Archive

In our newsletter, you will find the latest news and comments on legal and trade-related developments in various areas of Iranian commercial and financial law and practice.

Contents

The Law for Removing Specific Hurdles to Production and Industrial Investment is Now in Force Levies on Export of Bulk Saffron Lifted Term Extension of the Islamic Penal Code Inclusion of Serial Number of Home Appliances Obligatory in Import Documents Special Economic Zone Established in Zanjan Province Price Control Organization Demands Lower Prices Export of Imported Goods Iran Joins United Nations Convention against Corruption Iran to Sign Agreement with Libya on Avoidance of Double Taxation Import of Items Needed in Veterinary Industry with Free Foreign Exchange Iran to Sign Agreements with Venezuela, Ghana and Ivory Coast Ban on Import of  "Electronic Cigarette" Value Added Tax Still Applicable on Imports Privatization Law Comes Into Force Conditions for Exporting from Free Zones and Special Economic Zones Preferential Trade Agreement Signed Between Iran and Syria Temporary Exit of Goods Does Not Require Commercial Cards Levies Set for Export of Scrap and Waste Metals Tax Holiday of Free Zones may be Increased to 30 Years Iran and Kuwait Agree on Avoidance of Double Taxation Legislation on Collection of Outstanding Claims from Sudan, Tanzania, Nicaragua, Jordan and North Korea Levies Applicable to Export of Gray Cement Import of Agricultural Seeds, Chemical Fertilizers, Gas Cylinders Fpr Cars, Crane Spare Parts and Precious Stones with Free Foreign Currency Allowed Litigation of Foreigners at Iranian Courts Subject to Statutes of Limitation Notebooks, Digital Cameras, Photocopiers…to be Imported with Free Foreign Currency Halal Certificate Required for Clearing Imported Edible and Cosmetic Goods Council of Ministers Approves USD 5b for Importation of Industrial Raw Materials Levies Imposed on Imported Vehicles Iran Enters Commercial Agreements with Cuba and Sri Lanka Import of Rice with Free Foreign Exchange Allowed Falsely Dated Pro Forma Invoices Unacceptable Import of Airplane Spare Parts with Free Foreign Currency Allowed  Decrease of Commercial Benefit Tax on Certain Tariffs VAT Legislation Passed Government Sets Levies on Export of Six Foodstuff Items Unauthorized Use of Bank Facilities in Housing to End in Blacklisting Iran Signs Bilateral Agreement with Kuwait on Promotion and Protection of Investments   Importation of Raw Materials and Machinery Free for All Importers After 77 Years Iran has a New Law for Trademarks, Industrial Design and Patents Provincial Expansion of the Center for Foreign Investment Services Tariff Tables for Imported Goods Applicable in the Current Year Importation of Goods Eased Condition of the Manufacturing Year of Production for Import of Vehicles The Customs Decree on Evaluation of Goods Related to Foreign Investment The Law for Combating Money Laundering Re-export of Items Lacking Entry Documentation Tariff on Imported Rice Eliminated Importers of Fuel Efficient Cars Exempt from Duties Commercial Benefit Tax Lowered for Import of Mobile Phone Sets

31 December 2008

The Law for Removing Specific Hurdles to Production and Industrial Investment is Now in Force

Nourlaw.com (31 December 2008)- The Law for Removing Specific Hurdles to Production and Industrial Investment is now in effect after publication on 8 December 2008 in the Official Gazette. The law was approved on 7 Mordad 1387 (28 July 2008) by the Industries and Mines Commission of the parliament. It sets forth rules for environmental improvement, facilitation of industrial production and exports. According to its first article, a levy up to 1% of sales revenue shall be imposed on industries polluting the environment. On the basis of Article 2, the government shall, for protecting industrial exports, allocate sums for compensating some of the export costs related to capital and consumer goods, parts and accessories, and technical services. By virtue of Article 3, the government is also obliged to adopt measures insuring that the difference between bank interest paid to the depositors and the facilities must not exceed 3%. As foreseen in Articles 5 and 6, any discrimination in supplying electricity and gas to the factories and related pricing shall be lifted with respect to the governmental, cooperative and private sectors. With respect to Article 21 of the Labor Law which does not allow firing of workers and in an effort to ease this stricture,Article 8 of the Law stipulates that the work contract may be terminated if termination option has been mentioned in the contract. For facilitation and expansion of exploration and exploitation of mines, and safeguarding the natural and juridical mines against local nuisances, the law in Article 9 considers any such interference illegal and subject to prosecution and punishment. According to Article 10, banks are obliged to extend facilities in rials and foreign currencies (out of the Foreign Exchange Reserve Account) for industrial and mineral projects. The banks are bound to answer the application for facilities within a maximum one month and should these facilities be refused, the bank must inform the applicant in writing the reason for the refusal. Outstanding facilities commensurate to the time of delay in repayment of the instalment should enjoy a moratorium on repayment. According to Article 11, governmental corporations and organizations are obliged to give priority in purchasing to domestic manufacturers and settle the invoices of the sellers and contractors within 30 days. For protection of domestic products, the tariff of the SKD and CKD of mobile phones, home electric appliances and other electric equipment (expect cars and high tech industries) shall be respectively below 80%, and 10% the tariff of the CBU. The law shall be valid for a five-year trial period.

24 December 2008

Levies on Export of Bulk Saffron Lifted

Nourlaw.com (24 December 2008) -- Iranian Customs in its circular letter number 383/71/531/747/235540/259103 dated 24/09/1387 (14 December 2008) has lifted all levies on the export of bulk saffron. In October 2008, the Iranian government set incentives for encouraging the export of small packages of saffron and procuring the added valued gained from such packing (ranging from 1 to 10 milligrams). It also placed levies on bulk exports. In light of current domestic and international economic conditions, the new decision of the government has apparently been adopted for removing impediments to exporting saffron.

24 December 2008

Term Extension of the Islamic Penal Code

Nourlaw.com (24 December 2008) -- The Iranian parliament on 28 Azar 1387 (18 December 2008) approved the law for the extension of the Islamic Penal Code for another year. It is now in effect as per recently being published in the Official Gazette. The code, essentially based on the decrees of the Quran and Shia jurisprudence, contains 729 articles. In addition to other crimes, certain economic and commercial offences are also dealt with in the code. On 27 October 1991, the code was sanctioned by parliament to be implemented on a trial basis. Since that time its duration of validity has been extended for different periods.

03 December 2008

Inclusion of Serial Number of Home Appliances Obligatory in Import Documents

Nourlaw.com (24 December 2008) -- In a bid to halt contraband imported goods, Iranian Customs has stipulated in its circular letter number  378/73/385/525/230109/253084 dated 16 Azar 1387 (6 December 2008) that  following the Customs instructions for including the serial number of imported home appliances along with other related specifications, a complete copy of the full specifications of  imported home appliances containing the serial number, model and brand of the goods must be obtained from the owner of the goods at the time of clearance for verification and comparing the said specifications with those marked on the respective goods.

