Ethiopia

Registering Property in

Ethiopia

Listed below is a detailed summary of the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute.

The information appearing on this page was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 183 economies. The most recent round of data collection for the project was completed in June 2011.

  • Standard Property Transfer

  • Property Value: ETB 224,873.99
  • City: Addis Ababa

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No. Procedure Time to Complete Associated Costs
1 Verify the owner of the property and obtain the Carta and plan at the sub-city office

Since 2005 the Land Registry has been decentralized into 10 sub-cities. Due diligence is conducted at the sub-city where the warehouse is located . This search will provide information on the owner of the building, date of construction of the building, the basic area of the property, whether the property is affected by encumbrances. At the same time, the carta and plan of the warehouse will be provided. At the time of due diligence, the lawyer of the buying company will also check that the other company is properly registered.

Agency: Sub-City Office 		2 days 200 ETB
2 Evaluation of the sale price by the sub-city

The parties will bring the sale agreement to the sub-city. The sub-city official will check that the price included in the sale agreement corresponds to the Master list of price. Each sub-city has a fee schedule depending on the location of the building. In the event that the price in the sale agreement is not the same as the one indicated by the sub-city, Stamp duty will be paid based on the amount indicated by the sub-city and not on the amount written in the sale agreement.

Agency: Sub-City Office 		1 day no cost
3 The seller must obtain tax clearance from Tax Authorities

The seller must obtain tax clearance on the property (not income tax) from Tax Authorities for transfer tax. This institution has also been decentralized.

Agency: Tax Authority 		2 days no cost
4 Obtain water utility clearance from the local Water Company

The seller must obtain water utility clearance from the local Water Company.

Agency: Local Water Company 		1 day no cost
5 Obtain energy utility clearance from the local Energy Company

The seller must obtain energy utility clearance from the local Energy Company.

Agency: Local Energy Company 		1 day no cost
6 Payment of capital gains tax at Inland Revenue Service

The seller pays the capital gain tax at the Customs and Inland Revenue Authority. The tax amount is calculated based on a set scale.

Agency: Inland Revenue Service 		1 day not counted
7 Request the execution of the sale contract at the office of Documents Authentication and Registration

The parties go to the office of Documents Authentication and Registration. The buyer is given a slip on how much to pay and which account this amount should be deposited into.
The parties must provide the following documents
• The seller gives the Title deed of the building
• A copy of the ID of both managers
• The power of attorney of each manager to ensure that they do have the power to sell/buy this warehouse at the specific amount.
• A copy of the Business License for each PLC.

Agency: Office of Documents Authentication and Registration 		1 day 10 ETB for the service charge + 55 ETB for the power of attorney
8 Payment of Stamp duty at the Land Administration Office

Stamp duty is set by Proclamation 110/1998. Upon payment, the buyer will be given a receipt that he must bring back to the office of Documents Authentication and Registration

Agency: Land Administration Office 		1 day 2% of the property value for the Stamp duty
9 Execution of the sale contract at the office of Documents Authentication and Registration

Payment is done at the municipal tax office.

Agency: Office of Documents Authentication and Registration 		1 day Already paid in previous procedure
10 Apply for registration of property and obtain title deed in the buyer’s name

The buyer company brings the authenticated sale contract to the Land Administration Office for the final transfer. This can take up to 1 month or even more to obtain the new deed.

Agency: Land Administration Office 		30 days Included in previous procedures
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