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Doing Business in Iraq
 
 
 

Starting a Business

Standardised Company

Legal Form: Private Limited Liability Company
City: Baghdad

Procedure 1: Search for a company name; obtain a name reservation letter from the Baghdad Chamber of Commerce

Time to complete: 2 days

Cost to complete: ID 210,000

Comment: The company name should be an Arabic name. A special department at the Chamber of Commerce, Trade Names, starts by searching the suggested name through their system to see if the name is already taken or reserved by another company. Once a name is agreed upon and available, the name is reserved upon payment of a nominal fee. The Federation of the Chambers of Commerce is informed in order to ensure that the chosen name is not taken through other Iraqi chambers of commerce. This procedure likely requires more than one visit to both chambers and client coordination, ending with filing the name with the Registrar.

Procedure 2: Hire a lawyer to draft articles of association

Time to complete: 1 day

Cost to complete: About ID 400,000

Comment: Because lawyers are required to draft the articles of association, lawyers are usually also in charge of completing the registration process. The cost varies with the law firm.

Procedure 3: Deposit initial capital at commercial bank and obtain confirmation receipt

Time to complete: 2 days

Cost to complete: ID 5,000

Comment: After the company deposits the initial capital and obtains a confirmation receipt, the receipt must be filed with the Companies Register. The capital will be unblocked following registration.

Procedure 4: File for registration at the Commercial Registry

Time to complete: 14 days

Cost to complete: ID 250,000-350,000

Comment: Fees are paid directly to the Commercial Registrar. The fee schedule adopted by the Companies Registrar at the Ministry combines different fees (Registrar’s fee, stamp duty, filing fees, certain checking process, etc.), which are cumulative, according to company capital. The Company Registrar circulates the registration certificate to the bank, the tax authority, and other relevant agencies, including labour and so forth.

The following documents and information must be presented to the Registrar:

• Baghdad Chamber of Commerce letter (to reserve company or trade name);
• Chambers of Commerce Union letter (to ensure the consistency of the company or trade name with other registrations);
• Certified letter from the company’s bank;
• Iraqi identity cards;
• Iraqi certificate of citizenship;
• Ration card (food distribution form);
• Address certificate letter from the mayor’s office;
• Phone number(s), email address(es), and P.O. box number(s) of the company’s founder(s).

The registration fees are calculated as follows:

• Baghdad Chamber of Commerce fees: ID 45,000;
• Chambers of Commerce Union fees: ID 15,000;
• Bank fees: ID 25,000;
• Company registration fees: based on company capital.

Procedure 5: Advertise incorporation notice in the newspaper

Time to complete: 3 days

Cost to complete: US$70

Comment: Once the registration has been approved, the Companies Registrar issues a letter to request the two required publications, but the process must be followed up by the registration agent (lawyer), who must submit a copy of each publication to the registry.

Procedure 6: Make company seal

Time to complete: 2 days

Cost to complete: ID 20,000

Procedure 7: Obtain registration certificate

Time to complete: 1 day

Cost to complete: Included in Procedure 4

Comment: Once all related procedures, including both publications, are complete, the Companies Registrar issues the certification of registration. On the date of issuance, the company acquires its legal personality. A registration circular will be sent to all entities concerned.

Procedure 8: Report to tax authority to establish tax registration

Time to complete: 2 days

Cost to complete: No charge

Comment: This initial tax registration is important to commencing company operations. On a date set by the tax authority, the company must submit its first balance sheet to the tax authority, which will then provide the company its tax identification number the same day.

Procedure 9: Legalise accounting books

Time to complete: 2 days

Cost to complete: US$150

Comment: The General Body of Taxes must notarise or register the company accounting books and any new accounting books.

Procedure 10: Register employees for social security

Time to complete: 3 days

Cost to complete: About ID 20,000

Comment: The cost for social security registration depends on the number of employees. Any company employing more than three employees is bound, under the Social Security Law, to enroll their employees into the social security insurance program. The employer will deduct 5% from the employee’s salary and add to it an amount equal to 12% of the employee’s salary, resulting in a total payment of 17% to the Social Security Authority.

Procedure 11: Apply for a trade licence

Time to complete: 30- 60 days

Cost to complete: ID 200,000

 

 
 


 



 


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