24 December 2008

Special Economic Zone Established in Zanjan Province

Nourlaw.com (24 December 2008) -- The Iranian Council of Ministers in its decree number 41372/162855 dated 12 Azar 1387 (2 December 2008) has stipulated that a special economic zone shall be established in the western province of Zanjan. According to the Law on the Establishment and Administration of the Special Economic Zones in I.R.I., “In order to support economic activities and organize increased international trade relations in regional economies and producing and processing goods, transfer of technology, promoting non-oil exports, creating productive employment and attracting and protecting domestic and foreign investment , re-export, transiting and trans-shipping, the government is authorized to establish the zones in provinces which have the requisite capacity and potential for the fulfilment of the said objects under the designation Special Economic Zone”. Presently there are 19 special economic zones as listed here below: 1.Sirjan Special Economic Zone 2.Sarakhs Special Economic Zone 3- Bandar-e- Anzali Special Economic Zone 4- Payam Special Economic Zone 5- Khuzestan Special Economic Zone 6- Salafchegan Special Economic Zone 7- Khorramshahr Special Economic Zone 8- Persian Gulf Ship Building Special Economic Zone 9- Arg-e-Jadid Special Economic Zone 10- Bandar Imam Khomeini Petrochemical Special Economic Zone 11- Bandar Bushehr Special Economic Zone 12- Assalouyeh Special Economic Zone 13- Bandar Amirabad Behshahr Special Economic Zone 14- Bandar Shahid Raja'ee Special Economic Zone 15- Mines and Metals Special Economic Zone 16- Pars Special Economic Energy Zone 17-Sang-e-Lorestan Special Economic Zone 18- Shiraz Electric and Electronics Special Economic Zone 19- Yazd Textile Industries Special Economic Zone

03 December 2008

Price Control Organization Demands Lower Prices

Nourlaw.com (03 December 2008) -- Iranian importers and manufacturers were ordered to adjust their prices relative to the global reduction of the price of raw materials. The Consumers and Producers Protection Organization (CPPO) which is charged with controlling prices of vital imported and manufactured goods, in a decree published on 2 December 2008 has declared: "In light of the changes in the global economy and the resulting effects, in particular with respect to the decline in demand and the ensuing considerable decrease in price of various types of goods and services such as minerals, steel, copper, aluminium, and petrochemical base material etc., and the decrease in international transport rates as one of the determining factors in the prices of goods, all production units are bound to adjust the price of their products in proportion to the price of the raw materials. "Importers of consumer and capital goods are not excluded from this directive and are obliged to reduce prices. Consequently the inspectors of the CPPO shall increase their inspections and will take legal action against any violators." The CPPO sends alleged perpetrators to the Governmental Punishment Court (Tazirate Hokoumati) where penalties can be handed down ranging from a warning to fines and imprisonment of persons receiving a guilty verdict. The CPPO’s decree has ignited a protest among businesspersons who believe the global slump in prices will not be reflected for at least another six months. They assert that the order of the CPPC cannot reasonably be applied to raw materials used in production and purchased at the time of high global prices.

03 December 2008

Export of Imported Goods

Nourlaw.com (03 December 2008) -- Iranian Customs in its circular letter number 367/71/12/113/162854/244436 dated 9/9/1387 (29 November 2008) has declared that imported goods can be exported with the proviso that they have not been altered in any way.  The decree emphasizes that following a close examination of the import documents, import duties already paid shall be refunded to the exporter. Previously, imported goods had to be exported from the original customs house point of entry into the country. Now according to the said decree, any customs house can be utilized for exporting imported goods.

26 November 2008

Iran Joins United Nations Convention against Corruption

Nourlaw.com (26 November 2008) -- After more than two years, the Law of Accession of the Islamic Republic of Iran to the United Nations Convention against Corruption was ratified through the arbitration of the Expediency Council (EC) and forwarded to the president for implementation. The EC is the high ranking body which takes final decisions on legislation when a dispute arises between the Parliament and the Council of Guardians (CG). All parliamentary legislation must be reviewed by CG to insure its harmony with both the Constitution and the decrees of Islam. The law which was published on the order of President Ahmadinezhad on 29 Aban 1387 (19 November 2008) goes into effect as 5 December 2008. Ratification of the legislation by the EC is the latest step in a series of measures taken by Iran for creating a secure domestic business environment. In August this year, the long-awaited privatization law came into effect to promote the vigorous emergence of an Iranian private sector long overshadowed by a centralized economy and dominated by major government corporations for nearly three decades now. The privatization law contains stipulations which can be used for bridling corruption. Promoting competition and prohibiting the formation of monopolies is also part of the law. Article 44 bans any form of collusion which can create disorder in normal competition and lists the specifics of these actions, like price fixing, limiting the quantity of production, purchase and sale of goods and services in the market, imposing discriminatory conditions in transactions, hoarding, unfair pricing, dumping, making misleading statements etc. The Law for Combating Money Laundering is another legal anti-corruption stricture which came into force in March 2008. The law defines the penalties and punishments for acquiring, owning, keeping or using the revenues resulting from illegal activities with the knowledge that they are the direct or indirect result of the commission of crimes. Changing, exchanging. or transferring such revenues to conceal their illegal origin with the foreknowledge that the same has been the direct or indirect result of clearly illegal activities or assisting the perpetrator with a view to relieve such person(s) from being subject to the legal consequences and effects of criminal behavior, are considered money laundering crimes as well. The Law of Value Added Tax which was passed by the Parliament in February 2008 is yet another recent legal enactment aimed at increasing transparency in transactions while denying access to a series of trade practices that lend themselves to corrupt economic dealings. The common thread running through all the legislation mentioned above is the promotion of transparency, security of investment and waging battle with all those practices that lend themselves to corrupt practices whether in the private or public sphere. What can be ascertained from this serial legislation is that Iran has been steadily positioning itself and is now fully prepared to become a member state of the United Nations Convention against Corruption. What follows are excerpts of the preamble to the United Nations Convention against Corruption: The States Parties to this Convention, Concerned about the seriousness of problems and threats posed by corruption to the stability and security of societies, undermining the institutions and values of democracy, ethical values and justice and jeopardizing sustainable development and the rule of law, Concerned also about the links between corruption and other forms of crime, in particular organized crime and economic crime, including money-laundering, Concerned further about cases of corruption that involve vast quantities of assets, which may constitute a substantial proportion of the resources of States, and that threaten the political stability and sustainable development of those States,Convinced that corruption is no longer a local matter but a transnational phenomenon that affects all societies and economies, making international cooperation to prevent and control it essential, Convinced also that a comprehensive and multidisciplinary approach is required to prevent and combat corruption effectively,Convinced further that the availability of technical assistance can play an important role in enhancing the ability of States, including by strengthening capacity and by institution-building, to prevent and combat corruption effectively, Convinced that the illicit acquisition of personal wealth can be particularly damaging to democratic institutions, national economies and the rule of law, Determined to prevent, detect and deter in a more effective manner international transfers of illicitly acquired assets and to strengthen international cooperation in asset recovery, Acknowledging the fundamental principles of due process of law in criminal proceedings and in civil or administrative proceedings to adjudicate property rights, Bearing in mind that the prevention and eradication of corruption is a responsibility of all States and that they must cooperate with one another, with the support and involvement of individuals and groups outside the public sector, such ascivil society, non-governmental organizations and community-based organizations, if their efforts in this area are to be effective, Bearing also in mind the principles of proper management of public affairs and public property, fairness, responsibility and equality before the law and the need to safeguard integrity and to foster a culture of rejection of corruption,.. here agreed as follows…

19 November 2008

Iran to Sign Agreement with Libya on Avoidance of Double Taxation

Nourlaw.com (19 November 2008) -- The Iranian government by virtue of Decree Number H 29525 T/137272 dated 08/08/1387 (29 October 2008) has empowered the Ministry of Economic Affairs and Finance to conclude a temporary agreement with Libya on double taxation avoidance and exchange of information respecting taxes applicable to revenues, capital and assets belonging to the nationals of both contracting states. The ministry is bound to follow up the matter for final approval of the agreement in parliament.

12 November 2008

Import of Items Needed in Veterinary Industry with Free Foreign Exchange

Nourlaw.com (12 November 2008) -- The Ministry of Commerce in its circular letter number 87/210/3145 dated 14/8/87 (4 November 2008) has allowed import of the equipment and materials used in the veterinary industry with free foreign exchange. As a result, importers instead of going through the rather complicated process of getting the required foreign exchange through official channels can procure it from other sources such as the exporters who are allowed to allocated their foreign exchange revenues for importation of a number of goods.

05 November 2008

Iran to Sign Agreements with Venezuela, Ghana and Ivory Coast

Nourlaw.com (05 November 2008) -- The Iranian government in a decree passed in October 2008 empowered the Ministry of Economic Affairs and Finance to conclude temporary agreements in October 2008 with the states of Venezuela and Ghana on mutual administrative assistance for customs affairs. Permanent agreements in this regard are scheduled to be sent to the parliament for approval. In another development in the month of October, the Iranian government has authorized the Ministry of Economic Affairs and finance to finalize a temporary agreement for promotion and protection of foreign investments with the Republic of Ivory Coast.

