Courts and Traditional Financial Institutions in Ethiopia: Selected Case-Studies on Legal Hybridity

(eng) Drawing on the analysis of court records in Addis Abeba and the Amhara, Oromia and Tigray Regional States, this paper offers case-studies on the conflicting encounter between the formal legal system and normative practices in the way judges deal with problems arising in traditional financial institutions known as “Eqqub” or “Iqub”. It is shown how, on a variety of topics – ranging from the legal capacity of Eqqub leaders to present members, through the legal validity of internal bylaws to the liability of guarantors – judges decide not only on the basis of the codified laws but also on the basis of traditional practices that are clearly at variance with the official norms. This leads to the hybrid co-existence of both official and unofficial norms that somehow works in practice but also leads to abuse and legal uncertainty for Eqqub members. Therefore, at the end of this paper the authors recommend the legislator to give both more recognition to the seminal role played by “Eqqubs” in the economic development of Ethiopia while offering a more predictable framework that judges can rely on when deciding Eqqub-cases.