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FEDERAL NEGARIT GAZETA OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA

ht.+;;: ~OO..,.-hTC !:'k

4th Year No. 16'
hJtit hOfl-fS,i;"" Hl. 4>') EI1.1. flh.""r-A-f "--Y..t.I\'e Jt'JPht'()..fJ'e &T1ll\.h
ADDIS ABABA - J9tJt Feb., 1998
f;"'1'11 +mS,r-T 9"hC 11.""mll<t~"" fmfIJ

lP!l&6IiJ,
CONTENTS
h'P~ «hTC 1%/IU!1 '}.9".
Proclamation No. 97/1998
flfl1h flUDJ'"lr (}/\1-fll 111lT flDflJ
Property Mortgaged or Pledged with
h 'P)!:- 1 ~ ~!G'!!
Banks Proclamation Page 674

h 'Pj!- <h,,'c :i1;/Ei 1.1.

PROCLAMATION NO. 97/1998
fllnh floo.(''tr ittH'.('''. fD?~,)4>It4>""C; A PROCLAMATION TO PROVIDE FOR PROPERTY
fD? ') 4>It 4>(). ').fl l-f:-'~ f m fIJ h 'P j!- MORTGAGED OR PLEDGED WITH BY BANKS
fl 'n 1'11' fl'Pit:',c; f.t- .('". fUIJ~ ,)4>It4>().C; fD? ') 4>It4>....
,)lIl'Y.:'}'" ~ ')J;Jf m. t\r,:c,~' fl.')' hit h:"C(1 t\D?itm()')c;
WHEREAS, it takes rather too long a time to obtain
judgement, from courts of law, for sale of property mortgaged
m.lt~m'')9u t\u"lit~.1.9" fD?mfaf.m'
'lIt flfIJ9" lj!-9" floorr~! or pledged with banks and to subsequently have it executed;
fl<hml] ,£,.,11 ooAh
h;"'1'11 f()fl()n-..,.')c; h"'t\f~ WHEREAS, consequently, banking business thriving
9"')'-1' .("n'.:"') 'nll1] flUIJflf.c W''l:'-fm- fmt\.(- 111. on interest payments on loans it provides from public money
fD?"'~~~ fI,)1'11' Ft. I\~ hr,:".~ received by way of saving deposits or acquired from other
"';t~'i flD?It~~!
t\h.I'1'i"7. ~'):"it""""m. hoo:t; y.~:J' t\oott:mC fI,)I'1T sources, has been adversely affected;
t\+t\.('~ f')",'(-C; fAUIJ"" ~'):"it fD?()f!l.rm- lI.(-C:T') WHEREAS, in order to create a conducive environment
fl+4>I\m~. 00')1y,." t\00()11()11 ~')JtTt\"c; t\m~~1: T~ to economic development by enabling banks to collect their
f,)"Iy,." h()t.C flIM\ ~')Jt~lIC t\UIJ.(-l"l t\fI,)h debts from debtors efficiently and thereby promoting a good
lIY."C floof'tr
f,t-()m. fUIJ~,)4>It4>""c; f"7,,)4>It4>(). business culture, it is necessary to amend the Civil Code
')11l-f1'') 1i.('6JJ>fl"7,oo
t\h')' flFt. I\~ ,('t\"'),') concerning the sale of property mortgaged or pledged with
;""f'}'" UIJ?i7iAc; hJtit FC~""
oollC;J:" flUIJfa~,t\'N banks;
NOW, THEREFORE, in accordance with Article 55(1)
flh.:"f'A',r &",('..t.I\'P. JtlfDht,().,(''e &T11t\.h ;"'100') of the Constitution of the Federal Democratic Republic of
"IF')'l,,)4>1.' ~U;(fi) oolPl:" f"7,h.,.t\m- ;J'm'~:A::
Ethiopia, it is hereby proclaimed as follows:
ji' l,6IN: C /) fa
I. Short Title
~IJ h'P:~" "flfl,)h floo,(''tr itt\+,rll ')11l:" fmfIJ h'Pj!-
This Proclamation may be cited as the' 'property
<h'I'C 1.1;/:011.1." "'111\" t\.m4>it ~1"I\A:: Mortgaged or Pledged with Banks Proclamation No. 97/
1998."
,("M. (P,"J
Unit Price 2.30 ~;J kr ;J 11.11)
;,...". -k. ii' a:!!
Negarit G.P.O.Box 80,001
r
',K' ?;r.(f?; &..yo(..t:\ ~;Jt'1' ;J/Lf', '~'I'C: I?; flt,,;.1' I~ <I''}Iilfj fl.,... Federal Negarit Gazeta - No. 16 1901February, I998-Page 675