29 October 2008

Ban on Import of  "Electronic Cigarette"

Nourlaw.com (29 October 2008) -- The Export and Import Regulations Bureau of the Ministry of Commerce in its circular letter number 210/2486 dated 30/7/1387 (21 October 2008) has declared that according to the report of the World Health Organization, a new type of smoking product known as the “electronic cigarette” is being distributed worldwide to evade the legal restrictions put on consumption of tobacco smoking products in public places. The ministry notes that the so-called electronic cigarette contains a noticeable amount of vaporized powdered nicotine which is released directly into the mouth of the individual consumer by spray canister. Since nicotine is a highly addictive narcotic substance with well known lethal consequences for human health, importation of this product is banned and the stocks that may have already been imported must be seized and destroyed.

29 October 2008

Value Added Tax Still Applicable on Imports

Nourlaw.com (29 October 2008) -- Iranian Customs in its circular letter number 299/73/788/113/194188/194276 dated 24/7/1387 (15 October 2008) has emphasized that application of the Value Added Tax (VAT) on exports and imports is still in force. Enforcement of the recently passed VAT law regarding certain groups of retailers and shopkeepers was suspended by the president following the closure of the traditional Iranian bazaars in major cities across the country, in protest to the VAT in the past weeks. The VAT amount is 1.5% of the CIF value of the imported goods plus another 1.5% levy, (totally 3%) and is applicable to domestically produced or imported goods and services.

24 September 2008

Privatization Law Comes Into Force

Nourlaw.com (24 September 2008) -- The long-awaited privatization law following publication in the Official Gazette became effective in late August 2008 and is expected to facilitate the vigorous emergence of the Iranian private sector which has been overshadowed by a centralized economy, dominated by major government corporations for nearly three decades. The law was passed by the parliament on 8 Bahman 1386 (28 January 2007), but because of objections from the constitutional oversignt body the Council of Guardian to certain clauses, it was referred to the legislative arbitration body, the Expediency Council which subsequently ratified it on 25/3/1387 (14 June 2008). The precise title of the law, the framework for which was outlined by the general policies of the Leader of the Islamic Republic of Iran, Ayatollah Seyyed Ali Khamenei, is “The Law Amending Certain Articles of the Fourth Economic, Social and Cultural Development Plan of the Islamic Republic of Iran and Implementation of the General Policies of Principle 44 of the Constitution”. Excerpts follow. Article 2 stipulates that: "Economic activities in the Islamic Republic of Iran consisting of production, purchase or sale of goods and services are divided into the following groups: Group One - All the economic activities except the instances mentioned in Group Two and Group Three of this Article. Group Two - The economic activities mentioned in the beginning of Principle forty four (44) of the Constitution Law * except the instances mentioned in Group Three of this Article. Group Three - Activities, establishments and companies subject to this group are: 1)  Mother telecommunication networks and issues related to provision of frequencies. 2)  The central networks for sorting, exchange and distribution of basic postal services. 3)  Military, police and security products at the discretion of the Commander General of the Armed Forces. 4)  National Iranian Oil Company and the companies engaged in extraction and production of crude oil and natural gas. 5)  Oil and gas fields. 6) Central Bank of the Islamic Republic of Iran, Bank Melli Iran, Bank Sepah, Bank of Industry and Mine, Export Development Bank, Bank Keshavarzi (Agriculture Bank), Housing Bank and the Cooperative Development Bank. 7)  Central Insurance and Iran Insurance Company. 8)  Primary grid networks for transfer of electricity. 9)  Civil Aviation Organization and the Ports and Shipping Organization of the Islamic Republic of Iran. 10) Dams and large water networks. According to Article 3 and the Notes thereto, ownership, investment and management of the government in the companies and corporations acting in the area of the aforesaid Group One is prohibited. The government shall be bound to transfer 80% of the value of the shares of governmental companies active in Group Two activities, except roads and railways, to the private, cooperative and non-governmental public sectors. However, the non-governmental sectors are allowed to initiate activity in the areas of roads and railways. Investment, ownership and management in the activities and companies falling under the scope of Group Three shall be exclusively with the government. Article 4 outlines the scope of the economic activities of the non-governmental sector as follows: Investment, ownership and management of activities in Group One shall belong exclusively to the non-governmental sector. Any privileges granted to governmental companies acting in the areas of Group One and Group Two shall be extended to the private, cooperative and non governmental public corporations engaged in similar activities. Articles 9 to 12 of the Law deal with the cooperative sector with a view to increasing the share of this sector in the national economy to 25% by the year 1393 (2014). In all instances wherein the government protects and gives incentives to the non-governmental sector, these instruments will be 20% higher for the cooperative sector except in matters of taxation. The capital resources of the cooperative sector are to be provided by establishment of the Cooperative Bank. In Articles 13 to 16, the mechanisms for revamping governmental companies are foreseen. The aim is to make optimal use of such companies, upgrade the management and increase their productivity. Articles 17 to 33 detail the process of transfer of governmental companies to the non-governmental sectors. The Privatization Organization is charged with selling transferable companies and adopting suitable methods for attaining the goals set out in the Law. The newly conceived "Justice Share" is defined in Articles 34 to 38. As outlined in Article 34: "for materialization of the policy of expansion of public ownership and enabling the establishment of social justice, the government is permitted to transfer up to 40% of the companies of Group Two to Iranian nationals. The poorest strata of society shall receive the "Justice Share" at a 50% discount and will pay the said amount in 10 year instalments. Villagers and nomads shall have priority in this respect." Promoting competition and prohibiting the formation of monopolies is also part of the privatization law. Article 44 bans any kind of collusion which may cause disorder in normal competition and lists the specifics of such actions, like price fixing, restricting or controlling the quantity of production and purchase and sale of goods and services in the market, imposing discriminatory conditions in transactions, hoarding, discriminatory pricing, dumping, making misleading statements etc. The law in Article 53 has envisaged formation of the Competition Council for attaining the goal of an economy free from unfair competition. The Council has special powers for combating anti-competitive practices in the market. Penalties and the remedy of damages have been foreseen for violators. The government is bound by virtue of Article 91 to make official the membership of the presidents or representatives of the Iran Chamber of Commerce, Industries and Mines (ICCIM), as well as similar Cooperative Chambers in the various councils charged with deciding on the economic affairs of the country. By virtue of the law, for increasing the active participation of the delegates of the private and cooperative sectors in important economic decisions, the presidents of the said chambers shall become official members of the Economy Council, Board of Trustees of the Foreign Exchange Reserve Account, Foreign Investment Board and the Supreme Board of Assignment of governmental corporations. ICCIM and Cooperative Chambers shall be the senior advisors of the government, parliament and the judiciary and shall endeavour to prepare the draft law for “producing a suitable environment for creating jobs and removing impediments to business”. As noted in Article 92, all contradictory laws and regulations shall be abrogated from the date of passing of the legislation.   * Nourlaw.com’s note: for more reader information we cite complete text of Principle 44 here. It states” The economic system of the Islamic Republic of Iran is based on the three public, cooperative and private sectors with regulated and sound planning. The public sector includes all major industries, mother industries, foreign trade, large mines, banking, insurance, power generation, big dams and irrigation networks, radio and television, post and telegraph and telephone, aviation, shipping, roads and railways and the like which are publicly owned and under the control of government. The cooperative sector shall include the production and distribution companies and institutions set up in the cities and villages according to Islamic principles. The private sector includes that part of agriculture, animal husbandry, industry, trade and services which shall complement the public and cooperative economic activities. Ownership in these three sectors shall be protected by the law of the Islamic Republic, insofar as it conforms to the other articles of this Chapter and does not violate the limits of the Islamic laws, promotes economic growth and development of the country and does not damage the society”.

