Doing Business 2019 Iran, Islamic Rep.

Economy Profile

Iran, Islamic Rep.

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Doing Business 2019 Iran, Islamic Rep.

Economy Profile of Iran, Islamic Rep.

Doing Business 2019 Indicators

(in order of appearance in the document)

Starting a business Procedures, time, cost and paid-in minimum capital to start a limited liability company

Dealing with construction permits Procedures, time and cost to complete all formalities to build a warehouse and the quality
control and safety mechanisms in the construction permitting system

Getting electricity Procedures, time and cost to get connected to the electrical grid, and the reliability of the
electricity supply and the transparency of tariffs

Registering property Procedures, time and cost to transfer a property and the quality of the land administration
system

Getting credit Movable collateral laws and credit information systems

Protecting minority investors Minority shareholders’ rights in related-party transactions and in corporate governance

Paying taxes Payments, time, total tax and contribution rate for a firm to comply with all tax regulations as
well as post-filing processes

Trading across borders Time and cost to export the product of comparative advantage and import auto parts

Enforcing contracts Time and cost to resolve a commercial dispute and the quality of judicial processes

Resolving insolvency Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the
legal framework for insolvency

Labor market regulation Flexibility in employment regulation and aspects of job quality

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 Doing Business 2019 Iran, Islamic Rep.

About Doing Business

The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected
cities at the subnational and regional level.

The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying
to them through their life cycle.

Doing Business captures several important dimensions of the regulatory environment as it applies to local firms. It provides quantitative
indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit,
protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also
measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market
regulation indicators or include the topic in the aggregate ease of doing business score or ranking on the ease of doing business, it does
present the data for these indicators.

By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time,
Doing Business encourages economies to compete towards more efficient regulation; offers measurable benchmarks for reform; and serves
as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy.

In addition, Doing Business offers detailed subnational reports, which exhaustively cover business regulation and reform in different cities and
regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve
performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region
and with the 190 economies that Doing Business has ranked.

The first Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets
and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that
have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the
Russian Federation and the United States) where Doing Business also collected data for the second largest business city. The data for these
11 economies are a population-weighted average for the 2 largest business cities. The project has benefited from feedback from
governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving
the regulatory environment for business around the world.

More about Doing Business (PDF, 5MB)

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 Doing Business 2019 Iran, Islamic Rep.

Ease of Doing Business in DB 2019 Rank

Region Middle East & North Africa
190 1
Iran, Islamic Rep.
Income Category Upper middle income 128
DB 2019 Ease of doing business score
Population 81,162,788
0 100

City Covered Tehran 56.98

DB 2019 Ease of Doing Business Score

0 100
81.28: United Arab Emirates (Rank: 11)

67.19: Oman (Rank: 78)

60.98: Jordan (Rank: 104)

58.30: Regional Average (Middle East & North Africa)

56.98: Iran, Islamic Rep. (Rank: 128)

44.72: Iraq (Rank: 171)

Note: The ease of doing business score captures the gap of each economy from the best regulatory performance observed on each of the indicators across all economies
in the Doing Business sample since 2005. An economy’s ease of doing business score is reflected on a scale from 0 to 100, where 0 represents the lowest and 100
represents the best performance. The ease of doing business ranking ranges from 1 to 190.

Rankings on Doing Business topics - Iran, Islamic Rep.

28

55

82 86 90 89
Rank

99
108
109 121
131
136
149

163 173 173

190

Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving
a with Electricity Property Credit Minority Taxes across Contracts Insolvency
Business Construction Investors Borders
Permits

Ease of Doing Business Score on Doing Business topics - Iran, Islamic Rep.

100

80
67.79 69.11 68.86
63.98 66.20
58.21
Score

60 56.78
50.00

40 33.33 35.57

20

Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving
a with Electricity Property Credit Minority Taxes across Contracts Insolvency
Business Construction Investors Borders
Permits

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 Doing Business 2019 Iran, Islamic Rep.

Starting a Business

This topic measures the number of procedures, time, cost and paid-in minimum capital requirement for a small- to medium-sized limited
liability company to start up and formally operate in each economy’s largest business city.

To make the data comparable across 190 economies, Doing Business uses a standardized business that is 100% domestically owned, has
start-up capital equivalent to 10 times the income per capita, engages in general industrial or commercial activities and employs between 10
and 50 people one month after the commencement of operations, all of whom are domestic nationals. Starting a Business considers two
types of local limited liability companies that are identical in all aspects, except that one company is owned by 5 married women and the
other by 5 married men. The ranking of economies on the ease of starting a business is determined by sorting their scores for starting a
business. These scores are the simple average of the scores for each of the component indicators.

The most recent round of data collection for the project was completed in May 2018. See the methodology for more information.

What the indicators measure Case study assumptions

Procedures to legally start and formally operate To make the data comparable across economies, several assumptions about the
a company (number) business and the procedures are used. It is assumed that any required information is
readily available and that the entrepreneur will pay no bribes.
• Preregistration (for example, name verification or
reservation, notarization)
The business:
• Registration in the economy’s largest business - Is a limited liability company (or its legal equivalent). If there is more than one type
city
of limited liability company in the economy, the most common among domestic firms
• Postregistration (for example, social security is chosen. Information on the most common form is obtained from incorporation
registration, company seal) lawyers or the statistical office.
- Operates in the economy’s largest business city. For 11 economies the data are
• Obtaining approval from spouse to start a
business or to leave the home to register the also collected for the second largest business city.
company - The entire office space is approximately 929 square meters (10,000 square feet).
- Is 100% domestically owned and has five owners, none of whom is a legal entity;
• Obtaining any gender specific document for has a start-up capital of 10 times income per capita and has a turnover of at least
company registration and operation or national 100 times income per capita.
identification card
- Performs general industrial or commercial activities, such as the production or sale
of goods or services to the public. The business does not perform foreign trade
Time required to complete each procedure
activities and does not handle products subject to a special tax regime, for example,
(calendar days)
liquor or tobacco. It does not use heavily polluting production processes.
• Does not include time spent gathering - Leases the commercial plant or offices and is not a proprietor of real estate and the
information amount of the annual lease for the office space is equivalent to the income per
capita.
• Each procedure starts on a separate day (2
procedures cannot start on the same day) - Does not qualify for investment incentives or any special benefits.
- Has at least 10 and up to 50 employees one month after the commencement of
• Procedures fully completed online are recorded operations, all of whom are domestic nationals.
as ½ day - Has a company deed that is 10 pages long.
• Procedure is considered completed once final
document is received The owners:

• No prior contact with officials - Have reached the legal age of majority. If there is no legal age of majority, they are
assumed to be 30 years old.
Cost required to complete each procedure (% of - Are sane, competent, in good health and have no criminal record.
income per capita) - Are married and the marriage is monogamous and registered with the authorities.
- Where the answer differs according to the legal system applicable to the woman or
• Official costs only, no bribes man in question (as may be the case in economies where there is legal plurality), the
• No professional fees unless services required by answer used will be the one that applies to the majority of the population.
law or commonly used in practice

Paid-in minimum capital (% of income per

capita)

• Funds deposited in a bank or with third party

before registration or up to 3 months after
incorporation

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 Doing Business 2019 Iran, Islamic Rep.

Starting a Business - Iran, Islamic Rep.

Standardized Company

Legal form Limited Liability Company (‫)دودحم تيلوئسم اب تکرش‬

Paid-in minimum capital requirement IRR 0

City Covered Tehran

Indicator Iran, Islamic Middle East & OECD high Best Regulatory
Rep. North Africa income Performance

Procedure – Men (number) 10 7.2 4.9 1 (New Zealand)

Time – Men (days) 72 20.5 9.3 0.5 (New Zealand)

Cost – Men (% of income per capita) 1.2 22.6 3.1 0.0 (Slovenia)

Procedure – Women (number) 11 7.9 4.9 1 (New Zealand)

Time – Women (days) 73 21.2 9.3 0.5 (New Zealand)

Cost – Women (% of income per capita) 1.2 22.6 3.1 0.0 (Slovenia)

Paid-in min. capital (% of income per capita) 0.0 8.1 8.6 0.0 (117 Economies)

Figure – Starting a Business in Iran, Islamic Rep. and comparator economies – Ranking and Score

DB 2019 Starting a Business Score

0 100

94.06: United Arab Emirates (Rank: 25)

92.89: Oman (Rank: 37)

84.43: Jordan (Rank: 106)

82.00: Regional Average (Middle East & North Africa)

76.55: Iraq (Rank: 155)

67.79: Iran, Islamic Rep. (Rank: 173)

Note: The ranking of economies on the ease of starting a business is determined by sorting their scores for starting a business. These scores
are the simple average of the scores for each of the component indicators.

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 Doing Business 2019 Iran, Islamic Rep.

Figure – Starting a Business in Iran, Islamic Rep. – Procedure, Time and Cost

Time (days) Cost (% of income per capita)

0.6
70

Cost (% of income per capita)

60 0.5

50 0.4
Time (days)

40
0.3

30
0.2
20

0.1
10

0 0
1 2 *3 4 *5 6 7 8 *9 * 10 * 11
Procedures (number)

* This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.

Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and
women, the graph shows the time for women. For more information on methodology, see the Doing Business website
(http://doingbusiness.org/en/methodology ). For details on the procedures reflected here, see the summary below.

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 Doing Business 2019 Iran, Islamic Rep.

Details – Starting a Business in Iran, Islamic Rep. – Procedure, Time and Cost

No. Procedures Time to Complete Associated Costs

1 APPLIES TO WOMEN ONLY: Obtain husband's permission to open a 1 day no charge

business
Agency : Domicile
According to Civil Code Art. 1117, the husband can prevent his wife from occupations or
technical work which is incompatible with the family interests or the dignity of himself or
his wife. Therefore, a married woman should obtain the permission of her husband to
open a business and commence the business incorporation process. Otherwise, the
husband may ask the court to oblige the wife to cease her involvement with a business
proved in the court as incompatible.
While requirement to obtain husband's permission is not listed within the Commerce law
and is not requested at the Company Registration Office, a married women should still
obtain such a permission based on provisions of the Civil Code.

2 Obtain a criminal record clearance 7-10 days IRR 50,000 (for

Agency : Police Electronic Service Centers criminal record) +
Under articles 111 and 147 of the amendments to the Commercial Code of 1969, a IRR150,000 (to the
criminal record clearance must be obtained for appointing a company's directors. It is a account of the Justice
practice adopted by Companies Registration Office to request criminal record clearance
Department in
certificates during the company incorporation.
Tehran)

3 Reserve a unique company name 3-4 days paid in procedure 5

Agency : Companies Registration Office
Founders must provide online several suggested company names, preferably with 3
syllables. These names will be approved online in a few days, and then company may
chose the preferred name and proceed with applying for incorporation.

4 Register at the Companies Registration Office 5 days paid in procedure 5

Agency : Companies Registration Office
To register with the Companies Registration Office, the company must submit the
following documents:
- Articles of association, signed by all shareholders
- Declaration stating that all shares have been subscribed
- Minutes of the shareholders’ meeting, reflecting the election of the first directors and
inspector(s)
- Written statement accepting the position of directorship
- Criminal record clearance certificate
- National ID Card (Carte Melli) and birth certificates (certified copies) of the
shareholders
- Name of a mass circulation newspaper in which all company announcements will be
published

Application files are assigned a bar code so that each internal desk that receives the file
tracks its entrance and exit. The files are submitted online, and then mailed over post.
Once the application is reviewed, the registrar will make an appointment for founders to
come and sign the documents.

The official registration fee of incorporation is calculated based on the Company's

capital. The fee for any amount of capital exceeding IRR 500 million is fixed at the
maximum rate of IRR 525,000. The schedule of fees can be found at the following link:
http://sherkat.ssaa.ir/Portals/39/tarrif_typed.pdf

5 Pay name search and reservation fee and registration fee 1 day IRR 525,000 for
Agency : Bank registration and IRR
The fees are paid at a commercial bank 40,000 for name
search and
reservation

6 Publish a notice of the company formation in the Official Gazette and the 2-3 days IRR140,000 for
selected newspaper of general circulation official Gazette; IRR
Agency : Official Gazette and the relevant newspaper of mass circulation 240,000 for general
It is possible to directly publish the notice of the company formation through the Official circulation newspaper
Gazette and the selected newspaper or general circulation or submit it to the national post
agent (located at the Registrar's office), which then forwards them to the Official Gazette
and selected newspapers electronically. This process takes 15 to 30 days. However,
businesses do not need to wait until the publication is completed to start their business.
Upon submission of the registration notice to the official gazette for publication, a copy
thereof is affixed with the stamp of the official gazette office indicating that the notice is
in the process of publication. The notice published online is required to proceed with tax
registration.

