As it has been observed for the past ten years, the general policy of the Republic of Iraq is heading towards ensuring that investments are given priority and the privatization is a pillar of the new Iraqi free economy prospective.
Investment Bodies and Laws
The national regulator of investment in Iraq is National Investment Commission (NIC), which by virtue of its law No. 13 of 2006 lays out the general terms for providing benefits and protections for investors,
There are several laws involves the investment in Iraq such as, Residency Law No. 118 of 1978, Companies Law No. 21 of 1997, as amended, Trade Law No. 30 of 1984, and Banking Law No. 94 of 2004, Civil Law No. 40 of 1951, Investment Law on Crude Oil Refining No. 64 of 2007, Industrial Investment Law No. 20 of 1998, and Free Trade Zone Law No. 3 of 1998, in addition to several related pieces of legislation, such as Regulation No. 5 of 1989. In any case, when the text of any of these laws conflicts with the National Investment Law, application of the National Investment Law supersedes these laws, even if the conflicting law was enacted subsequent to the National Investment Law. This is pursuant to the principle that “specific rules restrict general rules,” and is also affirmed in the National Investment Law, which states that “any provision that contradicts the regulations of this law shall be null and void.”
It is noteworthy that Iraq is in the process of joining multilateral and bilateral agreements that regulate investment activities, as a means of providing additional privileges to investors.
Our Legal Services in relation to Investment
Our office provides legal support and guidance in all investment phases as listed hereunder; in particular we provide legal consultancies services, local assessment, representation of investor before NIC and all government agencies.
In addition to the other legal services we regularly provide, we offer providing legal structuring and registration of investor, feasibility study and projects due diligence studies throughout all phases as follows:
If an investor is interested in an available investment opportunity, we offer to start the process of requesting full information about the investment project from the NIC to facilitate investors’ work.
As a foreign investor is required to apply for a visa to Iraq, we offer applying to obtain a visa and coordinate with the Residency Directorate at the Iraqi Ministry of Interior to obtain the visa
Upon the investor decision to proceed with the investment opportunity, we will assist the investor with all the requirements for obtaining an investment license, as provided by the National Investment Law, which include:
- Filling out an application prepared by the NIC. There is a specific application that includes details on the investor and the investment opportunity.
- Assist in preparing the Financial Capability Statement from an Accredited Bank. The purpose of this requirement is to demonstrate that the investor has the financial means to carry out the project. To qualify as an accredited bank, the bank must be on the Central Bank of Iraq’s (CBI) bulletin that includes a list of all accredited banks.
- Assist the Investor’s to demonstrate its Projects within or outside Iraq. The purpose is to identify past or present similar work carried out by the investor, as this is considered an indication of the investor’s ability to implement a project in a professional and timely manner.
- Assist the Investor in demonstrating details of the Investment Project such as preparing the Economic Feasibility Study and other details of the project. We will follow up with NIC to review and refer such documents to related authorities to obtain the necessary approvals.
- Ensuring that all of the required information are provided, so that the investor can be granted an investment license that provides the investor with all of the rights and guarantees set forth in the National Investment Law. Once a license is granted, the investor then moves to complete the remaining contractual procedures with the relevant sectors and entities owning the land, in each case based on the particular nature of the project.
Investment Project Implementation
In this phase, we offer legal support to the investor to establish and build project facilities in accordance with the investment license and/or the investment contract; in particular, we facilitate the process for the investor to enjoy the benefits and exemptions provided to investors by the National Investment Law such as:
- Assets imported for the purposes of the investment project shall be exempt from import duties for the duration of project implementation and all phases of the project.
- Allowing the investor take out the capital he brought into Iraq and its proceeds.
- Insure the investment project with any foreign or national insurance company it deems suitable.
- To open accounts in Iraqi or foreign currency or both at a bank inside or outside Iraq for the licensed project.
- to participate in the Iraqi Stock Exchange, and acquire membership in private stock and mixed companies, even when there are properties within the assets of said companies.
- To employ and use non-Iraqi workers in case it is not possible to employ an Iraqi with the required qualifications and capable of performing the same task in accordance with guidelines issued by the NIC.
- To assist the investor to utilize the guarantee the right of ownership and protection against confiscation or nationalization of the investment project.
- To support in obtaining a tax exemption for the project of up to ten (10) years and for each phase of project implementation, which can be increased to fifteen (15) years if the ownership ratio of the Iraqi partnership in the project is more than 50%.
- To support in obtaining exemption from taxes and fees for the primary materials necessary for commercial operations based on the percentage of locally-produced materials that are used in the project.