Foreign Investment in Iran

Transcription

1 Foreign Investment in Iran

2 Outline Policy for Attracting FDI Why Invest in I.R.IRAN Organization for Investment, Economic & Technical Assistance of Iran O.I.E.T.A.I Foreign Investment Promotion and Protection Act (FIPPA) Foreign Investment Services Center (FISC) Foreign Investment Licensing Procedure Incentives of Investment in Iran (Tax, Custom, Free Zones)

3 The Policy Contribution to Economic Development Upgrading Technological & Management Skills Improving Products with High Quality and Competitiveness in International Scale Increasing Employment & Exports Sharing Benefits and Risks on Equal Term without Discrimination

4 At the Cross Roads of East and West Why Iran?

5 Iran as a hub for the CIS/MENA market Low effective rate of taxation 25% flat corporate tax rate Tax holidays No tax on dividends or capital gains Quality infrastructure 319 airports, 13,000 km railroads 20 Ports Cheap energy 1.5 per kwh Natural 1.5 per M³ Affordable labor Abundant natural resources Export promotion incentives Full tax exemption Export prize Duty refund on raw material imports Soft loans

6 Why Iran?

7 Continue

8 OIETAI Founded in June 1975 The main official authority to promote and protect Foreign Investment Taking care of all issues related to foreign investment such as: Admission Importation Utilization Repatriation Foreign Investment Board Ministry of Economic Affairs & Finance OIETAI Foreign Investmen t Dep. Foreign Investment Services Centre (FISC)

9 Types of Investments Direct Investment (Equity Participation) in Greenfield & Brownfield Projects Investment through Contractual Arrangements (Non-Equity Forms): Buy Back Arrangements BOT Schemes

10 The Legislation The Foreign Investment Promotion and Protection Act (FIPPA): Substitutes Former LAPFI Ratified in 2002 Implementing Regulations of the FIPPA

11 Centre of Investment and Consultancy Services Continuous study and investigation of investment barriers, proposing solutions to correct the weaknesses through the approval of new law and regulation. Developing a map of country s investment incentives and provincial advantages. Establishment of investment service centers in Provincial chambers Holding Training courses, workshops and etc. for corporate managers and companies interested in attracting FI including negotiation, contracting, financial solutions and other related issues in cooperation with UNIDO and institutions like EY, Deloitte,KPMG and etc.

12 Continue Collection of data from Brownfield and Greenfield plans and categorizing and refining them according to the pattern proposed by the investors. Preparation and distribution of Investment Guidebook. Establishing a private Investment fund for the use of private sector in order to secure bank facilities. Identifying foreign investors and domestic investors and establish a proper link between them. Proposal for establishing specialized courts for investment disputes.

13 Features of Investment under FIPPA: No Limitation on: Equity Percentage, Volume of Investments, Profit Transfer, Capital Repatriation Types of Capital Imported No Import / Export Restriction

14 Some other Features of FIPPA Article 35 Services 3 years Multi-entry Visa 3 years Residence Permit Work Permit

15 Risks Covered By FIPPA Currency Transfer Nationalization & Expropriation Government Intervention and Breach of Contracts by Government

16 Foreign Investment Services Center (FISC) I.R.I Customs Administration Tax Organization Any Organization as per the case Ministry of Foreign Affaires Ministry of Labor FISC Central Bank of Iran Office for registration Companies & Industrial Property Ministry of agriculture Ministry of Industry, Mine &Trade Department of Environment

17 FISC Facilitation of Issues related to the admission and activities of FDI Facilitation of official procedures for required permissions & licenses Coordination with Executing Agencies Related to Foreign Investment

18 Key Services Offered by FISC Guidance to foreign investors concerning investment in Iran. General supervision of foreign investment projects. Necessary coordination with all relevant authorities, prior to the issuance of the investment license including: the declaration of establishment the environment protection license the permits for subscriptions to water, electricity, fuel and telephone the license for exploration and exploitation of mines, etc.

19 Continued registration of joint venture company registration of order for importation of machinery and equipments issues related to importation and repatriation of capital, customs and tax affairs, etc.

20 Investment Licensing Procedure Submission Of Application OIETAI Preparation And Submission Of a Report Foreign Investment Board Draft License Communicated Final License Issued by Minister of Economic Affaires and Finance Max 5 Days Max 10 Days

21 Incentives and Benefits of Foreign Investment in Iran

22 Tax Incentives Fixed corporate income tax at a flat rate of 25% Income Tax with Rate of 0.0% Industry, Mining & Services (Hospital & Hotels) Industry, Mining & Services (Hospital & Hotels) in Industrial Parks and Special Economic Zones Industry, Mining & Services (Hospital & Hotels) in Less Developed Areas Industry, Mining & Services (Hospital & Hotels) in Less Developed Areas located at Industrial Parks and Special Economic Zones Duration of Exemption 5 Years 7 Years 10 Years 13 Years 100% of Income Derived Agricultural Activities Perpetual 100 % of Income Derived From Export of Services,non-oil goods, agricultural Products Perpetual

23 Tax Incentives After the Termination of Tax Holidays Period: Total Taxable income <= registered Capital 50% of income is free of tax In less developed areas: Total Taxable income <= double of registered Capital 100% of income is free of tax

24 Investment Incentives in Free Zones 7 free Zones in Iran: 2 in North-West (Aras, Makou) 1 in North (Anzali) 3 in South (Kish, Geshm, Chabahar) 1 in South-West (Arvand) 20 Years Tax Exemption for All Economic Activities No needed Visa for Entrance of Foreigners Custom Exemption for Raw materials and Industrial machineries of Producing units Possibility of Exporting Products to The Mainland Easy provisions for Re-export and Transit of Commodities

25 No. 82 Vozara Ave., P.C.: Tehran IRAN Tel.: (+98-21) Fax: (+98-21) Website: Foreign Investment Office Tel: Fax: Foreign Investment Services Center Tel: Fax: