Investing in Iraq in 2026

Investing in Iraq in 2026: Five Legal Questions International Companies Should Address Before Market Entry

Iraq continues to attract international companies across infrastructure, industry, construction, technology, trade, logistics, and other sectors. In February 2026, Iraq’s National Investment Commission announced 65 new investment opportunities and reported total investment volumes of USD 104 billion, including USD 67 billion in foreign investment. These figures are official NIC figures and should be understood as indicators of the broader investment environment rather than as a guarantee of the commercial viability of any individual project.

For an international company, however, identifying a commercial opportunity is only the beginning. Before committing capital, signing contracts, appointing a local partner, or establishing a presence in Iraq, the company should determine how its proposed activity can be structured and implemented within the Iraqi legal and regulatory framework.

Five questions are particularly important.

1. What is the appropriate legal structure for our activities in Iraq?

There is no single market-entry structure suitable for every foreign company.

Depending on the nature and duration of the proposed activity, the contractual model, the sector involved, and the level of presence required in Iraq, a company may need to consider establishing an Iraqi entity, registering a branch of the foreign parent company, or operating through another legally appropriate commercial arrangement.

Foreign-company branches are regulated under the Regulation of Branches of Foreign Companies No. 2 of 2017, as amended, and are registered through the Companies Registration Department of the Iraqi Ministry of Trade. Official registration requirements include corporate documents relating to the parent company, a valid certificate of registration, recent financial accounts, information on authorised representatives, and powers granted to the branch management. Certain documents must also be certified in the country of origin and translated into Arabic. 

The legal vehicle should therefore follow the business model—not the other way around. A company should assess its intended activities, contracts, regulatory exposure, operational requirements, and anticipated duration in Iraq before choosing its structure.

2. Does the project require an investment licence?

Company registration and an investment licence are not the same legal process.

Iraq’s Investment Law No. 13 of 2006, as amended, establishes a separate framework for qualifying investment projects and provides the legal basis for certain incentives, guarantees and exemptions. The National Investment Commission and the relevant Provincial Investment Commissions administer investment licensing within their respective areas of competence. 

The official investment-licensing process may require, among other things, an executive summary of the project, an economic feasibility study, evidence of financial capacity, a project implementation timetable, and corporate documentation where the investor is a legal entity. 

The Investment Law does not apply uniformly to every activity. In particular, Article 29 excludes investment in the extraction and production of oil and gas and investment in the banking and insurance sectors from the scope of that Law. 

Accordingly, an investor should establish at an early stage whether its project requires ordinary corporate and sectoral registration, qualifies for the investment-licensing framework, or requires a different regulatory route.

3. Which sector-specific approvals and regulatory requirements apply?

Establishing a company or registering a branch does not necessarily authorise the company to carry out every proposed business activity.

Regulatory requirements may differ significantly according to sector. Industrial, construction, healthcare, technology, financial, infrastructure and other activities can involve different authorities, approvals and technical requirements.

The National Investment Commission’s One-Stop Shop is specifically tasked, in the context of investment projects, with coordinating with the relevant governmental and sectoral authorities to obtain approvals necessary for issuing investment licences and implementing licensed projects. 

For this reason, regulatory mapping should take place before significant contractual or financial commitments are made. International companies should determine which authority regulates the proposed activity, which licences or approvals may be required, and whether those requirements affect the proposed corporate or contractual structure.

4. Have we properly assessed our local partner, distributor or counterparty?

Many foreign companies enter a new market through commercial relationships with local distributors, agents, contractors, suppliers or strategic partners.

The existence of a registered Iraqi company should not, by itself, be treated as sufficient due diligence.

Depending on the transaction, a legal review may need to examine the counterparty’s corporate status, authorised representatives, contractual authority, licences relevant to the proposed activity, ownership and management information, and other matters material to the transaction.

The contract itself should also address issues such as scope of authority, exclusivity where applicable, payment arrangements, intellectual-property protection, allocation of liability, termination rights and dispute-resolution mechanisms.

The appropriate level of due diligence should always reflect the nature, value and risk profile of the proposed relationship.

5. What obligations continue after market entry?

Legal market entry is not the end of the compliance process.

Once operating in Iraq, a foreign company may face continuing obligations relating to corporate filings, taxation, accounting, employment, licences, contractual compliance, renewals and other regulatory matters, depending on its structure and activities.

The Iraqi General Commission for Taxes states that foreign companies registered in Iraq, or foreign companies with a permanent establishment in Iraq, are taxed on income arising in Iraq. Its current corporate-tax guidance identifies a 15% rate for general activities, while entities falling within the scope of Law No. 19 of 2010 are subject to a 35% rate. 

Separately, qualifying projects under the Investment Law may benefit from statutory incentives and exemptions. The NIC identifies benefits that may include tax exemptions, customs-related benefits, the ability to repatriate invested capital and returns, and other protections, subject to the conditions and scope of the applicable investment regime. 

Accordingly, tax and compliance treatment should be determined for the specific company and project, rather than assumed from the general investment framework.

Before Entering the Iraqi Market

The key legal question for an international company is not simply:

“Can we do business in Iraq?”

A more useful question is:

“What legal pathway best fits our business model, sector, proposed activities, timetable and risk profile?”

A structured legal assessment before implementation can help identify the appropriate market-entry route, applicable regulatory requirements, key legal risks and the sequence of actions required before capital and management resources are committed.

For companies already operating in Iraq, the same approach can also be used to review existing structures, identify compliance gaps and plan further expansion.

Planning to Enter or Expand in Iraq?

Hamurabi Iraq provides structured legal assessments for international companies exploring, entering or operating in the Iraqi market.

The assessment is designed to clarify the relevant legal pathway, core requirements, principal risks and recommended next steps before implementation.

Request a Legal Assessment