Business
A 2015 commercial code on paper, over a state-dominated and largely closed economy
Proclamation 166/2015 promulgated a new Commercial Code replacing the 1991 transitional codes. In practice the economy is dominated by state and party-affiliated enterprises, and private foreign investment is minimal.
Key rules
- Jurisdiction — National. Licensing runs through the relevant ministries; there is no independent competition authority.
Governing law
- Commercial Code of Eritrea, Proclamation 166/2015
- Civil Code of Eritrea, Proclamation 165/2015
- Investment Proclamation 59/1994
- Mining Proclamation 68/1995
In practice
The 2015 codes replaced the transitional codes of 1991, which had themselves been adapted from the Ethiopian codes of 1960, so Eritrean private law is still recognisably part of that René David lineage. The codes provide company forms and a law of obligations that read as ordinary civil law. What cannot be described from the codes is how business is actually conducted: the ruling party's holding structures, state trading enterprises and the military play a large role, foreign exchange is tightly controlled, and the private sector is small. Mining is the exception where substantial foreign investment exists, principally in gold, potash and base metals through joint ventures with the state mining enterprise, governed by the 1995 Mining Proclamation and negotiated agreements. Those agreements are not generally public, which is a further reason for the research stamp.