Iraq · Guide
Registering a company in Iraq is not one procedure. It is two, and the first decision you make is which country's version of Iraq you are dealing with.
Federal Iraq requires Iraqi shareholders to hold at least 51% of an LLC, and takes six to twelve weeks. The Kurdistan Region permits full foreign ownership of licensed projects and takes two to four weeks. That is not a regional nuance, it is a different rulebook with a different registry, and any guide that treats Iraq as a single jurisdiction is wrong on its first page.
Iraq Company Registration: the Short Answer
- Entity of choice: the LLC, with 2 to 25 shareholders and liability limited to each shareholder's contribution.
- Minimum capital: IQD 1,000,000, roughly USD 850, deposited in an Iraqi bank.
- Federal Iraq ownership: Iraqi shareholders must hold at least 51%, capping foreign ownership at 49%.
- Kurdistan Region: full foreign ownership permitted for licensed projects.
- The step nobody schedules for: every foreign shareholder, individual or corporate, must clear a Ministry of Interior security check.
The ownership answer and the timeline both change depending on which registry you file with. Settle that before anything else.
First decision: federal Iraq or the Kurdistan Region
| Federal Iraq | Kurdistan Region | |
|---|---|---|
| Foreign ownership of an LLC | Capped at 49% | Full foreign ownership permitted |
| Registry | Companies Registration Directorate, Ministry of Trade | KRG Business Registration System |
| Offices | Baghdad | Erbil, Dohuk, Sulaymaniyah |
| MOI security clearance | Required for foreign shareholders | Not required in the same form |
| Branch of a foreign company | Generally needs a government contract or investment licence | No government contract required |
| Typical timeline | 6 to 12 weeks | 2 to 4 weeks |
If this table points you north, the procedure is not the one below: the Region runs its own registry and its own steps, covered in how to register a company in the Kurdistan Region. | Document legalisation route | Federal chain | KRG Department of Foreign Relations, then Ministry of Justice |
The choice is not purely legal. It follows where the project physically sits, which regulator licenses your sector, and which counterparties you intend to contract with.
The ownership rule, and the date it changed
This is the single most misreported fact about Iraq, because plenty of material online predates the change.
Law No. 17 of 2019 amended Article 12 of Companies Law No. 21 of 1997 to require that Iraqi individuals or entities hold at least 51% of the capital of a limited liability company or a joint stock company. Foreign ownership is capped at 49%. That reversed the earlier position, under which full foreign ownership had been permitted.
The Kurdistan Region never adopted the 2019 amendment. It continues to allow full foreign ownership of projects licensed there. This is why the two halves of the country diverge, and it is a legal fact with a date rather than a regional habit.
The routes that open more than 49%
Two exist in federal Iraq, and one structuring approach sits alongside them.
- A branch of a foreign company. The branch is the parent operating directly, not a separate entity. In federal Iraq it generally requires a government contract or an investment licence, which makes it a route for contractors rather than for a general trading business.
- A project licensed by the National Investment Commission under Investment Law No. 13 of 2006. Practitioners understand the licence to permit majority or full foreign ownership, and it carries substantial exemptions.
- Voting and economic rights structuring, through a shareholders' agreement, used by foreign minority holders to protect governance and economic outcomes within the 49%.
One honest caveat on the second route. The relationship between the Investment Law and the Companies Law on majority foreign ownership is understood by practitioners to permit it, and it is not fully settled. That tension is real, it is why an Iraqi lawyer is not optional here, and no guide should present it as resolved.
And one warning on the third. A shareholders' agreement protects a minority holder. It does not convert 49% into control of the register, and structuring it as though it does is where foreign investors get into trouble.
The Ministry of Interior clearance
The step that turns a four-week plan into a twelve-week one.
Every foreigner, whether a natural person or a legal entity, must pass a security clearance by the Ministry of Interior before being permitted to become a shareholder in an Iraqi company. The Companies Registrar obtains that approval before issuing the registration certificate for a foreign-owned LLC.
The same requirement reaches management: appointing a foreign national as a manager needs MOI approval as well, even though there is no requirement for managers to be Iraqi nationals.
There is no published service standard for this. It is the main reason federal registration is quoted at six to twelve weeks rather than as a fixed period, and it is not something a formation agent can accelerate.
