1289 (Agri - Product.contract Farming)

I

FEDERAL NEGARIT GAZETTE
OF THE FEDERAL DEMOCRATIC REPUBLIC OF ETHIOPIA
a$ 8= -." F 29th Year No.27

A < A% A 4 c> 1067 8.! I ADDIS ABABA 6th July, 2023
!" # $%&
'() Content
A+, -." /01234/1067 8.! Proclamation No.1289/2023
:"; !" A! ; A<= :>?> Agricultural Production Contract Proclamation
@=A> A+,……………………CD 6E0F2G ..................................................................Page 14,770
A+, -." /01234/

/01234/1067 PROCLAMATION NO. 1289/2023
:"; !" A! ; A<= :>?> A Proclamation to provide for Agricultural

@=A> A+, Production Contracts
:"; !" . >H A= I WHEREAS, it is key in improvements in

J.K;>; LL> E> N! :"; E; product quality, production efficiency, agricultural
A:O- I>Q< =R> 'S : production competitiveness and l linkage to agro-
ITUV =+J W::" E(> @'XI: SY industries is akey pillar to realize structural
=Z[\ economic transformation;
:"; !" A! ] > @C VZ> WHEREAS, it is critical to create market

:"; !"^ > '!I '_C" :"; linkage between agricultural producers and
!"^ > `VabH `Vc%dH Ee processors, value adding agro-industries and larger
`Vf!d A:O I>Q<g E> N! ` J buyers in a sustainable manner by transforming
Chg " ci @( C <<" =K$" them to produce for market;
SY =Z[\
j i k l :"; !" WHEREAS, the existing Laws do not

(> m % n =o '<;:Q adequately address the particular nature of
=Z;p( :"; !" (> =$c! agricultural production contracts, it becomes
'!I !"; !"q'> 'S : V< k necessary to put a system in place that guarantees a
producer-contractor relationship led by a
E(c; stH uUtv W::"; C
comprehensive legal framework and ensures
<<" Vw$" A! E; A<=
knowledge, skill, and technology transfer as well as
:>? n : 'EcK V= j"8
market linkages;
=a" A<w x ZU =Cyz\
I NOW, THEREFORE, in accordance with

C =>:< A>c{ |7 (/) E; () =I Article 55(1 & 6) of the Constitution of the Federal
V`@( q( Democratic Republic of Ethiopia, it is hereby
proclaimed as follows
ÃNÇ êU nU¶T Uz¤È ±.œ.q.Ü *¹þ1

Unit Price Negarit G. P.O.Box 80001
gA 6E0F2G/ Ød‰L ነ U¶T Uz¤È qÜ_R F A 4 qN 1067 ›.M Federal Negarit Gazette No. 27, 6th July, 2023 ……....page 14771
K A>X PART ONE

$J GENERAL PROVISIONS
/. A" "E< 1. Short Title
is A+, “:"; !" A! ; A<= This Proclamation may be cited as the

:>?> @=A> A+, -." “Agricultural Production Contract Proclamation
/01234/1067” t $c< i No.1289/2023”
1. " 2. Definitions
k AC% "! VA$( Z unless the context requires otherwise, in this
<c" s A+, (<.- Proclamation:
// “:"; !"” '@ .( ="^ 1/ “Agricultural Produce” means processed

i! ="^; a,^ Vc" feed, seed,breed; of plant, animal and fish
ED+H E><S E; 8S a"; !" and their product in a raw or produced and
E> N! c%I =U (\ processed form;
1/ “E><S’’ '@ L `H :H KH 2/ “Animal” means cattle, sheep, goat, draft
' `H :=H OH >H 8H " animal, camel, chicken, bee, fish,
H AS'H t E; ! =Q silkworm, pig, any others those that might
V k>! $ \ be domesticated in the future;
/ “E{+” '@ "EH ACLH J%H 3/ “Plant” means cereals, pulses, oil crops,
. .H AH K KH < <"H vegetables, fruits, root crops, spices, forage
=UH J='J=!H s: `@`@ crops, non-banned stimulants, industrial
A&H I>Q< E; = crops, forest & forest products and other
A> E> N! >; > (> cultivated crops;
$ \
E/ “:"; !" (” '@ :"; !" 4/ “Agricultural Production Contract” means
A! E; A<= =` V I: an agreement between agricultural produce
<!! ZU (> V=a: A:% Contractor and Producer that is registered
@( A =aC (\ by an appropriate body to register
contracts,
7/ “A<= ” '@ :"; !"> 5/ “Contractor” means any person with

@'<=I À! " ( VC%H investment & trade license or an eligible
I><=>; >:X wX @( cooperative who enters into a contractual
i! sI j 's" A( agreement with a Producer for agricultural
production;
Cy A( (\
/ “A! ” '@ iq = @( i! 6/ “Producer” means any person who has his
'S ` i^ :"; !" @'!I own holding or rents farm and enters into
À<= " ( VC% A( (\ contract with a contractor for agricultural
production;
F/ “c;, (” '@ :"; !" ( 7/ “Out-Grower Contract” means a kind of
8i ZU A<= iq UO agricultural production contract where the
V=" E; `t :"; !" contractor himself is a producer on his
A! ] " @f' :"; !" holdings and enters into an agreement
withother agricultural producers for
'!I V "C( <!! (\
additional agricultural production.
gA 6E0F2G1 Ød‰L ነ U¶T Uz¤È qÜ_R F A 4 qN 1067 ›.M Federal Negarit Gazette No. 27, 6th July, 2023 ……....page 14772
/ “'`@ (” '@ :"; !" ( 8/ “Centralized Contract” means a kind of

8i ZU A<= Z '!I agricultural production contract where the
iq SiUI( A! > E Cw À! contractor does not have his own holding
" :"; !" @'<=I but enters into an agreement with producer
V "C( <!! (\ while supporting him;
4/ “%@ +>> (” '@ :"; 9/ “MultipartiteContract” means a kind of

