Federal transport authorities are steering the vehicle import market into uncharted territory with sweeping regulatory changes that are triggering alarm among importers.

In a bold attempt to modernise the sector and accelerate the shift toward electric vehicles (EVs), the Ministry of Transport & Logistics (MoTL) has tabled draft regulations that demand a radical overhaul of how vehicle import businesses operate, from the showroom floor to after-sales service. Applicants for a Vehicle Importer Competency Certificate should present a comprehensive organisational profile and title deeds for property ownership.

Importers are required to secure written authorisation from a vehicle manufacturer or official representatives, verified by the relevant chamber of commerce or the Ministry of Foreign Affairs.

A controversial clause in new draft regulations from the Ministry of Transport & Logistics (MoTL), issued as part of a drive to modernise the automotive sector and promote electric vehicles (EVs), requires importers to operate their own garage and workshop. These facilities should provide after-sales services and supply spare parts, while the importer should demonstrate the organisational structure and technical expertise required to support vehicles brought into the country.

Importers of electric vehicles are subject to even more specific requirements, including installing at least two charging stations that meet international standards and submitting international battery safety certificates for each imported vehicle. There are also new conditions on the cars themselves. All imported vehicles should be new, unregistered, and no older than two years from their production date. A pre-export certificate is mandatory, confirming compliance with safety, environmental, and operational standards.

Companies are also expected to maintain offices that meet specified standards for facilities, staff, parking, and display space. All software and technical documentation for vehicles should be available in English. Once a vehicle is sold, the company is responsible for providing after-sales service, including safety guidance on new technologies, collecting data on vehicle performance, and providing on-the-job training for mechanics and other professionals.

For EVs, importers will be required to provide a legal warranty for the vehicle and its battery. There are also new reporting requirements, such as obliging importers to submit quarterly reports to the Ministry on the performance of vehicles sold and the training provided to mechanics, while also maintaining ongoing cooperation with the Ministry’s own training centres.

According to Assefa Haddis, a transport service and supervision advisor at the Ministry, the new regulation is designed to align the sector with international standards and help importers develop deeper expertise in EVs.

“We don’t want importers to engage in this only for a short time," he told Fortune. "We want it to become their profession, with the necessary maintenance skills and insurance readiness.”

He sees safety and reliability as top priorities, insisting that the Ministry stands ready to support importers through the transition, emphasising the importance of education and training as essential elements of the new policy.

“Regulatory changes are introduced for specific reasons,” Assefa said. "Businesses need to view the process constructively so the implementation phase can proceed without unnecessary friction."

However, Andualem Shiferaw, manager at Take Off Vehicle Import & Sales Plc, a company operating on Gabon street near Gazebo roundabout, is among those who see the draft regulation as unrealistic and out of step with business realities. He characterised the new standards as “far-fetched.”

"This directive forces us to take over the work of those who're already qualified to do it,” he told Fortune.

Andualem observed that most importers already bring in new vehicles, mainly because duties and excise taxes are similar if a car is used or brand-new. For his company, focusing solely on importing and selling  vehicles makes sense, as garage services and spare-part distribution are already handled by established businesses with their own expertise. His company has been importing five to 10 EVs, mainly from China, for more than two years. However, shipping takes three to five months, and each vehicle costs anywhere from four million to 10 million Br, depending on the brand, mileage, and market conditions.

“Setting up a garage requires trained technicians, large workspaces, machinery, and operational responsibilities that importers can't reasonably assume,” he said. "Importers should instead be allowed to sign agreements with certified garages and refer customers to them for technical issues."

Andualem’s company already owns one EV charging machine and provides another charger with each vehicle sold.