Iraq Moves to Enforce ASYCUDA at Kurdistan Border Crossings, Sets 50-50 Revenue Sharing Mechanism
Ministerial Council for Economy recommends joint federal-KRG committee to assess border crossings, unify customs procedures, and channel revenues through Baghdad before transferring the Kurdistan Region's share
ERBIL (Kurdistan24) — Iraq's Ministerial Council for Economy has recommended a series of measures aimed at fully integrating the Kurdistan Region's border crossings into the federal customs system, including the implementation of the ASYCUDA customs platform, the establishment of a joint inspection committee, and a mechanism for sharing customs revenues equally between Baghdad and Erbil.
According to an official recommendation issued by the council and addressed to the Secretary-General of the Council of Ministers, the proposals were approved during the Ministerial Council for Economy's session held on June 29, 2026.
The recommendations build on previous correspondence between the Kurdistan Regional Government (KRG), Iraq's Finance Ministry, the General Commission of Customs, and the Border Ports Commission regarding customs administration and border crossing management in the Kurdistan Region.
The council recommended forming a joint committee headed by the Federal Border Ports Commission and including representatives from the relevant federal authorities and the KRG.
The committee would conduct a comprehensive survey of all official and unofficial border crossings in the Kurdistan Region and submit a detailed report identifying crossings that meet the legal requirements for operation and those that should be closed by the Border Guards Command.
The report is to be presented to the Ministerial Council for Economy within 30 days for further consideration and a final decision.
The recommendations also call for the Iraqi Finance Ministry, in coordination with the KRG Ministry of Finance, to prepare a unified customs manual covering all customs exemptions and procedures.
The manual would facilitate the implementation of the ASYCUDA (Automated System for Customs Data) electronic customs management system across all border crossings in the Kurdistan Region, with periodic updates as required.
ASYCUDA, developed by the United Nations Conference on Trade and Development (UNCTAD), is widely used around the world to modernize customs administration, improve transparency, and enhance revenue collection.
The document also outlines a proposed framework for handling customs revenues generated at the Kurdistan Region's border crossings.
Under the recommendation, all customs revenues collected at the Region's border crossings would initially be transferred to Iraq's Federal Ministry of Finance.
The ministry would then transfer 50 percent of those revenues to the Kurdistan Region's account on a monthly basis.
Alternatively, the recommendation proposes opening two separate accounts at each border crossing, with customs revenues automatically divided upon collection—50 percent deposited directly into the Kurdistan Region's Ministry of Finance account and the remaining 50 percent transferred to Iraq's Federal Ministry of Finance.
The recommendations were signed by Deputy Prime Minister and Finance Minister Falih Sari, who also chairs the Ministerial Council for Economy.
The document concludes by requesting that the recommendations be reviewed and submitted to the Iraqi Council of Ministers for final approval, indicating that the measures have not yet entered into force and remain subject to Cabinet endorsement.
If approved, the recommendations would represent one of the most significant steps in recent years toward harmonizing customs administration between Baghdad and Erbil, an issue that has long been at the center of fiscal and constitutional disputes between the federal government and the Kurdistan Regional Government.