!" ( 8i ZU A<= E; agricultural production contract between
A! l wLp( A C> the contractor and the producer with active
support & coordination of a third party
XK E; 'A%" V`;> :";
based on good will of contracting parties;
!" '<=I <!! (\
6/ "AC;Y (” '@ :"; !" ( 10/ “Intermediary Contract” means a kind of
8i ZU A! wX A:% agricultural production contract made by
@( A( A! > t À<= " person on behalf of the producer with the
V "C( <!! (\ contractor;
6// “< C>” '@ A<= ; A! 11/ “Third Party” means a person who provides
=` V¡X :"; !" ( ¢ support in agricultural production contract
wLp( XK VA. A( (\ processes between the producer and the
contractor;
61/ “:8” '@ @:"; !" 'S x 12/ “Input” means improved seed, fertilizer,
V( !". a"H 'LH £I %iH £I pesticide, herbicide, technical assistance,
AI!H u¤ XKH ¥i;>< AJ"¦ financial access, and any agricultural
E; t :"; uUtvg > q\ technology necessary for enhancing
production;
6/ “u¤ XK“ '@ :"; !"> 13/ “Technical Assistance “means any
'!I ¢ V$ic(> E(c; knowledge or technical skills or training
st j$; E; !" AC:t (\ necessaryinthe process of agricultural
production;
6E/ “A:% @( A” '@ A+b> E; 14/ “Appropriate Authority” means the
A+b> @'<w£! V§ >¦ i! Ministry of Agriculture or respective
==g X>¨g j>; © regional organ responsible for Agriculture,
A$( :"; V¤<u" i! upon which the powers and duties are
:"; V=@`( =>:< ª! (\ vested under the provisions of this
proclamation; and its regulations or
directives issued for the implementation of
this proclamation.
67/ “V¤<u"” '@ :"; V¤<u" (\ 15/ “Ministry” means the Ministry of
Agriculture
6/ “” '@ I 16/ “Region” means any region referred to
C=>:< A>c{ under Article 47 of the Constitution of the
47 =I '>(! Z>H A < Federal Democratic Republic of Ethiopia
A% `' A<L ">H XL+ A<L "> and includes Addis Ababa City
if! \ Administration, Dire Dawa
Administration. ;
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6F/ “A(” '@ '>(! w.O A( i! 17/ “Person” means a natural or juridical
: A( = A$( A (\ person;
6/ s A+, >X q C@®( X>¨ 18/ under this proclamation, an expression in
e>! q if! the masculine gender includes the
feminine.
. w¯V A> 3. Scope of Application
is A+, '>(! A<= H A! H This Proclamation shall be applicable on any

°< E; A:% %@( A i w¯V contractor, producers, third party and
iZ; appropriate authority..
K N@ PART TWO
:"; !" ( =± ²S Ac I; ia FORMATION AND CONTENT

E. Ac I; X"X" A:% 4. Initiation and Negotiation
// :"; !" ( A=A I V³!I( 1/ The formation of agricultural production

A<= i! A! Vc"( contract can be initiated through contract
( ²S =± Z> i \ offer by either the Contractor or the
Producer.
1/ :"; !" ( =± ²S DNK 2/ The initial offer shall be in either writing or
i! c" i oral.
/ ( =± ²S !"z> 8i\ +>H 3/ Contract initial offer may include
A`¥w Nq>H =$>>H . I´>H information like produce type, price, terms
x C >H '`' =a>>H of payment, quantity, quality standard,
'<I`R ¦q>H V<w: XK>H deadlines, storage, place of produce
> E; t ++ (S handover, kind of support to be provided,
tracking and any other information
:µ V k =I´g if!
necessary to support all parties to make
decision.
E/ s A>cD >U< A>cD (/) C@£( 4/ Notwithstanding the provisions of Sub-
RU"! '>(! =>:<q ª! i! Article (1) of this Article, any government
=>:<q Z ' X", institution or non governmental
:"; !" (> A<=^ :>·# development organization may create an
'<f.H ²S 'JI i! '=p awareness, initiate and facilitate an offer .
i
7/ (k ²S cI@ ++i C> (k> 5/ The offeree shall be given sufficient time to
Nqg A:%¸ @=IL & x review and understand the terms of the
A$( iC%\ contract.
/ :"; !" ( X"X" ¢ ++i 6/ Both parties may be assisted by a third

CU °< C> EC· I: p( party in the process of agricultural
i production contract negotiations.
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7. :"; !" ( AaC´´ 5. Agricutural Production Contract Form
// :"; !" ( '±' Nq 1/ An Agricultural Production Contract shall

DNK =a³ A@ be made in writing using simple and
standard language.
1/ ++i CU :"; !" ( p(> 2/ The parties may draw up their contract in
A>X i! ` i Z[ ª>ªg one or more languages, one of which is the
ab i k\ A>Q :> k j working language of the Regional S tate.
ª>ª =Z> A@
/ (k À>X i Z[ ª>ªg a,^ 3/ Where the contract is drawn in more than
"! m À (k w£= one language, the version with the
j ª>ª Ch iZ; Region`s working language shall be the
governing in case of discrepancy.
E/ :"; !" ( R>< < 4/ The Contract shall be attested by at least

!<O =wI! A@\ `!<O three witnesses, one of whom shall be a
A>Q A:% @( A i Z> representative of the appropriate authority.
iC%
7/ :"; !" ( ( @==C 5/ The Agricultural Contract shall be registered

j> A$( A ==C by the appropriate document Authentication
A@ and Registration Authority.
/ (k `:"; !" ( X>¨g (¹ 6/ Where the text of the contract refers to

t A > V$J< Z> $c documents and texts other than the
A `wI= (k Jv " (k provisions of the contract, such documents
A Z( ( @==C j> shall be attached to the signed copy of the
@A$( A =JI A@%p( contract for registration upon submission
to the appropriate document`s
authentication and registration authority.
. :"; !" ( ia 6. Content
:"; !" ( R>< V`@( ia An Agricultural Production Contract shall at

