The Position, Powers, and Responsibilities of the Liquidator in Iranian and Iraqi Joint-Stock Companies

Abstract

The liquidator is one of the essential actors following the dissolution of joint-stock companies and is entrusted with important duties, including the settlement of debts, management of the company’s remaining affairs, protection of the rights of creditors and shareholders, and, ultimately, distribution of the company’s assets. Despite certain similarities arising from the influence of Islamic jurisprudential traditions, civil law, and legal concepts derived from Western legal systems, significant differences exist between Iran and Iraq regarding the manner of appointment, scope of powers, mechanisms of supervision, and legal responsibilities of liquidators. In the Iranian legal system, the provisions governing the liquidation of joint-stock companies are stipulated in the Amendment Bill to the Commercial Code and, with respect to the liquidation of bankrupt companies, in the Bankruptcy Administration Act of 1939. In Iraq, by contrast, Companies Law No. 21 of 1997, together with its subsequent amendments, constitutes the principal legal framework governing this area. Using a comparative approach and a descriptive-analytical method, this article comprehensively examines the position, powers, and responsibilities of liquidators within the Iranian and Iraqi legal systems. Through a comparative analysis of the relevant statutory provisions, the study seeks to identify and examine the similarities and differences between the two legal systems and to evaluate the strengths and weaknesses of each. The findings emphasize that, in order to enhance transparency and efficiency and to provide greater protection for stakeholders’ interests during the dissolution of joint-stock companies, the regulations governing liquidators in both countries need to be reviewed and updated. Accordingly, the article proposes reforms to the relevant legal frameworks and measures to strengthen the supervisory and executive roles of liquidators, thereby contributing to improvements in the quality of corporate dissolution proceedings and enhancing public confidence in this legal process in Iran and Iraq.