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Doing Business 2019 Iran, Islamic Rep.

7 Notify the State Tax Affairs Organization (STAO) of the commencement of 25 days no charge
business activities, obtain confirmation from STAO and the Economic Code
Agency : State Tax Affairs Organization
As per Article 177, Note 3 of the Direct Tax Act, the new company must notify the State
Tax Affairs Organization in writing of the commencement of its business operations
within 4 months. Failure to do so will result in a fine and a deprivation of any applicable
tax facilities and exemptions.

8 Register for VAT 1 month no charge

Agency : Value Added Head Office of the State Tax Affairs Organisation
The registration for VAT is needed for a company performing general industrial or
commercial activities such as the case-study measured by Doing Business. The legal
basis for such registration is the Law of Implementation of the Value Added Tax enacted
in 1387 (as amended). Company needs to have tax identification in order to apply for
VAT registration. There is no cost for VAT registration, and it can be completed online
through www.evat.ir. The State Tax Affairs Organization is part of the Ministry of
Economic Affairs and Finance.

9 Retrieve the officially sealed books of account within 30 days of 2 weeks IRR 100,000
registration
Agency : Authorized Vendor
Company needs to have the books sealed by the government to officially operate.
Legally, the company needs to enter its daily operations in these books.

The books are produced by Government and sold by private companies. The cost of the
books depends on the number of pages of the official sealed books of account.

The request for Sealing Account Books is done online at

http://irsherkat.ssaa.ir/Design/RqstAdmission/PolompRequest.aspx . After the order is
placed, company must receive the books in physical form.

Pay the share certificate stamp duty within 60 days of company registration 1 day 0.05% of the par
10 Agency : Bank value of the
According to Article 48 of the Direct Taxation Act, the stamp duty must be paid within subscribed share
60 days of company registration. It is paid at Bank Melli Iran or at the Tax Affairs capital
Organization offices because it is an official government duty.

Enroll workers in the social security program at the Iranian Labor 13 days no charge
11 Department and Obtain a workplace number
Agency : Social Security Organization
Entrepreneur needs a tax ID for social security registration office (SSO). The
manager/representative needs to go to the SSO with company registration documents,
lease and employee list. After some time, the SSO will send an inspector to the office to
check if the company exists, employees are working there, and all requirements are met.
In a few days after this visit, the company will receive social security code. After
obtaining this code, company can make the monthly social security payments online.

Applies to women only.

Takes place simultaneously with previous procedure.

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 Doing Business 2019 Iran, Islamic Rep.

Dealing with Construction Permits

This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all
required notifications, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with
Construction Permits indicator measures the building quality control index, evaluating the quality of building regulations, the strength of
quality control and safety mechanisms, liability and insurance regimes, and professional certification requirements. The most recent round of
data collection was completed in May 2018. See the methodology for more information

What the indicators measure Case study assumptions

Procedures to legally build a warehouse To make the data comparable across economies, several assumptions about the
(number) construction company, the warehouse project and the utility connections are used.

• Submitting all relevant documents and obtaining The construction company (BuildCo):
all necessary clearances, licenses, permits and
certificates - Is a limited liability company (or its legal equivalent) and operates in the economy’s
largest business city. For 11 economies the data are also collected for the second
• Submitting all required notifications and receiving largest business city.
all necessary inspections
- Is 100% domestically and privately owned; has five owners, none of whom is a
• Obtaining utility connections for water and legal entity. Has a licensed architect and a licensed engineer, both registered with
sewerage the local association of architects or engineers. BuildCo is not assumed to have any
other employees who are technical or licensed experts, such as geological or
• Registering and selling the warehouse after its
completion topographical experts.
- Owns the land on which the warehouse will be built and will sell the warehouse
Time required to complete each procedure upon its completion.
(calendar days)
The warehouse:
• Does not include time spent gathering
information - Will be used for general storage activities, such as storage of books or stationery.
- Will have two stories, both above ground, with a total constructed area of
• Each procedure starts on a separate day— approximately 1,300.6 square meters (14,000 square feet). Each floor will be 3
though procedures that can be fully completed
meters (9 feet, 10 inches) high and will be located on a land plot of approximately
online are an exception to this rule
929 square meters (10,000 square feet) that is 100% owned by BuildCo, and the
• Procedure is considered completed once final warehouse is valued at 50 times income per capita.
document is received - Will have complete architectural and technical plans prepared by a licensed
architect. If preparation of the plans requires such steps as obtaining further
• No prior contact with officials
documentation or getting prior approvals from external agencies, these are counted
Cost required to complete each procedure (% of as procedures.
income per capita) - Will take 30 weeks to construct (excluding all delays due to administrative and
regulatory requirements).
• Official costs only, no bribes
The water and sewerage connections:
Building quality control index (0-15)
- Will be 150 meters (492 feet) from the existing water source and sewer tap. If there
• Quality of building regulations (0-2) is no water delivery infrastructure in the economy, a borehole will be dug. If there is
• Quality control before construction (0-1) no sewerage infrastructure, a septic tank in the smallest size available will be
installed or built.
• Quality control during construction (0-3) - Will have an average water use of 662 liters (175 gallons) a day and an average
• Quality control after construction (0-3) wastewater flow of 568 liters (150 gallons) a day. Will have a peak water use of
1,325 liters (350 gallons) a day and a peak wastewater flow of 1,136 liters (300
• Liability and insurance regimes (0-2) gallons) a day.
• Professional certifications (0-4) - Will have a constant level of water demand and wastewater flow throughout the
year; will be 1 inch in diameter for the water connection and 4 inches in diameter for
the sewerage connection.

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 Doing Business 2019 Iran, Islamic Rep.

Dealing with Construction Permits - Iran, Islamic Rep.

Standardized Warehouse

Estimated value of warehouse IRR 9,158,743,577.10

City Covered Tehran

Indicator Iran, Islamic Middle East & OECD high Best Regulatory
Rep. North Africa income Performance

Procedures (number) 16 16.6 12.7 None in 2017/18

Time (days) 130 137.4 153.1 None in 2017/18

Cost (% of warehouse value) 6.6 4.7 1.5 None in 2017/18

Building quality control index (0-15) 12.5 12.1 11.5 15.0 (3 Economies)

Figure – Dealing with Construction Permits in Iran, Islamic Rep. and comparator economies – Ranking and Score

DB 2019 Dealing with Construction Permits Score

0 100

86.41: United Arab Emirates (Rank: 5)

72.05: Oman (Rank: 66)

69.11: Iran, Islamic Rep. (Rank: 86)

67.64: Iraq (Rank: 103)

60.47: Jordan (Rank: 139)

59.17: Regional Average (Middle East & North Africa)

Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their scores for dealing with
construction permits. These scores are the simple average of the scores for each of the component indicators.

Figure – Dealing with Construction Permits in Iran, Islamic Rep. – Procedure, Time and Cost

Time (days) Cost (% of warehouse value)

6
120

5
Cost (% of warehouse value)

100

4
Time (days)

80

3
60

2
40

20 1

0 0
1 2 3 4 5 6 7 8 9 10 11 12 * 13 14 15 16
Procedures (number)

* This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.

Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and
women, the graph shows the time for women. For more information on methodology, see the Doing Business website
(http://doingbusiness.org/en/methodology ). For details on the procedures reflected here, see the summary below.

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 Doing Business 2019 Iran, Islamic Rep.

Figure – Dealing with Construction Permits in Iran, Islamic Rep. and comparator economies – Measure of Quality

15.0
15
12.5 12.1
11.0 11.0
Index score
10

5.5
5

Iran, Islamic Rep. Iraq Jordan Oman United Arab Emirates Middle East & North Africa

Details – Dealing with Construction Permits in Iran, Islamic Rep. – Procedure, Time and Cost

No. Procedures Time to Complete Associated Costs

1 Hire an independent licensed engineering service office 1 day IRR 457,937,179

Agency : Surveillance Company
BuildCo must hire an independent licensed office to undertake pre-construction
clearances and supervise construction.

The design and supervision team provides technical supervision through an architectural
engineer for the duration of the construction work and directs the workers in accordance
with the plans. This team reports on all construction activities to the engineer.

2 Apply for zoning approval 1 day no charge

Agency : E-service office
BuildCo must obtain zoning permission from the e-service office. BuildCo submits the
request and the e-service officer scans the request and supporting documents into the
system. An inspection is scheduled usually with a couple of days at most. By the third or
fourth day, the inspector will enter the information about the site into the system and it is
transferred electronically to the Municipality for approval. The Municipality will usually
approve the location permit request within 1 -- 2 days and send the approval back to the
relevant e-service office. BuildCo can obtain the location approval within 10 days of
submitting the application.

Payment is made using an ATM card in POS system available in the e-service offices.

3 Receive site inspection 1 day IRR 3,472,602

Agency : Municipality

4 Obtain zoning approval 10 days IRR 8,453,900

Agency : E-service office

5 Obtain a fire safety approval 30 days no charge

Agency : Central Fire Agency
BuildCo must obtain an approval on fire safety before applying for a construction permit.
This requirement was introduced on October 9, 2016.

6 Request and obtain construction permit 30 days IRR 10,625,000

Agency : Engineering and Technical Services Institution and Municipality
BuildCo submits the construction permit application through the e-service office. The e-
service office will send the documents to the Municipality for approval. The application
is reviewed and signed by the following people: Head of Masterplan (at the location
approval stage), Head of Issuing Permission, Deputy of Urban and City Planning District,
and the District Mayor. Once everyone has signed off, the approved application is sent
back to the e-service office and the permit is issued. Applicants are informed by email,
SMS, or telephone that their applications have been approved. The whole process takes
about 1 month.

Payment is made using an ATM card in POS system available in the e-service offices.

7 Receive inspection from Municipality - I 1 day no charge

Agency : Municipality
Construction work does not stop when the inspections take place.

8 Receive inspection from Municipality - II 1 day no charge

Agency : Municipality

9 Receive inspection from Municipality - III 1 day no charge

Agency : Municipality

10 Receive inspection from Municipality - IV 1 day no charge

Agency : Municipality

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Doing Business 2019 Iran, Islamic Rep.

11 Receive inspection from Municipality - V 1 day no charge

Agency : Municipality

12 Obtain sewage connection 49 days IRR 44,857,000

Agency : Tehran Water and Wastewater Company

Obtain water connection 21 days IRR 74,019,000

13 Agency : Tehran Water and Wastewater Company

14 Apply for building completion certificate 1 day no charge

Agency : E-service office
Upon completion of construction works, BuildCo must submit the site file containing all
the inspection reports signed by the supervising engineer at each stage of construction to
the e-service office. The e-service office will scan and transmit the file to the
Municipality which will assign an inspector to come and check that there have been no
breaches to the construction permit. The inspector files a no-breach report at the
municipality.

The building completion certificate must be signed by:

• The Head of Issuing Permission
• The Head of Technical Supervision
• Deputy for Urban Planning
• The District Mayor

Once all signatures are obtained, the approved building completion certificate is
transmitted back to the relevant e-service office who will notify BuildCo.

15 Receive final inspection 1 day no charge

Agency : Municipality

16 Obtain building completion certificate 1 day IRR 3,472,602

Agency : E-service office
The cost for the building completion certificate is IRR 3670 per sqm. Payment is made
using an ATM card in POS system available in the e-service offices. Payment for the
completion certificate must be made at the same time that the construction permit is
requested.

Takes place simultaneously with previous procedure.

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 Doing Business 2019 Iran, Islamic Rep.

Details – Dealing with Construction Permits in Iran, Islamic Rep. – Measure of Quality

Answer Score

Building quality control index (0-15) 12.5

Quality of building regulations index (0-2) 1.0

How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0
Free of charge.

Which requirements for obtaining a building permit are clearly specified in the building List of required 0.0
regulations or on any accessible website, brochure or pamphlet? (0-1) documents;
Required
preapprovals.

Quality control before construction index (0-1) 1.0

Which third-party entities are required by law to verify that the building plans are in Licensed 1.0
compliance with existing building regulations? (0-1) engineer; Private
firm.

Quality control during construction index (0-3) 2.0

What types of inspections (if any) are required by law to be carried out during construction? Inspections by 1.0
(0-2) external engineer
or firm;
Unscheduled
inspections;
Inspections at
various phases.

Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0
inspections are
always done in
practice.

Quality control after construction index (0-3) 3.0

Is there a final inspection required by law to verify that the building was built in accordance Yes, final 2.0
with the approved plans and regulations? (0-2) inspection is
done by
government
agency; Yes,
external engineer
submits report for
final inspection.

Do legally mandated final inspections occur in practice? (0-1) Final inspection 1.0
always occurs in
practice.