UI( iC%- least include the following:
// A! E; A<= ºk <! E; 1/ The names and addresses of the Producer

AX ±H and the Contractor;
1/ A<= : A! ", `Z 2/ Investment and business license reference

I><=>; >:X wX -."H number, if the contractor is a private
producer company;
/ A<= =>:< ' X", `Z 3/ An establishment regualtion and trade
ªª= : E; >:X wX\ license, for public owned enterprise
contractors.;
E/ A<= sI j 's" Z> 4/ Registration Certificate, for cooperative
A( Cy !<" Ic\ contractors;
7/ A! iq %@# 'IC) 5/ For producers, Land Owner Certificate or

!<" Ic i! = legal land rent contract ;
» i (\
/ :"; !" (k 8 'H 6/ The objective of the contract;
F/ 'S( i! ' R ¦q <¥; 7/ Agricultural Production site and its

A+S¼ i! V %( ·H boundaries or quantity of agricultural
produce;
/ A! E; A<= =; :½qg H 8/ Rights and Obligations of the Producer and
the Contractor;
4/ !" 8i\ . ; =$> =:@) 9/ Type, quality and quantity of agriculture
=<w"^ H produce, and descriptions of unit of
measurement;
6/ :8 E; !" + ASA>H 10/ Pricing mechanism of agriculture produce

and input;
6// '¾ j"8; ¹ A_¥w>H 11/ System of transportation and related costs;
12/ Types of technical supports;

61/ u¤ XK 8i^ H
6/ E> A:%z AL E; AE!O 13/ As required legal provisions related to
= %@#> =@`z X>¨g H Breeder` and intellectual property rights;
6E/ (k E>Liw£! 'XI: V k ÀJ! 14/ Provisions specifying the causative events
i Z[ !>^ H that can be considered as force majeure;
67/ ++i CU ¿ i! »g 15/ Provisions on inheritors or substitutes of

=>; :½q> <@'< @K V=@`z contracting parties and transfer of
X>¨g H obligations & rights;
6/ :"; !" (k £>^ VÀi x\ 16/ The duration or validity date of the contract,
<@V±± i! <@Vc"\ and conditions as well as procedures of
<@VªI. Nqg ; j-j"8 agricultural production contract renewal,
amendment, alteration or terminations;
V=@`z X>¨g H
17/ Dispute resolution mechanisms;
6F/ A@=:%%^ > =K =>C H
6/ !" (k =AI !"z . ; 18/ Price amendments when quality & quantity
=$> =c< i! =f=" m of the agricultural produce exceeds or
drops below agreed quantity and standards
Rw$" + j '<`
respectively; and
<@V I:H
64/ :"; !" (k w£= x; 19/ The date and place of signature by the
¦q parties to the Contract.
K < PART THREE
:"; !" ( 8i^ H ++i CU TYPES OF AGRICULTURAL PRODUCTION

=; :½qg CONTRACTS, RIGHTS AND OBLIGATIONS
OF PARTIES
F. :"; !" ( 8i^ 7. Types of Agricultural Production Contracts
s A+, :"; !" ( 8i^ According to this Proclamation, the following
V`k ;p(- are the types of Agricultural Production
Contracts:
// c;, (\ 1/ Out-grower Contract;

1/ '`@ (\ 2/ Centralized Contract;
/ %@ +>> (\E; 3/ Multipartite Contract; and
E/ AC;Y ( 4/ Intermediary Contract.
. A<= =; :½qg 8. General Rights and Obligations of the

Contractor
// A<= V`k =^ iUdq- 1/ The Contractor shall have the following
rights:
²) A$( :8 E; u¤ XK a) To enter into the production farm of the
=I '!I j ( :% producer to follow up whether the
E IC <@=Z[ A! > '!I production process is undergoing
according to provided input and
¦q j A8 =`q\
technical support;
@/ :"; !" (k =@`( ¦qH b) as indicated in the agricultural
xH !"z> . ; =$> AI:Á production contract to receive
=I`\ agricultural produce at agreed place &
time, confirming its quality and
quantity;
/ (k $cA( =I :"; c) to reject any substandard product
!"> . V<$- :8^ brought from the producers and make
AJ"¦ A! . I´> n him accountable provided that he
:"; !" c" @=I`; supplied the necessary inputs,
according to the contract, that ensure
A! > : $& 'XI:
agricultural produce quality.
1/ A<= V`k :½qg iUdq- 2/ The Contractor shall have the following
obligations:
²) A' =< I><=> a) To submit an investment and trade

E; >:X wX i! sI j license or cooperative registration
's" A( @( i! certificate or public enterprise
establishment regualtion in areas of his
=>:< ' X", =Z[>
engagement;
VI:. ªª= : 'JI\
@) :"; !" (k =I A:% b) to ensure the delivery of input and

p(> :"; :8^ E; u¤ technical support to the Producer as
XK @A! 'JI\ agreed in the agricultural production
contract;
) A! =I´ E> i ; c) to track and monitor the producer to

u`¤ XK 'XI:\ compile the required information are
documented;
=) :"; !" (k =I K d) effect payment to the Producer at time
Jz =w£!\ agreed in the Agricultural Production
Contract;
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) :"; !" ( =I @'<=I e) submit a competency of certificate

- <@=Z[ `V¤<ud i! A:% issued by the Ministry or an
@( RO 'IC) A"Â appropriate Authority that assures his
'JI V \ "" Aw¯£º competence to engage in agricultural
V¤<ud == iC@¯ production contracts; particulars shall
be prescribed in the Ministry
Directive.
4. A! =; :½qg 9. Rights and Obligations of the Producer
// A! V`k =^ iUdq- 1/ The Producer shall have the following rights:
²) À<= (k =I :8 E; a) to get input and payment from the
K ':y\ contractor based on the contract;
@) :"; !" (k =I b) to confirm the type, quality and quantity

À<= VA$(> :8 8iH of agricultural input provided by the
. ; =$> Jz AI:Á Contractor at delivery and comply to
=I` E; =$c!\ agreed applications;
) VI`(> :8 . ; =$[> c) to get support from a third party or an