.-,. 2. Definition
!I' C =\
fill

(}fUJ htp~ m'i\", "1o~i\:"t..C" IP/l\:" nlP/,e.'}.,.".,.i\ In this Proclamation' 'Registrar" means in the case
,}1I~'-"1\,e. ,fl\ oPlI:'-') n'f-oPl\hof- flP/f. '}.,.".,.i\ ,}1I~'-" of mortgage, a Regional or City organ responsible
foPoP1'1-f1 ~I\.c.":'- ,fl\m. fhAA m,e.9" fhof-IP/ htaA
for registering an immovable property or in the
m,e.9" nlP/.'}.,.".,.i\ ,}-fI~:" I\,e. ,fl\ oPlI'-"'} nof-oPl\hof- case of pledge, an organ with the power to witness
f i\ 9"9"" 1: '} oP L~ 9" flP/.,f ~;1"1 m m-C;i\9"9" .,.,:'} fDtf
the signing of a contract of pledge and deposit
.,m.;:
i\"'9"mm. fhAA m,e.'}o fh'f'lP/ htaA
same.
f.' flP/,e.'}.,.".,.i\ m,e.9" fOlf.'}.,.".,.i\
,}-fI~:" flP.f"r i\9"9°"')- 3. Contract of Mortgage or Pledge
fIi!~=tg fr.::'-thllth.C ~"l h'}"''' !Iif.:!:~2li "C; h'}"''' Notwithstanding the provisions of Articles 2851
!:if.:f Y:'} ;11. n. 'iC'}o: fOlI,e.'}.,.".,.i\ mf.9" fDt '}.,.".,.i\ and 3060 of the Civil Code, an agreement
,}1I~:'- ntpi\'-"c; f f" 11l\1'}"11 '1'}h fOO/..c.A 1m- "~m'
.,.C;.-,. authorizing a creditor bank with which a property
"'}-'th.c.A nof-lD(}"ID'1.IL",e.h.c.l\m- O..,.C hIPI\"
has been mortgaged or pledged and whose claim is
,fl\"(} IP/i\m'}.,.ctf l\'Il\~~ID' noPi\m'-" noP f..r
not paid within the time stipulated in the contract,
f.f"ID''} foo/f.'}.,.".,.i\ 1D,e.9" fDt'}.,.".,.i\ ,}1I~'-"
ntht..~ l\oP7I1'C; f'1l\n.:'-":'- oPlI1:,}9" l\11Cm- to sell the said property by auction upon giving a
l\lP/t,IDC 10,e.9" l\(/ol\'f'~: l.IL nlDlfJ f~t..~ 1P/i\;t-lDctf prior notice of at least 30 days to the debtor and to
oPIP~')- ',:-"r taA.,.~n ,}-fI~":,} nll'('c ID-l\- lD'i\1' transfer the ownership of the property to the buyer,
n(}.c.~m' ftp;1 '19":,. oPlJ'!.')' l\oPlD'(}.(-C; f'1l\n.'-""'-" shall be valid.
oP-fl1: ni\oo. "'}-'tt,IDCl\:" l\1P/i:~"I h'1l\~~ID' ;JC
fOO/.,ff.C11D' i\9"9""'-" 'f'.c.~OO/..,:,- f.'i ~tpA;: 4. Claim on Mortgaged or Pledged Property
9.' nlP/,e.'}.,.".,.i\ 1D,e.9" nOO/.'}.,.".,.i\ ,}1I~'-" I\,e. fl\ A creditor bank which, prior the effective date of
foP ,f"r oPlI'-" this Proclamation, has a claim on property mort-
,e.U "tpJ~' hoP"C;1: n.c.:" flP/,e.'}.,.".,.i\ 1D,e.9"fDt'}'" gaged or pledged with it, may sell the property by
