The Status of International Joint-Venture Contracts in the Iranian Oil Industry

Joint venture is a contract whereby two or more business partners participate in the execution of a specific economic plan and invest in that plan through cash or non-cash. Joint venture is among the international contract models that can be and is used in the oil industry. In Iran, this contractual method was permitted under Oil Act of 1957 but the law was changed. First the use of this method was limited in the "upstream operation" of the oil industry by the Oil Act of 1974 and then the Oil Act of 1987 prohibited the use of any type of cooperative method in the oil industry. Although a law passed in 2011 amended the provisions of the 1987 Act. The main question this paper is the following: is it allowed to use this contractual model under the new rules in oil and gas industry? With the introduction of new oil contracts in the post-JCPOA and in view of the fact that one of the country's top priorities is attracting foreign investment, it seems new laws have explicitly or implicitly permitted the use of this model of contract in the oil contracts.