'IC. ¢ °< C> i! appropriate authority in assuring input
A:% @( A XK\ quality and quantity;
=) u¤H<$;; !" AC:t d) to get technical, training and advisory

À<= =c support from the contractor.
1/ A! V`k :½qg iUdq- 2/ The producer shall have the following

obligations:
²) (k =I :"; j J> a) Enter to production activity following

`t '!I :%" =:%\ the appropriate agricultural season
indicated on the contract;
@) (k; !I-²S¸ =I Jq b) To carry out the necessary seasonal
'!I < g '`;>\ agricultural production activities,
according to the contract;
) A<= XK =I´ =; c) With support of the contractor to
=<$\ document the necessary information;
=) !" . V±Wk; > d) take appropriate measures that enhance

Vc> :% > '`;>\ quality of agricultural produce and
minimize losses;
) (k =I !"z> C@®( ¦qH e) ensure delivery of agricultural produce
xH . ; =$> AI:Á @A<= at agreed place and time with the
'<I` quantity and quality specified in the
agricultural production contract.
6.:";
6.:"; !" +H K a½ E; A`¥w 10. Price, Mode, and Term of Payment of
Agricultural Produce
// ++i CU (k V_w(> :"; 1/ The parties shall clearly state, in the
!" + '!I E; ·', ¹g > contract, the price of an agricultural
i<;k produce, cost of production, and other
related costs.
1/ ++i CU :"; !"z> $J 2/ The contracting parties shall clearly specify
+ i! $ + K < :{ either the total or unit price of the
'<w" A@%p( Agricultural Produce.
/ s A>cD >U< A>cD (1) CC( 3/ Without prejudice to Sub-Article (2) of this
E> $c ZU ( `C@®( . Article, the parties shall state the basis for
I´ =c< i! =f=" m price revision in a causative event where
Rw$" + j '<` (k quality of the agricultural produce either
:{ '<c=. A@%p( become below or above of what has been
agreed in the contract.
E/ ++i CU :"; !"z> + 4/ The parties shall clearly specify mode and
A`¥w E; K x :{ '<c=. time of payment for the price of the
A@%p( agricultural produce.
7/ :"; !" ( !"; :i 5/ The parties may agree to renegotiate on

:>?> a & @'IC. !" price when escalations occur at time of
" x !" C + ( agricultural produce delivery, above or
`C@®( i `K i! J @ E> Z below the price indicated on the
N@z ++i CU X"X" + agricultural production contract,
considering equity and long-term interest
'±± " i k "d
of both parties. particulars shall be
V¤<ud == iA;
prescribed in the Ministry Directive;
/ A<= ( $cA( x (<. 6/ As indicated on the Agricultural Production
I`(> !" + X!" c;W Contract, the Contractor shall deposit
VZ> :8 +; cX @A! payments, through the nearest bank
A$ JX= K @ c;W 'XI: account of the Producer or through eligible
@A! AJ R( VCY %> <º money transfer, after receiving the
`w( %> ¢S o i! E(J; agricultural produce while deducting price
of input, and other advance payments made
%@( C>a A< @ o CR
to the Producer.
'XI: A@
6/. :"; !" =$>> <@=A> 11. Specifying Quantity of Agricultural Produce
++i CU - The parties shall:
// :"; !"z> A'i =$>; =@» 1/ clearly determine average quantity and units
:{ =A> A@%p(\ of measurement of the agricultural
produce;
1/ ( `=@`( !" =$> @=c< 2/ clearly determine phenomena that might
i! @=f=" =><Ã Z[ V k cause increase or decrease of quantity of
<^ ; ( w¯V I´ :D agricultural produce to either above or
X>¨g (k (<. ' A@%p( below the agreed quantity and effects
"d V¤<ud == iA;\ thereof on the enforcement of the
agricultural production contract. particulars

shall be prescribed by the Ministry
Directive;
/ :"; !"z =$>; =@»( & 3/ If parties fail to clearly specify the quantity
Nq a"O c=$ E> Z and measurement unit of the agricultural
X"X" @=A> i k produce, they can decide upon
negotiations.
61. :"; !" . > <@=A> 12. Specifying Quality of Agricultural Product
// ++i CU !" . I´; 1/ The parties shall clearly specify verification
'IC) =>C > :{ '<c=. mechanisms for agricultural produce
A@%p( quality standards.
1/ s A>cD >U< A>cD (/) CC( 2/ Without prejudice to Sub-Article (1) of this
E> $c ZU @!" . = Article, the parties shall clearly specify
=><Ã Z[ V k <^ ; ( phenomena that might cause the deviation
wÄV I´ :{ X>¨g (k of quality of the agricultural produce from
the agreed quality and effects thereof on
(<. = A@%p( "d
the enforcement of the agricultural
V¤<ud == iA;
production contract. particulars shall be
prescribed in the Ministry Directive;
/ :"; !" ( ++i CU E> 3/ The agricultural production contracting

A:%z '_xH !" . parties shall clearly specify packaging,
=:@) I´g > E; '_x ¹g > labeling standards and expenses of
'> E> V_K> !" (k "" packaging, if any, and the party that shall
bear related;
'<c=. A@%p(
6. :8 AJ"¦; + ASA> 13. Input Supply and Payment
// A<= Vc"(> :8 8iH 1/ The parties shall clearly specify, in their
. ; =$>H " xH ¦qH agricultural production contracts, the type,
'¾ =>CX; + :{ :"; quality, quantity, time and place of
delivery, mode of transportation, and price
!" (k i '<c=. A@%p(::
of input to be provided by the Contractor.
1/ s A>cD >U< A>cD (/) C@£( 2/ Notwithstanding the provisions of Sub-
RU"! A<= @A! Vc"( Article (1) of this Article, the price of the
:8 + Jz A%R C `VCY input to be provided by the Contractor
=SSi :8 + =@. @!:: shall not be higher than the prevailing local
market price of same or similar input at
time of delivery.
/ A<= @:8 =:¾; t fg 3/ The Contractor may pay in advance cash or
VZ> . C>a i! t through other mode of payment to the
=w A' Æ JX= K `K Producer for input purchase or other
expenses; such payment, however, shall
i \ ZU! =$[ !" (k
not be higher than the agreed total price of
`=@`( A$ i !" + =@.
the agricultural produce.
@!
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6E. :"; !" " 14. Delivery of Agricultural Produce
++i CU :"; !"z> '<I`R The parties shall specify place and time of
¦q\ xH '¾ 8i; ¹ A_¥w> delivery, mode of transportation, and the party
=A> iC%p+ that covers the cost of delivery of the
agricultural produce in their Contract.
67. =^ >; :½qg > <@'< @K 15. Transfer of Rights and Obligations
:"; !" (k X>¨g E> $- Without prejudice to provisions of the

