IRAQ Law and Practice Contributed by: Ahmed Al-Janabi, MENA Associates in association with AMERELLER
4.3 Hurdles to Stakebuilding Alteration of Reporting Thresholds and Other Hurdles to Stakebuilding in Iraq According to the Iraqi Companies Law, report - ing and filing requirements are mandatory and cannot be altered or reduced by the articles of incorporation or by-laws. Companies may only impose additional obligations provided these are consistent with the statutory requirements. For example, general assembly meetings can have increased requirements, but they cannot reduce what is stipulated by law. Another common hurdle in stakebuilding is the voting process. Shareholders often face difficul - ties reaching a majority agreement on alternative voting rules, as they must adhere to the proce - dures set out in the Companies Law. 4.4 Dealings in Derivatives Lack of Clear Regulation Dealing in derivatives is not clearly regulated under Iraqi law. Case-by-Case Decision The Register of Companies makes decisions on derivatives transactions on a case-by-case basis. This approach means that each derivatives deal is individually assessed to ensure compliance with the overall corporate and financial frame - work. 4.5 Filing/Reporting Obligations Iraq’s competition framework is governed by Law Number 14 of 2010 on Competition and Monopoly Prevention. However, this Law does not set out any filing or reporting obligations for derivatives under securities disclosure or com - petition laws.
The Law primarily focuses on preventing monop - olistic practices and maintaining fair competi - tion. It does not include provisions specifically addressing derivatives transactions. Therefore, there are no additional mandated fil - ing or reporting obligations for derivatives under this law. 4.6 Transparency Shareholder Disclosure Obligations The law in Iraq does not require shareholders to declare the purpose of their acquisition or their intention regarding control of the company. However, the Companies’ Registrar mandates that all companies file an Ultimate Beneficial Owner (UBO) declaration. This UBO form must clearly identify the ultimate owner who controls the shares in the company. 5. Negotiation Phase 5.1 Requirement to Disclose a Deal Disclosure Requirements for Target Companies Iraq’s law does not mandate a specific stage at which a target company must disclose a deal. There is no legal obligation to disclose when first approached, during negotiations, upon signing a non-binding letter, or at the point of signing
definitive agreements. Acquirer’s discretion
Acquirers can stipulate disclosure conditions within the deal terms. This allows them to require the target to disclose relevant business informa - tion at a particular stage, based on their require - ments.
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