RE-APPRAISING EFFICACY ETHIOPIAN INVESTMENT LAWS IN ENABLING TECHNOLOGY TRANSFER BETWEEN FOREIGN INVESTORS AND LOCAL FIRMS

Abstract

Technology transfer from foreign investors to National firms through the instrumentality of FDI requires Comprehensive investment laws and regulations that encourage technology transfer between foreign investors and national firms. Investment laws shall provide strategies that promote technology transfer. Particularly, it shall affirm the protection against infringement of foreign investor's IPRs, which is key in promoting technology transfer to domestic firms. Investment laws shall incorporate comprehensive incentives targeting technology transfer and provide mechanisms for monitoring and evaluating technology transfer activities. Employing the doctrinal research methodology, the thesis has re-assessed the efficacy of Ethiopian investment laws in enabling technology transfer from foreign investors to national firms. After an in-depth analysis of Ethiopia's BITs, investment proclamations, and regulations, along with experience from other countries, the thesis finds that these legal frameworks lack comprehensiveness in providing adequate incentives that target technology transfer and lack clear cooperation mechanisms for easier monitoring and evaluation of technology transfer. Investment proclamation is silent about investment-related intellectual property rights. In addition, they do not adequately establish effective mechanisms to promote technology transfer between foreign investors and local firms. Accordingly, the study recommends the amendment of technology transfer-related provisions under the investment proclamation to clearly and comprehensively establish incentives that target technology transfer activity, clearly stipulate a guarantee for investment-related intellectual property rights, and provide a framework for monitoring, evaluating and coordinating technology transfer activity. Regarding BITs, the researcher recommends drafting a new BIT model with technology transfer provisions. The provision must be constructed so that the state can apply local content requirements to the extent that no international commitment exists. Model BITs shall incorporate science, technology and innovation capacity-building elements as a strategy to promote technology transfer so that the state can benefit from the spillover effect of FDI.