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The Addis Ababa Chamber of Commerce and Sectoral Association (AACCSA) lost yet another legal battle regarding the controversial general assembly held a year ago.
The association, which was sued by United Insurance Share Company (UNIC), a member of AACCSA, has lost the appeal that it took to the Federal Higher Court.
In May this year the lower court handed down a final verdict in the favor of UNIC, who claimed that the general assembly held on December 19, 2013 was illegal.
The final verdict given by the Federal High Court’s 14th Civil Bench, on Tuesday November 25 indicated that lower court’s decision followed appropriate legal protocol.
The Fifth Commercial Bench, First Instance Court heard the law suit filed by UNIC against AACCSA, after the chamber’s general assembly declined to allow ZafuEyesus Work Zafu, representative of the insurance company, board chairman and one of the dominant shareholders of UNIC, to attend the ninth general assembly at the Addis Ababa Hilton Hotel last December. Zafu did attend the event after a lot of chaotic upheaval but he was prevented from getting a card that allows him to vote.
On May 19, 2014 the lower court ruled that the ninth General Assembly and the entire result in the presidential election should be canceled. That means another general assembly will have to be called for re-election.
The court also stated that the plaintiff’s representative was not allowed to vote or to be voted for and giving his comment to the general assembly was illegal. “Based on this the general assembly had not followed the legal procedure,” the court stated.
On the other hand the court also rejected the chamber’s decision that it ordered UNIC to change its representative.
The plaintiff, who did not lose membership from the association, represented individuals that wanted to be part of the general assembly. “Initially the chamber’s decision to suspend the plaintiff representative does not have a legal precedent,” the lower court’s decision stated. The court found that the board member’s actions violated the plaintiff’s rights.
In January 2013 the board of the association suspended Zafu’s representation.
A day before the general assembly was held, the outgoing board, which was elected three years ago, sent a letter to United Insurance, advising it to suspend their representative, ZafuEyesus Work. This meant that he was barred from attending the meeting and the letter said the insurance company would have to assign another representative for the general assembly.
The letter, issued on Wednesday December 18, 2013 and signed by Getachew Regassa, secretary general of AACCSA indicated that Zafu was suspended not only from the assembly but from all events that would be conducted in the future.
However, the lower court ruled that the general assembly passed decisions without following the chamber’s rules and regulations.
Teshome Beyene was one of the presidential nominees at the 9th general assembly. He was also controversially disqualified for the nomination by the screening committee. He said that this decision shows some rights are universal.
He told Capital that the chamber has to accept the decision and build a consensus that will be acceptable for a majority of members.
“The way that they conducted their business was not right so they have to respect the decision and keep the institution’s (AACCSA) priority,” Teshome said.
He claimed that the board has to exercise the power and should not be led by the secretariat of AACCSA. Instead, Teshome argues, the secretariat should depend on them.
“The 10th general assembly planned to be held later this month, will have to be postponed following the court’s decision,” he stressed.
ZafuEyesus Work said that the general assembly planned to be held on December 25, will be illegal. He stressed that the chamber has to follow the legal procedure to undertake the general assembly.
UINC has already opened a procedural file to follow the implementation of the court’s decision.
“I recommended that Kebede Chane, Minister of Trade, form a higher body to undertake the general assembly based on the rules amended by the founding general assembly held about ten years ago” said ZafuEyesus.
He recommended that members be represented from the Ministry of Trade, Addis Ababa City Administration Trade and Industry Bureau and Ethiopian Chamber of Commerce and Sectoral Association in order to follow the implementation of the legal procedure based on the 2005 law.
One of UNIC’s claims was also the quorum issue. It claimed that the general assembly was held below the required quorum and due to that the decision passed on that day was invalid, based on the rules and regulations of the chamber.
The defendant claimed that based on the general assembly’s decision held in October 2010 the quorum must be 500 members. The court said that the 2010 decision is against the chamber’s article of association.
At the sixth general assembly held in October 2010 the number of participants was 860, but there are 14,000 total members. According to the chamber’s article of association issued in December 2008, the general assembly quorum should be 50 percent plus one, as per the proclamation amended by the parliament in 2003. But the 2008 article of association stated that any part of it shall be revised when it receives acceptance by two thirds of the quorum at the general assembly.
The defendant argued that all the general assembly held before 2010 did not follow the proclamation or the article of association.
The court also stated that all general assembles held since September 2005 (the first general assembly) did not follow the rule in terms of adequate quorum, which is against the law. “The defendant has accepted that all general assembly were held against the law. It is not the behavior that is expected from the chamber,” the court stated.
Zafu, who severed both at the national and city chambers as president, stated that the general assembly planned to be held at the Addis Ababa Hilton Hotel, is expected to include at least over half of the 15,000 members, according to the way that the current management of chamber follows. “It is known that the hotel does not have a large enough hall to handle over 7,501 members,” he added
Elias Genete, who was elected President of AACCSA in December 2013, told Capital that he doesn’t have any comment because the issue is under court procedure. He stated that a week ago the chamber again appealed the case to the Federal Supreme Court.
Based on the lower court’s decision another general assembly overseen by the Ministry of Trade and the Addis Ababa Trade and Industry Development Bureau will take place.
United Insurance representative ZafuEyesus also claimed that the board of directors has to implement their power and not be lead by the chamber office.