The Rules Governing Foreign Direct Investment in Free Trade Zones

The Rules Governing Foreign Direct Investment in Free Trade Zones Goodarz Eftekhar jahromi Ebrahim Rezvani Abstract This article examines the rules governing Foreign Direct Investment in Iran’s Free Zones. These rules are pertaining to investor’s entry procedures, exceptions in foreign investment, restrictions and requirements of foreign investment. The results, found through a comparative study of some leading countries to attract foreign investment and Foreign Investment Promotion and Protection Act (FIPPA), indicated that the rules governing foreign direct investment play a significant role to stimulate the investor’s incentive and are considered one of the imperative and determinant legal factors to attract foreign investment in free zones. Solutions to make the Iran’s free zone investment climate more attractive to foreign investors include substitution of approval and confirmation system by informing and notifying one, limitation of exceptional segments from foreign investment, redundancy prohibition of possession or ownership of property, elimination of share ownership limitation and reduction of administrative requirements for the foreign investor. Key Words: Foreign Investment, Free Zones, Investor’s Entry Procedures, Ownership of Property, Share Ownership, Inves