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Are there any special advantages foreseen in the rules for investors in the Zones ?

 
 

All natural and legal persons and institutions, Whether Iranian or foreign, as well as international organizations, may either independently or jointly with each Authority and their affiliated companies, or Jointly with each other, invest in the Zone. Foreign investors may participate in the economic activities of the Free Zone in any investment ratio they wish to. The legal rights of foreign investors are guaranteed and protected. Fair compensation for damages shall be abided by the Authority, in cases where the capital of foreign investors is nationalized or expropriated. Foreign investors also have the option to safeguard their capital and rights by operating under the provisions of the Law Concerning the Attraction and Protection of Foreign Investment passed in 1955 (See foreign investment booklet also in this series). Repatriation from the Free Zone of net profits, the initial capital and gains resulting from economic activities of foreign investment is permitted. The authority of each Free Zone is obliged to issue a permit of transfer within one week from the date of the receipt of an application for such repatriation. Investors may transfer their shares to other investors with the approval of the respective Authority . In principle, the movement of capital and expatriation of profits generated by economic activities and commercial operations in the Free zone is free and permitted, without let or hindrance.

 

What things are considered capital under the rules of the Free Zones ?

 
 

As defined in Article 3 of the Regulations on investment in the Free Zones, capital shall include: The national currency, i.e., the Rial and foreign currencies convertible in the Free Zones; machinery, equipment , accessories and tools of work; industrial property rights resulting from patents, technical know-how, trademarks and commercial names; land, air and sea transport vehicles related to the subject of investment; all or part of the transferable net profit obtained in the Free Zones and added to the principal capital or utilized in other activities authorized under the rules of the Free Zones . In certain cases, at the discretion of the Free Zone Authority, raw materials and semi-manufactured parts may be designated as a portion of the foreign investment.

In the Free Zones, how are disputes between the foreign investor and the Iranian partner of the Joint-venture settled ?

 
 

Such disputes are resolved on the basis of written contracts and agreements concluded between the parties concerned. The resolution of differences can be achieved by means such as conciliation and arbitration or court litigation.

How is the registration of Companies and intellectual properties accomplished ?

 
 

Registration of companies, institutions and branches of Iranian or foreign companies shall be established in the Free Zone, upon submission of the required documentation. The registration Bureau of the Zone shall also handle the applications for registration of trademarks and names, patents, and industrial designs.

Are export and import activities completely unrestricted in the Zones ?

 
 

The exchange of goods between each Zone and outside the country is excluded from the provisions of the Export-import Regulations. However, exchange of goods between the Zone and the rest of the country, whether of a commercial nature or by travelers, is governed by the general national regulations on the export and import of goods. Importation of goods produced in the Free Zones, into other parts of the country, is exempt from payment or all or a part of customs duties and commercial benefit tax, equal to the added value thereof in the Zone. Importation of goods produced in the Free Zone in which all or parts of their raw materials are supplied domestically, shall be exempt wholly or partially from payment of customs duties and commercial benefit tax, in proportion to the domestic raw materials component ot the product.

And the taxes ?

 
 

Natural and legal persons, whether Iranian or foreign nationals, who are engaged in any kind of commercial or manufacturing activities in the Free Zones, are exempt from payment of tax on their revenues and assets for fifteen years, as from the date their business operation commences .

Do foreigners need visas for entering the Free Zones?

 
 

For direct entry into and exit from each Free Zone through authorized points, foreign nationals are not required to obtain visas in advance The police shall affix the seal of a residence permit on the valid travel documents of such foreign citizens. The respective residence permit is issued for a period of two weeks and may be extended up to six months upon the request made by the Authority. For entry into the Free Zones through the mainland of Iran, foreign nationals are obliged to obtain a visa from the Iranian consulates abroad. Foreigners who wish to travel to other parts of the country after their entry into the Zone, are required to obtain a permit from the local representative office of the Iranian foreign Ministry .

Are all types of banks allowed to operate in the Free Zones ?

 
 

Banking in Iran is the sole domain of the government. However, establishment of Iranian banks with a minimum of 51% government participation, organizing branches of foreign banks, establishment of Iranian or foreign non-banking credit institutions, or setting up their branches in the Free Zones are permitted. The banks can be engaged in operation like opening letters of credit and rendering similar services to businesspersons. Offshore activities are also allowed for the banks, if they use foreign currencies. Foreign exchange dealers may operate in the Zone upon the authorization of the Authority. Buying and selling of foreign currencies by banks and exchange dealers is based on the supply and demand factor and the floating rate of the free market.

What about employment and Social Security in the Free Zones ?

 
 

Provisions regarding labor and social security regulations are more flexible in the Free Zones, in comparison with the rules prevailing on the mainland, Employment may be based on a contract according to the mutual agreement of the employer and employee, with the right of cancellation of the work contract applicable for both parties. In this context, the employer is allowed to lay off workers after payment of due compensation.