Guide to Foreign Investment in Iran

Posted on Posted in Business Guidelines

General laws and regulations regarding foreign business in Iran could be regrouped under the following categories:

  • Contract work: A foreign company is allowed to be involved in contractual work in Iran. Such work may be performed either directly by the foreign company or through a registered branch in Iran. Branch offices in Iran do not have the separate legal status enjoyed by LLCs, and the parent company is responsible for the actions of the branch office. For legal and tax purposes, opening a representative office in Iran, by itself, is not considered foreign direct investment. Establishing and setting up a legal presence in the Iranian market requires a local advisor who can provide a step-by-step advisory service regarding incorporation, office rental, recruitment, staff, business contracts, customs, and the laws in general.
  • Direct sales: Most foreign companies are involved in direct sales to Iranian customers through letters of credit and, occasionally on the basis of Usance.
  • Investments: In accordance with the terms of the Foreign Investment Promotion and Protection Act (FIPPA), foreign companies may invest in newly established factories and industries. Foreign companies are allowed to own 100 per cent of the businesses in the free economic zones.
  • Purchase Stock Shares: every Foreign investors or Iranian living outside Iran could invest in Exchanges (Tehran Stock Exchange Co.), OTC market (Farabourse Co.), as well as Futures Market of Iran Mercantile Exchange (IME).


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