Liability and insurance regimes index (0-2) 1.5

Which parties (if any) are held liable by law for structural flaws or problems in the building Architect or 0.5
once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) engineer.

Which parties (if any) are required by law to obtain an insurance policy to cover possible No party is 1.0
structural flaws or problems in the building once it is in use (Latent Defect Liability Insurance required by law
or Decennial Insurance)? (0-1) to obtain
insurance ;
Construction
company;
Insurance is
commonly taken
in practice.

Professional certifications index (0-4) 4.0

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Doing Business 2019 Iran, Islamic Rep.

What are the qualification requirements for the professional responsible for verifying that the Minimum number 2.0
architectural plans or drawings are in compliance with existing building regulations? (0-2) of years of
experience;
University degree
in architecture or
engineering;
Being a
registered
architect or
engineer;
Passing a
certification
exam.

What are the qualification requirements for the professional who supervises the construction Minimum number 2.0
on the ground? (0-2) of years of
experience;
University degree
in engineering,
construction or
construction
management;
Being a
registered
architect or
engineer;
Passing a
certification
exam.

Page 15
 Doing Business 2019 Iran, Islamic Rep.

Getting Electricity

This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly
constructed warehouse. Additionally, the reliability of supply and transparency of tariffs index measures reliability of supply, transparency of
tariffs and the price of electricity. The most recent round of data collection for the project was completed in May 2018. See the methodology
for more information.

What the indicators measure Case study assumptions

Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions about the
(number) warehouse, the electricity connection and the monthly consumption are used.

• Submitting all relevant documents and obtaining The warehouse:

all necessary clearances and permits
- Is owned by a local entrepreneur and is used for storage of goods.
• Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the data are
receiving all necessary inspections
also collected for the second largest business city.
• Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is in an
purchasing material for these works area with no physical constraints. For example, the property is not near a railway.
- Is a new construction and is being connected to electricity for the first time.
• Concluding any necessary supply contract and
- Has two stories with a total surface area of approximately 1,300.6 square meters
obtaining final supply
(14,000 square feet). The plot of land on which it is built is 929 square meters
Time required to complete each procedure (10,000 square feet).
(calendar days)
The electricity connection:
• Is at least 1 calendar day
- Is a permanent one with a three-phase, four-wire Y connection with a subscribed
• Each procedure starts on a separate day capacity of 140-kilo-volt-ampere (kVA) with a power factor of 1, when 1 kVA = 1
• Does not include time spent gathering kilowatt (kW).
information - Has a length of 150 meters. The connection is to either the low- or medium-voltage
distribution network and is either overhead or underground, whichever is more
• Reflects the time spent in practice, with little common in the area where the warehouse is located and requires works that involve
follow-up and no prior contact with officials
the crossing of a 10-meter road (such as by excavation or overhead lines) but are all
Cost required to complete each procedure (% of carried out on public land. There is no crossing of other owners’ private property
income per capita) because the warehouse has access to a road.
- Does not require work to install the internal wiring of the warehouse. This has
• Official costs only, no bribes already been completed up to and including the customer’s service panel or
• Value added tax excluded switchboard and the meter base.

The reliability of supply and transparency of The monthly consumption:

tariffs index (0-8)
- It is assumed that the warehouse operates 30 days a month from 9:00 a.m. to 5:00
• Duration and frequency of power outages (0–3) p.m. (8 hours a day), with equipment utilized at 80% of capacity on average and that
• Tools to monitor power outages (0–1) there are no electricity cuts (assumed for simplicity reasons) and the monthly energy
consumption is 26,880 kilowatt-hours (kWh); hourly consumption is 112 kWh.
• Tools to restore power supply (0–1) - If multiple electricity suppliers exist, the warehouse is served by the cheapest
• Regulatory monitoring of utilities’ performance supplier.
(0–1) - Tariffs effective in January of the current year are used for calculation of the price of
electricity for the warehouse. Although January has 31 days, for calculation
• Financial deterrents limiting outages (0–1) purposes only 30 days are used.
• Transparency and accessibility of tariffs (0–1)
Price of electricity (cents per kilowatt-hour)*

• Price based on monthly bill for commercial

warehouse in case study

*Note: Doing Business measures the price of

electricity, but it is not included in the ease of doing
business score nor the ranking on the ease of
getting electricity.

Page 16
 Doing Business 2019 Iran, Islamic Rep.

Getting Electricity - Iran, Islamic Rep.

Standardized Connection

Price of electricity (US cents per kWh) 5.3

Name of utility Great Tehran Electricity Distribution Company (GTEDC)

City Covered Tehran

Indicator Iran, Islamic Middle East & OECD high Best Regulatory
Rep. North Africa income Performance

Procedures (number) 6 4.7 4.5 3 (25 Economies)

Time (days) 77 72.4 77.2 18 (3 Economies)

Cost (% of income per capita) 923.1 479.9 64.2 0.0 (3 Economies)

Reliability of supply and transparency of tariff 5 4.2 7.5 8.0 (27 Economies)
index (0-8)

Figure – Getting Electricity in Iran, Islamic Rep. and comparator economies – Ranking and Score

DB 2019 Getting Electricity Score

0 100

80.49: Jordan (Rank: 62)

79.34: Oman (Rank: 66)

69.45: Regional Average (Middle East & North Africa)

68.86: Iran, Islamic Rep. (Rank: 108)

61.73: Iraq (Rank: 126)

100.00: United Arab Emirates (Rank: 1)

Note: The ranking of economies on the ease of getting electricity is determined by sorting their scores for getting electricity. These scores are
the simple average of the scores for all the component indicators except the price of electricity.

Page 17
 Doing Business 2019 Iran, Islamic Rep.

Figure – Getting Electricity in Iran, Islamic Rep. – Procedure, Time and Cost

Time (days) Cost (% of income per capita)

600

70

Cost (% of income per capita)

500
60

50 400
Time (days)

40 300

30
200
20

100
10

0 0
1 *2 3 4 5 6
Procedures (number)

* This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.

Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and
women, the graph shows the time for women. For more information on methodology, see the Doing Business website
(http://doingbusiness.org/en/methodology ). For details on the procedures reflected here, see the summary below.

Figure – Getting Electricity in Iran, Islamic Rep. and comparator economies – Measure of Quality

8
8
7
7
6
6
Index score

5
5
4.2
4
3
2
1
0
0

Iran, Islamic Rep. Iraq Jordan Oman United Arab Emirates Middle East & North Africa

Page 18
 Doing Business 2019 Iran, Islamic Rep.

Details – Getting Electricity in Iran, Islamic Rep. – Procedure, Time and Cost

No. Procedures Time to Complete Associated Costs

1 Submit application to GTEDC and await external inspection 9 calendar days USD 0
Agency : Great Tehran Electricity Distribution Company (GTEDC)
The client needs to submit an application for electricity connection with Great Tehran
Electricity Distribution Company (GTEDC) in person, and attach to that a certificate with
the type of activity.

2 Receive external inspection by GTEDC 1 calendar day IRR 5,000,000

Agency : Great Tehran Electricity Distribution Company (GTEDC)
After the application process, an engineer from the utility will visit the site to assess
whether the grid will have enough capacity to accommodate the new connection. The site
visit is necessary because the utility’s maps are not up to date. Furthermore, the utility
will also inspect to check that the estimated consumption submitted by the applicant is
correct.
Then they prepare an estimate of the connection fees for the client to later pay at a bank.
The client also signs a contract with the utility at the time of applying.

3 Obtain approval from GTEDC for design of private substation 20 calendar days USD 14,000
Agency : Great Tehran Electricity Distribution Company (GTEDC)
In the case of 140 kVA a substation is most likely needed. A private electrical firm
(possibly the same as the one that did the internal wiring) designs the substation and
submits it to Great Tehran Electricity Distribution Company (GTEDC) for approval. The
Great Tehran Electricity Distribution Company (GTEDC) has a unified design that the
customer can use.

4 Obtain material for external works 7 calendar days USD 5,000

Agency : Market
External works consist of the utility's contractor building a private distribution substation.

Transformers are often missing in the utility's stock. The customer can buy the materials,
or pay the market price to the utility and the utility will then buy the materials. For
smaller projects, it is usually the utility who would buy the materials. For larger projects,
the customer might want to buy the materials themselves. 140 kVA is considered a
medium project. It is becoming more common with time for the utility to purchase the
material.

If the customer purchases the material, they will need to provide a certification (the utility
provides customers with a detailed list of the materials to buy).

5 Obtain external works from GTEDC 35 calendar days USD 30,000

Agency : Great Tehran Electricity Distribution Company (GTEDC)
Great Tehran Electricity Distribution Company (GTEDC)'s contractor completes the
external connection works by installing substation and connecting it to its medium-
voltage network.

6 Obtain meter installation and final connection from GTEDC 6 calendar days USD 700
Agency : Great Tehran Electricity Distribution Company (GTEDC)
When the works are completed, Great Tehran Electricity Distribution Company
(GTEDC) installs the meter and electricity is turned on immediately.

Takes place simultaneously with previous procedure.

Page 19
 Doing Business 2019 Iran, Islamic Rep.

Details – Getting Electricity in Iran, Islamic Rep. – Measure of Quality

Answer

Reliability of supply and transparency of tariff index (0-8) 5

Total duration and frequency of outages per customer a year (0-3) 1

System average interruption duration index (SAIDI) 5.1

System average interruption frequency index (SAIFI) 4.8

What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 2.0

Mechanisms for monitoring outages (0-1) 1

Does the distribution utility use automated tools to monitor outages? Yes

Mechanisms for restoring service (0-1) 1

Does the distribution utility use automated tools to restore service? Yes

Regulatory monitoring (0-1) 1

Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on reliability of Yes
supply?

Financial deterrents aimed at limiting outages (0-1) 0

Does the utility either pay compensation to customers or face fines by the regulator (or both) if outages No
exceed a certain cap?

Communication of tariffs and tariff changes (0-1) 1

Are effective tariffs available online? Yes

Link to the website, if available online http://www.tbtb.co.ir/f

a/home/khadamat

Are customers notified of a change in tariff ahead of the billing cycle? Yes

Note:

If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tariff
index.

If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index.

If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index.

Page 20
 Doing Business 2019 Iran, Islamic Rep.

Registering Property

This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to
purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land
administration system in each economy. The quality of land administration index has five dimensions: reliability of infrastructure, transparency
of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for
the project was completed in May 2018. See the methodology for more information.

What the indicators measure Case study assumptions

Procedures to legally transfer title on To make the data comparable across economies, several assumptions about the
immovable property (number) parties to the transaction, the property and the procedures are used.

• Preregistration procedures (for example, The parties (buyer and seller):

checking for liens, notarizing sales agreement,
paying property transfer taxes) - Are limited liability companies (or the legal equivalent).
- Are located in the periurban area of the economy’s largest business city. For 11
• Registration procedures in the economy's largest economies the data are also collected for the second largest business city.
business city.
- Are 100% domestically and privately owned.
• Postregistration procedures (for example, filling - Have 50 employees each, all of whom are nationals.
title with municipality) - Perform general commercial activities.

Time required to complete each procedure The property (fully owned by the seller):
(calendar days)
- Has a value of 50 times income per capita, which equals the sale price.
• Does not include time spent gathering - Is fully owned by the seller.
information - Has no mortgages attached and has been under the same ownership for the past
• Each procedure starts on a separate day - 10 years.
though procedures that can be fully completed - Is registered in the land registry or cadastre, or both, and is free of title disputes.
online are an exception to this rule - Is located in a periurban commercial zone, and no rezoning is required.
- Consists of land and a building. The land area is 557.4 square meters (6,000
• Procedure is considered completed once final square feet). A two-story warehouse of 929 square meters (10,000 square feet) is
document is received
located on the land. The warehouse is 10 years old, is in good condition, has no
• No prior contact with officials heating system and complies with all safety standards, building codes and legal
requirements. The property, consisting of land and building, will be transferred in its
Cost required to complete each procedure (% of entirety.
property value) - Will not be subject to renovations or additional construction following the purchase.
• Official costs only (such as administrative fees, - Has no trees, natural water sources, natural reserves or historical monuments of
duties and taxes). any kind.
- Will not be used for special purposes, and no special permits, such as for
• Value Added Tax, Capital Gains Tax and illicit residential use, industrial plants, waste storage or certain types of agricultural
payments are excluded activities, are required.
- Has no occupants, and no other party holds a legal interest in it.
Quality of land administration index (0-30)

• Reliability of infrastructure index (0-8)

• Transparency of information index (0–6)
• Geographic coverage index (0–8)
• Land dispute resolution index (0–8)
• Equal access to property rights index (-2–0)

Page 21
 Doing Business 2019 Iran, Islamic Rep.

Registering Property - Iran, Islamic Rep.