Z( ++i CU - agricultural production contract, parties:
// (k X>¨g VC?+p(> =^ 1/ shall not be deprived to transfer their rights
'< @K Ai`@`k!\ stated subject to contract terms;
1/ (k X>¨g VCÇp(> :½qg 2/ shall only transfer their obligations under
@'< @K V@( (> ++i the contract upon the consent of the other
C> wX Cy (\ party;
/ s A>cD >U< A>cD (1) CC( 3/ According to the provision of Sub-Article (2)
=I :½q> '< @K <!! @ of this Article, the transfer of obligation
j> A$( A o =w£! shall be done through responsible
A@ appropriate authority.
6.'Iq
6.'Iq <@':y 16. Acquiring Incentives
:"; !" ++ =X> +<;>H Contracting Parties may acquire incentives like
=$ A C <<"HÈqH :" K insurance, wide scale of market linkage, capital,
JS i! EÉiq xH E"± =Sg tax holiday or relief, farm machinery support
XK E; t 'Iqg °< C> and other incentives from a third party.
= p( i "d V¤<O particulars shall be prescribed by a Regulation
of the Council of Ministers.
!" # > iA;
K A PART FOUR
:"; !" ( :½qg > = NON-PERFORMANCE OF CONTRACT

< @= OBLIGATION
6F. ÀJ! i Z ©i 17. Force Majeure
// ÀJ! i Z ©i %k V k 1/ The following unexpected phenomena canbe

X>C <^ V`k> $ - considered as force majeure:
²) < (> c.q `VA A! a) serious illness of the producer, if he

o {[ s=!\ himself is responsible to perform
activities;
@) `=$[ @w i! A ; Hl"K\ b) extreme high or low rainfall, flood;
) ! J i! `K ºc \ c) extreme low or high temperature;
=) ES A \ d) fire accident;
) = =>c.c. i! ;L i! e) earthquake or landslide;

= =>_ \
gA 6E0F23/ Ød‰L ነ U¶T Uz¤È qÜ_R F A 4 qN 1067 ›.M Federal Negarit Gazette No. 27, 6th July, 2023 ……....page 14781
I) À! :@A¸ f' {EU f) man-made accident affecting more

Vw." A( A W A \ E; people including the producer;and
A) `-.." i Z E><S i! g) extreme animal or crop disease or pest

E{+ Wq; %i IIWY <^ outbreaks.
;p(
1/ s A>cD >U< A>cD (/) aIad 2/ Causative events listed under Sub-Article
ÀJ! i Z ©i @( AQ (1) of this Article shall be considered to
V k ( $cA( !" 8i constitute force majeure where such
i <`k L =$> A! causative events prevent a Producer from
C%(> :½q (k =I =w®! undertaking his obligations, if they are
confirmed by the two parties’ agreement or
'< @( <@=Z[ N@z CU
verified by the appropriate authority.
<!! i! A:% %@( A
IC$ `Z (
/ :"; !" ( ++i CU 3/ Parties to the Agricultural Production

A<= ; A! o ÀJ! i Contract may specify the causative events
Z ©i %k V k <^ > E; that can be considered as force majeure
(^p(> :"; !" ( p( i and the effects thereof.
@iÊ <c!§ i k
E/ s A>cD >U< A>cD (/) i! (1) 4/ In occurrence of force majeure under Sub
C@£( `:"; !" ++i CU Article (1) or (2) of this Article, the party
ÀJ! i Z ©i w$I x shall forthwith notify the other party and
A>Q @ ( C> ([ 'SJ take reasonable measures to mitigate the
A@ "d V¤<ud == adverse impact. particulars shall be
determined by the Ministry Directive.
iA;::
7/ :"; !" (k> @=w£! ÀJ! 5/ The Parties may specify the party that bears
i Z ©i À x ++i CU the cost of input and other expenses for the
:8 E; t ¹g > A_¥w> amount lost in the agricultural production
contract.
=@` ( p( z iC%::
6. =X> +<; 18. Insurance
:"; !" ( ++i CU - Parties to Agricultural Production Contract

may:
// ÀJ! i Z ©i (k E>Liw®! 1/ Agree to obtain insurance against force

@V " A g =X> +<; W¥> majeure that prevent a party or the parties
@=:% <'º i k\ to the contract from undertaking his/their
obligations;
1/ :"; !" ( ++i CU 2/ Where the parties to the agricultural

=X> +<; W¥> @':y <'º production contract agree to obtain
E> Z <!!qp( =X> AI¦> insurance, they shall specify the party
K =w®! :½q V< (> C> liable for payment of the premium;
=@ A@%p(\
/ s A>cD >U< A>cD (1) C@£( 3/ Notwithstanding the provisions of Sub-
RU"! < C> =X> AI¦> K Article (2) of this Article, the parties may
E> Ww> <'º i k agree to get their insurance premium from
a third party.
K A!< PART FIVE
:"; !" ( a=>H (k> <@'±± DURATION, RENEWAL OR ALTERATION;

i! <@=c" E; (> <@'ªI. AND TERMINATION
64. :"; !" ( a=> 19. Duration of the Agricultural Production

