These three legal entities – Limited Liability Company (LTD), Private Joint Stock Company, and Institute – are the most commonly used business forms in Iran. Each has its own features, advantages, and limitations.
Minimum Partners: 2 persons
Initial Capital: At least 100,000 IRR (100% deposited in the bank until official announcement)
Liability of Partners: Limited to their share of capital
Management: One or more managers (can be non-partners)
Share Transfer: Only with the consent of more than half of the partners and a notarized document
Suitability: Ideal for small to medium-sized businesses
Minimum Shareholders: 3 shareholders + 2 auditors
Initial Capital: At least 100,000 IRR (minimum 35% must be deposited in the bank)
Liability of Shareholders: Limited to the amount of shares
Management: Board of Directors (minimum 3 members from shareholders)
Share Transfer: Relatively easier; does not require notarization but must be registered in the share ledger
Suitability: Suitable for larger businesses, participation in tenders, more formal and credible than LTD
Nature: Non-commercial legal entity (can be for-profit or non-profit)
Minimum Members: 2 persons
Initial Capital: No specific minimum
Main Purpose: Scientific, cultural, educational, or charitable activities; if for-profit, it must be stated in the Articles of Association
Liability of Members: According to contribution or Articles of Association
Suitability: Ideal for social, cultural, or research activities
| Feature | Limited Liability Company (LTD) | Private Joint Stock Company | Institute |
|---|---|---|---|
| Minimum Members | 2 partners | 3 shareholders + 2 auditors | 2 members |
| Initial Capital | 100,000 IRR (100% deposited) | 100,000 IRR (35% deposited) | No specific limit |
| Liability of Members | Limited to share of capital | Limited to shares | According to Articles or contribution |
| Management | Manager(s) | Board of Directors (≥3 members) | According to Articles of Association |
| Ownership Transfer | Difficult (requires partner approval) | Easier (registered in share ledger) | According to Articles of Association |
| Main Use | Small and medium businesses | Large-scale activities, tenders, higher credibility | Cultural, educational, social, or charitable activities |
Limited Liability Company (LTD): Suitable for startups, small, or family businesses
Private Joint Stock Company: Ideal for larger ventures, raising capital, participating in tenders
Institute: Best for non-commercial purposes such as scientific, educational, or charitable activities
Trademark registration in Iran is a legal process regulated by the Industrial Property Office, granting exclusive brand protection and classification under the Nice system for goods and services.
Company registration in Iran establishes a legal business entity, while trademark registration protects a brand name or logo. Many businesses choose to complete both processes to operate legally and secure their brand identity.
Company dissolution in Iran is the legal process of ending a company’s operations and entering liquidation, ensuring proper settlement of debts, distribution of assets, and compliance with tax and legal obligations. Expert guidance ensures a smooth and legally compliant process.
LTD, Private Joint Stock Companies, and Institutes are the main legal entities in Iran, each suited for small businesses, large ventures, or non-commercial activities.
