Erbil and Baghdad Reach Landmark Agreement on Customs System, Easing Trade for Kurdish Businesses
In a significant move to resolve a long-standing impediment to regional trade, the Kurdistan Regional Government (KRG) and the Federal Government of Iraq have reached an agreement on the implementation of the ASYCUDA customs system. The breakthrough is expected to normalize and streamline import and export activities for businesses in the Kurdistan Region.
The agreement was finalized during a high-level meeting in Baghdad on Tuesday. A KRG delegation, led by Blind Mohammed, the Director General of Company Registration, met with federal counterparts and Sami Sudani, an advisor to the Iraqi Prime Minister. The delegation included representatives from the KRG’s Ministries of Trade and Interior, as well as the General Directorates of Industrial Development, Customs, and Quality Control.
A central point of the agreement is the mutual recognition of the Unique Enterprise Number (UEN), a 14-digit identifier for companies. The KRG Ministry of Trade stated that this will serve as the foundational document for acceptance within the ASYCUDA (Automated System for Customs Data) platform. Crucially, this eliminates the previous and contentious requirement for companies registered in Kurdistan to obtain a federal tax ID, known as a Huweyat al-Daribi.
This change means that companies based in the Kurdistan Region can now conduct cross-border trade “normally and legally, on the same terms as businesses in central and southern Iraq,” officials confirmed.
For years, the dispute over the mandatory use of the federal ASYCUDA system had created major obstacles for Kurdish traders and companies, leading to delays, added costs, and bureaucratic hurdles that negatively impacted the Kurdistan Region's economy and market stability.
The KRG hailed the new arrangement as a critical step forward. In a statement, the Ministry of Trade said the agreement marks “an important step toward resolving these disputes and easing business operations across Iraq,” signaling a positive shift towards greater economic integration and cooperation between Erbil and Baghdad.
