The Iraq Securities Commission (ISC) is the principal regulator of Iraq’s capital markets, with broad responsibilities for issuer oversight, market integrity, intermediary regulation, and investor protection. Understanding the ISC’s role, powers, and operational patterns is essential for any party engaged with the Iraqi capital marketS, issuers, investors, intermediaries, and advisers. The ISC operates alongside the Iraq Stock Exchange (ISX) and other authorities, with each addressing distinct elements of the broader capital markets framework.
Mandate and Scope
The Iraq Securities Commission’s mandate covers, including Regulation of public securities offerings including prospectus approval, oversight of listed companies in their dealings with the public markets, supervision of intermediaries operating in the securities markets, market integrity through prohibition and enforcement against insider trading and market manipulation, protection of investors through disclosure requirements and investor protection frameworks, development of the capital markets through policy and regulatory initiatives, and Coordination with international securities regulators on cross-border matters. Each element of the mandate is exercised through specific procedures and engagement patterns.
Powers
The ISC exercises substantial powers including:
- Approval of prospectuses for public offerings.
- Licensing of intermediaries operating in the markets.
- Issuance of regulations governing market participants and conduct.
- Inspection of regulated entities for compliance with applicable rules.
- Investigation of suspected violations of securities laws and regulations.
- Imposition of administrative penalties for violations.
- Referral of serious cases for criminal prosecution.
- Suspension or revocation of approvals and licences in defined circumstances.
- Issuance of orders requiring corrective action by regulated entities.
ISC powers support its supervisory and enforcement functions across the capital markets framework.
Engagement with Issuers
Issuers engage with the ISC across multiple touchpoints:
- Pre-IPO engagement during the preparation phase.
- Prospectus submission and approval for public offerings.
- Ongoing disclosure submissions throughout the listing’s life.
- Periodic financial reporting submitted through the ISC framework.
- Specific approval procedures for material corporate transactions.
- Inspections and inquiries regarding compliance matters.
- Where applicable, enforcement proceedings for alleged violations.
- Engagement on policy and regulatory developments affecting listed companies.
Constructive engagement with the ISC produces better outcomes than transactional or adversarial postures.
Engagement with Investors
The ISC’s investor protection function involves direct engagement with investors, including maintenance of public registers and disclosure databases supporting investor access to information, receipt and handling of investor complaints about issuers, intermediaries, or market matters, investigation of complaints raising regulatory concerns, education and awareness initiatives supporting investor capability, and Where applicable, support for investor recovery in cases of confirmed violations. Investors with concerns about issuers or intermediaries can typically raise them with the ISC through established complaint procedures.
Engagement with Intermediaries
Intermediaries, brokers, market makers, and other licensed market participants operate within the ISC’s licensing and supervision framework. The ISC engages with intermediaries through initial licensing, ongoing supervision, conduct rules covering their dealings with clients and the market, capital and prudential requirements, and where applicable disciplinary action for violations. Intermediaries’ continuing operation depends on maintaining ISC licensing and respecting the conduct framework.
Cooperation with the ISX
The ISC and the Iraq Stock Exchange exercise complementary but distinct functions. The ISC is the regulator with broad legal authority over the capital markets, while the ISX operates the trading marketplace with its own listing rules and trading procedures. The two bodies coordinate on matters affecting both functions, with the ISC providing the regulatory framework within which the ISX operates and the ISX implementing market mechanisms supporting the broader framework.
Policy and Development
Beyond its supervisory role, the ISC contributes to capital markets development through policy initiatives, regulatory modernisation, and engagement with international standards. Policy developments shape the framework within which issuers and other market participants operate, and engagement with the policy process is part of how sophisticated market participants help shape the environment in which they work.
How We Can Help
Etihad Law Firm advises clients on engagement with the Iraq Securities Commission, initial registrations and approvals, ongoing compliance with ISC frameworks, response to inspections and inquiries, defence of enforcement proceedings, and engagement on policy and regulatory matters. We work with issuers, investors, intermediaries, and advisers across the capital markets framework.