Contract
// ++i CU (k V_w(> :"; 1/ Parties shall state the duration of the
!"> A= I a½ %C;a =o contract taking into account the nature and
( a=> i<;k production method of the agricultural
produce covered in the contract;
1/ s A>cD >U< A>cD (/) C@£( 2/ Notwithstanding the provisions of Sub-
RU"! %p( m :"; !" Article (1) of this Article, the Ministry may
( a=> @V<wp( :"; determine, by a Directive, the duration of
!"^ V¤<ud V( == Agricultural Production Contract for
A> i :: agricultural produces with specific nature
. :"; !" (k> <@'±± i! 20. Renewal or Alteration of the Agricultural
<@=c" Production Contract
++i CU V`k !>^ (k> Parties to the Agricultural Production Contract
@'±± i! @=c" i k- may agree to renew or alter their contract:
// :8 i! !" + ( J 1/ When either input or agricultural produce price
`VC=( =@. i! '< m is beyond the anticipated price at the time of
w$I E> Z E; is! A:% %@( concluding the Contract and the same is
verified by the appropriate authority;
A IC$ E> Z\
1/ :"; !" 8i; =$> @=@. 2/ When Parties agree to change the type and
++i CU <!! U"\ quantity of agricultural produce;
/ :"; !" ( ++i CU 3/ Where the Parties to the contract agree to
( p(> @'±± i! @=c" renew or alter their contract, all formal
Vc" DNK .Ë <'º E> Z requirements for the formation of the
s A+, <@( ==<I c=§ Contract under this Proclamation shall
apply to effect the renewal or alternation of
X>¨g wÄV iZ;k
the contract.
/. :"; !" (> <@'ªI. 21. Termination of the Contract
// ++i CU (k> 'ªI. <@V< p( 1/ Parties may stipulate the specific situations
Nqg :{ '<w" A@%p( under which each party is entitled to
terminate the Contract.
1/ s A>cD >U< A>cD (/) CC( 2/ Without prejudice to provisions of Sub-
E> $c ZU (k> A>Q C> Article (1) of this Article, a Party to the
@<!! @'ªI. w@C E> Z ( agricultural production contract that
=ªI§ !> ( ++i C> decides to terminate the contract shall
i @ IA( L =Y S =w compensate the other party for the damage
arising from the termination of the
A@\S <> =@` V¤<O
contract; Calculation of compensation shall
!" # > VA> iZ;
be set by the Council of Ministers
Regulation.
K <X< PART SIX
A@=:%%> <@=Kq DISPUTE RESOLUTION
1. @=:%% À Awq ¢ 22. Dispute Resolution Procedures
`(k X>¨g i! `(k " a Parties to agricultural production contract may
++i CU =` A@=:%% Rw$" resolve dispute through the following resolution
++i CU - mechanism:
// =³= A@=:%%z> X"X" =Kq 1/ The parties shall first settle their dispute
A@%p(\ amicably between themselves through
negotiations;
1// A@=:%%z> X"X" =Kq k 2/ Where the Parties fail to reach an amicable
A:% @( A i! N@z settlement by themselves through
CU V=I. C@ C> :: negotiations, they may resort to mediation
LY i! W!:; <'º i k\ by a third party or settle the matter by
arbitration;
/ A@=:%%z> :: i! W!:; 3/ Where the Parties fail to resolve the dispute
@=Kq k E> Z Lm> @' through mediation or arbitration, they may
j> @( K"X # =@z lodge a complaint to a court of law with
i k appropriate jurisdiction.
K A% PART SEVEN
:"; !" ( A+, A<wÄV A DUTIES AND POWERS OF EXECUTORS OF

j>; :%" THE PROCLAMATION FOR AGRICULTURAL
PRODUCTION CONTRACTS
. V¤<ud i! A:% @( 23. Powers and Duties of the Ministry and
A j>; :%" Appropriate Regional Body
// V¤<ud s A+, CC( A:% 1/ The Ministry of Agriculture shall have the
:"; !" (> V=@` following powers and duties regarding
V`k j>; :% iUdq- agricultural production contracts:
²) @:"; !" (t A<w x Z[; a) Develop and distribute Directives and

s A+, X>¨g $c templates of agricultural production
contracts as prescribed under this
==g > E; ½ (t >
Proclamation;
Aa,^ A )\
gA 6E0F23E Ød‰L ነ U¶T Uz¤È qÜ_R F A 4 qN 1067 ›.M Federal Negarit Gazette No. 27, 6th July, 2023 ……....page 14784
@) :"; A! ] E; A<= ] b) Create linkages among agricultural

=` :>? E> w$" <% \ producers and contractors;
) @A! ] H @A<= ] E; @< c) Provide advisory services to producers,

C> !" AC:t^ > iA\ contractors and third parties;
=) `:"; !" (t V d) Facilitate the resolution of disputes

A@=:%%^ > A:% % p( s arising from agricultural production
A+, X>¨g =I Vwz> contracts in accordance with the relevant
Nq =H provisions of this Proclamation;
) :"; !" (t > <+(H e) Creates awareness on agricultural

A=Ì Nq> iw. H <% \ production contracts, provide fertile
environment, play a coordination role;
I) A:% p(> =aÇ (t >; f) Register agricultural production

A > ii·\ contracts and documents of relevant
records;
A) AC (> :"; !" A! ; g) Organizes or nominates a national

