How to Form Agribusiness Technology Transfer Partnership in Ethiopia

Last updated March 14, 2015

Are you counting on technologies of foreign sources for your proposed agribusiness investment project in Ethiopia? If so, you should be considering the next steps following the approval of your investment project for implementation — getting the technology and starting investment in the value chain where you saw promises. To do this, follow the useful guides and basic steps outlined in this article.

1

Be aware of the openness and requirements for agribusiness technology transfer in Ethiopia

Note that there is enabling regulatory environment for local investors, both domestic and foreign, who wish to receive technologies from sources outside of Ethiopia. In fact, the investment law of Ethiopia encourages technology transfer. Accordingly, the government provides attractive incentive packages to agribusiness development projects involving technology transfer.

Know that according to the investment law transfer of technology means ”the transfer of systemic knowledge for the manufacture of a product, for the application or improvement of a process or for rendering service, including management and technical know-how as well as marketing technologies, but may not extend to transactions involving mere sale or lease of goods.”(Proclamation No 769/2012)

 In addition, make notice that the law requires prospective technology recipient investors like you to conclude technology transfer agreement and register same in Ethiopia.

2

Examine the value chain to ensure the validity of the technology requirements for your investment

Agricultural investment activities in value chains that require new technologies of foreign sources can be high profit ventures particularly if there is significant gap in technology sourcing locally. Because at the problem at local level opens wider room for investment given there is huge prospect for chain development and value addition by in introducing new technologies required to fill the gap harnessing the opportunities and potentials for development.

Therefore, you need to make an inventory of the availability and accessibility of technologies developed by agricultural research centers in Ethiopia. Examine also their qualities for instance in terms of yield or disease resistance or market demands if the technology concerns crop varieties. That will help you with the next step.

 

3

Create technology requirement specifications for your investment

After you have ensured the validity of the new foreign source technology requirements for you your investment project in Ethiopia in the previous step, know exactly what type of technology is required. Specify the nature of the product / technology, the growing conditions or performance requirements if again that concerns for instance crop varieties.

Depending on the type of technology you plan to get by way of transfer, you should have technology specifications and reasons for partnership. Only if you know what and why will you be in a better position to focus your efforts on finding technology and partnership that will help you grow your agribusiness. You are advised to state your specifications and reasoning in writing. That will help you with the next step.

4

Research opportunities for investment involving technology transfer

There are country business opportunity study reports that indicate opportunities for investment including involving technology transfer. For instance, a study on aquaculture recommends intensive commercial aquaculture business models and discusses the need for technology transfer through joint venture between multinational Dutch companies and Ethiopian companies.

The report includes studies on the Ethiopian and Dutch aquaculture subsector profiles that are useful for researching possible joint venture partners, particularly Dutch companies.

You need to find and review available business opportunity reports for the investment area of your business that requires technology transfer. Doing so will help you come up with sound reasons and consolidate the specifications created in the previous step. Besides, country and company profiles included in reports will allow you to start researching possible technology supplier partners which will help you with the next step.

5

Research companies to find your strategic partner

Use your technology specifications and stated reasons in the previous steps to help you find a strategic partner and supplier that fits your needs. Research companies until you find one that can help you meet your goals while also benefitting from what your company can offer as well.

6

Determine whether you seek support for networking and partnerships

One of the common ways to find a partner is networking with foreign-based companies or knowledge institutions involved in the business of technology development. To do this, you need to get support from facilities of for example development partner country projects like the Dutch-funded Agribusiness Support Facility (ABSF) that create partnership networking platforms for investment and trade. Other organizations in Ethiopia include chambers of commerce and sectoral associations and government organizations involved in investment promotion such as Ethiopian Investment Commission.

7

Schedule follow up meetings

After you have met a number of people by networking, schedule follow up meetings with those individuals whose companies meet your needs for transfer of technology related to your investment project in Ethiopia. Be prepared to discuss the needs of your business as well as what you have to offer.

8

Choose your partner

After you discuss with potential partners, choose the one with whom you will form technology transfer partnership.

Have a clear outline of your proposal and begin open discussions. That will help you to come to a mutual agreement with the partner you have chosen.

9

Conclude a technology transfer agreement

Create and conclude a technology transfer agreement with your partner. A technology transfer agreement is a legal document that sets out what each party to the technology transfer partnership is responsible for and how to work together. The purpose of the agreement is to clarify relationships and time periods for the transfer as well as ensure trust between the partners.

Accomplish the following core tasks to create the agreement:

  1. Meet with the partner to discuss the nature of the partnership
  2. Choose an attorney to draft an agreement
  3. Review the draft agreement
  4. Sign the agreement
10

Locate the institute that registers technology transfer agreement in Ethiopia

You need to locate the government institution authorized to register technology transfer agreements in Ethiopia. It is apparently the Ethiopian Investment Commission (EIC) which is located on Africa Avenue, popularly called Bole Road, in Addis Ababa

11

Collect application form for registration of technology transfer

As recipient of the technology, you the local partner are required to apply for registration with EIC. Therefore, collect the application form from the Information Desk of EIC. Alternatively, you can download and print the form from http://www.investethiopia.gov.et/images/pdf/form-Technology_Transfer_Agree.pdf.

12

Provide adequate information

You need to carefully complete the form ensuring that you provide adequate and correct information required for registration of the technology transfer agreement. The basic requirements include information about:

  1. The applicant or recipient of the technology
  2. The technology supplier
  3. The technology transfer agreement
  4. The local enterprise or project related to the agreement
13

File application for registration

After you have collected and completed the application form, file your application with EIC. Submit the completed application form together with required documents. You should collect up to date information from EIC on the requirements of documents and fulfill same while filing your application. According to Proclamation No. 769/2012, these include:

  1. A completed application form signed by the recipient of the technology
  2. A photocopy of the authenticated agreement between the recipient and provider of the technology
  3. A photocopy of a valid business license or investment permit of the recipient of the technology
  4. A certificate of registration or business license of the provider of the technology
14

Collect a certificate of registration

The EIC will examine your application and issue you a certificate of registration if your application is found acceptable. In that case, you need to follow up your application process and collect a certificate upon issuance of same by EIC.

Notes
Take note that this article was prepared by Amare Molla, Information Hub Coordinator for ABSF, and as such does not necessarily reflect the views and opinions of the institutions involved in funding or managing the AGRIbiz.et website. The article is written with utmost care by referring available and reliable information sources. It is also thoroughly reviewed by Gertjan Becx, the ABSF project coordinator, and other experts of the project. Despite that, you are advised to check the accuracy of the information as the requirements and procedures for technology transfer related to a local enterprise or investment project in Ethiopia may change over time with, for instance, changes in related laws, regulations and directives of the tax authority.
References
EIC (Ethiopian Investment Commission). Application form for technology transfer agreement registration.  http://www.investethiopia.gov.et/images/pdf/form-Technology_Transfer_Agree.pdf. http://www.investethiopia.gov.et/investment-process/starting-a-business. Accessed on January 24, 2015. Investment Proclamation No 769/2012. http://www.investethiopia.gov.et/images/pdf/Investment_Proclamation_No769-2012_of_Ethiopia.pdf. Accessed on January 24, 2015. Investment Incentives and Areas Reserved for Domestic Investors Regulation No 270/2012. http://www.investethiopia.gov.et/images/pdf/Investment_Regulations_No270-2012_of_Ethiopia.pdf. Accessed on January 24, 2015.