Every business operating in Ethiopia — whether a domestic manufacturing company, a foreign-invested enterprise, a bank, or a multinational project developer — is ultimately subject to a single judicial institution that defines the boundaries of Ethiopian law with final and binding authority: the Federal Supreme Court Cassation Bench

Ethiopia stands out as one of Africa's fastest-growing economies and a key gateway for investment in East Africa. In recent years, the Ethiopian government has modernized its business laws - notably with the Commercial Code Proclamation No. 1243/2021 - to make registering a company more transparent and investor-friendly. For foreign investors, this means clearer rules and a defined process for entering the market.

The enactment of the Commercial Code of Ethiopia, Proclamation No. 1243/2021, represents the most significant overhaul of Ethiopian corporate law in more than sixty years.

Ethiopia's 2021 Commercial Code introduced a modern, rescue-oriented insolvency framework — most notably, a general automatic stay that freezes "individual enforcement actions" once reorganization proceedings enter the observation period

On 12 February 2026, the National Bank of Ethiopia (NBE) issued Directive No. FXD/04/2026, amending the foundational Foreign Exchange Directive No. FXD/01/2024. The new directive, signed by NBE Governor Eyob Tekalign (PhD), represents the most significant liberalization of Ethiopia's foreign exchange regime since the landmark July 2024 reforms.

As part of the government's effort to update and modernize existing laws in the commercial sector, a number of laws have been revised and a few new ones have been enacted.

Mergers & Acquisitions Comparative Guide for the jurisdiction of Ethiopia, check out our comparative guides section to compare across multiple countries

Project Finance Comparative Guide for the jurisdiction of Ethiopia, check out our comparative guides section to compare across multiple countries