A<= :% > V<%" j coordination department responsible
for agricultural production contract
K iAi' i! ,
activities.
1/ s A>cD >U< A>cD (/) i 2/ In discharging its powers and duties under
$c> :% @'<w£! V¤<ud Sub-Article (1) of this Article, the Ministry
`t A:% p( E; shall cooperate with and coordinate other
=>:< A E> N! relevant Federal and Regional government
=>:<q Z[ ' X",^ " and non-government agencies.
"; J>, iA ::
/ V¤<ud E>
A<w xz j>; 3/ The Ministry may, as appropriate, delegate
:% z> A:% p( ; its powers and duties to other relevant
=>:<q A (; A. i :: federal and regional institutions.
E/ s A>cD >U< A>cD (/) `$c 4/ In addition to the duties provided under
f' I´ :";> A<=^ Sub-Article (1) of this Article, the
j> A$( A E> k appropriate regional body responsible for
f% Nq is> A+, @'<w£! agriculture development may institute
I´ : i :: additional duties by law for the best
implementation of this Proclamation.
7/ s> :"; !" ( A+, 5/ Each Regional State may designate an
@'<w£! V A:% @(> appropriate regional body that executes
A =>:< Ai! i this Proclamation of the agricultural
production contract.
K <!>
PART EIGHT
m m X>¨g MISCELLANEOUS PROVISIONS
E. wÄV @( : 24. Applicable Law
s A+, %_w[ L i KÍ" Provisions of the Civil Code shall be applicable
: X>¨g w¯V iZ;k to matters not provided in the provisions of this
Proclamation.
7. wÄV 'iU p( l 25. Inapplicable Laws
s> A+, X>¨g VI> ';p(! No law or customary practices shall, in so far as
: i! 'L AA " A+b =@`z they are inconsistent with this Proclamation,
L i wÄV AiU p(! have effect on matters provided by this
Proclamation.
. >; ==g > '( j> 26. Power to Issue Regulations and Directives
// V¤<O !" # @s A+, Aw¯£! 1/ The Council of Ministers may issue
V<w >¦ > i Regulations necessary for the
implementation of this Proclamation.
1/ V¤<ud is> A+, E; s A>cD >U< 2/ The Ministry may issue Directives necessary
A>cD (/) =I V§ >¦ > for the implementation of this
@'<w£! ==g > Î Proclamation or Regulations issued
pursuant of Sub-Article (1) of this Article.
F. A+b V£; x 27. Effective Date
is A+, q This Proclamation shall enter into force upon
` c> ³!O £; iZ; the date of publication in the Federal Negarit
Gazette.
Done at Addis Abeba, on this 6th day of July,

A < A% A 4 c> 1067 8.!
2023.
s@"J a(½ SAHLEWORK ZEWDE
I ½ PRESIDENT OF THE FEDERAL

ÏL> DEMOCRATIC REPUBLIC OF ETHIOPIA

1289 (Agri - Product.contract Farming)

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I    

 a$ 8= -." F 29th Year No.27

A+, -." /01234/

:"; !" A! ; A<= :>?> A Proclamation to provide for Agricultural

:"; !" . >H A= I WHEREAS, it is key in improvements in

:"; !" A! ] > @C VZ> WHEREAS, it is critical to create market

j i k l :"; !" WHEREAS, the existing Laws do not

I     NOW, THEREFORE, in accordance with

ÃNÇ êU nU¶T Uz¤È ±.œ.q.Ü *¹þ1

K A>X PART ONE

/. A" "E< 1. Short Title

is A+, “:"; !" A! ; A<= This Proclamation may be cited as the

// “:"; !"” '@ .( ="^ 1/ “Agricultural Produce” means processed

7/ “A<= ” '@ :"; !"> 5/ “Contractor” means any person with

/ “'`@ (” '@ :"; !" ( 8/ “Centralized Contract” means a kind of

4/ “%@ +>> (” '@ :"; 9/ “MultipartiteContract” means a kind of

. w¯V A> 3. Scope of Application

is A+, '>(! A<= H A! H This Proclamation shall be applicable on any

K N@ PART TWO

:"; !" ( =± ²S Ac I; ia FORMATION AND CONTENT

// :"; !" ( A=A I V³!I( 1/ The formation of agricultural production

/ :"; !" ( X"X" ¢ ++i 6/ Both parties may be assisted by a third

7. :"; !" ( AaC´´ 5. Agricutural Production Contract Form

// :"; !" ( '±' Nq 1/ An Agricultural Production Contract shall

E/ :"; !" ( R>< < 4/ The Contract shall be attested by at least

7/ :"; !" ( ( @==C 5/ The Agricultural Contract shall be registered

/ (k `:"; !" ( X>¨g (¹ 6/ Where the text of the contract refers to

. :"; !" ( ia 6. Content

:"; !" ( R>< V`@( ia An Agricultural Production Contract shall at

// A!  E; A<=  ºk <! E; 1/ The names and addresses of the Producer

1/ A<=  : A! ", `Z 2/ Investment and business license reference

7/ A!  iq %@# 'IC) 5/ For producers, Land Owner Certificate or

/ :"; !" (k 8 'H 6/ The objective of the contract;

F/ 'S( i! ' R ¦q <¥; 7/ Agricultural Production site and its

6/ :8 E; !" + ASA>H 10/ Pricing mechanism of agriculture produce

12/ Types of technical supports;

67/ ++i CU  ¿ i! »g 15/ Provisions on inheritors or substitutes of

K < PART THREE

:"; !" ( 8i^ H ++i CU TYPES OF AGRICULTURAL PRODUCTION

// c;, (\ 1/ Out-grower Contract;

. A<=  =; :½qg 8. General Rights and Obligations of the

²) A'  =<  I><=> a) To submit an investment and trade

@) :"; !" (k =I A:% b) to ensure the delivery of input and

) A!  =I´ E> i ; c) to track and monitor the producer to

) :"; !" ( =I @'<=I e) submit a competency of certificate

4. A!  =; :½qg 9. Rights and Obligations of the Producer

@) :"; !" (k =I b) to confirm the type, quality and quantity

) VI`(> :8 . ; =$[> c) to get support from a third party or an

=) u¤H<$;; !" AC:t d) to get technical, training and advisory

1/ A!  V`k :½qg iUdq- 2/ The producer shall have the following

²) (k =I :"; j J> a) Enter to production activity following

=) !" . V±Wk; > d) take appropriate measures that enhance

7/ :"; !" ( !"; :i 5/ The parties may agree to renegotiate on

++i CU - The parties shall:

