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The Iraqi National Oil Company law and the return of confusion again
Among the decisions of the Cabinet session taken on August 17, 2020, the following related to the Iraqi National Oil Company:
1. Approving the draft law of the first amendment to the Iraqi National Oil Company law and referring it to the House of Representatives, based on the provisions of Articles 61 / First and 80 / Second Clause of the Constitution, taking into account the opinion of the General Secretariat of the Council of Ministers.
2. Completing the steps of establishing the company through its board of directors choosing a specialized consulting office to work on setting the administrative structure, classifying tasks and responsibilities, and determining the value of the fixed assets of the owned companies, in preparation for disassociating them from the Ministry of Oil, and owning them to the company in question without compensation, in accordance with the provisions of the two articles ( 1/5 and 7/5) of the National Oil Company Law, taking into consideration what was mentioned in the aforementioned draft law.
Before discussing what was mentioned in the above decision, it is necessary to refer to some matters related to the subject:
First: I previously dealt with what was stated in the ministerial curriculum of the Al-Kazemi government regarding “completing and sending the draft law (the Iraqi National Oil Company)” and showed that the importance of the Iraqi National Oil Company requires issuing its law after careful and integrated study of all aspects of specialization, technology, legal, economic and within normal circumstances This guarantees the correctness of restructuring the company according to the modern and advanced principles and standards related to the standards of efficiency, productivity and economic feasibility.
However, the subject of this law and the attempts to issue it are not new, especially after 2003, when political considerations and practices of "legalized corruption" overwhelmed the requirements of efficiency, productivity, economic feasibility and the supreme national interest, the most recent of which was the "malicious" company law No. 4 in 2018, which was passed by the House of Representatives and approved. In a suspicious manner, ambiguous circumstances, and record speed, with coordination and support by the then Minister of Oil, Jabbar Laibi, who hastened to take a set of wrong, contradictory and inconsistent measures with the constitution, which indicated Minister Jabbar Laibi’s lack of the simplest administrative capacity qualifications in terms of his usual confusion in decision-making.
The wretched and malicious legislation of the law prompted a nationwide campaign by oil experts and national figures, outside and inside Iraq, to challenge the said law before the Federal Supreme Court, where the appeal was accepted. Thus, the esteemed Federal Supreme Court decision formed a very important material and legal basis, binding on both the legislative authority (i.e. the House of Representatives) and the executive authority (i.e. the Cabinet and the Ministry of Oil) when making the necessary amendments to Law No. 4 in 2018.
Second: The above company law has been included in the government program of the Ministry of Adel Abdul Mahdi, and he is one of the main supporters of the above-mentioned "malicious" law; As stated in the government program (the third axis: (1) the Ministry of Oil, paragraph (11 T1.)) to “Putting the National Oil Company Law into practice,” and the date for the start of the procedure was 10/25/2018 and the end on 10/25/2020.
In implementation of this, the Deputy Prime Minister for Energy Affairs and former Oil Minister Thamer Al-Ghadhban (in the government of Adel Abdul Mahdi) confirmed on Sunday 10 March 2019 that “the ministry has a set of alternatives: either the House of Representatives amend the law, or send it again to the executive authority to reconsider it. Or, or the executive authority submits a new draft decision in accordance with its powers, with a comprehensive new draft draft decision that takes into account the appeals approved by the Federal Court and at the same time takes into account the vision of the Ministry of Oil in how to establish this company in a modern, reformist manner.
However, the Ministry of Oil did not announce any details about those alternatives or the comparison between them and their priorities, and whether they were actually submitted to the Council of Ministers at the time and when or not.
Third: It seems that the last cabinet decision that is the subject of discussion has adopted, in part, the third alternative from what was mentioned by former minister Thamer Al-Ghadhban, meaning that “the executive authority submits a new draft decision in accordance with its powers with a new draft resolution,” but there is no confirmation that this draft is for the new decision. Shamil takes into account the appeals approved by the Federal Court, and at the same time takes into account the vision of the Ministry of Oil on how to establish this company in a modern, reformist manner.
Fourth: As for timing, it is strange that this decision was taken hours before the departure of Prime Minister Al-Kazemi and his accompanying delegation to the United States. Does this matter have any connection with the mission of the official visit and why?
In light of the above, and given the difficult economic conditions that Iraq is suffering from and because of the extremely worrying oil situation that requires further follow-up and efforts by the Ministry of Oil, I do not see absolutely any urgent need for the Al-Kazemi government to adopt such a law and its legislation during the current parliamentary session, especially since the remaining period The Al-Kazemi government and the current parliamentary session are too short to allow discussion of this important amendment whose details are unknown !!!
Back to the recent decision of the Council of Ministers, I would like to state the following:
First: With regard to paragraph (1-) of the above resolution:
1. The text of the "First Amendment Bill" has not been published, and therefore it is difficult to verify the extent of compliance with the decisions of the Federal Supreme Court mentioned above and to act accordingly when preparing the amendment bill;
2. No reference has been made to referring the amendment bill to the State Council to ascertain whether the amendment is legal or not.