24 September 2008

Conditions for Exporting from Free Zones and Special Economic Zones

Nourlaw.com (24 September 2008) -- Iranian Customs in its circular letter number 243/71/950/747/70394/171350 dated 31/6/1387 (21 September 2008) has declared that since shipment of the goods produced in the Special Economic Zones and Free Trade-Industrial Zones will be considered as exports, hence from the beginning of the year 1386 (21 March 2007) they shall be subject to all export incentives applicable on the mainland.

10 September 2008

Preferential Trade Agreement Signed Between Iran and Syria

Nourlaw.com (10 September 2008) -- Iranian President Mahmoud Ahmadinejad has notified the Ministry of Commerce of the Preferential Trade Agreement between the states of the Islamic Republic of Iran and Syria for implementation. The agreement was passed by the Iranian parliament on 6/5/1387 (27 July 2008). In the preface of the agreement it is stated that the pact could create a new environment for the economic and regional relations of Iran and Syria, stimulate expansion of their economies and facilitate their joining the World Trade Organization. The agreement contains clauses designed for reduction of customs duties (tariffs), removal of non tariff barriers (such as border levies), anti dumping measures and generally lays the groundwork for free future commerce.

10 September 2008

Temporary Exit of Goods Does Not Require Commercial Cards

Nourlaw.com (10 September 2008) -- Iranian Customs in its circular letter No. 222/71/477/747/157208 dated 12/6/1387 (2 September 2008) has stipulated that in light of Article 3 of the Export and Import Regulations Law and Clause 1 of Article 10 of the Implementing Regulations of the said law, the formalities for temporary exit of goods for repair and completion in addition to vehicles, machinery and equipment needed for the export of technical and engineering services can be accomplished without a commercial card. However, changing the permit from temporary export to final export status needs the commercial card.

10 September 2008

Levies Set for Export of Scrap and Waste Metals

Nourlaw.com (10 September 2008) -- The minister members of the Commission of Article 1 of the By-law of the Export and Import Regulations, a body charged with proposing export and import regulations, has stipulated in its decree No. K 40439 T/97378 dated 16.6.1387 (6 September 2008) that a 30% levy shall be imposed on the scrap and waste iron, iron billet. and wastes and scraps of other metals. The measure is seen as a step to help promote domestic industries reliant on these materials. The decree excludes the following items from the export levy:  Iron billet produced from domestic scrap and iron ore. Iron billet produced from imported iron ore and concentrate. Billets of other metals regardless of the raw material used for producing the billets. The above decree has been ratified by the President of the Republic for implementation.

03 September 2008

Tax Holiday of Free Zones may be Increased to 30 Years

Nourlaw.com (03 September 2008) -- According to a one note law, the generalities of which were approved by parliament in July, the 15-year tax holiday foreseen in Article 13 of the Law on the Administration of Free Trade-Industrial Zones of the Islamic Republic of Iran may be increased to 30 years when the lawmakers hammer out the specifics of the new legislation. The free zones law was originally approved in 1993 and the 15-year tax holiday expires this year. Hence the government has asked parliament to increase the length of the no-taxation period. The aforesaid Article 13 reads: “Natural and legal persons engaged in any kind of economic activity in a Zone are exempt from payment of income and property tax subject to the Direct Taxation Act for a duration of 15 years from the date of the commencement of the operation mentioned in the permit with respect to any type of economic activity in the Free Zone, and upon the lapse of the initial 15 years at issue shall be subject to the tax regulations to be enacted by the Parliament, upon the proposal by the Council of Ministers”.

03 September 2008

Iran and Kuwait Agree on Avoidance of Double Taxation

Nourlaw.com (03 September 2008) -- On August 22, Iranian President, Mahmoud Ahmadinejad sent the Law of Avoidance of Double Taxation on the Taxes Applicable to Revenues and Capital between the States of the Islamic Republic of Iran and Kuwait to the Ministry of Economic Affairs and Finance for implementation. The law was approved by Parliament on 27 July 2008. In the preface of the law it is stated that Iran and Kuwait have agreed to sanction the legislation for expansion of mutual economic relations. In August 2007, the two countries also signed an investment agreement which was envisaged by the Iranian parliament in the form of the Law of Agreement of Reciprocal Promotion and Protection of Investment between the Government of the Islamic Republic of Iran and the Government of Kuwait, The law seeks to facilitate creation of conditions conducive for the expansion of mutual economic cooperation and investment for investors from each country. The double taxation avoidance legislation covers natural and juridical persons residing in either or both countries. According to the law, revenue and capital tax encompasses all the taxes applicable to the total revenue and total capital or portions of revenue or capital such as the tax on the outcome of transfer of movable and immovable assets, salary tax paid by the entities and the tax on the increased value of the capital. The law specifies the taxes in force in each of the two countries. According to Article 7 of the Law, the revenues of a company or firm of a contracting state in the territory of the other state shall only be subject to the taxation of the country where the entity is located and active.

13 August 2008

Legislation on Collection of Outstanding Claims from Sudan, Tanzania, Nicaragua, Jordan and North Korea

Nourlaw.com (13 August 2008) -- Iranian President Mahmoud Ahmadinejad according to letter number 66991 dated 19/05/1387 (9 August 2008) to the Ministry of Economic Affairs and Finance has notified the law for Collection of Outstanding Claims from the Countries of Sudan, Tanzania, Nicaragua, Jordan and North Korea for implementation. The legislation was passed by the Iranian parliament on 12/4/1387 (2 July 2008).  According to the said law, the Iranian government (specifically the ministries of economic affairs and finance, foreign affairs, defense and armed forces logistics, and oil) is allowed to act in line with due consideration of the obligations and arrangements of international bodies and organizations to which Iran is a member state, bilateral agreements and relations, concluded contracts and the best interests of the country for reaching negotiated settlement agreements with the following countries: 1-Sudan, for debts accruing from the loan received for buying crude oil in the year 1974, export of crude oil by the National Iranian Oil Company (NIOC) in 1993 and for services rendered and delivery of equipment by the Ministry of Defense and Armed Forces Logistics in the years 1991-1993. 2- Tanzania: Debts accruing from the export of crude oil by NIOC in the years 1984-1986. 3- Nicaragua: Debts accruing from export of crude oil by NIOC in the year 1983. 4- Jordan: Debts accruing from four loans granted in the years 1973 and 1974 No details of debts are given in the legislation with regard to North Korea.   Reimbursement of the debts in kind such as factories, properties and agricultural lands is allowed. A moratorium is also permitted and the debts can also be sold to third parties through bids.

13 August 2008

Levies Applicable to Export of Gray Cement

Nourlaw.com (13 August 2008) -- Iranian Customs in its circular letter number 182/71/480/747/128244/132008 dated 20/5/87 (10 August 2008) has stipulated that the levies due shall only be imposed on the export of Iranian gray cement. White cement is not subject to the levies.

13 August 2008

Import of Agricultural Seeds, Chemical Fertilizers, Gas Cylinders fpr Cars, Crane Spare Parts and Precious Stones with Free Foreign Currency Allowed

Nourlaw.com (13 August 2008) -- The Iranian Ministry of Commerce in its circular letter number 210/162 dated 7/5/87 (28 July 2008) has declared that in line with Part 9 of Article 38 of the Export and Import Regulations, the import of agricultural seeds, chemical fertilizers, gas cylinders for cars, crane spare parts and precious stones through the use of foreign currency is allowed.

