The responsibility for right-of-way compensation payments is being transferred to regional states, relieving federal authorities of this duty. This change aims to end the current practice where wereda-level officials conduct evaluations and then obtain the payments from federal authorities.

The amendment, co-authored by the Justice and Urban & Infrastructure ministries under Prime Minister Abiy Ahmed's (PhD) direction, introduces changes such as compensation for psychological and social damages. It also limits the provision for contesting decisions to courts in the same area as the federal institutions managing the projects.

Urban & Infrastructure Minister Chaltu Sani supported the action during a stakeholder session at Parliament, recalling that prolonged right-of-way disputes have led to project delays.

"We are here to serve the public ultimately," she said.

The sentiment was echoed by the head of the Land & Cadaster department at the Ministry. Bizualem Admassu said the allure of compensation has gotten a grip over the development.

"It's because the evaluators don't make the payments," he said.

Concerns were raised about possible violations of jurisdiction if the ability to obtain legal rulings is transferred from regional states. Tesfaye Neway, vice president of the Federal First Instance Court, stressed the need for careful assessment, noting potential gaps in considering the number of individuals involved.

"It could be one or a thousand people looking for a court audience," Tesfaye said.


A similar concern was raised by Girma Birhanu from the Federal Housing Corporation. He questioned the feasibility of challenging the right to get a court ruling in one's locality. He pointed out that someone in a border town would have to travel hundreds of kilometres to federal offices for a court hearing.

"This could present serious problems," Girma said. "Who would pay for the accommodations?"

Another shift in the amendment is removing the right to place a court injunction on the funds of a federal office by a regional court. All bank account freezes of federal institutions would need the president's approval of the Federal First Instance Court. Tesfaye said that court injunctions are crucial in legal proceedings and should not be governed by external parties.

"Maybe all infrastructure projects should be exempt from account injunctions," he said.

Representatives of state-owned enterprises like Ethiopian Electric Power (EEP) welcomed the possibility of hastened compensation settlements. Merkineh Yigezu, legal director of EEP, revealed that current practices have allowed bond accounts for the Grand Ethiopian Renaissance Dam (GERD) to be frozen by regional courts.

"Several abuses and exploitation are occurring," Merkineh said.


Tefera Wagshum, senior advisor at the Ethiopian Roads Administration (ERA), recalled a case where a farm household in Lume wereda inflated compensation claims by planting crops after initial estimates. They received 15 million Br through a court decision.

"There is a serious misalignment of incentives," said Tefera.


Similar instances of exaggerated compensation claims were common among Administration officials, currently dealing with court disputes amounting to eight billion Br.

Recently, State Minister for Finance Eyob Tekalign (PhD) indicated that hefty compensations for infrastructure projects have become a concern. During the Ministry's report to Parliament, he said they had no plans to make payments until the law was amended. The Ministry approved budgetary support of around 270 billion Br for regional states for the current financial year.

Wasihun Abate, senior advisor at the Ministry, noted that the property tax proclamation already granted regional states the mandate to collect revenues. He said that some budgetary increases could be included in the federal budget to help with the compensation load. However, he noted that dealing with right-of-way issues should have been the responsibility of regional states from the start.

"Their property values will increase because of the infrastructure," Wasihun told Fortune.

Justice Minister Gedion Timotheos (PhD) acknowledged the need to clarify points in the amendment regarding which disputes would go to federal courts. He stressed that the main goal was to transfer payment responsibility to regional authorities. He indicated that allowing regional courts to impose injunctions on federal institutions' bank accounts for small compensation rulings derails infrastructure development and creates misaligned incentives.

"Nothing less than a robbery has been occurring," Gedion said. "The amendment is necessary."

Co-chaired by Estegenet Mengistu and Shewit Shenka from the Law & Justice and Urban, Infrastructure & Transport Affairs standing committee, the discussion ended with plans for a final public hearing.

Land administration researcher Gebeyeu Belay (PhD) questioned the assumptions behind the proposed amendments. He believes transferring mandates without addressing the professionalism of property evaluations is circular reasoning.


"Subjective evaluation remains unaddressed," Gebeyehu said.

He suspects the amendments arise from federal institutions seeking budgetary relief by shifting financial mismanagement to others. He pointed out that even after land titles are transferred, the gains from developments go to the new owner, with little benefit to the originally dispossessed party.

"When has anyone ever felt adequately compensated?" he inquired.

Gebeyehu recommends establishing a national property estimation standard, a cadaster system with adequate information, and independent evaluators before addressing compensation issues. He said property evaluations by untrained committees at the wereda level will remain subjective, complicating matters for rural households.

According to Yilma Sisay, director of the Land Planning Program in Oromia Regional State, managing development projects if nearby communities do not feel adequately compensated is difficult. He said previous projects have favoured a few, leaving many feeling disenfranchised.

"The political chaos a few years ago had partly to do with this," Yilma told Fortune.

While he believes more tax revenue can be collected in the regional state, he stresses the need for exhaustive public deliberations before making major changes to the right-of-way compensation structure.

"We can't afford to repeat past mistakes," Yilma said.



PUBLISHED ON Jun 01,2024 [ VOL 25 , NO 1257]


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