Iraq's Top Court Strikes Down 1994 Ban on Foreign Ownership

Summary

• Iraq's Federal Supreme Court ruled unconstitutional a 1994 decree barring foreigners from owning assets in Iraqi companies.
• The decree carried prison terms of one to three years and confiscation of the assets involved.
• The ruling is final and binding on all authorities, clearing a legal barrier to foreign investment.

The latest

A Saddam-era decree that blocked non-Iraqis from owning property and investing in companies inside Iraq has been struck down as unconstitutional. The Federal Supreme Court, sitting in full bench under Chief Justice Mundhir Ibrahim Hussein, ruled unanimously against Revolutionary Command Council Decision No. 23 of 1994, as amended by Decision No. 33 of 1997, according to a statement from the court's media office carried by 964 Network.

Details

• The decree: Decision No. 23 of 1994 suspended the operation of all laws and regulations allowing non-Iraqis to own assets and invest in companies inside Iraq, according to the court's statement. It was later amended by Decision No. 33 of 1997, both issued by the now-dissolved Revolutionary Command Council.
• The penalties: Violators faced imprisonment of between one and three years along with confiscation of the assets involved in the breach, the statement said. For an Iraqi national found in violation, the sentence could not fall below two years, a harsher floor than the one applied to others.
• The constitutional basis: The court found the decree in conflict with Articles 23, 25 and 26 of the 2005 constitution, which cover property rights, the state's duty to reform the economy on modern economic principles, and the encouragement of investment in Iraq.
• Who brought it: The case was filed by the prime minister in his official capacity against the speaker of the Council of Representatives in his official capacity, according to the court's media office. The challenge therefore came from the executive itself rather than from a private investor or a foreign party.
• The vote: The ruling was issued unanimously by the full bench headed by Chief Justice Mundhir Ibrahim Hussein. Under Article 94 of the constitution, decisions of the Federal Supreme Court are final and binding on all authorities, leaving no route of appeal.
• What it unlocks: With the suspension lifted, the laws and regulations permitting foreign ownership and investment in Iraqi companies return to force. The court did not set out a timetable or implementation mechanism for how ministries and the companies registrar should apply the decision.
• The confiscation risk: The decree's confiscation clause had attached an expropriation threat to any foreign stake acquired in breach of it. Removing it eliminates a standing legal exposure that sat above cross-border shareholdings in Iraqi firms regardless of later investment legislation.
• The timeline: The decree stood for 32 years, surviving the 2003 fall of the government that issued it and the adoption of the 2005 constitution. The statement was published by 964 Network on Tuesday, 27 October 2026, with Iraq Business News reporting the decision the following day.

Background

Revolutionary Command Council decisions were the legislative instruments of the pre-2003 government. Many remained formally on the books after the body was dissolved, and Iraq's Federal Supreme Court has repeatedly been asked to measure them against the 2005 constitution.

Between the lines

The challenge was brought by the prime minister against the speaker, placing the government on the side of repeal rather than parliament. Because the ban operated by suspending existing permissive laws rather than replacing them, striking it down restores those laws directly. The unanimous, unappealable vote under Article 94 gives investors a clearer answer than legislative amendment would have.

What's next

Watch how the companies registrar and the ministries handle registration of foreign shareholdings, whether parliament moves to align remaining legislation, and the first disclosed foreign acquisitions of stakes in Iraqi companies after the ruling.

Source: 964 Network (Federal Supreme Court media office statement); Iraq Business News