Legal Professions in Iran; (Part two) Law Firm in Iran is not what you know about law firms. How an Iranian Law firm works?
In the first part of this Article about legal professions in Iran, We discussed the individual lawyers and contracts.
In this part as the last part, I want to explain about law firm in Iran
I will explain the differences between Iranian law firm with the law firm in other legal systems.
As a general rule, when we talk about hiring a lawyer in Iran, the contract is what I explained in the first part. Also, an Iranian law firm cannot be a substitute for a lawyer. Furthermore, in most cases, an Iranian law firm cannot be a part of lawyering contract.
Law Firm in general and Law Firm in Iran
- The concept of “Law Firm” is based on the concept of “Firm”.
- The concept of Firm, as such, depends on a Partnership relation between members. This partnership relation is a contract.
Overall, the diversities about the Firm, Partnership, and the contract can be described as follow:
- In some countries, a partnership contract is enough to create a Firm but members can register the Firm.
- In some countries, registration is required.
- In some countries, only special type of Firms need to be registered.
- In some countries, the Partnership contract will create the Firm and there is no such thing as registration.
What about Law Firm in Iran
- The concept of Firm doesn’t exist in Iran laws.
- As a result, the is no such thing as Law Firm in Iran
- An Iranian Law Firm has to be a company or an institution. This structure is entirely different from what we know about Firm. For example, we work as a Law Office shaped as an institution. I will explain this. Keep reading.
There is no Firm in Iran business structures
- This topic can take 100 pages but I explain it in simplest way.
- As a general policy, in most countries, business structures divided into three forms;
- This can differ from country to country. For example, in Singapore, individual business practitioners can perform many separate businesses using different Business names. This is not a group nor a company.
- The second type of business structures or organizations, doesn’t exist in Iran laws.
- In the other words, if you want to do business in Iran, it is either individually or through a legal entity.
- Firm comes from the Group. It depends on a partnership between a two or more person without creating a company.
I explained the different types of companies in other posts;
Non- commercial institutions and Firm
- In Iran commercial code, in section number 2, there is a list of commercial activities.
- If someone does one of these activities as a job, he or she is a businessman.
- If someone doesn’t want to do a business activity individually, he or she has to establish a company.
- The problem was that, legal services, educational services, charities, and a lot of other profitable and non-profitable were not in that section.
- To fill the gap, Non- commercial Institutions were invented.
- A Non- commercial institution can be either profitable or non-profitable.
- Legal services including lawyering, is a profitable non-commercial activity.
- The problem is that, a non-commercial institution is exactly like a company. It is not like a Firm and a partnership contract. See different type of companies.
- So no matter if you do a collective legal service in shape of a company or a non-commercial institution, the rules are same.
What are the differences?
- When you see or hear about a law firm in Iran it mainly is a Non-commercial institution. Of course it can be a company too but that is highly unlikely.
- First- members of a Firm have collective and separate responsibility. It does not exist in an Iranian Law Firm
- Second- a contract with a member of a Firm is binding for all members. Iranian Law firms have a CEO or a Board of Directors just like companies. Only contracts with competent member or members is binding for the Firm.
- Third- if you conclude a contract with an Iranian Law Firm signed by the CEO, it is not a lawyering contract; it is a contract that allows the Firm to assign a lawyer for your case.
- Forth- since; 1- a proxy or lawyering contract has to be in the official language of the court; 2- the official version of the contract created by Iran Bar Association is in Persian language, so it is sufficient if you sign the contract with the Firm and let the Firm assign the lawyer.
- As a final remark remember that; this structure about Firms in Iran is the same in all Firms including Accounting Firms, Consulting Firms, Management Firms and … . If a Firm has special rules about responsibilities or guarantees, it counts as a competitive advantage so you will be informed about it.