".,.i\ ,}1I~'-" noP,f"r f,f"C; ~~m- "'}-'thLA nof-ID auction UpODgiving a prior notice of at least 30
(}"ID' 'lIL JJAof-h.c.l\CD' 11l\1'},,11 '1'}h l\'1l\~~m- days and transfer the ownership of the property to
hIPI\" .,.C;.-,.J'I\.,() tllJi\m'}.,.ctf noPi\m'-" noPf"r the buyer.
.-,.
f ,f" CD''} ftIIJ,e.'}.,.".,. i\ ID,e.9" f 00/.'}.,.".,. i\ '}11~
(Itht..~ l\oP7I1'C; flll\n.')'''1:,}9'' oPlI:" l\11CID'
5. Relationship between the Bank and the Debtor
l\lP/t,IDC 1D,e.9" l\(/ol\"'~ 1.,L flDlfJ ftht..~OO/i\;t-lDctf
oPIP~')' 11C taA.,.~n '},n~1:,} nll'('c 1D'l\- m-i\", The sale made in accordance with Article 3 and 4 of
n(}L~ID' ftp;1 '19"'-" oPIP~'-" l\oPm-(}f;C; f'1l\n.'-""'-" this Proclamation shall be deemed to have been
oP-01: ni\oo' "'}-'tt,IDCl\:" l\1P/f;~"I ,e.'fI\AII executed on behalf of the debtor.
?;, n'1'}hC; n'1l\~~m- oPtahA i\l\Dt'iC "ITf."'-"
6. Application of the Civil Procedure code to Auction
mLU "tp~ "'}.,.,, f."c; ~ oPIP~'-"n'1'}h fof-1.~11if6J.l'
'1l\~~CD''} noPlDhA "'}f..f'.c.2\oP ,e.cJ.mt..A:: The Provisions of Article 394-449 of the Civil
,;, procedure"!Code shall, mutatis mutandis, be ap-
ntht..~ 'li,f6J.1'I\,e. fr.:,).thllthoC r., rc'i'-" ~"I
.f' .c.~ 0If. ., .).
plicable while the Bank is exercising its power of
selling the mortgaged or pledged property by
'1'}h noP ,f"r f JJ"ID''} ftllJ,e.'}.,.".,.i\ 1D,e.9" fOO/.'}.,.
auction.
".,.i\ ,}-fI~')' ntht..~ foP7I1' rAIfJ'} nrt.. I\f.
nOO/.J'ID'An.-,.
l.lt. n~:,.thllthoC r., rc'i'-" ~"I
7. Liability of the Bank
h+.1'C f.~~m-!!f.~i! f,t-oPl\h-t:'-"Y:'};J1."'f ",}1.""I
'111., ;J':r:ID' of-.c.~Dt .,:,. ,e.'i t..T'P A II The Bank shall be liable for any damage it causes to
~, i\ l\ '1'} h of-m,f ct., .-,. the debtor in the process of selling by auction in
violation of the relevant provisions of the Civil
'1'}h (}fLUh'P~ h'}"''' 1 f,t-m+"''-''') h"l'1-o fl\TID-'}
Procedure Code specified under Article 6 of this
y...'};11."';f- noP-tl\l\r.: 1i.f'U;,} OoP.c.2\tJOon'1l\~~ID'I\f.
Proclamation.
l\00/.,ff-C(}CD'1'~'-" n:'JI\.c..,,-,, .t-mfct ,e.11'C;AII \
 .,~. j~{t.4 t..~o".A ~;Jt..1' ;JJI.f'J <I:'I'Cj:j ft11:-r I!{ 4>1Hjf.j '}.9". Federal Negarit Gazeta - No. 16 19u1 February, 1998-Page 676