3. The decision did not mention what is the "opinion of the General Secretariat of the Council of Ministers" on the subject, and if the opinion of the General Secretariat of the Council of Ministers is important for this purpose, then why was it not included in the draft amendment ??
4. The decision did not mention who is the official body that should take into consideration the opinion of the General Secretariat of the Council of Ministers? If the parliament is intended, then this contravenes the provisions of Articles 61 / First and 80 / Second Clause of the Constitution. As both articles are concerned with proposing draft laws and nothing is mentioned in them, which requires taking the opinion of the General Secretariat of the Council of Ministers into consideration. And what will happen if that official body does not take the opinion of the General Secretariat of the Council of Ministers into account !!!
Therefore, what was stated in paragraph (1) of the decision is inaccurate and inconsistent, in addition to the lack of transparency (not publishing or announcing the text of the amendment draft and the opinion of the General Secretariat of the Council of Ministers).
Second: As for paragraph (2-) of the above decision, it suffers from many gaps, the most important of which are:
1. How can the Council of Ministers approve "completing the steps of establishing the company" before the amendment bill is approved by the House of Representatives and published in the Official Gazette ?? !!
2. Has the company’s board of directors been appointed? If this is done, who is the president of the company and who are the members of its board of directors ?? If this is not done, who will undertake the task of "completing the steps of establishing the company" ??
3. It is strange that "completing the steps of establishing the company" is only done "by choosing a specialized advisory office" and this is not mentioned in Law 4 of 2018 !!! Where the task of the legal advisory office was determined by determining the value of fixed assets of the owned companies only, and not also "setting the administrative structure and classifying tasks and responsibilities" !!!
4. With regard to determining the value of fixed assets of owned companies, is it not more feasible and more accurate for the Federal Office of Financial Supervision to cooperate with the companies concerned with this task instead of the specialized advisory office (which will most likely be foreign, financially costly and methodologically different) !!!
5. In this regard, it is necessary to clearly and accurately determine the value of the fixed assets of the owned companies currently producing (Basra Oil, North Oil, Maysan Oil, Central Oil, Dhi Qar Oil) and in the future does not include at all the hydrocarbon-oil reserves (oil, gas and condensate), confirmed and potential; As the oil wealth - according to the constitution - belongs to all the Iraqi people, not to the mentioned productive companies.
6. Because the text of the draft amendment to the law in question has not been published, it becomes known, at the present time, who are the owned companies and are they the same as the companies listed in Article 7-Second-2. From Law No. 4 of 2018. If the companies are the same listed, then this violates the Federal Supreme Court’s decision to the extent that it concerns the inclusion of the Oil Marketing Company (SOMO) within the owned companies. In this regard, I think that the Oil Exploration Company, the Iraqi Drilling Company and the Iraqi Tanker Company should not be included, and that they should remain as specialized service companies (especially with regard to the exploration and drilling companies).
7. The decision of the Council under discussion referred to “the provisions of Articles 5/1 and 7/5 of the National Oil Company Law” and this is imprecise as these two articles do not exist in the aforementioned law; It was necessary to refer to the relevant articles precisely, namely: “Article -5-First-1” and “Article -8-Fifth” respectively.
8. Paragraph (2) of the above resolution was concluded with a loose phrase that is neither necessary nor important, as it states: "Taking into consideration what was mentioned in the aforementioned bill !!!" Isn't the aforementioned bill binding on the company’s board of directors if it is approved in accordance with constitutional principles !!! Such a text lends itself to confusion and to take the wrong, hasty and ill-considered measures, and reminds us of the decisions of Jabbar Laibi; Have you not yet learned and why this insistence on repeating mistakes and disastrous practices ?? !!
In light of the above, I find it necessary:
First: Because of the many loopholes diagnosed above, it is imperative that the General Secretariat of the Council of Ministers publish the full text of the draft law of the first amendment to the Iraqi National Oil Company law and know the opinion of the State Council on the legal sobriety of the draft law, especially with regard to the Federal Supreme Court’s decision to accept appeals to Law No. 4 For the year 2018;
Second: The publication of the full text of the draft law of the First Amendment to the Iraqi National Oil Company law will enable oil experts to evaluate and advise on it;
Third: I call on the House of Representatives not to address the draft law of the first amendment to the Iraqi National Oil Company law during the current session and to refer it to the new parliament after the parliamentary elections next year;
Fourth: In the event that the Council of Ministers and the House of Representatives insist on passing and "wrapping" the draft of the First Amendment in the same way and manner as Law No. 4 of 2018 was legislated, then what we and all those who are concerned with the concerns of the homeland and the protection of its oil wealth must be prepared for confrontation and resort to the court The Supreme Federation is distinguished because, in my conviction, it is the only body that has been proven by actual experience as a guardian of the constitution.
* An Iraqi writer residing in Norway
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