Short answer: The work does not end with the certificate of incorporation. A limited company prepares final accounts every year, puts them to its general assembly and sends them to the Registrar. A foreign company branch files final accounts and an activity report every year. Both keep their records and notify changes. On top of that come the employer's social-security duties and filings with the General Commission for Taxes.
1) Limited company (Companies Law No. 21 of 1997)
- Final accounts: the managing director prepares the previous year's final accounts within the first six months of each year, with a report on them and on the annual plan, and submits them to the general assembly (Art. 117/Third, which applies to the managing director of a limited company under Art. 123/Second).
- Annual plan: the managing director prepares a plan for the coming year during the last six months of the year (Arts. 117/Fourth and 123/Second). The general assembly discusses and approves it (Art. 102/Fifth).
- General assembly: the assembly meets to discuss and approve the final accounts under Arts. 102/Fourth and 135.
- Signature and responsibility: the managing director signs the final accounts and is responsible for their accuracy (Art. 138).
- Filing with the Registrar: a copy of the meeting invitation goes to the Registrar with the annual list of members and the final accounts (Arts. 126–127). Copies of the final accounts, the annual plan and the related assembly resolutions follow (Art. 139). Assembly resolutions in general go to the Registrar within four days (Art. 99).
- Records: the law fines a company that does not keep the required records (Art. 216). We do not state the amount here.
- Continuous activity: stopping activity for a continuous period of more than one year without a legitimate excuse is a ground for the company's termination (Art. 147/Second).
2) Foreign company branch (Regulation No. 2 of 2017, as amended)
- Accounts and activity report: the branch files its final accounts and an activity report with the Registrar annually, within the period the Regulation sets (Art. 8).
- Manager: the branch is managed by a manager resident in Iraq. A change of manager is notified within 60 working days (Art. 7/Second).
- Cancellation: the Registrar may cancel the branch's registration by a reasoned decision in cases that include no commercial activity for four years since the last activity, or failure to file final accounts and required documents for two consecutive years without a legitimate excuse (Art. 11/First). Keeping up the annual cycle protects the registration itself.
3) Employer duties every year
- Social security (Law No. 18 of 2023): contributions continue for covered workers. The general rates in the law are 5%, 12% and 25%. The competent body is the Department of Pensions and Social Security for Workers; in the Kurdistan Region, the Directorate of Labour and Social Security.
- Work permits: a foreign worker's work permit is renewed annually (Instructions No. 1 of 2026, Art. 5). A work fee of IQD 2,000,000 is paid once for each foreign worker entering Iraq (Law 18/2023, Art. 106/First).
- End-of-service gratuity: due to the worker.
- Tax: the taxpayer files a return with the General Commission for Taxes. We do not state rates or dates here; they are checked case by case.
Short annual checklist
- Prior-year final accounts (limited company: within the first six months).
- General assembly; send the resolutions and accounts to the Registrar.
- Annual plan for the next year.
- Branch final accounts and activity report (Art. 8).
- Work-permit renewals; social-security records kept up to date.
- Tax return.
- Notify any change of manager or address.
We provide this service to our clients in Baghdad, the Kurdistan Region (Erbil, Sulaymaniyah, Duhok and Halabja) and Basra from our Baghdad office. See also: LLC or branch and Closing a foreign company branch.
Al-Taswia Legal Services Company is an Iraqi legal services company founded in 2018 in Baghdad, with a team of 15 lawyers. Othman Al-Juboori, Iraqi lawyer, Member of the Iraqi Bar Association. www.al-taswia.com
General information, not legal advice.