{"id":41143,"date":"2026-04-07T13:31:39","date_gmt":"2026-04-07T13:31:39","guid":{"rendered":"https:\/\/alghanim-lawfirm.com\/en\/?p=41143"},"modified":"2026-04-07T13:43:46","modified_gmt":"2026-04-07T13:43:46","slug":"dissolution-of-companies-in-iraq","status":"publish","type":"post","link":"https:\/\/alghanim-lawfirm.com\/en\/2026\/04\/07\/dissolution-of-companies-in-iraq\/","title":{"rendered":"Dissolution of Companies in Iraq"},"content":{"rendered":"

Article (147) of the Iraqi Companies Law regulates the grounds for the dissolution of a company and provides that: \u2018A company shall be dissolved for any of the following reasons in accordance with the provisions of this Law:-<\/strong><\/p>\n

First: Where the company fails to commence its business activities within two years of its incorporation without lawful excuse.
\nSecond: Where the company ceases to carry on its business for a continuous period exceeding two years without lawful excuse.
\nThird: Where the company has completed the project for which it was established, or where the execution of such project has become impossible.<\/strong><\/p>\n

Fourth: Where the company merges with another company or is converted in accordance with the provisions of this Law.
\nFifth: Where the company loses seventy-five per cent (75%) of its nominal capital and fails to take the measure prescribed in paragraph (1) of item (Second) of Article 76 of this Law within sixty days from the date of its confirmation by the balance sheet.
\nSixth: Where the General Assembly of the company resolves to liquidate it.<\/strong><\/p>\n

Clarification of the above grounds:-
\nFirst: The company shall lose its legal personality if it fails to carry on its business within two years from the date of issuance of its certificate of incorporation.<\/strong><\/p>\n

Second: In this ground, it is presumed that the company has commenced its business activities but subsequently ceased them, noting that the legislator has stipulated that the period must be continuous and not intermittent, since an interrupted period shall not constitute a ground for the dissolution of the company.
\nThird: The company contract takes effect from the date on which the company acquires legal personality, and the company begins to pursue the activity for which it was established. Upon completion of the work for which it was founded, the company shall lose its legal personality by reason of the contract losing one of its essential elements, namely the \u2018object\u2019 (the purpose for which the articles of incorporation were drawn up). Likewise, if the execution of such purpose becomes impossible, whether by natural or legal impossibility, the company contract shall terminate.<\/strong><\/p>\n

Fourth: The conversion of a company from one type to another results in the termination of its legal personality and consequently its dissolution. Merger, however, does not necessarily entail dissolution, as merger may take two forms: the first being consolidation, whereby two or more companies merge to form a single company, in which case the legal personality of each merging company ceases and a new legal personality arises for the newly formed company; the second being absorption, whereby one company is absorbed into another, in which case only the legal personality of the absorbed company ceases in favour of the surviving company.
\nFifth: The company\u2019s capital constitutes the general guarantee for the creditors\u2019 rights, and accordingly the General Assembly must, within sixty days, take the necessary measures by convening an extraordinary meeting.
\nSixth: As the company is the product of a contract under which it is established, the partners may resolve to dissolve the company in accordance with the majority prescribed by law.<\/strong><\/p>\n

Company Liquidation
\nLiquidation refers to the set of material and legal procedures undertaken by the liquidator in order to discharge the company\u2019s obligations, through the conversion of its assets into monetary sums used to settle the company\u2019s debts, with any remaining balance distributed among the partners in proportion to their contributions to the company\u2019s share capital, following the termination of the company\u2019s legal personality, <\/strong>This decision is taken by the General Assembly, which, upon the occurrence of a cause for dissolution, must within sixty (60) days adopt a resolution to liquidate the company; failing which, the Registrar of Companies shall do so, and may grant the General Assembly additional time to reach such a resolution,<\/strong>Upon the adoption of the liquidation resolution by either the company\u2019s General Assembly or the Registrar of Companies, one or more liquidators shall be appointed. The liquidator\u2019s legal status is that of an agent of the company, with powers defined by the authority issuing the liquidation resolution. A copy of the resolution shall be transmitted to the Registrar of Companies for review of its validity. Upon approval, the liquidator shall publish the liquidation resolution in two daily newspapers and in the company\u2019s periodic bulletin.<\/strong><\/p>\n

Duties of the Liquidator:-<\/strong><\/p>\n

– To take possession of the company\u2019s records and documents and to prepare inventories of all its assets.<\/strong><\/p>\n

– To publish a liquidation notice in two daily newspapers, inviting all creditors of the company or any persons claiming rights therein to present their claims within specified days for settlement.<\/strong><\/p>\n

– To submit reports at least once every three months detailing the progress of the liquidation, with the Registrar of Companies entitled to summon the liquidator for clarification.<\/strong><\/p>\n

– To convene the company\u2019s General Assembly within the first two months of each financial year.<\/strong><\/p>\n

– To present for discussion and approval the annual balance sheet and reports, including those relating to the progress of the liquidation.<\/strong><\/p>\n

– To discharge the company\u2019s debts in the following order:<\/strong><\/p>\n

1- Amounts due to the company\u2019s employees.<\/strong><\/p>\n

2- Amounts due to the State.<\/strong><\/p>\n

3- Amounts due according to the order of their statutory priority, with the remainder distributed among the other creditors.<\/strong><\/p>\n

– To prepare a final report upon completion of the liquidation, convene the General Assembly to discuss and approve it, and forward a copy to the Registrar of Companies.<\/strong><\/p>\n

– To distribute any remaining share capital among the partners within thirty (30) days from the date of the company\u2019s deregistration, and to retain the company\u2019s records for a period of five years from the date of its removal from the Companies<\/strong> Register.<\/strong><\/p>\n

 <\/p>\n

Lawyer <\/strong><\/p>\n

Mustafa Sameer Al-saady<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Article (147) of the Iraqi Companies Law regulates the grounds for the dissolution of a company and provides that: \u2018A company shall be dissolved for any of the following reasons in accordance with the provisions of this Law:- First: Where the company fails to commence its business activities within two years of its incorporation without…<\/p>\n","protected":false},"author":1,"featured_media":161,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[56],"tags":[],"class_list":["post-41143","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles"],"acf":[],"_links":{"self":[{"href":"https:\/\/alghanim-lawfirm.com\/en\/wp-json\/wp\/v2\/posts\/41143","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/alghanim-lawfirm.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/alghanim-lawfirm.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/alghanim-lawfirm.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/alghanim-lawfirm.com\/en\/wp-json\/wp\/v2\/comments?post=41143"}],"version-history":[{"count":5,"href":"https:\/\/alghanim-lawfirm.com\/en\/wp-json\/wp\/v2\/posts\/41143\/revisions"}],"predecessor-version":[{"id":41148,"href":"https:\/\/alghanim-lawfirm.com\/en\/wp-json\/wp\/v2\/posts\/41143\/revisions\/41148"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/alghanim-lawfirm.com\/en\/wp-json\/wp\/v2\/media\/161"}],"wp:attachment":[{"href":"https:\/\/alghanim-lawfirm.com\/en\/wp-json\/wp\/v2\/media?parent=41143"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/alghanim-lawfirm.com\/en\/wp-json\/wp\/v2\/categories?post=41143"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/alghanim-lawfirm.com\/en\/wp-json\/wp\/v2\/tags?post=41143"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}