Draft Iraqi Arbitration Law – Investor-friendly law expected to be published in 2026

3 min 6 sec January 18, 2026 (Edited)

Introduction

The Iraqi parliament’s draft arbitration law represents a significant modernisation of Iraq’s dispute resolution framework, aiming to deliver an efficient, transparent, and reliable arbitral regime that aligns with international standards, particularly the UNCITRAL Model Law approach. It emphasizes written arbitration agreements, party autonomy, streamlined tribunal formation, restrained judicial intervention, and robust enforcement of awards, all of which are designed to support Iraq’s economic growth and attract foreign investment in key sectors such as oil and gas, construction, and infrastructure. As of mid-2025, the draft was under parliamentary consideration and there is currently no definitive 2026 legislative timetable or parliamentary programme. However, if enacted and implemented during 2026, the law’s core features would be expected to reduce legal uncertainty, improve enforcement predictability, and enhance investor confidence throughout 2026 and beyond.

Main features of the draft law

The draft law’s foundation is the requirement that arbitration agreements be in writing, whether embedded in a contract or concluded separately, either pre or post‑dispute. This formal requirement aims to reduce disputes over the existence and scope of the arbitral clause and to provide clarity on consent, which is central to arbitral jurisdiction.  Consistent with modern arbitral norms, the draft embraces party autonomy and limits court interference, enabling parties to shape procedure, choose the seat, and fix the commencement of proceedings, thereby aligning the regime with regional and international standards while signaling judicial restraint.

Tribunal constitution is addressed through detailed provisions that allow parties to agree on the number of arbitrators, and which commonly contemplate a three‑member tribunal to enhance impartiality and balance. The draft imposes disclosure obligations regarding potential conflicts of interest to safeguard integrity, transparency, and fairness in proceedings. With respect to competence-competence, the tribunal is authorized to rule on its own jurisdiction—including objections—at an early stage, with parties required to raise jurisdictional challenges promptly, thereby minimizing delay and procedural gamesmanship.

Procedurally, the draft law mandates equal treatment of the parties and a full opportunity to present their cases, reinforcing due process guarantees within a flexible framework which the parties may tailor to the requirements of their dispute. This blend of procedural fairness and flexibility is consistent with international arbitral practice and is intended to foster confidence among both domestic and international users. Proceedings terminate upon the issuance of a final award, mutual agreement, or withdrawal, and tribunals must provide clear, reasoned, and comprehensive awards that address the disputed issues conclusively, supporting finality and enforceability.

Award challenges and review are restricted: appeals are available only on specified grounds (such as procedural irregularity or lack of jurisdiction) and must be brought within ninety days of receipt. This narrow, time‑bound challenge regime preserves the finality of arbitration and supports effective enforcement, while still providing an avenue for fundamental defects. Enforcement proceeds through court approval to confer on arbitral awards the same legal effect as court judgments; applicants must furnish the original award and arbitration agreement to confirm that enforcement is grounded in a valid consensual instrument. This mechanism is designed to ensure that awards are effectively implemented and integrated within the judicial system.

The practical implications for Iraq’s economy are significant. For energy and construction disputes, the ability to appoint arbitrators with industry expertise and to proceed confidentially can expedite resolution while protecting sensitive information. The promise of predictability, speed, and expertise is particularly salient in time‑critical projects, offering both contractors and employers a stable, fair, and enforceable path to resolve disputes without prolonged litigation. In broader terms, the draft law is expected to reduce legal uncertainty, improve the business environment, and bolster investor confidence by strengthening procedural autonomy, ensuring judicial restraint, and reinforcing the finality of awards—all of which are hallmarks of investor‑friendly arbitration regimes.