New Commercial Code of Iran
New development
The number of economic laws of Iran is very limited. A major reason for this shortcoming is that the general principles of the civil and commercial law of Iran are believed to respond to all possible questions in the field of international trade and economic law. In other words, the Civil Code and the Commercial Code of Iran are considered by majority of the Iranian lawyers as jus communes of the Iranian legal system. This understanding in its turn is based on a basic rule of Islamic law that fiqh (teachings of Sharia) shall respond to all legal queries forever.
The old Commercial Code of Iran dated back to 1920s. During the last 20 years, different projects were initiated in order to prepare an up-to-date version of the Code but to no avail. Finally, two decades of continuous efforts resulted in adopting a new Commercial Code in April 2014.
What are the impacts of the new Commercial Code on the economic and international trade law of Iran? This Newsletter tries to share with you a brief response to the above question, covering the following seven subjects.
Definition of commercial activities
Section 1(8-14) of the Code includes the following ICT-related matters in the scope of commercial activities: “issues related to information and communication technology including offering of national or public domain names; rendering services of access to communication or the Internet-based networks; rendering of hosting or data center services as well as the issues related to providing electronic contents or computer soft wares.”
This provision amounts to legal recognition of an already established practice. This means that legally speaking, section 1(8-14) just makes it easier for Iranian lawyers to convince the courts that ICT activities are commercial in nature.
Definition of legal persons in commercial law
Section 124 of the new Code states that concept of domestic ‘legal person’ includes government, government institutions, chartered companies, public and non-governmental associations and entities, non-profit making institutions, corporations and Islamic charity trusts (moqofat). Section 126 mentions that government institutions, public and non-governmental associations, and chartered companies that are established under a special law acquire their legal personality at the moment that the special law becomes enforceable. This means that registration of these entities is not required.