Indicator Iran, Islamic Middle East & OECD high Best Regulatory
Rep. North Africa income Performance

Procedures (number) 6 5.6 4.7 1 (4 Economies)

Time (days) 31 29.7 20.1 1 (New Zealand)

Cost (% of property value) 5.7 5.7 4.2 0.0 (Saudi Arabia)

Quality of the land administration index (0-30) 15.0 14.2 23.0 None in 2017/18

Figure – Registering Property in Iran, Islamic Rep. and comparator economies – Ranking and Score

DB 2019 Registering Property Score

0 100

90.88: United Arab Emirates (Rank: 7)

74.03: Oman (Rank: 52)

66.40: Jordan (Rank: 72)

63.98: Iran, Islamic Rep. (Rank: 90)

62.11: Regional Average (Middle East & North Africa)

57.74: Iraq (Rank: 113)

Note: The ranking of economies on the ease of registering property is determined by sorting their scores for registering property. These
scores are the simple average of the scores for each of the component indicators.

Figure – Registering Property in Iran, Islamic Rep. – Procedure, Time and Cost

Time (days) Cost (% of property value)

6
30

Cost (% of property value)

25

4
20
Time (days)

15 3

10 2

5 1

0 0
1 *2 *3 *4 5 6
Procedures (number)

* This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure.

Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a different procedure list for men and
women, the graph shows the time for women. For more information on methodology, see the Doing Business website
(http://doingbusiness.org/en/methodology ). For details on the procedures reflected here, see the summary below.

Page 22
 Doing Business 2019 Iran, Islamic Rep.

Figure – Registering Property in Iran, Islamic Rep. and comparator economies – Measure of Quality

30

25 22.5 22.0
Index score
20
15.0 14.2
15 13.5
10.5
10

Iran, Islamic Rep. Iraq Jordan Oman United Arab Emirates Middle East & North Africa

Details – Registering Property in Iran, Islamic Rep. – Procedure, Time and Cost

No. Procedures Time to Complete Associated Costs

1 Obtain a social security clearance certificate 20 days no charge

Agency : Social Security Organization
A social security clearance certificate must be obtained from the Social Security
Organization for properties being used for commercial purposes. An inspection of the
premises is carried out to check if the premises can be used for commercial purposes.
Obtaining a Social security clearance certificate is mandatory by law and the deadline to
obtain this certificate is 20 days.

2 Conduct a check on the property at the Real Estate Registration 3 days IRR 400,000;
Department (IRR100,000 +
Agency : Real Estate Registration Department IRR300,000 for urban
The buyer/seller visits the notary office, where the notary will electronically contact the areas
Registry Office to ask if there are any obstacle to transfer this property. The copy of the
IRR100,000 +
title deeds or replica copy is valid for one months until the answer of the Land Registry is
IRR100,000 for rural
displayed on its official website.
areas)

3 Obtain a tax clearance certificate from the Tax Affairs Organization 12 days IRR 457,937,178.86;
Agency : Tax Affairs Organization (Transfer tax - 5% of
When transferring a property, the seller obtains specific fax forms and municipality duties the property price)
for transferring a property from the notary's office (procedure 2). These tax forms are
then submitted along with the required documents to the tax office, for the calculation of
the taxes to be paid. This clearance serves two purposes: (i) to check whether there no
outstanding taxes on this property. The verification process is still paper based, and it
takes time for the officers to verify that there are no outstanding taxes. (ii) it is also to
verify that the property transfer tax of 5% has been paid.

The clearance of taxes is determined according to official regional values. The certificate
is valid for 1 month. According to amended Article 1 of the Law on the Facilitation of
Administration of Notary Public Office of July 2006, the public notaries must not register
a property transaction before the receipt of the Tax Clearance Certificate (starting in
March 20, 2016)

4 Obtain settlement certificate for reconstruction duty from the Municipality 5 days no charge
Agency : Tax Affairs Organization
A settlement certificate (tax clearance certificate) must be obtained from the Municipality
to account for any and all the renovations made to the property. In practice municipality
and village authority have to come to the premises and conduct inspection in person to
determine the fee.

Page 23
Doing Business 2019 Iran, Islamic Rep.

5 The deed is prepared and notarized at the notary public’s office 1 day IRR 64,611,205.04;
Agency : Public Notary (Immovable property
Documents are sent electronically to the land registry (online), but the buyer and seller transaction fees
must be physically in the Notary office to sign the documents. The electronic platform is according to the
used by the Notary to do checks on property, communicate with Registry Office, prepare
"Mantaghe Bandi"
the deed, etc, The draft agreement is prepared at the Notary office, it is then signed, and
(Zoning) Price, for a
finger scanned/inked at the notary and then sent to the Land Registry.
property value:

The notary public collects an amount according to legal tariffs determined by the
Organization of Deeds and Properties Registration at the time of drawing up the deed, 1) up to 2,000,000
which includes writing fee and the registration fee. According to the decree 87/8039 of IRR: fixed fee of
the Deputy Head of the Organization for the Registration of Deeds and Properties. 600,000 IRR
2) from 2,000,000
IRR to 10,000,000
IRR: 16.5% of the
(cadastral) property
value
3) from 10,000,000
IRR to 50,000,000
IRR: 11% of the
(cadastral) property
value
4) from 50,000,000
IRR to 100,000,000
IRR: 5.5% of the
(cadastral) property
value
5) from 100,000,000
IRR to 200,000,000
IRR: 3.3% of the
(cadastral) property
value
6) from 200,000,000
IRR to 500,000,000
IRR: 1.1% of the
(cadastral) property
value
7) from 500,000,000
IRR to sum of
1,000,000,000 IRR:
0.4% of the
(cadastral) property
value
8) above
1,000,000,000 IRR:
0.2% of the
(cadastral) property
value

In addition, 500,000
fee for obtaining title
in Procedure 6 + .5%
registration fee)

6 The title is registered at the Real Estate Registration Department 10 days no charge
Agency : Real Estate Registration Department
The title is registered at the Real Estate Registration Department by the notary public,
who sends an abstract of the deed.

Land Registry sends the deed to the buyer in a special envelope. Deed is not give in
person, because the agency wants to have a record of the postal address of the buyer.
Deeds need to be signed by different Land Administration officers.

Takes place simultaneously with previous procedure.

Page 24
 Doing Business 2019 Iran, Islamic Rep.

Details – Registering Property in Iran, Islamic Rep. – Measure of Quality

Answer Score

Reliability of infrastructure index (0-8) 6.0

What is the institution in charge of immovable property registration? The State

Organization for
Registration of
Deeds and
Properties

In what format are the majority of title or deed records kept in the largest business city—in a Computer/Scann 1.0
paper format or in a computerized format (scanned or fully digital)? ed

Is there an electronic database for checking for encumbrances (liens, mortgages, restrictions Yes 1.0
and the like)?

Institution in charge of the plans showing legal boundaries in the largest business city: Cadastre
General Office at
the state
Organization for
Registration of
Deeds and
Properties

In what format are the majority of maps of land plots kept in the largest business city—in a Computer/Scann 1.0
paper format or in a computerized format (scanned or fully digital)? ed

Is there an electronic database for recording boundaries, checking plans and providing Yes 1.0
cadastral information (geographic information system)?

Is the information recorded by the immovable property registration agency and the cadastral Different 1.0
or mapping agency kept in a single database, in different but linked databases or in separate databases but
databases? linked

Do the immovable property registration agency and cadastral or mapping agency use the Yes 1.0
same identification number for properties?

Transparency of information index (0–6) 1.0

Who is able to obtain information on land ownership at the agency in charge of immovable Only 0.0
property registration in the largest business city? intermediaries
(notaries,
lawyers, etc.)

Is the list of documents that are required to complete any type of property transaction made Yes, online 0.5
publicly available–and if so, how?

Link for online access: http://ssaa.ir/Port

als/0/%D9%85%
D8%AF%D8%A7
%D8%B1%DA%
A9%20%D9%85
%D9%88%D8%
B1%D8%AF%20
%D9%86%DB%
8C%D8%A7%D8
%B2%20%D8%A
C%D9%87%D8
%AA%20%D8%
AA%D9%86%D8
%B8%DB%8C%
D9%85%20%D8
%B3%D9%86%
D8%AF%20%D8
%A7%D9%86%
D8%AA%D9%82
%D8%A7%D9%
84.pdf?ver=1397-
03-29-163309-
600

Is the applicable fee schedule for any property transaction at the agency in charge of Yes, online 0.5
immovable property registration in the largest business city made publicly available–and if
so, how?

Page 25
Doing Business 2019 Iran, Islamic Rep.

Link for online access: http://ssaa.ir/Defa

ult.aspx?tabid=63

Does the agency in charge of immovable property registration commit to delivering a legally Yes, in person 0.0
binding document that proves property ownership within a specific time frame–and if so, how
does it communicate the service standard?

Link for online access:

Is there a specific and separate mechanism for filing complaints about a problem that No 0.0
occurred at the agency in charge of immovable property registration?

Contact information:

Are there publicly available official statistics tracking the number of transactions at the No 0.0
immovable property registration agency?

Number of property transfers in the largest business city in 2017:

Who is able to consult maps of land plots in the largest business city? Only 0.0
intermediaries
(notaries,
lawyers, etc.)

Is the applicable fee schedule for accessing maps of land plots made publicly available— Yes, in person 0.0
and if so, how?

Link for online access:

Does the cadastral or mapping agency commit to delivering an updated map within a No 0.0
specific time frame—and if so, how does it communicate the service standard?

Link for online access:

Is there a specific and separate mechanism for filing complaints about a problem that No 0.0
occurred at the cadastral or mapping agency?

Contact information:

Geographic coverage index (0–8) 4.0

Are all privately held land plots in the economy formally registered at the immovable property No 0.0
registry?

Are all privately held land plots in the largest business city formally registered at the Yes 2.0
immovable property registry?

Are all privately held land plots in the economy mapped? No 0.0

Are all privately held land plots in the largest business city mapped? Yes 2.0

Land dispute resolution index (0–8) 4.0

Does the law require that all property sale transactions be registered at the immovable Yes 1.5
property registry to make them opposable to third parties?

Is the system of immovable property registration subject to a state or private guarantee? Yes 0.5

Is there a specific compensation mechanism to cover for losses incurred by parties who No 0.0
engaged in good faith in a property transaction based on erroneous information certified by
the immovable property registry?

Does the legal system require a control of legality of the documents necessary for a property Yes 0.5
transaction (e.g., checking the compliance of contracts with requirements of the law)?

If yes, who is responsible for checking the legality of the documents? Registrar; Notary;

Does the legal system require verification of the identity of the parties to a property Yes 0.5
transaction?

If yes, who is responsible for verifying the identity of the parties? Registrar; Notary;

Is there a national database to verify the accuracy of identity documents? Yes 1.0

For a standard land dispute between two local businesses over tenure rights of a property First instance
worth 50 times gross national income (GNI) per capita and located in the largest business public court
city, what court would be in charge of the case in the first instance?

Page 26
Doing Business 2019 Iran, Islamic Rep.

How long does it take on average to obtain a decision from the first-instance court for such a More than 3 0.0
case (without appeal)? years

Are there any statistics on the number of land disputes in the first instance? No 0.0

Number of land disputes in the largest business city in 2017:

Equal access to property rights index (-2–0) 0.0

Do unmarried men and unmarried women have equal ownership rights to property? Yes

Do married men and married women have equal ownership rights to property? Yes 0.0

Page 27
 Doing Business 2019 Iran, Islamic Rep.

Getting Credit

This topic explores two sets of issues—the strength of credit reporting systems and the effectiveness of collateral and bankruptcy laws in
facilitating lending. The most recent round of data collection for the project was completed in May 2018. See the methodology for more
information.

What the indicators measure Case study assumptions

Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of
borrowers and lenders with respect to secured transactions through 2 sets of
• Rights of borrowers and lenders through indicators. The depth of credit information index measures rules and practices
collateral laws (0-10)
affecting the coverage, scope and accessibility of credit information available
• Protection of secured creditors’ rights through through a credit registry or a credit bureau. The strength of legal rights index
bankruptcy laws (0-2) measures the degree to which collateral and bankruptcy laws protect the rights of
borrowers and lenders and thus facilitate lending. For each economy it is first
Depth of credit information index (0–8) determined whether a unitary secured transactions system exists. Then two case
• Scope and accessibility of credit information scenarios, case A and case B, are used to determine how a nonpossessory security
distributed by credit bureaus and credit registries interest is created, publicized and enforced according to the law. Special emphasis
(0-8) is given to how the collateral registry operates (if registration of security interests is
possible). The case scenarios involve a secured borrower, company ABC, and a
Credit bureau coverage (% of adults) secured lender, BizBank.

