IRAQ Law and Practice Contributed by: Ahmed Al-Janabi and Sarmad Akrawi, MENA Associates in association with AMERELLER
1.2 Sources of Corporate Governance Requirements The main source of law related to corporate gov - ernance requirements in Iraq is the Companies Law. No code or regulation has to date been enacted specifically to regulate corporate gov - ernance matters. The Companies Law sets out most of the corpo - rate governance rules, determining managerial powers and responsibilities of the different bod - ies within the company. The articles of association may also set out rules and requirements, though this is not particularly mentioned in the law. However, the document must at a minimum include the following: • name and form of the company; • the company’s objects and type of business; • address of head office in Iraq; • name, nationality and profession of founder(s); • share capital, amount of cash and in-kind contributions, a description of any contribu - tions in kind, and names of the contributors; and • number of elected members on the board of directors (in a JSC). 1.3 Corporate Governance Requirements for Companies With Publicly Traded Shares Joint-stock companies are the only type of entity in Iraq whose shares may be publicly traded. It is required for a part of the shares to be offered for public subscription. The chairman or deputy chairman may not also be the managing director of the JSC.
The following committees are to be established comprising members selected from the board of directors: • audit committee to recommend external, independent auditors; and • compensation committee to determine the remuneration of board members and the managing director. Committee members may not be officers, employees or holders of 10% or more of shares in the company. 2. Corporate Governance Context 2.1 Hot Topics in Corporate Governance There are no other key corporate governance rules and requirements to be drawn out in Iraq. 2.2 ESG Considerations There are no laws or regulations for companies regarding environmental, social and governance (ESG) issues. These provisions may be provided for in the company’s internal policies or articles of association based on standard international practices in this area. 3. Management of the Company 3.1 Bodies or Functions Involved in Governance and Management The general assembly of shareholders consists of all members of the company and is con - sidered the highest authority of the company, according to the Companies Law. The general assembly of an LLC appoints and determines the authorities of the managing direc - tor and deputy managing director. The deputy
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