Foreign
Investment Promotion and Protection Act (FIPPA)
The main
Iranian foreign investment law is the Foreign Investment Promotion and
Protection Act (FIPPA). The FIPPA grants foreign investors the same rights,
protections and facilities available to domestic investors. This includes
permission for investment in all fields where private sector activity is
allowed and permission to hold up to 100% of shares in Iranian legal entities.
Protection against expropriation and nationalization is guaranteed except where
public interest reasons apply, in which case the expropriation should follow a
non-discriminatory procedure and the investor should obtain compensation based
on the real value of the investment. Moreover, the FIPPA includes provisions to
ensure free transfer of foreign capital and profits of foreign investment
abroad. Foreign investors may claim through the Act to convert Iranian Rial and
to acquire necessary foreign currency for such transfer. Furthermore, residence
and work permits for foreign personnel are facilitated under the FIPPA. The
FIPPA defines a foreign investor as any non-Iranian or Iranian individual or
legal entity utilizing capital of foreign origin, provided it has obtained the
relevant investment license. Foreign capital is defined as being all types of
capital, including cash or in kind that has been imported into Iran. To obtain
an investment licence, an application has to be made to the Organization for
Investment, Economic and Technical Assistance of Iran (OIETAI).
Foreign Investment License
Foreign Investment Promotion and Protection Act