Iraq Company Registration: Step by Step
- 10. ScreeningDue diligence and sanctions checks on shareholders, managers and intended counterparties, before any filing.
- 21. Entity and documentsChoose LLC, branch or JSC. Draft the memorandum of association and the founders' decisions.
- 32. Reserve the nameWith the Companies Registrar. Since the April 2026 digital platform, name reservation can be started online.
- 43. File the packWith the Companies Registration Directorate, or the KRG registry for the Kurdistan Region.
- 54. Bank and capitalOpen the account and verify paid-in capital of IQD 1,000,000 in an Iraqi bank.
- 65. Tax and licencesRegister with the General Commission for Taxes, obtain the trade licence and any sector permits.
- 76. Post-incorporationRegister with Daman for social security, notify employment, appoint an auditor.
What the April 2026 platform changed, and what it did not
A digital platform rollout in April 2026 shortened several filing stages, and name reservations in federal Iraq can now be started electronically.
What it did not change: notarisation, legalisation and capital verification. Those are still physical, still sequential, and still where the calendar goes.
The document chain, and when to start it
Everything issued outside Iraq arrives legalised and translated, and the registry, the bank and the tax authority will each want their own certified set.
- Start legalisation two to four weeks before you intend to file, and longer if documents have to travel between consulates in different countries.
- The registrar retains originals, so plan for multiple certified sets rather than one.
- For the Kurdistan Region, foreign documents are certified through the KRG Department of Foreign Relations and the Ministry of Justice, which is a different chain from the federal route.
Capital, shares and management
| Item | Requirement |
|---|---|
| Minimum capital of an LLC | IQD 1,000,000, roughly USD 760 at the official rate |
| Where it goes | Deposited in an Iraqi bank, verified at registration |
| Nominal value of each share | One Iraqi dinar |
| Shareholders | Minimum 2, maximum 25 |
| Management | A managing director, plus a deputy managing director |
| Foreign manager | Permitted, with Ministry of Interior approval |
The deputy managing director is a requirement people miss. The company appoints one alongside the managing director to exercise the powers when the managing director cannot, and it is part of the incorporation pack rather than an afterthought.
What the registry charges
Federal fee schedules are not consistently published, which is itself worth knowing. The Kurdistan Region publishes its own:
| KRG fee | Amount |
|---|---|
| Capital fee | 4,500 IQD per million of capital |
| Inspection fee | 25,000 IQD |
| Company registration fee | 50,000 IQD |
Market pricing for the whole setup is covered in Iraq company registration cost.
After incorporation: four registrations, not one
- General Commission for Taxes, for tax registration.
- Daman, the General Retirement and Social Security Authority, for social security.
- Employment notifications, as part of post-incorporation filings.
- An auditor, appointed as part of the incorporation and carried forward.
Between roughly day 90 and the end of the first year come the obligations that catch people: onboarding local hires to meet localisation commitments, the first quarterly tax returns, and preparation for the first annual accounts cycle. Full calendar in Iraq company compliance.
Why files stall
- MOI clearance, which has no published timeline and cannot be accelerated.
- Legalisation started too late, so the pack is incomplete at the counter.
- Capital not verifiable, because the bank account and the deposit trail were treated as a later step.
- A shareholding structure that does not satisfy the 51% rule, filed in the hope that it will pass.
- Sector permits discovered after filing, particularly in oil and gas, banking and insurance, which sit under separate regimes.
- Documents legalised through the wrong chain, federal instead of KRG or the reverse.
Timeline, day 0 to day 90
| Phase | Federal Iraq | Kurdistan Region |
|---|---|---|
| Screening and document preparation | Day 0 to 20 | Day 0 to 20 |
| Legalisation abroad | Day 0 to 25, in parallel | Day 0 to 25, in parallel |
| Name reservation and filing | Day 20 to 30 | Day 20 to 25 |
| MOI security clearance | Day 30 to 75, variable | Not applicable in the same form |
| Certificate issued | Day 45 to 90 | Day 30 to 40 |
| Bank, tax, Daman | Following weeks | Following weeks |
The gap between the two columns is the MOI clearance and nothing else. That is the whole story of why the Kurdistan Region is faster.
