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Authors: Dr. Abdulbasit Kareem Mawlood
Abstract: The study of the rules governing the establishment of companies and their capital and in a monetary framework is of great importance, because companies as a moral figure and their capital play an important role in economic activity at the public and private levels.
The Iraqi legislator in the Iraqi Company Law No. 21 of 1997, amended, did not have to have the contract of the company written, but left it to indicate through the texts that conclude the contract is written.
In the matter of suspending the approval of the sector to establish the company in an absolute form if it has advantages in terms of time and effort, but the nature of the activity of some companies, especially the shareholders companies don’t it need to re-examine this subject to the extent that creates a balance between the benefits of suspension and protection of the public interest and private interest of savers from Individuals? As for the founder of the company, the Iraqi legislator did not care to determine who the founder is, should we not re-examine this issue?
The Iraqi legislator did not give any attention to the establishment of a system for the company and was not correct in the subject of eligibility in the Joint Stock Company for minors.
On the other hand, the minimum capital of companies is very low and does not seriously affect the company’s activity. The company may increase its capital if it is paid in full. The legislator specified a party to increase the capital of the company, but the legislator limited the increase of the company’s capital through the cash quota, contrary to what was followed by comparative legislation.
In view of the need to harmonize the activity of the company and its economic capacity in accordance with the surrounding variables, companies may resort to, especially the shareholding companies to reduce their capital for several reasons, such as having too much capital and more than they need, to prevent loss or if the shares remained unsubscribed after the success of the process of institutional subscription. The process of reduction must be carried out in accordance with the procedures determined by law because it affects the interests of creditors and the interest of the company itself, therefore, the legislation intentionally aims to determine the means of reducing the capital of the company.
Based on the above, we have concluded in this research that we require a serious review of the Iraqi Corporate Law No. 21 of 1997 amended, and the introduction thereof as explained in our research the proper legal organization and clear accuracy is needed with regard to the stage of the establishment of the company and its capital to protect the interests of the company and its clients.
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doi:10.23918/ilic2018.44
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Journal of Law and political science
ISSN: 2079-3901
16th year , No.(23), 10 May 2018
Vol.(2): Special Issue