IRAQ Trends and Developments Contributed by: Buraq Al-Hamdy, Waddah Hamed, Sajida Ankouni and Mohammad Jaber, Basrah Obelisk Law Firm Ltd
structuring agreements in a way that ensures realistic and achievable enforcement outcomes. Public procurement and tendering environment Public procurement remains a major component of Iraq’s commercial activity, particularly in infrastructure and government-related projects. Tender processes issued by public authorities and international opera- tors typically involve strict procedural requirements and formal documentation standards. In practice, bidders are required to ensure consistency across corporate records, authorisations and regula- tory filings. Even minor inconsistencies can create compliance risks or lead to disqualification. Another important feature is the limited flexibility in tender submissions. Deviations from prescribed terms often must be explicitly disclosed, and failure to do so can have significant consequences. Accordingly, participation in public tenders requires not only legal accuracy, but also strong co-ordination between legal, commercial and operational teams. The expanding role of local legal counsel A defining feature of the Iraqi legal environment is the mandatory and practical reliance on licensed local legal counsel for a wide range of legal, regulatory and procedural matters. This includes court representa- tion, regulatory filings, company registration and par- ticipation in public procurement processes. In recent years, the role of local counsel has expanded significantly beyond traditional representation. Legal advisers are now engaged at much earlier stages of commercial activity, including market entry planning, contract structuring and regulatory strategy. In practice, foreign companies often face challeng- es in aligning documentation with local procedural requirements and navigating administrative systems. Local counsel plays a critical role in bridging this gap, not only through legal interpretation, but also through practical insight into how institutions operate. Importantly, legal advice is increasingly integrated into commercial decision-making. Companies are involv-
ing legal advisers in discussions around risk alloca- tion, dispute resolution design and enforcement strat- egy from the outset of transactions. This reflects a broader shift in Iraq: legal risk is no longer treated as a downstream issue, but as a core component of commercial planning. As a result, early and continuous engagement with experienced local counsel has become a key success factor for foreign investors operating in Iraq. Regional legal complexity and jurisdictional considerations Iraq’s legal environment is further shaped by the co- existence of federal law and the legal system of the Kurdistan Region of Iraq (KRI). While broadly aligned in principle, practical differences may arise in proce- dure and enforcement. For companies operating across multiple jurisdictions within Iraq, this introduces additional complexity in relation to jurisdictional clarity and dispute resolution planning. Careful drafting of governing law and forum selection clauses is therefore essential to avoid ambiguity and reduce enforcement risk. Alternative dispute resolution Alternative dispute resolution mechanisms, particu- larly negotiation and mediation, are becoming increas- ingly relevant in Iraq’s commercial environment. These mechanisms are commonly included as early-stage steps within multi-tier dispute resolution clauses. Their use is primarily driven by commercial considera- tions, particularly in long-term projects where preserv- ing business relationships is important. While ADR is not yet fully institutionalised, its practical use continues to expand. In many cases, outcomes depend more on party engagement than on formal procedural enforcement. Practical implications for businesses Businesses operating in Iraq should consider the fol- lowing key points.
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