• Number of individuals and firms listed in largest In some economies the legal framework for secured transactions will allow only case
credit bureau as a percentage of adult population
A or case B (not both) to apply. Both cases examine the same set of legal provisions
Credit registry coverage (% of adults) relating to the use of movable collateral.

• Number of individuals and firms listed in credit Several assumptions about the secured borrower (ABC) and lender (BizBank)
registry as a percentage of adult population are used:

- ABC is a domestic limited liability company (or its legal equivalent).

- ABC has up to 50 employees.
- ABC has its headquarters and only base of operations in the economy’s largest
business city. For 11 economies the data are also collected for the second largest
business city.
- Both ABC and BizBank are 100% domestically owned.

The case scenarios also involve assumptions. In case A, as collateral for the loan,
ABC grants BizBank a nonpossessory security interest in one category of movable
assets, for example, its machinery or its inventory. ABC wants to keep both
possession and ownership of the collateral. In economies where the law does not
allow nonpossessory security interests in movable property, ABC and BizBank use a
fiduciary transfer-of-title arrangement (or a similar substitute for nonpossessory
security interests).

In case B, ABC grants BizBank a business charge, enterprise charge, floating

charge or any charge that gives BizBank a security interest over ABC’s combined
movable assets (or as much of ABC’s movable assets as possible). ABC keeps
ownership and possession of the assets.

Page 28
 Doing Business 2019 Iran, Islamic Rep.

Getting Credit - Iran, Islamic Rep.

Indicator Iran, Islamic Middle East & OECD high Best Regulatory
Rep. North Africa income Performance

Strength of legal rights index (0-12) 2 2.2 6.1 12 (5 Economies)

Depth of credit information index (0-8) 8 5.1 6.7 8 (42 Economies)

Credit registry coverage (% of adults) 57.5 14.7 21.8 100.0 (4 Economies)

Credit bureau coverage (% of adults) 58.3 15.5 65.3 100.0 (25 Economies)

Figure – Getting Credit in Iran, Islamic Rep. and comparator economies – Ranking and Score

DB 2019 Getting Credit Score

0 100

70.00: United Arab Emirates (Rank: 44)

50.00: Iran, Islamic Rep. (Rank: 99)

36.00: Regional Average (Middle East & North Africa)

35.00: Jordan (Rank: 134)

35.00: Oman (Rank: 134)

0.00: Iraq (Rank: 186)

Note: The ranking of economies on the ease of getting credit is determined by sorting their scores for getting credit. These scores are the
sum of the scores for the strength of legal rights index and the depth of credit information index.

Figure – Legal Rights in Iran, Islamic Rep. and comparator economies

8
7
6
6
Index Score

5
4
3
2 2.2
2
1
1
0 0
0

Iran, Islamic Rep. Iraq Jordan Oman United Arab Emirates Middle East & North Africa

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 Doing Business 2019 Iran, Islamic Rep.

Details – Legal Rights in Iran, Islamic Rep.

Strength of legal rights index (0-12) 2

Does an integrated or unified legal framework for secured transactions that extends to the creation, publicity and No
enforcement of functional equivalents to security interests in movable assets exist in the economy?

Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without No
requiring a specific description of collateral?

Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring a No
specific description of collateral?

May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds and No
replacements of the original assets?

Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and obligations be No
secured between parties; and can the collateral agreement include a maximum amount for which the assets are
encumbered?

Is a collateral registry in operation for both incorporated and non-incorporated entities, that is unified geographically and by No
asset type, with an electronic database indexed by debtor's name?

Does a notice-based collateral registry exist in which all functional equivalents can be registered? No

Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be performed No
online by any interested third party?

Are secured creditors paid first (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency Yes
procedure?

Are secured creditors paid first (i.e. before tax claims and employee claims) when a business is liquidated? Yes

Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised reorganization No
procedure? Does the law protect secured creditors’ rights by providing clear grounds for relief from the stay and sets a time
limit for it?

Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law allow No
the secured creditor to sell the collateral through public auction or private tender, as well as, for the secured creditor to keep
the asset in satisfaction of the debt?

Figure – Credit Information in Iran, Islamic Rep. and comparator economies

8 8
8
7
7
6
6
5.1
Index Score

5
4
3
2
1
0
0

Iran, Islamic Rep. Iraq Jordan Oman United Arab Emirates Middle East & North Africa

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 Doing Business 2019 Iran, Islamic Rep.

Details – Credit Information in Iran, Islamic Rep.

Depth of credit information index (0-8) Credit Credit Score

bureau registry

Are data on both firms and individuals distributed? Yes Yes 1

Are both positive and negative credit data distributed? Yes Yes 1

Are data from retailers or utility companies - in addition to data from banks and Yes No 1
financial institutions - distributed?

Are at least 2 years of historical data distributed? (Credit bureaus and registries Yes No 1
that distribute more than 10 years of negative data or erase data on defaults as
soon as they are repaid obtain a score of 0 for this component.)

Are data on loan amounts below 1% of income per capita distributed? Yes Yes 1

By law, do borrowers have the right to access their data in the credit bureau or No Yes 1
credit registry?

Can banks and financial institutions access borrowers’ credit information online Yes Yes 1
(for example, through an online platform, a system-to-system connection or
both)?

Are bureau or registry credit scores offered as a value-added service to help Yes No 1
banks and financial institutions assess the creditworthiness of borrowers?

Total Score ("yes" to either public bureau or private registry) 8

Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or
covers less than 5% of the adult population, the total score on the depth of credit information index is 0.

Coverage Credit bureau Credit registry

Number of individuals 33,266,645 32,756,068

Number of firms 286,478 325,817

Total 33,553,123 33,081,885

Percentage of adult population 58.3 57.5

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 Doing Business 2019 Iran, Islamic Rep.

Protecting Minority Investors

This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain
as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most
recent round of data collection for the project was completed in May 2018. See the methodology for more information.

What the indicators measure Case study assumptions

• Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several
approval requirements for related-party
assumptions about the business and the transaction.
transactions; Disclosure requirements for related-
party transactions
The business (Buyer):
• Extent of director liability index (0–10): Ability - Is a publicly traded corporation listed on the economy’s most important stock
of minority shareholders to sue and hold exchange. If there are fewer than ten listed companies or if there is no stock
interested directors liable for prejudicial related- exchange in the economy, it is assumed that Buyer is a large private company with
party transactions; Available legal remedies multiple shareholders.
(damages, disgorgement of profits, fines, - Has a board of directors and a chief executive officer (CEO) who may legally act on
imprisonment, rescission of the transaction) behalf of Buyer where permitted, even if this is not specifically required by law.
• Ease of shareholder suits index (0–10): - Has a supervisory board in economies with a two-tier board system on which Mr.
Access to internal corporate documents; James appointed 60% of the shareholder-elected members.
Evidence obtainable during trial and allocation of - Has not adopted bylaws or articles of association that go beyond the minimum
legal expenses requirements. Does not follow codes, principles, recommendations or guidelines that
are not mandatory.
• Extent of conflict of interest regulation index
- Is a manufacturing company with its own distribution network.
(0–10): Simple average of the extent of
disclosure, extent of director liability and ease of
The transaction involves the following details:
shareholder indices
- Mr. James owns 60% of Buyer, sits on Buyer’s board of directors and elected two
• Extent of shareholder rights index (0-10): directors to Buyer’s five-member board.
Shareholders’ rights and role in major corporate - Mr. James also owns 90% of Seller, a company that operates a chain of retail
decisions hardware stores. Seller recently closed a large number of its stores.
• Extent of ownership and control index (0-10): - Mr. James proposes that Buyer purchase Seller’s unused fleet of trucks to expand
Governance safeguards protecting shareholders Buyer’s distribution of its food products, a proposal to which Buyer agrees. The price
from undue board control and entrenchment is equal to 10% of Buyer’s assets and is higher than the market value.
- The proposed transaction is part of the company’s principal activity and is not
• Extent of corporate transparency index (0-10): outside the authority of the company.
Corporate transparency on ownership stakes,
- Buyer enters into the transaction. All required approvals are obtained, and all
compensation, audits and financial prospects
required disclosures made—that is, the transaction was not entered into fraudulently.
• Extent of shareholder governance index (0– - The transaction causes damages to Buyer. Shareholders sue Mr. James and the
10): Simple average of the extent of shareholders executives and directors that approved the transaction.
rights, extent of ownership and control and extent
of corporate transparency indices

• Strength of minority investor protection index

(0–10): Simple average of the extent of conflict of
interest regulation and extent of shareholder
governance indices

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 Doing Business 2019 Iran, Islamic Rep.

Protecting Minority Investors - Iran, Islamic Rep.

Indicator Iran, Islamic Middle East & OECD high Best Regulatory
Rep. North Africa income Performance

Extent of disclosure index (0-10) 7.0 6.4 6.5 10 (13 Economies)

Extent of director liability index (0-10) 4.0 4.7 5.3 10 (Cambodia)

Ease of shareholder suits index (0-10) 1.0 4.5 7.3 10 (Djibouti)

Extent of shareholder rights index (0-10) 3.0 5.1 6.4 10 (Kazakhstan)

Extent of ownership and control index (0-10) 3.0 4.7 5.4 None in 2017/18

Extent of corporate transparency index (0-10) 2.0 5.8 7.6 10 (6 Economies)

Figure – Protecting Minority Investors in Iran, Islamic Rep. and comparator economies – Ranking and Score

DB 2019 Protecting Minority Investors Score

0 100

75.00: United Arab Emirates (Rank: 15)

51.83: Regional Average (Middle East & North Africa)

46.67: Iraq (Rank: 125)

46.67: Jordan (Rank: 125)

46.67: Oman (Rank: 125)

33.33: Iran, Islamic Rep. (Rank: 173)

Note: The ranking of economies on the strength of minority investor protections is determined by sorting their scores for protecting minority
investors. These scores are the simple average of the scores for the extent of conflict of interest regulation index and the extent of
shareholder governance index.

Figure – Protecting Minority Investors in Iran, Islamic Rep. and comparator economies – Measure of Quality

the Islamic Republic of Iran 2 4 7 3 3 1

Iraq 3 5 4 3 8 5

Jordan 8 4 4 6 3 3

Oman 4 5 8 4 4 3

United Arab Emirates 7 9 10 9 6 4

OECD high income 7.4 5.5 6.5 5.2 6.3 7.4

Middle East & North Africa 5.8 4.7 6.4 4.7 5.1 4.5

0 5 10 15 20 25 30 35 40 45 50
Sub-Indicator Score

Extent of corporate transparency index (0-10) Extent of director liability index (0-10) Extent of disclosure index (0-10)
Extent of ownership and control index (0-10) Extent of shareholder rights index (0-10) Ease of shareholder suits index (0-10)

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 Doing Business 2019 Iran, Islamic Rep.

Details – Protecting Minority Investors in Iran, Islamic Rep. – Measure of Quality

Answer Score

Extent of conflict of interest regulation index (0-10) 4

Extent of disclosure index (0-10) 7.0

Whose decision is sufficient to approve the Buyer-Seller transaction? (0-3) Board of 2.0
directors
excluding
interested
members

Must an external body review the terms of the transaction before it takes place? (0-1) No 0.0

Must Mr. James disclose his conflict of interest to the board of directors? (0-2) Existence of a 1.0
conflict without
any specifics

Must Buyer disclose the transaction in periodic filings (e.g. annual reports)? (0-2) Disclosure on the 2.0
transaction and
on the conflict of
interest

Must Buyer immediately disclose the transaction to the public? (0-2) Disclosure on the 2.0
transaction and
on the conflict of
interest

Extent of director liability index (0-10) 4.0

Can shareholders representing 10% of Buyer's share capital sue for the damage the Yes 1.0
transaction caused to Buyer? (0-1)

Can shareholders hold Mr. James liable for the damage the transaction caused to Buyer? (0- Not liable 0.0
2)

Can shareholders hold the other directors liable for the damage the transaction caused to Liable if unfair or 2.0
Buyer (0-2) prejudicial

Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by Yes 1.0
shareholders? (0-1)

Must Mr. James repay profits made from the transaction upon a successful claim by No 0.0
shareholders? (0-1)

Is Mr. James disqualified upon a successful claim by shareholders? (0-1) No 0.0

Can a court void the transaction upon a successful claim by shareholders? (0-2) Only in case of 0.0
fraud or bad faith

Ease of shareholder suits index (0-10) 1.0

Before suing, can shareholders representing 10% of Buyer's share capital inspect the No 0.0
transaction documents? (0-1)

Can the plaintiff obtain any documents from the defendant and witnesses at trial? (0-3) No 0.0

Can the plaintiff request categories of documents from the defendant without identifying No 0.0
specific ones? (0-1)

Can the plaintiff directly question the defendant and witnesses at trial? (0-2) No 0.0

Is the level of proof required for civil suits lower than that of criminal cases? (0-1) No 0.0

Can shareholder plaintiffs recover their legal expenses from the company? (0-2) Yes if successful 1.0

Extent of shareholder governance index (0-10) 2.7

Extent of shareholder rights index (0-10) 3.0

Does the sale of 51% of Buyer's assets require shareholder approval? No 0.0

Can shareholders representing 10% of Buyer's share capital call for a meeting of No 0.0
shareholders?

