| Abstract: | This comment examines the legality of Guideline No. FIS/01/2016 issued by
the National Bank of Ethiopia (on November 1st, 2016) regarding the
relinquishing of shares in banks owned by foreign nationals of Ethiopian origin.
It is argued that at the time of the auction, an Ethiopian born foreign national
remains to be the owner of the share unless it is proved that ownership is
acquired fraudulently or with criminal intention. One can only sell what
he/she/it owns, and, the owners of the shares (to be relinquished in accordance
with the NBE Guideline) are clearly the shareholders in whose name the shares
were registered, and in effect, they are entitled to the premiums obtained during
the transfer of shares by auction. If the initial acquisition of shares is considered
improper, ‘two wrongs don’t make a right’ and thus, the proper procedures for
redeeming or repurchasing of shares under the Commercial Code should have
been pursued upon the exit of the shareholders, in the absence of which the
path taken by the NBE Guideline constitutes an act of sequestration,
expropriation or forced purchase. |