23 July 2008

Litigation of Foreigners at Iranian Courts Subject to Statutes of Limitation

Nourlaw.com (23 July 2008) -- The Iranian Council of Guardians, which vets national legislation for its adherence to Islam and the constitution, holds that those foreign nationals, whose national laws contain a statute of limitations for litigation can not benefit from the lack of such limitations in certain cases when filing lawsuits in Iranian courts.   In reply to a question from Justice Minister Gholamhossein Elham, the Council, in its answer number 87/30/27426  dated 4/4/1387 (24 June 2008) emphasized that the previous opinion of the Council on the abrogation of statutes of limitation shall not apply to foreign natural or juridical persons who have time limits  in their own laws and regulations. The opinion of the Council may restrict the access of foreign nationals, primarily in financial and commercial disputes, to Iranian courts when the defendant is an Iranian national.     Heretofore Iranian courts have not been acting in line with the aforesaid opinion regarding foreign litigants. The legal basis for the courts’ conduct has been the fact that in the national Civil Procedure Code, it has not been said, explicitly or by implication, that foreigners who have statues of limitation in their own country would not be entitled to use the lack of limitation in certain cases in Iran. Despite the similar previous opinion by the Council of Guardians respecting the limitations imposed on foreigners, the Iranian courts did not abide by it because this specific restriction applied for foreigners had not been stipulated in the laws which had been vetted by the Council itself.        The background of the issue of time limitation begins after the Islamic Revolution of Iran in 1979. Then the Council of Guardians abrogated statutes of limitations in certain areas of law on the basis of the precepts of the Islamic jurisprudence (fiqh). According to fiqh, the criminal is always a criminal and the debtor is always a debtor, no matter how long ago the crime was committed or the debt incurred.   The criminal should be punished, and the debtor must pay his (her) debts. Consequently claims which are pecuniary in nature or emanate from a financial dispute have no time limitations with respect to filing a lawsuit.   The Council on 27/11/1361 (16/02/1983), abrogated the periods prescribed in Articles 731 to 769 of the Civil Procedure Code which had set time limitations (varying from one, three, ten, to twenty years) for bringing legal proceedings.   At that time, the courts adopted contradictory approaches with respect to the issue of limitation. Some interpreted the Council’s decree as a general guideline and considered other statues of limitations in other areas of law, such as the Commercial Code, automatically null and void. A number of courts observed the Council’s opinion only in the area of the Civil Procedure Code and honored the limitations prescribed in other areas, especially in the Commercial Code. The paradoxical conduct of the courts was relaxed when the Council on 18/4/1365 (09/07/1986) declared: ”In cases wherein conformity of each of the principles of the Constitution to the current laws needs the interpretational opinion of the Council, as long as the Council has not given its opinion, there are no restrictions on implementation of such laws...”.   In light of the above, the limitations foreseen in the Commercial Code of Iran are still applicable to related issues and the litigating parties may use them, as the case may be, to obstruct proceedings. In a broader context, recent modifications in the Criminal Procedure Code has led to acceptance of limiting the time within which a complaint may be lodged with respect to certain crimes. This indicates that the tendency from earlier years for elimination of time limitations in instituting lawsuits has been relaxed.

23 July 2008

Notebooks, Digital Cameras, Photocopiers…to be Imported with Free Foreign Currency

Nourlaw.com (23 July 2008) -- Iranian Customs has announced via circular letter number 149/73/2425/103/102410/110056 dated 29/4/87 (19 July 2008) that importation of certain products including the following goods shall be permitted with free foreign currencies: 1-    Photocopy and fax machines 2-    Notebook PCs 3-    Paper shredding machines 4-    Digital cameras 5-    Platter machines 6-    Data projectors Toner and developer for copying machines.

23 July 2008

Halal Certificate Required for Clearing Imported Edible and Cosmetic Goods

Nourlaw.com (23 July 2008) -- In a notice carried by the Farsi website iraneconews.com, the Ministry of Health and Medical Education has announced that "with due regard to the religious control of imported goods and having genuine assurances of the heliat (religious permissibility) of the products made with raw materials originating from animal husbandry, the sea or questionable origins, it is required that until the end of the month of Shahrivar of the current year (21 September 2008) a Halal Assurance System (HAS) Certificate for the producing factories of the said goods must be provided, otherwise for clearing any shipment of goods a separate halal certificate shall be required.

2 July 2008

Council of Ministers Approves USD 5b for Importation of Industrial Raw Materials

Nourlaw.com (2 July 2008) -- By virtue of decree Number H40176 T/51225 dated 9/4/1387 (29 June 2008), the Iranian Council of Ministers, in an effort to counteract the global inflationary impact of the rising price of oil which has affected the price of goods and raw materials, has stipulated that up to USD 5b be allocated to private sector production units for importing raw materials needed in factories. The beneficiaries of the new facilities are forbidden from changing these dollars into the local currency (rial) in order to avoid escalation of the current rise in inflation. In addition, the consumers of these instruments should be free from any current outstanding bank loans. The USD 5b is to be paid from the Foreign Exchange Reserve Fund that was created to keep surplus oil export revenues in order to extend needed low-interest loans to domestic industry.

2 July 2008

Levies Imposed on Imported Vehicles

Nourlaw.com (2 July 2008) -- The member ministers of the Headquarters for Management of Transport and Fuel, have stipulated in their decree number K 135 T/51215 dated 9/4/1387 (29 June 2008) that 5% of the total custom value and duties must be received from the importers of gasoline-powered engine vehicles with consumption of more than six liters per 100 kilometers. The exceptions are: CNG powered cars, safety vehicles like public ambulances and fire engines, military and police cars. According to the decree, when application is made for the first set of license plates, another 5% of the total custom value and duties must be paid to the government for all imported cars, except for government diesel and CNG powered vehicles, gasoline engine taxi vans, safety vehicles like public ambulances, fire engines, military and police cars. The above decree has been ratified by the president for implementation.

25 June 2008

Iran Enters Commercial Agreements with Cuba and Sri Lanka

Nourlaw.com (25 June 2008) --The Law of Trade Agreement between the Islamic Republic of Iran and Republic of Cuba, passed by the parliament on 29/2/1387 (18 May 2008), and the Law of Agreement between the Government of Islamic Republic of Iran and the Democratic Socialist Republic of Sri Lanka for Reciprocal Encouragement and Protection of Investments, passed by the parliament on 29/2/1387 (18 May 2008), have been notified on 19/3/1387 (8 June 2008) by the Speaker of the Parliament to the President for implementation. Both agreements have been designed for improvement of economic relations and trade exchanges between Iran with Cuba and Sri Lanka.

25 June 2008

Import of Rice with Free Foreign Exchange Allowed

Nourlaw.com (25 June 2008) --To mitigate the shortage and high prices of edible rice, the Ministry of Commerce has eased importation by virtue of circular letter number 210/899 dated 26/3/1387(15 June 2008). According to the decree, importation of  edible rice with free foreign currency is allowed until further notice.

18 June 2008

Falsely Dated Pro Forma Invoices Unacceptable

Nourlaw.com (18 June 2008) -- Iran Customs in its circular letter Number 86/24/109/1098/68584 dated 19/3/1387 (8 June 2008) has declared that "with regard to false pro forma invoices with dates relating to the period prior to  global price increases, some of which lack a validity date or have an unreasonable validity date, since the said invoices have false prices and  have been submitted to the related provincial commerce organizations for action and as such shall violate the rights of the government, therefore acceptance of such invoices and registering them for importation of goods is prohibited".

18 June 2008

Import of Airplane Spare Parts with Free Foreign Currency Allowed

Nourlaw.com (18 June 2008) -- The Iranian Council of Ministers in its Decree Number H 39560 T/36226 dated 9/3/1387 (29 May 2008) has stipulated that, ”Airline companies are allowed  to import the spare parts needed for their airplanes and airport equipment and accessories with free foreign currency, after obtaining a yearly permit from the Central Bank of Iran and registration of an importation application”.

18 June 2008

Decrease of Commercial Benefit Tax on Certain Tariffs

Nourlaw.com (18 June 2008) -- In an effort to mitigate the shortage of detergents in the market, the Iranian government has facilitated importation of such goods. According to the circular letter number 80/73/3130/103/62200/6670 dated 13/3/1367 (2 June 2008) issued by Iran Customs the commercial benefit taxes on certain tariffs have been decreased by the government: 1- Tariff 34022010 (Powder or liquid for washing clothes by hand) from 26% to 21% 2- Tariff 34022020 (Powder or liquid for washing machines) from 36% to 21% 3- Tariff 34029010 (Powder or liquid for dish washing machines) from 26% to 16%.

