Jun 8 , 2024

The Addis Abeba Chamber of Commerce & Sectoral Association (Addis Chamber) has taken legal action against the Exhibition Centre & Market Development Enterprise and Addis Abeba City Administration over unpaid dividend payments. Through its legal representative, Addis Chamber pleaded to the court for profit earnings of 21.9 million Br from the Exhibition Centre it previously managed.

During the opening hearing at the Lideta Federal High Court Investment Bench last week, Yitayal Mekonen, representing the Chamber, argued that his client had been denied its rightful share of profits despite clear evidence of entitlement in the Exhibition Centre. He presented contracts demonstrating the City Administration outsourced management responsibilities to the Chamber while alleging withholding of two years of dividend shares.

"The City Administration assigns the board, shares in profits and is part owner," Yitayal stated.

However, Birhan Demeke, representing the City Administration, countered that there was no legally binding contract between the two parties. She pointed to a proclamation assigning responsibility for the Exhibition Centre to the Enterprise.

"The City Administration did not sign anything," Birhan said.

Yitayal strongly objected, arguing documents existed that outlined a contractual relationship with the City Administration through a designated board. He argued that profits were distributed through the Addis Abeba Finance Bureau, which operates under the City Administration, following external audits. Yitayal also said that the City Administration has a major stake in the Enterprise, to solidify his client's claim to profit sharing.

"It has a major stake in the Enterprise," Yitayal said.

The disagreement centres around profit sharing from the Exhibition Centre. The Chamber managed the four-decade-old facility, and all revenue went into a joint account with the Enterprise. Yitayal claimed the Enterprise withheld 13.7 million Br from the Chamber on top of only reimbursing 10 million Br of an earlier 18.2 million Br loan for renovations. The loan was taken from the joint account to finance the refurbishment of the Mesqel Square area. He argued that the Chamber was asking for its share of profits, while the Enterprise, claiming an empty bank account, placed the responsibility for collecting the loan on the Chamber.

"This illustrates irresponsibility," Yitayal said.

The dispute extends beyond the immediate lawsuit. Eight months ago, a five-member supervisory board established by Mayor Adanech Abiebea, led by Binyam Mikru, head of the Addis Abeba Trade Bureau; terminated the Chamber’s contract to manage the Exhibition Centre, at Meskel Square. The Board comprised of Girma Beka, Cabinet Affairs head; Lidya Tadesse head of the Addis Abeba Peace & Security Bureau; Girma Seifu, head of the city’s Investment Commission; Girma Gide, deputy head of the Addis Abeba Finance Bureau; and Weynshet Zerihun, head of the Women, Children & Social Affairs Bureau.

Lidya Tadesse, head of the Addis Abeba Peace & Security Bureau now chairs the board. Meanwhile, Tilahun Tadesse was also terminated from his managerial position at the Center three months ago.

Disagreement over access to these funds further complicates the case. Senait Asrat, representing the Enterprise, argued there was no outstanding debt and the Chamber controlled the joint account, being the only one authorised to move money. She said that the Chamber was aware of the state of the account after paying for the renovation.

"It [Chamber] should collect the money it manages," she said.

Presiding judges Samuel Tadesse, Hiwot Tadesse, and Ashenafi Workneh, set a date for a second hearing, ruling on the need for more investigation.

Editors' Note: This article has changed from its original form on June 13, 2024.

PUBLISHED ON Jun 08,2024 [ VOL 25 , NO 1258]

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