Must Buyer obtain its shareholders’ approval every time it issues new shares? No 0.0
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Doing Business 2019 Iran, Islamic Rep.

Do shareholders automatically receive preemption rights every time Buyer issues new Yes 1.0
shares?

Must shareholders approve the election and dismissal of the external auditor? Yes 1.0

Are changes to the rights of a class of shares only possible if the holders of the affected Yes 1.0
shares approve?

Assuming that Buyer is a limited company, does the sale of 51% of its assets require No 0.0
member approval?

Assuming that Buyer is a limited company, can members representing 10% call for a No 0.0
meeting of members?

Assuming that Buyer is a limited company, must all or almost all members consent to add a No 0.0
new member?

Assuming that Buyer is a limited company, must a member first offer to sell their interest to No 0.0
the existing members before they can sell to non-members?

Extent of ownership and control index (0-10) 3.0

Is it forbidden to appoint the same individual as CEO and chairperson of the board of No 0.0
directors?

Must the board of directors include independent and nonexecutive board members? No 0.0

Can shareholders remove members of the board of directors without cause before the end Yes 1.0
of their term?

Must the board of directors include a separate audit committee exclusively comprising board Yes 1.0
members?

Must a potential acquirer make a tender offer to all shareholders upon acquiring 50% of No 0.0
Buyer?

Must Buyer pay declared dividends within a maximum period set by law? Yes 1.0

Is a subsidiary prohibited from acquiring shares issued by its parent company? No 0.0

Assuming that Buyer is a limited company, must Buyer have a mechanism to resolve No 0.0
disagreements among members?

Assuming that Buyer is a limited company, must a potential acquirer make a tender offer to No 0.0
all shareholders upon acquiring 50% of Buyer?

Assuming that Buyer is a limited company, must Buyer distribute profits within a maximum No 0.0
period set by law?

Extent of corporate transparency index (0-10) 2.0

Must Buyer disclose direct and indirect beneficial ownership stakes representing 5%? No 0.0

Must Buyer disclose information about board members’ primary employment and No 0.0
directorships in other companies?

Must Buyer disclose the compensation of individual managers? No 0.0

Must a detailed notice of general meeting be sent 21 days before the meeting? No 0.0

Can shareholders representing 5% of Buyer’s share capital put items on the general meeting No 0.0
agenda?

Must Buyer's annual financial statements be audited by an external auditor? Yes 1.0

Must Buyer disclose its audit reports to the public? Yes 1.0

Assuming that Buyer is a limited company, must members meet at least once a year? No 0.0

Assuming that Buyer is a limited company, can members representing 5% put items on the No 0.0
meeting agenda?

Assuming that Buyer is a limited company, must Buyer's annual financial statements be No 0.0
audited by an external auditor?

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 Doing Business 2019 Iran, Islamic Rep.

Paying Taxes

This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as the
administrative burden of paying taxes and contributions and complying with postfiling procedures (VAT refund and tax audit). The most recent
round of data collection for the project was completed in May 2018 covering for the Paying Taxes indicator calendar year 2017 (January 1,
2017 – December 31, 2017). See the methodology for more information.

What the indicators measure Case study assumptions

Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory contributions a
2017 (number per year adjusted for electronic medium size company must pay in a year, and measures the administrative burden
and joint filing and payment) of paying taxes, contributions and dealing with postfiling processes. Information is
also compiled on frequency of filing and payments, time taken to comply with tax
• Total number of taxes and contributions paid or laws, time taken to comply with the requirements of postfiling processes and time
withheld, including consumption taxes (value
waiting.
added tax, sales tax or goods and service tax)

• Method and frequency of filing and payment To make data comparable across economies, several assumptions are used:
- TaxpayerCo is a medium-size business that started operations on January 1, 2016.
Time required to comply with 3 major taxes It produces ceramic flowerpots and sells them at retail. All taxes and contributions
(hours per year) recorded are paid in the second year of operation (calendar year 2017). Taxes and
• Collecting information, computing tax payable mandatory contributions are measured at all levels of government.

• Preparing separate tax accounting books, if The VAT refund process:

required - In June 2017, TaxpayerCo. makes a large capital purchase: the value of the
• Completing tax return, filing with agencies machine is 65 times income per capita of the economy. Sales are equally spread per
month (1,050 times income per capita divided by 12) and cost of goods sold are
• Arranging payment or withholding equally expensed per month (875 times income per capita divided by 12). The
Total tax and contribution rate (% of commercial machinery seller is registered for VAT and excess input VAT incurred in June will be
fully recovered after four consecutive months if the VAT rate is the same for inputs,
profits)
sales and the machine and the tax reporting period is every month. Input VAT will
• Profit or corporate income tax exceed Output VAT in June 2017.
• Social contributions, labor taxes paid by
The corporate income tax audit process:
employer
- An error in calculation of income tax liability (for example, use of incorrect tax
• Property and property transfer taxes depreciation rates, or incorrectly treating an expense as tax deductible) leads to an
• Dividend, capital gains, financial transactions incorrect income tax return and a corporate income tax underpayment. TaxpayerCo.
taxes discovered the error and voluntarily notified the tax authority. The value of the
underpaid income tax liability is 5% of the corporate income tax liability
• Waste collection, vehicle, road and other taxes due. TaxpayerCo. submits corrected information after the deadline for submitting the
annual tax return, but within the tax assessment period.
Postfiling Index

• Time to comply with a VAT refund (hours)

• Time to obtain a VAT refund (weeks)
• Time to comply with a corporate income tax
correction (hours)

• Time to complete a corporate income tax

correction (weeks)

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 Doing Business 2019 Iran, Islamic Rep.

Paying Taxes - Iran, Islamic Rep.

Indicator Iran, Islamic Middle East & OECD high Best Regulatory
Rep. North Africa income Performance

Payments (number per year) 20 17.7 11.2 3 (Hong Kong SAR,

China)

Time (hours per year) 216 196.7 159.4 49 (Singapore)

Total tax and contribution rate (% of profit) 44.7 32.7 39.8 26.1% (32 Economies)

Postfiling index (0-100) 7.96 50.08 84.41 None in 2017/18

Figure – Paying Taxes in Iran, Islamic Rep. and comparator economies – Ranking and Score

DB 2019 Paying Taxes Score

0 100

99.44: United Arab Emirates (Rank: 2)

90.16: Oman (Rank: 12)

74.52: Regional Average (Middle East & North Africa)

71.48: Jordan (Rank: 95)

63.55: Iraq (Rank: 129)

56.78: Iran, Islamic Rep. (Rank: 149)

Note: The ranking of economies on the ease of paying taxes is determined by sorting their scores for paying taxes. These scores are the
simple average of the scores for each of the component indicators, with a threshold and a nonlinear transformation applied to one of the
component indicators, the total tax and contribution rate. The threshold is defined as the total tax and contribution rate at the 15th percentile
of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a
total tax and contribution rate below this threshold receive the same score as the economy at the threshold.

Figure – Paying Taxes in Iran, Islamic Rep. and comparator economies – Measure of Quality

100
85.32
80
Index score

60
50.08

40 34.69
21.43
20
7.96

Iran, Islamic Rep. Iraq Jordan Oman United Arab EmiratesMiddle East & North Africa

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 Doing Business 2019 Iran, Islamic Rep.

Details – Paying Taxes in Iran, Islamic Rep.

Tax or Payments Notes on Time Statutory Tax base Total tax Notes on
mandatory (number) Payments (hours) tax rate and TTCR
contribution contribution
rate (% of
profit)

Employer 12.0 132.0 23% gross salaries 25.94

paid - Social
insurance
contributions

Corporate 1.0 26.0 25% taxable profits 18.41

income tax

Property 1.0 5% assessed 0.36

transfer tax value of land

Tax on check 1.0 IRR 200 per number of 0.00

transactions check checks issued
(stamp duty)

Value added 4.0 58.0 9% as of value added 0.00 not included

tax March 1,
2015

Employee 0.0 jointly 7% gross salaries 0.00 not included

paid - Social
insurance
contributions

Property tax 1.0 various rates assessment 0.00 small amount

of property
value

Totals 20 216 44.7

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 Doing Business 2019 Iran, Islamic Rep.

Details – Paying Taxes in Iran, Islamic Rep. – Tax by Type

Taxes by type Answer

Profit tax (% of profit) 18.4

Labor tax and contributions (% of profit) 25.9

Other taxes (% of profit) 0.4

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 Doing Business 2019 Iran, Islamic Rep.

Details – Paying Taxes in Iran, Islamic Rep. – Measure of Quality

Answer Score

Postfiling index (0-100) 7.96

VAT refunds

Does VAT exist? Yes

Does a VAT refund process exist per the case study? Yes

Restrictions on VAT refund process None

Percentage of cases exposed to a VAT audit (%) 75% - 100%

Is there a mandatory carry forward period? No

Time to comply with VAT refund (hours) 51.0 0

Time to obtain a VAT refund (weeks) 38.5 31.85

Corporate income tax audits

Does corporate income tax exist? yes

Percentage of cases exposed to a corporate income tax audit (%) 75% - 100%

Time to comply with a corporate income tax correction (hours) 72.0 0

Time to complete a corporate income tax correction (weeks) 38.9 0

Notes: Names of taxes have been standardized. For instance income tax, profit tax, tax on company's income are all named corporate
income tax in this table.
The hours for VAT include all the VAT and sales taxes applicable.
The hours for Social Security include all the hours for labor taxes and mandatory contributions in general.
The postfiling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a
corporate income tax correction and time to complete a corporate income tax correction.
N/A = Not applicable.

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 Doing Business 2019 Iran, Islamic Rep.

Trading across Borders

Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures
the time and cost (excluding tariffs) associated with three sets of procedures—documentary compliance, border compliance and domestic
transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project
was completed in May 2018. See the methodology for more information.

What the indicators measure Case study assumptions

Documentary compliance To make the data comparable across economies, a few assumptions are made
about the traded goods and the transactions:
• Obtaining, preparing and submitting documents
during transport, clearance, inspections and port
Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 days are
or border handling in origin economy
recorded as 22×24=528 hours). If customs clearance takes 7.5 hours, the data are
• Obtaining, preparing and submitting documents recorded as is. Alternatively, suppose documents are submitted to a customs agency
required by destination economy and any transit at 8:00a.m., are processed overnight and can be picked up at 8:00a.m. the next day.
economies The time for customs clearance would be recorded as 24 hours because the actual
procedure took 24 hours.
• Covers all documents required by law and in
practice, including electronic submissions of
Cost: Insurance cost and informal payments for which no receipt is issued are
information
excluded from the costs recorded. Costs are reported in U.S. dollars. Contributors
Border compliance are asked to convert local currency into U.S. dollars based on the exchange rate
prevailing on the day they answer the questionnaire. Contributors are private sector
• Customs clearance and inspections experts in international trade logistics and are informed about exchange rates.
• Inspections by other agencies (if applied to more
than 20% of shipments) Assumptions of the case study:
- For all 190 economies covered by Doing Business, it is assumed a shipment is in a
• Handling and inspections that take place at the warehouse in the largest business city of the exporting economy and travels to a
economy’s port or border
warehouse in the largest business city of the importing economy.
- It is assumed each economy imports 15 metric tons of containerized auto parts (HS
Domestic transport
8708) from its natural import partner—the economy from which it imports the largest
• Loading or unloading of the shipment at the value (price times quantity) of auto parts. It is assumed each economy exports the
warehouse or port/border product of its comparative advantage (defined by the largest export value) to its
• Transport between warehouse and port/border natural export partner—the economy that is the largest purchaser of this product.
Shipment value is assumed to be $50,000.
• Traffic delays and road police checks while - The mode of transport is the one most widely used for the chosen export or import
shipment is en route product and the trading partner, as is the seaport or land border crossing.
- All electronic information submissions requested by any government agency in
connection with the shipment are considered to be documents obtained, prepared
and submitted during the export or import process.
- A port or border is a place (seaport or land border crossing) where merchandise
can enter or leave an economy.
- Relevant government agencies include customs, port authorities, road police,
border guards, standardization agencies, ministries or departments of agriculture or
industry, national security agencies and any other government authorities.

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 Doing Business 2019 Iran, Islamic Rep.