28 May 2008

VAT Legislation Passed

Nourlaw.com (28 May 2008) -- The Council of Guardians, which vets Iranian parliamentary legislation for adherence to Islam and the constitution, has approved the Value Added Tax legislation which was passed in February 2008 by parliament. The legislation shall be in force for five years on a trial basis. The details of the 56-article legislation shall be carried in this newsletter after being published in the Official Gazette.

28 May 2008

Government Sets Levies on Export of Six Foodstuff Items

Nourlaw.com (28 May 2008) -- In a measure to control prices, regulate the domestic market and alleviate shortages caused by draught, the Iranian government in its Decree dated 25 May 2008 has decided to restrict exportation of chicken meat, vegetable oil, potatoes, peas, split peas and beans by imposing levies on them. The government has in recent weeks already restricted the export of rice and maize by applying heavy levies on the trade.

28 May 2008

Unauthorized Use of Bank Facilities in Housing to End in Blacklisting

Nourlaw.com (28 May 2008) -- According to the latest resolution of the common general meeting of Iranian banks which seeks to halt price increases in the housing market, customers who have received loans and bank facilities for non-housing purposes, if they use them in the properties and housing sector, shall be blacklisted. As reported by Fars News Agency, the meeting of the banks in its session of 12 May 2008 resolved that at the time of drawing up contracts for facilities, in addition to the terms in the contract that prohibits use of the facilities in areas other than the duly stated area of usage, the bank must receive a letter of commitment from the customer to the effect that it would not used in the properties and housing sector. The resolution asserts that in case of violation of the commitment, the customer shall be blacklisted and for five years cannot receive any manner of facilities from any bank.

14 May 2008

Iran Signs Bilateral Agreement with Kuwait on Promotion and Protection of Investments

Nourlaw.com (14 May 2008) -- Iranian parliament approved the Law of Agreement of Reciprocal Promotion and Protection of Investment between the Government of the Islamic Republic of Iran and the Government of Kuwait on 27 August 2007. The law was published on 20 April 2008 in the Official Gazette and came into force from 6 May 2008. The law states in its introduction that the government of the Islamic Republic of Iran and the government of Kuwait signed the Agreement to facilitate creation of suitable conditions for expansion of mutual economic cooperation and investment for investors from each country. It goes on to note that both governments acknowledge that reciprocal promotion and protection of such investments would expedite commercial activities and increase the productivity of the contracting parties.In Article 1 of the Agreement the terms of investment include moveable and immoveable properties, ownership rights such as leases, mortgages, liens, company shares and debentures, financial claims and intellectual property… Article 3 stipulates that the investments of the nationals of either country in the territory of the other country shall enjoy fair and just treatment and full security.  Articles 4 and 5 lay down the manner of compensating the damages suffered by the investors. Article 6 entitles the investors to repatriate the profits and the principal investment. Other aspects and matters pertaining to reciprocal investments are tackled as well in this 16-article Agreement.

10 May 2008

Importation of Raw Materials and Machinery Free for All Importers

Nourlaw.com (10 May 2008) -- Iran Customs in circular letter number 34/73/720/113/340820/23588 dated 2/2/87 (21 April 2008) has announced that, “By virtue of Article 16 of the Law Concerning Innovation in Industries and Mines, registration of orders for importation of raw materials, machinery and spare parts with free foreign exchange is permitted for the public and the importer does not need to be a producer of goods”.

7 May 2008

After 77 Years Iran has a New Law for Trademarks, Industrial Design and Patents

Nourlaw.com (7 May 2008) -- Iran’s Law of Registration of Marks and Patents was first passed in 1931.  Now, to cope with the changes in the world of trade and industry and keep abreast of developments in the area of  intellectual property, the parliament of the Islamic Republic of Iran has passed new legislation, “The Law of Registration of Patents, Industrial Designs and Trademarks” on 3 Bahman 1386 (23 January 2008) to be temporarily implemented for five years. The legislation went into effect on 5 May 2008 after being published in the Official Gazette.  The new law, contrary to the old one, gives priority to patents and industrial designs over trademarks. Article 1 stipulates that:” Invention is the result of thinking of an individual or individuals which presents a specific process or a product for the first time and solves a problem in a profession, craft, technology, industry and the like”.  According to Article 2:”An invention can be registered if it contains a new initiative and can be applied in industry …” The meaning of industry, as stated in the same article, is industry in its widest application which also includes handicrafts, agriculture, fisheries and services. Article 4 specifies cases where registration is not possible, such as discoveries, scientific theories, mathematical methods, works of art, plans and rules and methods for carrying out commercial affairs and other intellectual and social activities, the methods for diagnosing and treating human and animal diseases (with the exception of products which fall under the definition of invention), genetic sources and their genetic components as well as the biological process of producing them, matters which have been already foreseen in techniques and industries, and inventions whose use contravenes religious decrees, public order and ethics. By virtue of Article 5, the rights arising from the registered invention shall be transferable and after the demise of the owner of the right, it would be transferred to his heirs. The validity period of the certificate of patent shall be 20 years (Article 16).Article 17 states that in cases wherein the public interest with respect to national security, nutrition, hygiene or development of vital economic sections of the country are concerned, or use of the invention by the owner runs contrary to free competition, the government may disregard the accrued rights of the holder of the patent against payment of fair compensation.As permitted by Article 18, any beneficiary can refer to the court for cancellation of contestable patents.   Articles of Section 2 of the new law concern industrial designs, something which the old law lacked and which gave rise to numerous limitations and violations in the field of industry and trade. On the basis of Articles 20 and 21, any composition of lines or colors and any three- dimensional form with or without lines and colors which changes the dye or shape of an industrial product or a work of handicraft, is considered an industrial design, and it can be registered on the provision of being novel and genuine. According to Article 28, using any industrial design which is registered in Iran needs the consent of its owner. Use in this context means manufacturing, selling and importing the items having the registered design. The validity period of the registered industrial design is five years, renewable for two other similar periods.Article 29 authorizes the beneficiary to refer to the court for cancellation of contestable registered designs.  Marks, Collective Marks and Trade Names are dealt with in Section 3 of the new law.  In accordance with Article 30, a mark is a visible sign which can distinguish the goods or services of natural or juridical persons from each other. A collective mark is a visible sign which can be used by a number of natural or juridical persons under the supervision of the owner of the registered collective mark for distinguishing origin or other features such as quality of the goods. A trade name is the name or title which introduces and distinguishes the natural or juridical person.Article 31 states the exclusive right of using the mark belongs to the person who has registered it. In light of Articles 37 and 41 any beneficiary can contest a mark during registration by filing a protest with the Industrial Property Bureau or refer to the court for abrogation of the registered mark. Article 40 stipulates that the validity of a mark from the date of registration is 10 years and is renewable for subsequent similar periods.Any person who intentionally violates the rights accruing from registration of inventions, industrial designs and marks shall be subject to civil actions for compensation of damages and /or prosecution. Article 61 of the new law has set a cash penalty ranging from 10,000,000 rials to 50,000,000 rials or imprisonment from 91 days to six months for the infringers.  For replying to the questions which may be raised with respect to the intellectual property conventions in light of the new Iranian national law, Article 62 states that “in the event of contradiction between the purport of this law with the stipulations of the international treaties on industrial property to which the government of the Islamic Republic of Iran has joined, the stipulations of the said conventions shall prevail”. Iran is a member of the International Convention for Protection of Industrial Property (also known as the Paris Convention) and in December 2003 became a party to the Madrid Agreement and the Madrid Protocol for the international registration of marks. Iran's parliament approved on October 2007 the Islamic Republic of Iran becoming signatory to the Patent Cooperation Treaty (PCT) which enables inventors to register their patents in PCT member countries simply by filing a single application with the related national registration authority.

