Legal and Practical Challenges in the Implementation of Comesa Yellow Card Scheme: The Case of Ethiopia

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As regional motor third party liability insurance schemes involve parties, laws and institutions of different member states, Claims handling of cross-border traffic accidents is a complex process. Involving different stake holders and legal issues, the Yellow Card scheme of COMESA which operates in more than 13 countries couldn’t be free from challenges in its implementation. Thus the main theme of this study is to identify possible legal and practical challenges in the implementation of the YCS in Ethiopia and to forward possible way outs. The study concludes that, YCS is not clear as to, who is TP in the scheme.YCS in particular and the COMESA in general doesn’t have a comprehensive conflict of law rule. Claim handling procedure of the YCS follows a one line claim handling process and it is not in the interest of visiting victims. The liability limit incorporated under Ethiopian MTPL proclamation is not compatible with the assumptions in the scheme and it is both against the interest of foreign drivers and Ethiopian victims. Following the signing of the Protocol, states were entrusted with the responsibility to recognize the validity of the YC in their territories and to enact laws and regulations for the establishment of YCS; particularly for the designation of its NB. In a member state where single state-owned insurance company has the monopoly of all insurance operations, the government of that party to the Protocol may designate that company to act as it’s NB . Though the current situation in Ethiopia doesn’t allow state monopoly at all, EIC is still acting as NBE.



member states, Claims handling