Iraq's Federal Supreme Court Strikes Down Ba'ath Era Law Blocking Foreign Investment
The court unanimously struck down Ba'ath Leadership Council Resolution 23 of 1994 as amended in 1997, which had imposed prison sentences of one to three years on violators and confiscated assets acquired in breach of the foreign ownership ban
ERBIL (Kurdistan 24) - Iraq's Federal Supreme Court declared Tuesday that a Ba'ath-era resolution blocking foreign investment in Iraqi companies is unconstitutional, in a unanimous ruling that removes a legal barrier to foreign ownership that had survived from the dissolved Ba'ath Leadership Council into the post-2003 legal framework.
The court announced it had reviewed a case filed by Iraq's Prime Minister against the Speaker of Parliament, requesting the annulment of Ba'ath Leadership Council Resolution Number 23 of 1994, as amended by Resolution Number 33 of 1997. That resolution had prohibited the application of any laws or decisions that allowed non-Iraqi persons to own or invest in Iraqi companies.
Under the old resolution, violations carried imprisonment of one to three years for offenders, with a minimum of two years if the violator was Iraqi, alongside confiscation of any capital that had been invested or held in ownership contrary to the rules.
The Federal Supreme Court ruled that those restrictions violate Articles 23 Third B, 25, and 26 of Iraq's 2005 constitution. The ruling was issued unanimously, is binding on all authorities pursuant to Article 94 of the constitution, and was announced publicly.
The ruling removes a legal instrument from the Ba'ath era that had imposed criminal penalties on foreign investment in Iraqi companies, clearing one of the remaining legacy obstacles to attracting foreign direct investment under the current constitutional framework. Articles 25 and 26 of Iraq's 2005 constitution protect economic freedom and guarantee the rights to investment and private property, making the Ba'ath-era prohibition directly incompatible with the constitutional order the Federal Supreme Court is mandated to uphold.
The ruling arrives as Iraq is simultaneously negotiating its 2027 federal budget, managing a dollar transfer arrangement with Washington, and actively seeking to diversify its economy beyond oil. PM al-Zaidi's filing of the original case against the parliamentary speaker reflects the executive branch's interest in removing legal barriers to investment that have persisted in the Iraqi legal system despite the formal dissolution of the Ba'ath regime more than two decades ago.