Addis Ababa, April 8, 2026 (FMC) — Ethiopia has secured decisive victories in two major international arbitration cases, successfully defending claims exceeding 850 million USD and reinforcing its legal standing in global dispute resolution, the Ministry of Justice announced.
State Minister of Justice Belayihun Yirga disclosed the outcomes during a press briefing, outlining their significance and pointing to ongoing legal reforms aimed at enhancing the country’s capacity in international litigation.
The cases involved a Turkish construction firm and a Netherlands-based company, both of which had sought substantial financial compensation from the Ethiopian government.
The first claim was filed by Akgun Insaat Makina Sanayii ve Dis Ticaret Ltd. Sti., which had obtained a license to develop an industrial zone and demanded more than 500 million USD in compensation.
The dispute arose after authorities determined that the proposed project site was located near the Legedadi and Dire dams, which are critical sources of potable water for Addis Ababa.
“The company failed to provide a satisfactory Environmental Impact Assessment as required by law. Consequently, we requested relocation to safer alternative sites away from the dams to safeguard the city’s water supply,” Belayihun said, noting that the firm declined and instead alleged a violation of investment protection rights.
The tribunal ultimately dismissed the claim, affirming that Ethiopia acted within its sovereign authority to protect public health and the environment in line with international law.
The second case involved African Asset Finance Company Holding B.V., widely known as Ethio Lease, a Netherlands-registered firm that sought more than 350 million USD, claiming that regulatory enforcement measures had breached investment protections.
“Our Ministry led the defense, drawing on both internal and external legal expertise. Following extensive oral proceedings in The Hague, the tribunal unanimously dismissed the claim and ordered the claimant to reimburse Ethiopia for part of the legal costs,” Belayihun stated.
He noted that Ethiopia, a signatory to more than 30 bilateral investment treaties, is strengthening its institutional capacity to manage complex international disputes and safeguard national interests.
“These outcomes demonstrate that, while Ethiopia is a developing country, it possesses the institutional strength to prevail in international legal arenas. They also serve as a deterrent against attempts to use litigation as a tool of pressure,” he said.
The State Minister further revealed that Ethiopia is in discussions to host a branch of the Permanent Court of Arbitration (PCA), a move aimed at positioning the country as a regional hub for international dispute resolution.
According to him, Ethiopia is well placed to serve as a center for arbitration, given its expanding investment landscape, strong air connectivity, and its role as host of the African Union.
“We are working with the Ministry of Foreign Affairs to finalize the Host Country Agreement for the PCA,” he added.
He emphasized that the rulings not only shield the national treasury from significant financial liabilities but also signal that Ethiopia remains a rules-based and fair destination for responsible investment.