.T-fl/\.h
TlolLPa'J:,•

-OCV'l'i Mr "7·t-"7..f ll.·l·

BERHANENA SELAM PRINTING INTERPRISE