~. fOlJ~1"''''4>it m~'}o fOlJ.1.,."'.,.it 111~-} oo.r"r 8.
oo1';J0. FAflJ111 ;~,,&.~.}.
Ii' ~~:,./..~ /\OIJ~,.,."'.,. it m~1JD /\"7. ,.,. "'.,. it 111~-}
f fl1/.':~ "li,r6J!>ht.~~'}o fOlJ.~.P,.hit&.I\'l ~CIJD~5P1--1
foom''''.~' FAnnc,' :~"&.~:,. ~fj ~tpA::
~. {lILU t,14>:Z, 10.it t,1"'?t. (ji) ooIP~:" ~:~it-}/..~
/\OIJ.lIJftJ'.m.~,C,}o~ f?'/\.it :'J~A oom"''}o hitt.l\'l
Irfj .r1'fm. ~1J'.IY~ ?'/\.it1 OIJII11~1--"A::
9.
it. W':C.f.: n.')' noo :J-f:" ,,~ it,,/\, '1-~f'1--
fOlJ~1"''''4>it m~1JD fOlJ.1.,."'.,.it 111~:'- ntpit-}c;' n.rll
'1/\111111 'nh hooAi11'~:" ~U htp~ hooK'c;'i: n&,-}
n~C.f.: 0,')- noo:f-f-}"~ .r/\ hit (lJ~1JDht.~RIJD "'*C{1\
nlLU htp~ oolP~:,- 'nh 111~i:1 nm/.'~ /\ooif1'c;'
ff}/\f1.'}'H:1,}o 0011:" /\11': /\OIJit.,-,,/\~ ~1'''A::
Powers and Duties of the Registrar
I. The Registrar shall have the powers and duties to take
the necessary measures for carrying out the sale by
auction.
.
2. If the Registrar, while taking action in accordance
with sub-Article(1) of this Article, finds it necessary
to use police force, he may order the police.
Cases Pending before Court,
Any suit or decree on execution pending before a court
prior to the coming into force of this Proclamation may
be terminated upon application by the creditor bank with
which the property has been mortgaged or pledged and
the bank may sell and transfer the property to the buyer
in accordance with this Proclamation.

'i. f,,'7i~ ~ol 10. Repealed La w

The Civil Code (Amendment) Proclamation No. 65/

fC'::"fl111d1.C ~.., (tII/i'ii'i.r) htp~ <h1'C ~?;/H1£iti1
1997 is hereby repealed.
I1ILtJ htp:~ ''''li~A::
00 if;J11..r .f.:1;J1.
11. Transitional Provision
Hi'
Any action taken in accordance with the Civil Code
~U htp~ hooK'c;''': nt.:" f~-}m11m.C ~.., (OIJifif.r)
(Amendment) Proclamation No. 65/1997 prior to the
htp~ <h1'C ~?;/Iitf.'jrit oolP~-} nht.~~1JD ,,~ ,rlr
effective date of this Proclamation shall be governed by
1'~f'1' {lIlU htp~ ooIP~:'- ~oo/..lr:: this Proclamation.
II' .f- t.~ OIJ.~ -} fOlJ ~fj /..:,:m' ~ -) 1--
12. Inapplicable Laws
~U11 htp~ fOlJ.:J>l1 OIJc;'TCD-1JD
~.., .,.t.~"7.~-} Any law which is inconsistent with this Proclamation
h~fj ~m''}o::
shall not be applicable.
htp~ fOlJ.Rc;'n-} 'UL 13. Effective Date
Ii:'
This Proclamation shall enter into force as of the 191h
~U htp~ hfI'J-t:', :r:~ .,., Ii1£1 ~'IJD. 1.1JDC:fRc;' day of February, 1998.
~rrc;'A:: Done at Addis Ababa, this 19thday of February, 1998.

h.ctit Mlf} fi1-t-} .,., Ii1f1 ~'IJD NEGASO GIDADA (DR.)

I'-
PRESIDENT OF THE FEDERAL DEMOCRATIC
'./e ~;J(\ 1.~~ REPUBLIC OF ETHIOPIA
fJ\.:'-f'kl t..1../..,,'P. .ctlfPh/..f\I'P. I.T11/\.h
T~Il~1:"

{lCV1'i fI/\,.. """"7..' n.'}'

BERHANENA SELAM PRINTING INTERPRISE