agricultural production contract. particulars

/ :"; !" ( ++i CU E> 3/ The agricultural production contracting

6. :8 AJ"¦; + ASA> 13. Input Supply and Payment

6E. :"; !" " 14. Delivery of Agricultural Produce

:"; !" (k X>¨g E> $- Without prejudice to provisions of the

K A PART FOUR

:"; !" ( :½qg > = NON-PERFORMANCE OF CONTRACT

6F. `AJ!  i Z ©i 17. Force Majeure

// `AJ!  i Z ©i %k V k 1/ The following unexpected phenomena canbe

I

a$ 8= -." F 29th Year No.27

:"; !" A! ; A<= :>?> A Proclamation to provide for Agricultural

:"; !" . >H A= I WHEREAS, it is key in improvements in

:"; !" A! ] > @C VZ> WHEREAS, it is critical to create market

j i k l :"; !" WHEREAS, the existing Laws do not

I NOW, THEREFORE, in accordance with

K A>X PART ONE

/. A" "E< 1. Short Title

is A+, “:"; !" A! ; A<= This Proclamation may be cited as the

// “:"; !"” '@ .( ="^ 1/ “Agricultural Produce” means processed

7/ “A<= ” '@ :"; !"> 5/ “Contractor” means any person with

/ “'`@ (” '@ :"; !" ( 8/ “Centralized Contract” means a kind of

4/ “%@ +>> (” '@ :"; 9/ “MultipartiteContract” means a kind of

. w¯V A> 3. Scope of Application

is A+, '>(! A<= H A! H This Proclamation shall be applicable on any

K N@ PART TWO

:"; !" ( =± ²S Ac I; ia FORMATION AND CONTENT

// :"; !" ( A=A I V³!I( 1/ The formation of agricultural production

/ :"; !" ( X"X" ¢ ++i 6/ Both parties may be assisted by a third

7. :"; !" ( AaC´´ 5. Agricutural Production Contract Form

// :"; !" ( '±' Nq 1/ An Agricultural Production Contract shall

E/ :"; !" ( R>< < 4/ The Contract shall be attested by at least

7/ :"; !" ( ( @==C 5/ The Agricultural Contract shall be registered

/ (k `:"; !" ( X>¨g (¹ 6/ Where the text of the contract refers to

. :"; !" ( ia 6. Content

:"; !" ( R>< V`@( ia An Agricultural Production Contract shall at

// A! E; A<= ºk <! E; 1/ The names and addresses of the Producer

1/ A<= : A! ", `Z 2/ Investment and business license reference

7/ A! iq %@# 'IC) 5/ For producers, Land Owner Certificate or

/ :"; !" (k 8 'H 6/ The objective of the contract;

F/ 'S( i! ' R ¦q <¥; 7/ Agricultural Production site and its

6/ :8 E; !" + ASA>H 10/ Pricing mechanism of agriculture produce

67/ ++i CU ¿ i! »g 15/ Provisions on inheritors or substitutes of

K < PART THREE

:"; !" ( 8i^ H ++i CU TYPES OF AGRICULTURAL PRODUCTION

// c;, (\ 1/ Out-grower Contract;

. A<= =; :½qg 8. General Rights and Obligations of the

²) A' =< I><=> a) To submit an investment and trade

@) :"; !" (k =I A:% b) to ensure the delivery of input and

) A! =I´ E> i ; c) to track and monitor the producer to

) :"; !" ( =I @'<=I e) submit a competency of certificate

4. A! =; :½qg 9. Rights and Obligations of the Producer

@) :"; !" (k =I b) to confirm the type, quality and quantity

) VI`(> :8 . ; =$[> c) to get support from a third party or an

=) u¤H<$;; !" AC:t d) to get technical, training and advisory

1/ A! V`k :½qg iUdq- 2/ The producer shall have the following

²) (k =I :"; j J> a) Enter to production activity following

=) !" . V±Wk; > d) take appropriate measures that enhance

7/ :"; !" ( !"; :i 5/ The parties may agree to renegotiate on

++i CU - The parties shall:

/ :"; !" ( ++i CU E> 3/ The agricultural production contracting

6. :8 AJ"¦; + ASA> 13. Input Supply and Payment

6E. :"; !" " 14. Delivery of Agricultural Produce

:"; !" (k X>¨g E> $- Without prejudice to provisions of the

K A PART FOUR

:"; !" ( :½qg > = NON-PERFORMANCE OF CONTRACT

6F. `AJ! i Z ©i 17. Force Majeure

// `AJ! i Z ©i %k V k 1/ The following unexpected phenomena canbe

²) < (> c.q `VA A! a) serious illness of the producer, if he

) ! J i! `K ºc \ c) extreme low or high temperature;

=) ES A \ d) fire accident;

) = =>c.c. i! ;L i! e) earthquake or landslide;

I) `A! :@A¸ f' {EU f) man-made accident affecting more

A) `-.." i Z E><S i! g) extreme animal or crop disease or pest

/ :"; !" ( ++i CU 3/ Parties to the Agricultural Production

6. =X> +<; 18. Insurance

:"; !" ( ++i CU - Parties to Agricultural Production Contract

// `AJ! i Z ©i (k E>Liw®! 1/ Agree to obtain insurance against force

1/ :"; !" ( ++i CU 2/ Where the parties to the agricultural

K A!< PART FIVE

:"; !" ( a=>H (k> <@'±± DURATION, RENEWAL OR ALTERATION;

64. :"; !" ( a=> 19. Duration of the Agricultural Production

/. :"; !" (> <@'ªI. 21. Termination of the Contract

K <X< PART SIX

1. @=:%% `A Awq ¢ 22. Dispute Resolution Procedures

K A% PART SEVEN

:"; !" ( A+, A<wÄV A DUTIES AND POWERS OF EXECUTORS OF

²) @:"; !" (t A<w x Z[; a) Develop and distribute Directives and

@) :"; A! ] E; A<= ] b) Create linkages among agricultural