- Day 0 to 25Documents and legalisation, identical in both systems and run in parallel
- Day 20 to 30Name reservation and filing, day 20 to 25 in the Kurdistan Region
- Day 30 to 75Ministry of Interior clearance, federal Iraq only, no published timeline
- Day 30 to 90Certificate issued: Region day 30 to 40, federal Iraq day 45 to 90
The bottom line
Registering in Iraq is a seven-stage process wrapped around one legal fact and one administrative one. The legal fact is that federal Iraq caps foreign ownership at 49% since 2019, and the Kurdistan Region does not. The administrative one is the Ministry of Interior clearance, which has no clock.
Decide the jurisdiction first, decide the ownership route second, and start legalisation before you think you need to. If you want the entry structured rather than merely filed, that is what the Iraq formation package is built for.
Still weighing whether Iraq is the right market at all? Start with why incorporate in Iraq.
Frequently asked questions
Can a foreigner own 100% of a company in Iraq?
Not of a federal LLC or JSC. Law No. 17 of 2019 amended Article 12 of the Companies Law to require Iraqi shareholders to hold at least 51%. Full foreign ownership remains possible in the Kurdistan Region for licensed projects, and through a project licensed by the National Investment Commission, though the interaction between the Investment Law and the Companies Law is not fully settled.
How long does company registration take in Iraq?
Six to twelve weeks in federal Iraq, driven mainly by the Ministry of Interior security clearance, which has no published timeline. Two to four weeks in the Kurdistan Region, which does not apply the same requirement.
What is the minimum capital for an Iraqi LLC?
IQD 1,000,000, roughly USD 850, deposited in an Iraqi bank and verified at registration. Each share has a nominal value of one Iraqi dinar.
How many shareholders does an LLC need?
A minimum of two and a maximum of twenty-five, with liability limited to each shareholder's contribution.
What is the Ministry of Interior clearance?
A security check that every foreigner, whether an individual or a legal entity, must pass before becoming a shareholder in an Iraqi company. The Companies Registrar obtains that approval before issuing the certificate, and appointing a foreign manager requires it too.
Can I register in the Kurdistan Region instead?
Yes, if the project belongs there. The Kurdistan Region has its own registry, permits full foreign ownership of licensed projects, does not require a government contract to register a branch, and typically completes in two to four weeks.
Do I need a deputy managing director?
Yes. An Iraqi LLC appoints a deputy managing director alongside the managing director, and it forms part of the incorporation pack rather than a later filing.
What did the April 2026 digital platform change?
It shortened several filing stages and allows name reservation in federal Iraq to be started electronically. It did not change notarisation, legalisation or capital verification, which remain the slow parts.
What registrations follow incorporation?
Tax registration with the General Commission for Taxes, social security registration with Daman, employment notifications, and the appointment of an auditor. Localisation commitments and the first quarterly returns follow in the first year.
Do I need an Iraqi lawyer?
For the entry structure, yes. The 51% rule, the investment licence route and the unsettled relationship between the two are exactly the questions where a general guide should stop and local advice should start.
Sources
- Iraq Companies Law No. 21 of 1997, as amended by CPA Order No. 64 of 2004
- Law No. 17 of 2019 amending Article 12 of the Companies Law: the 51% Iraqi ownership requirement
- National Investment Commission (Investpromo): Investment Law No. 13 of 2006 and licensing
- KRG Business Registration System: national company and foreign branch registration
The 51% Iraqi ownership requirement follows Law No. 17 of 2019 amending Article 12 of Companies Law No. 21 of 1997, as amended by CPA Order No. 64 of 2004. The Kurdistan Region did not adopt the 2019 amendment and continues to permit full foreign ownership of licensed projects; the interaction between the Investment Law and the Companies Law on majority foreign ownership is understood by practitioners to permit it but is not fully settled, and that uncertainty is stated rather than resolved here. Minimum capital, share nominal value, shareholder limits, the Ministry of Interior clearance and registration timelines reflect practitioner sources as of September 2026. Fees, processing times and the April 2026 digital platform rollout should be confirmed with the Companies Registration Directorate or the KRG registry before filing. This is not legal or tax advice, and Iraqi entry structuring should be done with an Iraqi lawyer.