Standard time-frame for Iraq business setup
- Setting up a new company in Iraq with foreign directors/shareholders is a time-consuming process and usually takes 5 months;
- The process includes: i) multiple Government agencies approval ii) enhanced security checks for foreigners and iii) completion of slightly different procedures in different parts of the country (for instance, Baghdad and Mossoul);
- As a work around solution, Healy Consultants supplies fast solutions: a Nominee Iraq limited liability company for Clients who need to start business quickly.
Fast business setup time-frame
- With a nominee Iraq LLC, our Clients can i) invoice their customers within 1 month and ii) request them to settle invoices within the subsequent month instead of the usual 5 months;
- If our Clients wish to avail such a solution, we will i) register a new company using our professional local passive nominee directors & shareholders ii) register for tax and iii) open a corporate bank account within 8 weeks;
- Meanwhile, Healy Consultants’ Iraq lawyers and accountants will modify the corporate structure to appoint our Clients as the company’s directors and shareholders.
Please find below a comparison of costs and timelines for a nominee company setup and new company setup:
Advantages and disadvantages of a fast company solution
- A nominee company is a time-effective solution. Our Clients will be able to i) sign deals and contracts; and ii) invoice customers earlier when compared to a new company setup;
- Our Client will not be required to travel to Iraq to complete the company registration and bank account opening procedure.
- Engineering a nominee company solution is more expensive than a new company setup solution;
- While the Client will be able to commence operations within 1 month, he/she will still be required to amend the i) corporate structure and ii) M&AA and iii) company name (if required).
Corporate bank account considerations
- Initially, the corporate bank account signatory will be Healy Consultants’ nominee officer. Prior to changing the signatory, we will request our Client to submit 100% of the due diligence documents. Only after we receive all the due diligence, will we be able to change the bank account signatory;
- Healy Consultants will email the following details to the bank officer: i) company’s proposed business activity ii) directors & shareholders iii) ultimate beneficial owners (UBOs) and iv) expected transaction volume;
- We expect there is a 20% probability the bank officer will request the new bank account signatory to travel to Iraq for a bank interview. That said, we will negotiate extensively for a travel exemption;
- Realistically, we expect our Client will be able log into the e-banking facility within 15 weeks from the date Healy Consultants provides the bank account numbers.
Iraq Nominee LLC setup timeline
|Healy Consultants receives required corporate and personal due diligence from our Clients;||Week 1||Our Client signs our engagement letter and returns the original to our Singapore head office. Our Client settles our fees.|
|Healy Consultants proceeds to incorporate the new company with our professional nominee while Client undergoes security clearance checks;||Week 1||Our Client confirms the planned corporate structure;|
|Once the company is incorporated, Healy Consultants applies for corporate bank account opening with the nominee as bank signatory and registers the company for tax;||Week 4||Our Client can inform customers and suppliers, issue invoice, sign legal contracts and hire local staffs.|
|Healy Consultants receives bank account approval;||Week 8||Healy Consultants provides our Client the i) company name ii) tax registration number andiii) corporate bank account number.|
|Healy Consultants prepares the forms for i) changing the bank account signatory and ii) modifying the corporate structure. Our Client signs the forms and couriers them to Healy Consultants’ Iraq office;||Week 9||The new bank account signatory may need to visit the local bank branch for signature witnessing by a bank officer.|
|Client completes security clearance check;||Week 16||Healy Consultants can now amend company corporate structure and change bank signatory.|
|Healy Consultants appoints Client’s preferred shareholders and directors at Ministry of Trade.||Week 17||This procedure may take up to 8 weeks.|
|Healy Consultants proceeds to changing of bank signatory.|
We will divulge the following information to the bank officer: i) expected transactional volumes ii) shareholders/directors and iii) ultimate beneficial owners (UBOs). Based on this information, the bank’s Legal and Compliance Department will commence a DD check;
|Week 17||Depending on our Client business and nationality, there is a 20% probability the bank will ask the new bank signatory to travel for a one-hour interview. Healy Consultants will aggressively negotiate for a travel exemption.|
|The bank approves the Client’s proposed bank account signatory. It is possible the approval process will be completed in as long as 4 weeks;||Week 21||Once the DD check is complete, the bank officer confirms new signatory’s appointment.|
|Next, the bank setups internet banking for the account and couriers the e-banking tokens. Using these devices, Healy Consultants immediately activates the internet banking;||Week 22||We expect the bank to take two weeks to generate the new passwords and tokens. Generally, our Clients will request us to activate the tokens on their behalf.|
|Healy Consultants activates the e-banking and couriers the tokens to our Client’s preferred address;||Week 23||We expect the Client will receive the courier within 4 days. If needed, the Client may request us to guide them re internet banking.|
|Ministry of Trade reviews and approves the corporate structure change;||Week 24||Healy Consultants will email an extract of the registry to our Client.|
|Healy Consultants couriers our Client a complete company kit comprising original corporate documents.||Week 25||The engagement is complete.|