Intellectual creations and innovations, collectively known as intellectual property (IP)rnhave been considered for long means to developmental goals of states. They have beenrninseparable in trade concerns of states too in the sense that they (IP), more often thanrnnot, are involved in trade between states seeking protection to intellectual properlyrnrights on one hand and at the same time those others seeking beller benefit in trade termsrnji'om trading in goods involving new technology on the other. Their ubiquitous nature onrnone hand and the territoriality of the mode of legal protection on the other, beingrncontrasting, pose difficulties in the effort of states to effective protection.rnThe place of the doctrine of exhaustion of IPRs is central in a cross-culling mailer in therneffort seeking effective IPRs protection and that of ji'eedom of circulation of goods. Therndoctrine of exhaustion of IPRs sets the limit between ji'eedom of trade and optimalrnutilization of ones' property embodying IPRs on one hand and that of the person whornendeavors in the inventive and creative efforts resulting in some thing of commercial, orrnotherwise may be of value. Parallel importation of goods also remains a concern closelyrnintertwined with ji'eedom of movement of goods and services as well as the effectivernprotection of IP Rs.rnThe paper as such allempts to provide the nature of intellectual properly, define therndoctrine of exhaustiun of IPRs and gives accounts of how it is applied in differentrncountries where the concept is well known and the groundfor such legal mailer isfertileinrnthe industrially advanced trading states. Allempt has also been made to look in to therndevelopments in international trade and the place of exhaustion of IPRs in therninternational trading system as is revealed through the GATT and other WTOrninstruments. It also considers the debate on whether the developing states are belter offrnby adopting international exhaustion and/or allowing parallel imports or not andrnconcludes in the affirmative.rnThe paper has also considered the status of the Doctrine of Exhaustion of IPRs in thernEthiopian legal arena and the experience in the caurts which the researcher cone/udesrnthat the laws lack clear position in some cases and absolute darkness In the courts as farrnas the concept of exhaustion of IPRs is concerned Finally it is concluded that asrnaccession to WTO is inevitable, sooner or later, the doctrine of exhaustion be given ofrnthe top priority with respect to Ethiopia's commitment in TRIPS and other WTOrnagreements - by taking legislative, judicial and administrative measures creatingrnawareness /0 effective implementation of the doctrineexhaustion in the Ethiopian scenario as it stands in the laws of the country. It is shownrnthat the COUlts are not aware of the concept of exhaustion of rights as it relates to IPRsrnhowever no case involving it as an issue appeared before them .rnThe paper finally concludes that the exhaustion of IPRs could be a sign ificant obstacle torninternational trade if not handled carefully. InÂ· this respect as Ethiopia is on its way tornaccede to the WTO membership then it is very important this issue is well known in therncourts and other organs of government to create an enabling business envirolm1ent andrnfor the country to gain its due from international trade and foreign investment as in thernmajority of case these involves transfer of teclmology and protection to IPRs.The Impact of the Doctrine of Exhaustion of lPRs on International Trade: The Ethiop ian Perspect ive