Trading across Borders - Iran, Islamic Rep.

Indicator Iran, Islamic Middle East & OECD high Best Regulatory
Rep. North Africa income Performance

Time to export: Border compliance (hours) 101 58.0 12.5 1 (19 Economies)

Cost to export: Border compliance (USD) 415 442.4 139.1 0 (19 Economies)

Time to export: Documentary compliance (hours) 33 67.9 2.4 1 (26 Economies)

Cost to export: Documentary compliance (USD) 60 244.6 35.2 0 (20 Economies)

Time to import: Border compliance (hours) 141 105.4 8.5 0 (25 Economies)

Cost to import: Border compliance (USD) 660 536.0 100.2 0 (28 Economies)

Time to import: Documentary compliance (hours) 40 75.5 3.4 1 (30 Economies)

Cost to import: Documentary compliance (USD) 90 269.0 24.9 0 (30 Economies)

Figure – Trading across Borders in Iran, Islamic Rep. and comparator economies – Ranking and Score

DB 2019 Trading Across Borders Score

0 100

79.39: Oman (Rank: 72)

79.03: Jordan (Rank: 74)

71.50: United Arab Emirates (Rank: 98)

66.20: Iran, Islamic Rep. (Rank: 121)

60.17: Regional Average (Middle East & North Africa)

25.33: Iraq (Rank: 181)

Note: The ranking of economies on the ease of trading across borders is determined by sorting their scores for trading across borders. These
scores are the simple average of the scores for the time and cost for documentary compliance and border compliance to export and import.

Figure – Trading across Borders in Iran, Islamic Rep. – Time and Cost

Time (hours) Cost (USD)

160 660 700
141
140 600
120
Time (hours)

101 500
Cost (USD)

100 415
400
80
300
60
40 200
40 33
90
20 60 100
0 0

Export Export Import Import

- - - -
Border Documentary Border Documentary
Compliance Compliance Compliance Compliance

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 Doing Business 2019 Iran, Islamic Rep.

Details – Trading across Borders in Iran, Islamic Rep.

Characteristics Export Import

Product HS 29 : Organic chemicals HS 8708: Parts and accessories of motor

vehicles

Trade partner China Korea, Rep.

Border Bandar Abbas port Bandar Abbas port

Distance (km) 1295 1295

Domestic transport time (hours) 42 53

Domestic transport cost (USD) 700 800

Details – Trading across Borders in Iran, Islamic Rep. – Components of Border Compliance

Time to Complete (hours) Associated Costs (USD)

Export: Clearance and inspections required 22.2 153.8

by customs authorities

Export: Clearance and inspections required 8.0 50.0

by agencies other than customs

Export: Port or border handling 101.0 211.5

Import: Clearance and inspections required 25.8 169.2

by customs authorities

Import: Clearance and inspections required 72.0 265.4

by agencies other than customs

Import: Port or border handling 141.0 225.8

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 Doing Business 2019 Iran, Islamic Rep.

Details – Trading across Borders in Iran, Islamic Rep. – Trade Documents

Export Import

Invoice Commercial invoice

Packing list Packing list

Certificate of origin Certificate of origin

Inspection certificate Bill of lading

Customs export declaration Customs import declaration

Bill of lading Customs warehouse receipt

Customs warehouse receipt Technical standard certificate

SOLAS certificate Delivery order

SOLAS certificate

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 Doing Business 2019 Iran, Islamic Rep.

Enforcing Contracts

The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local first-instance court, and the
quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and
efficiency in the court system. The most recent round of data collection was completed in May 2018. See the methodology for more
information.

What the indicators measure Case study assumptions

Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract between 2
courts (calendar days) domestic businesses. The case study assumes that the court hears an expert on the
quality of the goods in dispute. This distinguishes the case from simple debt
• Time to file and serve the case enforcement.
• Time for trial and to obtain the judgment
To make the data comparable across economies, Doing Business uses several
• Time to enforce the judgment assumptions about the case:
Cost required to enforce a contract through the - The dispute concerns a lawful transaction between two businesses (Seller and
courts (% of claim) Buyer), both located in the economy’s largest business city. For 11 economies the
data are also collected for the second largest business city.
• Attorney fees - The buyer orders custom-made goods, then fails to pay alleging that the goods are
• Court fees not of adequate quality.
- The value of the dispute is 200% of the income per capita or the equivalent in local
• Enforcement fees currency of USD 5,000, whichever is greater.
- The seller sues the buyer before the court with jurisdiction over commercial cases
Quality of judicial processes index (0-18)
worth 200% of income per capita or $5,000.
• Court structure and proceedings (-1-5) - The seller requests the pretrial attachment of the defendant’s movable assets to
secure the claim.
• Case management (0-6)
- The dispute on the quality of the goods requires an expert opinion.
• Court automation (0-4) - The judge decides in favor of the seller; there is no appeal.
• Alternative dispute resolution (0-3) - The seller enforces the judgment through a public sale of the buyer’s movable
assets.

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 Doing Business 2019 Iran, Islamic Rep.

Enforcing Contracts - Iran, Islamic Rep.

Standardized Case

Claim value IRR 289,518,026

Court name Tehran First Instance Court

City Covered Tehran

Indicator Iran, Islamic Middle East & OECD high Best Regulatory
Rep. North Africa income Performance

Time (days) 505 622.0 582.4 None in 2017/18

Cost (% of claim value) 19.3 24.7 21.2 None in 2017/18

Quality of judicial processes index (0-18) 5.0 6.1 11.5 None in 2017/18

Figure – Enforcing Contracts in Iran, Islamic Rep. and comparator economies – Ranking and Score

DB 2019 Enforcing Contracts Score

0 100

75.88: United Arab Emirates (Rank: 9)

60.02: Oman (Rank: 73)

58.21: Iran, Islamic Rep. (Rank: 89)

55.56: Jordan (Rank: 108)

55.04: Regional Average (Middle East & North Africa)

48.02: Iraq (Rank: 143)

Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their scores for enforcing contracts. These
scores are the simple average of the scores for each of the component indicators.

Figure – Enforcing Contracts in Iran, Islamic Rep. – Time and Cost

Time (days) Cost (% of claim value)

Cost (% of claim value)

700 642 31.2 35
622.0 598
28.1 582.4
600 30
505 520 24.7
Time (days)

500 21.2 445 21.0 25

19.3
400 20
15.1
300 15
200 10
100 5
0 0

Iran, Iraq Jordan Middle OECD Oman United

Islamic East high Arab
Rep. & income Emirates
North
Africa

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 Doing Business 2019 Iran, Islamic Rep.

Figure – Enforcing Contracts in Iran, Islamic Rep. and comparator economies – Measure of Quality

the Islamic Republic of Iran 2.5 1 1 0.5

Iraq 1.5 0

Jordan 3 2 1 2

Oman 2.5 0 4

United Arab Emirates 2 4 3 5

OECD high income 2.5 3.1 2.3 3.6

Middle East & North Africa 2.2 0.8 0.4 2.8

0 2 4 6 8 10 12 14 16
Sub-Indicator Score

Alternative dispute resolution (0-3) Case management (0-6) Court automation (0-4) Court structure and proceedings (-1-5)

Details – Enforcing Contracts in Iran, Islamic Rep.

Indicator

Time (days) 505

Filing and service 30

Trial and judgment 295

Enforcement of judgment 180

Cost (% of claim value) 19.3

Attorney fees 10

Court fees 4.3

Enforcement fees 5

Quality of judicial processes index (0-18) 5.0

Court structure and proceedings (-1-5) 0.5

Case management (0-6) 1.0

Court automation (0-4) 1.0

Alternative dispute resolution (0-3) 2.5

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 Doing Business 2019 Iran, Islamic Rep.

Details – Enforcing Contracts in Iran, Islamic Rep. – Measure of Quality

Answer Score

Quality of judicial processes index (0-18) 5.0

Court structure and proceedings (-1-5) 0.5

1. Is there a court or division of a court dedicated solely to hearing commercial cases? No 0.0

2. Small claims court 0.0

2.a. Is there a small claims court or a fast-track procedure for small claims? No

2.b. If yes, is self-representation allowed? n.a.

3. Is pretrial attachment available? Yes 1.0

4. Are new cases assigned randomly to judges? Yes, but manual 0.5

5. Does a woman's testimony carry the same evidentiary weight in court as a man's? No -1.0

Case management (0-6) 1.0

1. Time standards 0.0

1.a. Are there laws setting overall time standards for key court events in a civil Yes
case?

1.b. If yes, are the time standards set for at least three court events? No

1.c. Are these time standards respected in more than 50% of cases? Yes

2. Adjournments 1.0

2.a. Does the law regulate the maximum number of adjournments that can be Yes
granted?

2.b. Are adjournments limited to unforeseen and exceptional circumstances? Yes

2.c. If rules on adjournments exist, are they respected in more than 50% of cases? Yes

3. Can two of the following four reports be generated about the competent court: (i) time to No 0.0
disposition report; (ii) clearance rate report; (iii) age of pending cases report; and (iv) single
case progress report?

4. Is a pretrial conference among the case management techniques used before the No 0.0
competent court?

5. Are there any electronic case management tools in place within the competent court for No 0.0
use by judges?

6. Are there any electronic case management tools in place within the competent court for No 0.0
use by lawyers?

Court automation (0-4) 1.0

1. Can the initial complaint be filed electronically through a dedicated platform within the no 0.0
competent court?

2. Is it possible to carry out service of process electronically for claims filed before the Yes 1.0
competent court?

3. Can court fees be paid electronically within the competent court? No 0.0

4. Publication of judgments 0.0

4.a Are judgments rendered in commercial cases at all levels made available to the No
general public through publication in official gazettes, in newspapers or on the
internet or court website?

4.b. Are judgments rendered in commercial cases at the appellate and supreme No
court level made available to the general public through publication in official
gazettes, in newspapers or on the internet or court website?

Alternative dispute resolution (0-3) 2.5

1. Arbitration 1.5
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Doing Business 2019 Iran, Islamic Rep.

1.a. Is domestic commercial arbitration governed by a consolidated law or Yes

consolidated chapter or section of the applicable code of civil procedure
encompassing substantially all its aspects?

1.b. Are there any commercial disputes—aside from those that deal with public No
order or public policy—that cannot be submitted to arbitration?

1.c. Are valid arbitration clauses or agreements usually enforced by the courts? Yes

2. Mediation/Conciliation 1.0

2.a. Is voluntary mediation or conciliation available? Yes

2.b. Are mediation, conciliation or both governed by a consolidated law or Yes

consolidated chapter or section of the applicable code of civil procedure
encompassing substantially all their aspects?

2.c. Are there financial incentives for parties to attempt mediation or conciliation No
(i.e., if mediation or conciliation is successful, a refund of court filing fees, income
tax credits or the like)?

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 Doing Business 2019 Iran, Islamic Rep.

Resolving Insolvency

Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to
calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or
debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing
Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist
Intelligence Unit. The most recent round of data collection was completed in May 2018. See the methodology for more information.

What the indicators measure Case study assumptions

Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies,
several assumptions about the business and the case are used:
• Measured in calendar years
• Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 suppliers.
The hotel experiences financial difficulties.
Cost required to recover debt (% of debtor’s - The value of the hotel is 100% of the income per capita or the equivalent in local
estate) currency of USD 200,000, whichever is greater.
- The hotel has a loan from a domestic bank, secured by a mortgage over the hotel’s
• Measured as percentage of estate value
real estate. The hotel cannot pay back the loan, but makes enough money to
• Court fees operate otherwise.
• Fees of insolvency administrators
In addition, Doing Business evaluates the quality of legal framework applicable to
• Lawyers’ fees judicial liquidation and reorganization proceedings and the extent to which best
• Assessors’ and auctioneers’ fees insolvency practices have been implemented in each economy covered.

• Other related fees

Outcome

• Whether business continues operating as a going

concern or business assets are sold piecemeal

Recovery rate for creditors

• Measures the cents on the dollar recovered by

secured creditors

• Outcome for the business (survival or not)

determines the maximum value that can be
recovered

• Official costs of the insolvency proceedings are

deducted

• Depreciation of furniture is taken into account

• Present value of debt recovered
Strength of insolvency framework index (0- 16)

• Sum of the scores of four component indices:

• Commencement of proceedings index (0-3)
• Management of debtor’s assets index (0-6)
• Reorganization proceedings index (0-3)
• Creditor participation index (0-4)

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 Doing Business 2019 Iran, Islamic Rep.

Resolving Insolvency - Iran, Islamic Rep.

