Amendments to Iraq’s Foreign Company Branch Regulation: Key Changes

A new amendment to Iraq’s Foreign Companies Branches Regulation No. 2 of 2017 has been published in the Official Gazette, print no. 4734. This amendment introduces several significant changes:

• Eligibility period for applying for branch registration in Iraq: This has been reduced from two years to just one year from the date of registration in the company’s home country.
• Submission of financial statements for branch registration in Iraq: Companies now have the option to submit the financial statements from the year before the last if the most recent year’s statements are not yet available.
• Decision of acceptance or rejection: The Registrar is now required to issue a decision on the acceptance or rejection of registration requests within 15 days from the date of application submission, instead of the previous 30-day period. If no decision is issued within this timeframe, the request is automatically considered accepted.
• Legal advisor appointment: Branches are now obligated to submit a legal advisor appointment letter from the Bar Association.
• Change of branch manager: In cases of changing the branch manager, the company must promptly notify the Registrar of Companies (“RoC“) within 60 days from the date of document attestation by the Iraqi Embassy, which is a change from the previous 30-day requirement.
• Branches engaging in commercial activities: Branches can engage in commercial activities, including executing contracts with government bodies, public sector entities, or mixed-sector companies, signing investment contracts in accordance with Iraq’s Investment Law, obtaining licenses from competent authorities in Iraq, or entering contracts or projects with private sector companies valued at no less than one million USD.

When will the Decision come into force?

These changes will come into effect from the date of publication on 28 August 2023.

What should you do next?

• Ensure timely notification to the RoC if there is a change in the branch manager, within 60 days from the date of document attestation by the Iraqi Embassy.
• Be aware that there is no longer a requirement to wait for two years to apply for registration; one year is now sufficient.
• Ensure compliance by submitting the necessary legal advisor appointment letter from the Bar Association.
• Inform your clients about the provisions outlined in point six, which define the conditions under which branches can engage in commercial activities.

How can we help?

As the leading law firm in the Middle East & North Africa Region and with strong corporate structuring experience across all industry sectors in the region, Al Tamimi & Company is well placed to assist you in assessing the impact of these legal changes on your organisation and assist you in achieving compliance with them in Iraq.