MIZAN LAW REVIEW, Vol. 11, No.1 September 2017
Asress Adimi Gikay §
Various countries have reformed their secured transaction laws recognizing the significance of modern secured transactions law in enhancing access to credit and economic development. Ethiopia has not undertaken comprehensive secured transactions law reform, despite the demonstrable mismatch between the legal regime governing security interests and the country’s current political, economic and commercial realities. In-depth analysis of the Ethiopian secured transactions law is made in this article in the light of UCC1 Art 9, English, and French secured transactions laws and the EBRD (European Bank for Reconstruction and Development) Model law and the experience of civil law jurisdiction of Louisiana. I argue that secured transaction law reform in Ethiopia can be implemented based on UCC Art. 9 with some adjustment in light of Louisiana’s experience. The article uses the unitary concept of security interest and floating lien to exemplify the supremacy of the approaches and policies of UCC Art. 9 and its suitability as a model for potential secured transactions law reform in Ethiopia.
International organizations and states recognize modern secured transactions law as vital for economic development. The United Nations Commission on International Trade Law (UNCITRAL),2 EBRD3 and the Institute for Unification of Private International Law (UNIDROIT) are among the key advocates of modern secured transactions law at international level.4 Central and Eastern European (CEE) countries, after the fall of communism have reformed their secured transactions laws as vital part of the transition to market economy and to sustain strong economy.5 Various African countries such as Malawi,6 Liberia,7 Sierra Leone,8 and Nigeria9 have recently implemented comprehensive reforms, albeit not necessarily flawless.10
The major part of Ethiopia’s secured transactions law has been in place since 1960, and it has not undergone wholesome secured transactions law reform although the country, like CEE countries, had a command economy for seventeen years.11 In view of its current developmental goals and economic realities,12 this article raises the issue of reform of Ethiopia’s secured transactions law taking the cue from the US Uniform Commercial Code Article