Banking Rulemaking after the 2023 Central Bank Law: An Analysis of the Nexus among Competence, Procedure, and Legal Control

Abstract

The enactment of the Law of the Central Bank of the Islamic Republic of Iran in 2023 altered the decision-making structure and the distribution of certain regulatory and supervisory powers of the Central Bank, thereby highlighting the need to reassess the process of banking rulemaking from the perspective of public law. The principal research question concerns the relationship among the three fundamental stages of this process: the competence of the rulemaking authority, the drafting and adoption of regulations, and their control and review. Using a doctrinal method and a normative approach, the study examines the relevant laws, regulations, and implementing documents and employs legal adequacy as an operational criterion for evaluation. This criterion focuses on the possibility of identifying the source and limits of legal authority, reconstructing the decision-making process and its underlying reasons, and determining whether an effective mechanism exists for control and correction. The findings indicate that identifiable legal rules and institutional capacities exist in all three areas; however, the links among them are not always clear or integrated. With respect to competence, the dispersion of legal sources and the proximity or overlap of certain organizational roles increase the need for precise documentation of the source of authority and the responsibility of each competent body. Regarding procedure, rules concerning assessment, consultation, justification, and publication are provided for in various legal and administrative instruments, but they are not consistently consolidated into a single, traceable record of the regulatory decision. In the area of control, a judicial mechanism exists for reviewing regulations of general application; nevertheless, incorporating the outcomes of such review into the subsequent process of amendment and reconsideration requires a more coherent framework. On the basis of these findings, the article proposes three complementary instruments: a “competence map” for documenting the legal basis and limits of authority, a “regulatory dossier” for consolidating the stages and reasons underlying the regulatory decision, and a “control-feedback register” for connecting the outcomes of challenges and judicial review with subsequent regulatory revisions. An illustrative application of this framework to the 2024 Directive on Domestic Rial-Denominated Letters of Credit demonstrates that information concerning the source of authority, the reasons for revision, and judicial control is accessible, but remains dispersed across separate documents. The proposals advanced in this article are intended to complement the legal design of banking rulemaking and, by themselves, do not imply their economic or administrative effectiveness.