30 April 2008

Provincial Expansion of the Center for Foreign Investment Services

Nourlaw.com (30 April 2008) -- By virtue of  Decree number H39246 T/207349 dated 20/12/1386 (10 March 2008) the Iranian Council of Ministers has assigned certain rights of the Center for Foreign Investment Services to the economic affairs and finance organizations of the provinces to assist attraction of foreign investments in the provinces. The initiative has been undertaken in the ongoing process of government decentralization. According to Article 16 of the Implementing Regulations of the Foreign Investment Promotion and Protection Act (FIPPA), the Center for Foreign Investment Services is established at the premises of the Organization for Investment, Economic and Technical Assistance of Iran (O.I.E.T.A.I) in Tehran. As set out in Article 20 of the Implementing Regulations, "The functions of the Center for Foreign Investment Services are determined as follows: 1.Provision of information and necessary advice to foreign investors. 2. Coordination required in respect to matters related to obtaining necessary licenses, including, but not limited to, the declaration of establishment, the permission of the  Organization  for  Protection  of  the  Environment,  the  permits  for subscriptions relating to water, electricity, gas and telephone lines, exploration and exploitation licenses for mines, etc. from  the relevant agencies, prior to the issuance of the  investment license. 3. Coordination  required   in  respect to matters related  to  the  issuance  of  visas, residence and work permits for the individuals  affiliated  to  foreign  investment. 4. Coordination required  in respect of  affairs  related to foreign investment  subsequent  to the  issuance of  the  investment license including registration of a joint venture  company, registration of orders, and issues related  to importation and  repatriation of capital, customs and tax matters, etc. 5. The representatives of the government agencies undertaking the coordination necessary among their related executive departments in respect of applications for foreign investment. 6. Monitoring the good performance of decisions made in respect of foreign investments." The aforesaid Decree of the Council of Ministers stipulates that: “The following text shall be added as a Note to Article 20 of the Implementing  Regulations of the Foreign Investment Promotion and Protection Act, subject of the Decree number H27032 T/32556 dated 23/7/1381 (15 October 2002): NOTE- The similar tasks of the Center for Foreign Investment Services shall be assigned to the economic affairs and finance organizations of the provinces for performing the related jobs in coordination with and upon approval of the Promotion and Protection of Foreign Investments Headquarters of each province”.

16 April 2008

Tariff Tables for Imported Goods Applicable in the Current Year

Nourlaw.com (16 April 2008) -- The Iranian Council of Ministers in its decree No. H39469 T/805 dated 5/1/1387 (24 March 2008) has ratified that the tariff tables attached to the By-law of the Export and Import Regulations Law subject of the decree No. H 630T/175956 dated 28/12/1385 (03 March 2007) and all subsequent amendments, will be applicable in the current Iranian year (20 March 2008- 19 March 2009).

16 April 2008

Importation of Goods Eased

Nourlaw.com (16 April 2008) -- The Iranian Council of Ministers in its session of 11/1/1387 (30 March 2008) upon recommendation of the Minister of Commerce approved that the import of goods, except forbidden items, no longer needs permits issued by the organs foreseen in Article 160 of the Law of 4th Economic, Social and Cultural and Development Plan of the Islamic Republic of Iran, approved in 1383”. In such cases wherein these organs are in charge of imposing certain standards on imported goods the said decree allows them to do that but in the shortest time. Concerning domestic production which the said organs were protecting by restricting importation, the decree stipulates that “Any protection of domestic products shall be undertaken solely by means of changing the import tariffs (duties)”.In the aforesaid Article 160 of the Development Plan, ministries and governmental entities are specified.   Earlier, Council of Ministers in its decree No. T/71837914 K dated 10/1/1387 had adopted another measure for facilitating importation by allowing the customs to give a maximum one year grace period to importers unable to pay the related duties and release their goods against receiving a bank guarantee, insurance policy, or keeping a percentage of the goods as collateral and letting the remainder be cleared.

16 April 2008

Condition of the Manufacturing Year of Production for Import of Vehicles

Nourlaw.com (16 April 2008) -- The Ministry of Commerce in circular letter No. 87/11010 dated 5/1/87 (24 March 2008) has announced that "by virtue of the minutes of the meeting of the Technical Committee for Vehicles, importers are hereby informed that in the current year after registration and entry of the vehicle through one of the official customs posts in accordance with the by-law of the regulations for any imported vehicle, not more than one year shall pass for cars, two years for trucks, and five years for motorized construction and mineral machines after the time of their production”.

12 March 2008

The Customs Decree on Evaluation of Goods Related to Foreign Investment

Nourlaw.com (March 12, 2008) -- For easing clearance of foreign investment goods, the Office for Determination of Value of the Iranian Customs in circular letter number 508/24/102/358/333876 dated 11/12/1386 (1 March 2008) has decreed that the declared value of foreign investment-related goods must be accepted unless there exists legal evidence to contest the declaration. According to the circular letter, "With due regard to Part B of Article 21 of the Implementing of the Regulations of the Foreign Investment Promotion and Protection Act (FIPPA), which stipulates the foreign non-cash capital (including machinery, equipment, tools and  spare parts, CKD  parts,  raw,  addable and auxiliary materials) shall be registered in accordance with the evaluation of the Customs. It is required that the value of the goods related to foreign investment be determined through observance of Articles 10 and 11 of the Customs Law and Article 131 of its by-law, and in cases of suspected over-pricing, while releasing the goods, the phrase  'the evaluation is under consideration' should be included on the importation permit and the declared value in addition to the legal supporting evidence must be sent to this office for review so that if over-pricing is established, the matter is referred to the Organization for Investment, Economic and Technical Assistance of Iran (O.I.E.T.A.I). It is clear that in the event there is no legal supporting evidence, rejection of the declared value is un-justifiable."

