INCORPORATION OF FOREIGN BRANCHES
Incorporation of Foreign Branches
The interest for the incorporation of an Iranian Company is continuously increasing as more and more businessmen or individuals try to enter the Iran market following JCPOA and removal of sanctions against Iran. Our lawyers guide and assist local and International clients in all steps of the incorporation process of a new Iranian company or the registration of a branch in Iran.
Registration of Branch of Foreign Companies in Iran
The Council of Ministers approved the Executive By-Law of the Law Permitting Registration of Branches and Representative Offices of Foreign Companies on May 2, 1999. According to Article 1 of this By-Law, foreign companies may set up their branches or representative offices in Iran, in order to carry out the businesses mentioned hereafter.
Iranian law provides a list of activities that foreign branches may engage in their work in Iran. These activities are:
- Supply of after sales services of foreign companies;
- Carrying out the executive works of the contracts concluded between Iranian subjects and foreign companies;
- Investigation and providing the means for investment by foreign companies in Iran.
- Entering into cooperation with Iranian technical and engineering companies for the purpose of carrying out projects in a third country;
- Increase of non-oil Iranian exports and transfer of technical know-how and technology;
- Carrying out activities that require permission from the relevant government organizations such as offering services in the fields of transportation, insurance, surveillance, banking, marketing, etc.
The most important point regarding branch in Iran is that
a branch office is deemed to be carrying out business in Iran on behalf of the head office of the company and therefore the mother company shall take responsibility for the activities of the branch company in Iran. However, foreign companies for their presence in Iran enjoy a second option and that is registration of an Iranian company with 100% ownership and control by foreign shareholders, even in the main land.