Indicator Iran, Islamic Middle East & OECD high Best Regulatory
Rep. North Africa income Performance

Recovery rate (cents on the dollar) 37.1 26.3 70.5 None in 2017/18

Time (years) 1.5 2.8 1.7 0.4 (Ireland)

Cost (% of estate) 15.0 13.8 9.3 1.0 (Norway)

Outcome (0 as piecemeal sale and 1 as going 0 .. .. ..

concern)

Strength of insolvency framework index (0-16) 5.0 5.9 11.9 None in 2017/18

Figure – Resolving Insolvency in Iran, Islamic Rep. and comparator economies – Ranking and Score

DB 2019 Resolving Insolvency Score

0 100

49.67: United Arab Emirates (Rank: 75)

42.34: Oman (Rank: 100)

35.57: Iran, Islamic Rep. (Rank: 131)

32.69: Regional Average (Middle East & North Africa)

30.31: Jordan (Rank: 150)

0.00: Iraq (Rank: 168)

Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their scores for resolving insolvency. These
scores are the simple average of the scores for the recovery rate and the strength of insolvency framework index.

Figure – Resolving Insolvency in Iran, Islamic Rep. – Time and Cost

Time (years) Cost (% of estate)

4.5 25
4.0

Cost (% of estate)
4 20.0 20.0
3.5 3.2 20
Time (years)

3.0
3 15.0 2.8
13.8 15
2.5
2 1.7 9.3
1.5 10
1.5
1 3.5 5
0.5
0 0

Iran, No Jordan Middle OECD Oman United

Islamic Practice East high Arab
Rep. Iraq & income Emirates
North
Africa

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 Doing Business 2019 Iran, Islamic Rep.

Figure – Resolving Insolvency in Iran, Islamic Rep. and comparator economies – Measure of Quality

the Islamic Republic of Iran 2 2 1 0

Iraq 4 2 1 0

Jordan 2 2 1 0

Oman 4 2 1 0

United Arab Emirates 6 2 1 2

OECD high income 5.3 2.8 2.2 1.9

Middle East & North Africa 3.3 2.2 1.2 0.4

0 2 4 6 8 10 12 14
Sub-Indicator Score

Management of debtor's assets index (0-6) Commencement of proceedings index (0-3) Creditor participation index (0-4)
Reorganization proceedings index (0-3)

Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the
economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.”

Figure – Resolving Insolvency in Iran, Islamic Rep. and comparator economies – Recovery Rate
Recovery rate(cents on the dollar)

100

80

60

37.1 38.0
40
27.3 28.4 26.3
20

0.0
0

Iran, Islamic Rep. Iraq Jordan Oman United Arab EmiratesMiddle East & North Africa

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 Doing Business 2019 Iran, Islamic Rep.

Details – Resolving Insolvency in Iran, Islamic Rep.

Indicator Answer Score

Proceeding foreclosure Because BizBank is a secured creditor, it will initiate foreclosure through the Executive Division of
the Deeds and Properties Registration Organization to enforce its security interest.

Outcome piecemeal sale Mirage's assets will be sold in order to satisfy BizBank's claims and the hotel will not be able to
operate.

Time (in years) 1.5 It would take about 18 months for the entire procedure of foreclosure to be completed.

Cost (% of 15.0 Major expenses will include court and government agency fees (up to 5%) and attorneys' fees (up
estate) to 7%) and auctioneer fees (2-3%).

Recovery rate 37.1

(cents on the
dollar)

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 Doing Business 2019 Iran, Islamic Rep.

Details – Resolving Insolvency in Iran, Islamic Rep. – Measure of Quality

Answer Score

Strength of insolvency framework index (0-16) 5.0

Commencement of proceedings index (0-3) 2.0

What procedures are available to a DEBTOR when commencing insolvency proceedings? (b) Debtor may 0.5
file for liquidation
only

Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor? (b) Yes, but a 0.5
creditor may file
for liquidation
only

What basis for commencement of the insolvency proceedings is allowed under the (a) Debtor is 1.0
insolvency framework? generally unable
to pay its debts
as they mature

Management of debtor's assets index (0-6) 2.0

Does the insolvency framework allow the continuation of contracts supplying essential goods No 0.0
and services to the debtor?

Does the insolvency framework allow the rejection by the debtor of overly burdensome No 0.0
contracts?

Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0

Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0

Does the insolvency framework provide for the possibility of the debtor obtaining credit after No 0.0
commencement of insolvency proceedings?

Does the insolvency framework assign priority to post-commencement credit? (c) No priority is 0.0
assigned to post-
commencement
creditors

Reorganization proceedings index (0-3) 0.0

Which creditors vote on the proposed reorganization plan? N/A 0.0

Does the insolvency framework require that dissenting creditors in reorganization receive at No 0.0
least as much as what they would obtain in a liquidation?

Are the creditors divided into classes for the purposes of voting on the reorganization plan, No 0.0
does each class vote separately and are creditors in the same class treated equally?

Creditor participation index (0-4) 1.0

Does the insolvency framework require approval by the creditors for selection or No 0.0
appointment of the insolvency representative?

Does the insolvency framework require approval by the creditors for sale of substantial No 0.0
assets of the debtor?

Does the insolvency framework provide that a creditor has the right to request information No 0.0
from the insolvency representative?

Does the insolvency framework provide that a creditor has the right to object to decisions Yes 1.0
accepting or rejecting creditors' claims?

Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the
economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice.”

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 Doing Business 2019 Iran, Islamic Rep.

Labor Market Regulation

Doing Business presents detailed data for the labor market regulation indicators on the Doing Business website
(http://www.doingbusiness.org). The report does not present rankings of economies on these indicators or include the topic in the aggregate
ease of doing business score or ranking on the ease of doing business.

The most recent round of data collection was completed in May 2018. See the methodology for more information.

What the indicators measure Case study assumptions

Hiring To make the data comparable across economies, several assumptions about the
(i) whether fixed-term contracts are prohibited for worker and the business are used.
permanent tasks; (ii) maximum cumulative duration
of fixed-term contracts; (iii) length of the The worker:
probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work
experience.
Working hours - Is a full-time employee.
(i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory.
week; (ii) premiums for work: at night, on a weekly
rest day and overtime; (iii) whether there are The business:
restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy).
day and for overtime work; (iv) whether - Operates a supermarket or grocery store in the economy’s largest business city.
nonpregnant and nonnursing women can work For 11 economies the data are also collected for the second largest business city.
same night hours as men; (v) length of paid annual - Has 60 employees.
leave. - Is subject to collective bargaining agreements if such agreements cover more than
50% of the food retail sector and they apply even to firms that are not party to them.
Redundancy rules - Abides by every law and regulation but does not grant workers more benefits than
(i) whether redundancy can be basis for terminating those mandated by law, regulation or (if applicable) collective bargaining
workers; (ii) whether employer needs to notify agreements.
and/or get approval from third party to terminate 1
redundant worker and a group of 9 redundant
workers; (iii) whether law requires employer to
reassign or retrain a worker before making worker
redundant; (iv) whether priority rules apply for
redundancies and reemployment.

Redundancy cost
(i) notice period for redundancy dismissal; (ii)
severance payments due when terminating a
redundant worker.

Job quality
(i) whether law mandates equal remuneration for
work of equal value and nondiscrimination based on
gender in hiring; (ii) whether law mandates paid or
unpaid maternity leave; (iii) length of paid maternity
leave; (iv) whether employees on maternity leave
receive 100% of wages; (v) availability of five fully
paid days of sick leave a year; (vi) eligibility
requirements for unemployment protection.

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 Doing Business 2019 Iran, Islamic Rep.

Labor Market Regulation - Iran, Islamic Rep.

Details – Labor Market Regulation in Iran, Islamic Rep.

Answer

Hiring

Fixed-term contracts prohibited for permanent tasks? No

Maximum length of a single fixed-term contract (months) No limit

Maximum length of fixed-term contracts, including renewals (months) No limit

Minimum wage applicable to the worker assumed in the case study (US$/month) 327.6

Ratio of minimum wage to value added per worker 0.5

Maximum length of probationary period (months) 1.0

Working hours

Standard workday 8.0

Maximum number of working days per week 6.0

Premium for night work (% of hourly pay) 35.0

Premium for work on weekly rest day (% of hourly pay) 40.0

Premium for overtime work (% of hourly pay) 40.0

Restrictions on night work? No

Whether nonpregnant and nonnursing women can work the same night hours as men Yes

Restrictions on weekly holiday? No

Restrictions on overtime work? No

Paid annual leave for a worker with 1 year of tenure (working days) 24.0

Paid annual leave for a worker with 5 years of tenure (working days) 24.0

Paid annual leave for a worker with 10 years of tenure (working days) 24.0

Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days) 24.0

Redundancy rules

Dismissal due to redundancy allowed by law? Yes

Third-party notification if one worker is dismissed? Yes

Third-party approval if one worker is dismissed? Yes

Third-party notification if nine workers are dismissed? Yes

Third-party approval if nine workers are dismissed? Yes

Retraining or reassignment obligation before redundancy? No

Priority rules for redundancies? No

Priority rules for reemployment? No

Redundancy cost

Notice period for redundancy dismissal for a worker with 1 year of tenure 0.0

Notice period for redundancy dismissal for a worker with 5 years of tenure 0.0

Notice period for redundancy dismissal for a worker with 10 years of tenure 0.0

Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 0.0

Severance pay for redundancy dismissal for a worker with 1 year of tenure 4.3
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Doing Business 2019 Iran, Islamic Rep.

Severance pay for redundancy dismissal for a worker with 5 years of tenure 21.7

Severance pay for redundancy dismissal for a worker with 10 years of tenure 43.3

Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 23.1

Job quality

Equal remuneration for work of equal value? No

Gender nondiscrimination in hiring? No

Paid or unpaid maternity leave mandated by law? Yes

Minimum length of maternity leave (calendar days)? 270.0

Receive 100% of wages on maternity leave? No

Five fully paid days of sick leave a year? No

Unemployment protection after one year of employment? Yes

Minimum contribution period for unemployment protection (months)? 6.0

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 Doing Business 2019 Iran, Islamic Rep.

Business Reforms in Iran, Islamic Rep.

In the past year, Doing Business observed a peaking of reform activity worldwide. From June 2, 2017, to May 1, 2018, 128 economies
implemented a record 314 regulatory reforms improving the business climate. Reforms inspired by Doing Business have been implemented
by economies in all regions. The following are reforms implemented since Doing Business 2008.

= Doing Business reform making it easier to do business. = Change making it more difficult to do business.

DB2019

Paying Taxes: The Islamic Republic of Iran made paying taxes easier by introducing an online system for filing social security contributions,
allowing the possibility of filing value added tax refund claims online, amending corporate income tax returns online and making payment of
additional tax liability at the bank.

Trading across Borders: The Islamic Republic of Iran made exporting and importing easier by enhancing the national trade single window.

DB2018

Getting Credit: The Islamic Republic of Iran improved access to credit information by reporting data on credit payments from an
automobile retailer.

DB2017

Trading across Borders: The Islamic Republic of Iran made exporting and importing easier by improving and expanding the services offered
by the national single window.

Enforcing Contracts: The Islamic Republic of Iran made enforcing contracts easier by implementing electronic service of process.

DB2015

Starting a Business: The Islamic Republic of Iran made starting a business easier by streamlining the name reservation and company
registration procedures.

Getting Electricity: The Islamic Republic of Iran made getting electricity easier by eliminating the need for customers to obtain an
excavation permit for electricity connection works.

DB2013

Starting a Business: The Islamic Republic of Iran made starting a business more difficult by requiring company founders to obtain a
criminal record clearance to register a new company.

Protecting Minority Investors: The Islamic Republic of Iran strengthened investor protections by requiring greater immediate disclosure of
related-party transactions.

DB2011

Starting a Business: The Islamic Republic of Iran eased business start-up by installing a web portal allowing entrepreneurs to search for
and reserve a unique company name.

Getting Credit: The establishment of a new private credit bureau improved access to credit information.

Enforcing Contracts: The Islamic Republic of Iran made enforcing contracts easier and faster by introducing electronic filing of some
documents, text message notification and an electronic case management system.

DB2010

Starting a Business: The Islamic Republic of Iran simplified business start-up by introducing an electronic registration system.

Dealing with Construction Permits: The Islamic Republic of Iran made dealing with construction permits easier by introducing electronic
service offices in Tehran; streamlining the process of obtaining location approvals, building permits and building completion certificates; and
reducing the time needed to obtain water and electricity connections.

Paying Taxes: The Islamic Republic of Iran made paying taxes easier for companies by converting the sales tax into value added tax.

Trading across Borders: The Islamic Republic of Iran reduced the time for exporting and importing through the installation of scanners at
the port of Shahid Rajaee and the reorganization of customs clearance offices to separate inspections of special goods (chemicals, petroleum)
from those of general goods.

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Doing Business 2019 Iran, Islamic Rep.

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