5 March 2008

The Law for Combating Money Laundering

Nourlaw.com (5 March 2008) -- The Iranian president has notified the Law for Combating Money Laundering approved by the parliament on 2/11/1386 ( 22 January 2008 ) for implementation. The law was published in the Official Gazette on 8/12/1386 ( 27 February 2008 ) for public knowledge and shall be effective from 14 March 2008 in accordance with Articles 2 and 3 of the Civil Code which stipulate the legislations shall come into force 15 days after being published in the Official Gazette.   Article 1- The principle observed is correctness and authenticity of commercial transactions subject of Article 2 of the Commercial Code, unless the contrary is proven on the basis of the purport of this Law. If associated with claim of ownership, proprietary rights of the persons over the assets and properties shall indicate ownership. Article 2- The crime of money laundering is: A  -Acquiring, owning, keeping or using the revenues resulting from illegal activities with the knowledge that they are the direct or indirect result of commission of crimes, B -Change, exchange or transfer of the revenues for concealing its illegal origin with the knowledge that the same has been the direct or indirect result of commission of crimes or assisting the perpetrator with a view to relieve that person from being subject to the legal consequences and effects of the commission of a crime. C -Concealing, hiding or not disclosing the true nature, origin, source, location, transaction, transferring, or owning of the revenues acquired as the direct or indirect result of crime. Article 3- The revenues resulting from crime encompasses all types of assets acquired directly or indirectly due to criminal activities. Article 4- For coordination of the bodies charged with collection, processing and analyzing news, documents, information and received reports, preparation of smart information systems, tracing suspicious transactions and for the purpose of combating the crime of money laundering, the Supreme Council for Combating Money Laundering shall be established under the chairmanship and responsibility of the minister of economic affairs and finance  and its membership shall consist of the ministers of commerce, intelligence, interior and the governor of the central bank and the council is charged with the following tasks: 1- Collection and gathering of related news and information and analysing technical and specific classifications of the same according to the regulations in cases wherein there exists circumstantial evidence of violations. 2- Preparation and recommending the required by-laws for implementation of the law to the Council of Ministers 3- Coordinating the relevant bodies and following up complete implementation of the Law in the country. 4- Evaluation of the received reports and sending the same to the Judiciary in cases where probability of (violations) is either true or the probability is strong. 5- Exchange of experience and information with similar organizations in other countries within the framework of Article 11. Note 1- The secretariat of the Supreme Council shall be located in the Ministry of Economic Affairs and Finance. Note 2- The structure and administrative organization of the Council in proportion to its legal tasks shall be approved by the Council of Ministers upon the proposal of the Council. Note 3- All the implementing regulations of the aforesaid Council after being approved by the Council of Ministers shall be binding upon all related natural and juridical persons. Those who do not honour that shall be sentenced to two to five years of severance of their related service, as the case may be, at the discretion of the administrative and judicial authorities.  Article 5- All the juridical persons such as the Central Bank of the Islamic Republic of Iran, banks, financial and credit institutions, interest-free loan funds, charity establishments, foundations and municipalities shall be duty bound to carry out the by-laws approved by the Council of Ministers for implementation of this Law. Article 6- Notary public offices, practicing lawyers, auditors, accountants, official experts affiliated to the Justice Administration and legal inspectors of companies shall be duty bound to supply the information needed for implementation of this Law, in accordance with what has already been approved by the Council of Ministers, to the Supreme Council of Combating Money Laundering upon its demand.   Article 7- Persons, foundations and bodies subject to this Law (with respect to Articles 5 and 6) are obliged in proportion to the type of their activities and organizational structure to undertake the following:  A) Identifying of clientele or identifying of their representative or proxy and the principal when the action has been committed by the representative or proxy in cases wherein there is circumstantial evidence of violations. Note-This legislation shall not overrule the instances where recognition of identity is obligatory in other laws and regulations. B) Provision of information, reports, and documents relating to the subject of this law to the Supreme Council of Combating Money Laundering within the by-law approved by the Council of Ministers. C) Reporting suspicious transactions and operations to the competent authority designated by the Supreme Council of Combating Money Laundering. D) Maintaining the records identifying clientele, records of the accounts, operations and transactions for the duration to be determined in the related by-law. G) Drafting the standards for internal control and education of the directors and employees for the purpose of implementation of the purport of this Law and its by-laws. Article 8- The information and documents gathered in the course of implementation of this Law, shall be used only in relation to the goals set out in the Law for Combating Money laundering and the crimes leading to it. Revealing the information or using it directly or indirectly by government employees or other persons foreseen in this law for the benefit of themselves or other persons is forbidden and the perpetrator shall be sentenced to the punishment stipulated in the Law of Punishment for the Propagation and Disclosure of Governmental Confidential and Secret Documents of 29/11/1353 (18 February 1975). Article 9- Perpetrators of the crime of money laundering in addition to returning the revenue and the profits resulting from commission of the crime including the principal and the accrued benefits (and in case they do not exist, their equivalent or value), shall be sentenced to a cash penalty amounting to one fourth of the revenues resulting from the crime which must be remitted to the Account of Public Revenue with the Central Bank of the Islamic Republic of Iran. Note 1- If the accrued revenues have been exchanged with other assets or changed, the same shall be confiscated. Note 2- Issuance and enforcement of the judgment for confiscating the assets and the accrued benefits shall be possible, if the perpetrator has not been already subjected to such judgment with respect to the original crime. Note 3- Perpetrators of the original crime, in the event of commission of the crime of money laundering, shall be sentenced as well to the punishments foreseen in this Law in addition to the punishments set out for the crime committed. Article 10- In implementation of this Law, all the matters which need judicial action or permission, must be carried out in accordance with the law. The Judiciary shall cooperate according to the related regulations. Article 11- Branches of the general courts in Tehran, and in case of need in the provincial capitals, shall be responsible for handling the crime of money laundering and related crimes. This responsibility shall not bar the branch from considering other crimes.       Article 12- In cases wherein a law for judicial and intelligence cooperation for combating money laundering has been concluded between the government of the Islamic Republic of Iran and other countries, the cooperation shall be conducted according to the stipulations of the related agreement.

20 February 2008

Re-export of Items Lacking Entry Documentation

Nourlaw.com (February 20, 2008) -- The Ministry of Commerce in circular letter number 210/3260 dated 16/11/1386 has stipulated that the export of imported items that lack entry documents is permitted, with the exception of production line machinery and items set forth in Article 114 of the third development plan (and re-ratified in Article 36 of the fourth development plan). The text of the said Article 114 reads as follows:  Regulating the domestic market will not prohibit export. The export of all goods and services excepting the following items is permissible: A.)  Antiques and objects of cultural heritage, B.)   Animal, plant and vegetable matter considered part of the genetic reserve pool or that is significant in terms of environmental protection, C.)   Goods subsidized by the government will be authorized for export upon the proposal of the relevant agency and approval by the Economic Council. In order to regulate the domestic market and counteract any potential scarcity, the Ministry of Commerce is authorized, according to its findings, to satisfy domestic needs by importing the required commodities without any foreign exchange transfer.

20 February 2008

Tariff on Imported Rice Eliminated

Nourlaw.com (February 20, 2008) -- According to decree number KH 81T/187378 dated 17/11/1386 (6 February 2008), the member ministers of the Commission of Article 1 of the Export and Import Implementing Regulations have decreased the commercial benefit tax from 146% to zero to facilitate importation of rice to meet mounting domestic needs. The president ratified the decree The Iranian Customs Administration has made known the above decree via circular decree number 488/73/3103/103/312472/314388 dated 24/11/1386 (13 February 2008). It also notes therein that 1,500 rials shall be levied on rice importers per each kilo of imported rice. The levy shall be 800 rials for border areas people and their cooperatives. These amounts will be paid to the government.

30 January 2008

Importers of Fuel Efficient Cars Exempt from Duties

Nourlaw.com (Jan.30, 2008) -- According to a statement from the head of the Traffic Police Center for Vehicular Registration, importers of fuel efficient vehicles shall be exempt from payment of duties set by the Note 13 Headquarters for importation of vehicles as well as being exempted from paying the cost of disassembling a    dilapidated car in lieu of importing a new one..      Note 13 of the National Budget Law stipulates that for improvement of the urban environment, the government has the right to impose levies on imported vehicles in proportion to their fuel consumption and pollution potential. Such levies shall be a percentage of the customs duties set in the related regulations for importation of vehicles. The Note 13 Headquarters has decreed as well that entry of a new car requires dismantling of a dilapidated car, provided the new car does not meet the fuel efficiency standards. Colonel Mohammad Reza Gholami, the head of the aforesaid vehicular center told IRNA that the government is encouraging importation of vehicles which use less than six liters per 100 km.  He added that such vehicles are now exempt from duties applicable to non-fuel efficient vehicles. The official continued by saying that newly imported cars manufactured five years ago can not be registered. He said that more than 90% of currently registered vehicles are domestically produced and around 10% are imported.

23 January 2008

Commercial Benefit Tax Lowered for Import of Mobile Phone Sets

Nourlaw.com (Jan. 23, 2008) -- In a bid to facilitate the import of mobile phones and suppress smuggling of this widely-used product while also boosting the domestic production of mobile sets, the following reductions in the import commercial benefit tax (CBT) has been set by the member ministers of the Article One Commission of the Implementing Regulations of the Export and Import Law: 1-      1-  CBT for the import of mobile sets was decreased from the current 56% of the cost insurance freight (CIF) value of mobile phone sets to 21%. 2-      2-  CBT on the parts and components of mobile phones in SKD (semi knocked down) form dropped to 6% and in CKD (completely knocked down) form was abolished altogether.  The tariff on imported mobile sets increased last year from 6% to 60% for protecting domestic manufacturers. But, since then, instead of the planned four million sets, less than 200,000 have been produced, leaving the market quite vulnerable for smuggling of the much needed mobile phones into the country. Iranian Customs in its circular decree No. 436/73/2935/103/277282/285176 dated 25/10/1386 (15 Jan. 2008) has declared the lowering of the CBT to 21% applicable retroactively from 9/10/1386 (30 Dec. 2007)