Setting up a logistics company in Iraq involves selecting an appropriate corporate vehicle, satisfying the shareholding rules that apply to most Iraqi companies, navigating the Companies Registrar process, and progressing through the sector-specific licensing addressed in Chapter 2. Companies Law No. 21 of 1997, as amended in 2019, provides the principal framework, with transport-specific overlays administered by the Ministry of Transport and related authorities. Treating establishment as a substantive workstream rather than an administrative checkbox makes the subsequent operational launch materially smoother.
Corporate Vehicle Options
Iraqi law offers several corporate vehicles suitable for logistics operations:
- Limited Liability Company (LLC). The dominant choice for most logistics businesses, including joint ventures involving foreign participation.
- Joint Stock Company (JSC). Used for larger ventures requiring a more formal governance framework.
- Single-Member LLC. Used by Iraqi parents holding a wholly-owned subsidiary.
- Branch of a foreign company. Registered with the Ministry of Trade and not a separate Iraqi legal entity.
- Specialised vehicles. Used for specific sub-sectors with distinctive regulatory characteristics.
The LLC is the standard vehicle in the great majority of cases. The branch is a particularly important option for foreign operators for reasons explained in the Foreign Ownership section below.
Foreign Ownership
The default position under the federal Companies Law, as amended in 2019, requires Iraqi nationals or Iraqi-owned entities to hold at least 51% of the share capital of an LLC or JSC, leaving foreign ownership capped at 49%. The amendment reversed an earlier liberalisation that had permitted up to 100% foreign ownership, and it applies across most sectors including logistics. A foreign investor seeking a directly held Iraqi logistics subsidiary will therefore ordinarily need an Iraqi partner; the joint-venture structures used.
Several routes allow foreign logistics operators to participate without the 49% cap:
- A branch of a foreign company, which is not a separate Iraqi legal entity and falls outside the Iraqi-shareholding requirement.
- A project licensed under the Investment Law No. 13 of 2006, which through the National Investment Commission may secure broader foreign ownership.
- A free-zone establishment, typically permitting full foreign ownership for in-zone activities.
- A company incorporated in the Kurdistan Region of Iraq, which is not subject to the 2019 amendment and may be wholly foreign-owned.
In practice, most foreign logistics investors choose between a joint venture under the 49/51 structure, operation through a branch, or an Investment Licence where the project qualifies.
Capital Requirements
Following the 2019 amendments, minimum capital thresholds were substantially reduced. The nominal floor is modest, but sector-specific licensing considers realistic capitalisation of the proposed activity. Logistics operations involving substantial assets such as vehicles, warehouses, and equipment should be capitalised commensurately rather than at the legal minimum. Undercapitalised operations attract licensing scrutiny and operational difficulties in practice.
Registration Process
Incorporation follows a defined sequence:
- Name reservation with the Companies Registrar
- Drafting and notarisation of the Memorandum and Articles of Association
- Deposit of paid-in capital with an Iraqi bank
- Submission of incorporation documents to the Companies Registrar
- Issuance of the Certificate of Incorporation
- Registration with the General Commission for Taxes
- Registration with social security and labour authorities
- Chamber of Commerce registration
Realistic timelines range from four to twelve weeks depending on the corporate form chosen and the completeness of the documentation, with foreign-investor files requiring document legalisation tending toward the upper end of the range.
Documentation and Post-Incorporation
Standard documentation includes shareholders’ identification or constitutional documents, evidence of legal existence for corporate shareholders, board resolutions authorising the investment, powers of attorney for representatives, lease or ownership evidence for the registered office, and proof of capital deposit. Foreign documents require legalisation through the Iraqi consular network and certified Arabic translation.
Post-incorporation, the company should apply for transport-sector licences addressed in Chapter 2, secure operational premises, register any vehicles operated, establish customs broker relationships where customs work is involved, open operational bank accounts, and obtain sectoral approvals for specialised activities. The interval between incorporation and operational launch is often longer than incorporation itself.
How We Can Help
Etihad Law Firm advises on logistics company establishment, including corporate vehicle selection, constitutional document drafting, navigation of the Companies Registrar, foreign ownership structuring, and coordination of post-incorporation steps with sector licensing.