Ethiopia: insolvency law: a new regulatory regime for corporate insolvency

For six decades, Book 5 of the Commercial Code of Ethiopia 1960 served as the authoritative legislation governing insolvency matters within Ethiopia. However, over time, a significant portion of its clauses became obsolete and were subsequently revoked. This was primarily due to its inability to align with the evolving developmental trajectory of the country and international benchmarks. Nonetheless, the 1960 Code was recognised as progressive and visionary during its inception.¹ It introduced contemporary provisions and acknowledged three distinct procedures for addressing the insolvency of debtors: liquidation, composition, and scheme of arrangement.² This multifaceted approach underscored its forward-thinking nature, as it afforded both liquidation and reorganisation avenues for resolving the financial affairs of insolvent debtors.³