Heavy fees drive Iraqi delivery firms toward collapse
Shafaq News- Baghdad
Iraq's delivery companies are warning that rising licensing costs, new fees and overlapping government regulations are putting increasing pressure on a sector that has become a key link between small businesses and their customers.
More than 25 delivery companies are closing each day because of the cost of renewing licenses and rising charges, Rami Ali, manager of Al-Sultan Road Delivery Company, stated on Tuesday.
Speaking at a forum in Baghdad that brought together representatives of delivery companies, lawmakers and government officials to discuss the challenges facing the sector, Ali noted that renewing licenses costs companies 8 million Iraqi dinars ($6,100) a year for services that are not actually provided.
“Half of the delivery fee goes to the courier and the other half to the company,” he added, cautioning that the financial pressure is particularly heavy for companies operating on relatively narrow margins, with profits accounting for no more than 13% of delivery fees.
The financial strain comes alongside a dispute over which government body should regulate delivery companies, with the Transport Ministry and Communications Ministry both involved in the sector.
Read more: Iraq's e-commerce boom fuels growth, fraud, and consumer mistrust
Legal expert Ayoub Rashid argued that the laws underpinning the regulatory framework are inconsistent with those currently in force, leaving the two ministries with overlapping authority.
“Transport falls under the jurisdiction of the relevant ministry, and no other ministry is authorized to regulate it,” he maintained, contending that the Communications Ministry cannot impose fees on delivery companies without a clear legal basis.
The dispute extends beyond the companies themselves, with potential implications for the growing number of small businesses and households that rely on delivery services to reach customers.
Economic expert Khaled al-Jabri described delivery companies as a key link in Iraq's e-commerce sector, particularly for people who produce goods from their homes and depend on delivery services to sell them.
“Delivery companies provide the link between producers and consumers, particularly for businesses that can be operated from home and do not require extensive administrative or legal procedures,” Jabri told Shafaq News.
Many of these small activities generate revenues below the threshold for tax exemptions and have limited dealings with company registration offices or other government departments, he added, stressing that disruptions to the sector could therefore affect the livelihoods of hundreds of thousands of families, particularly as Iraq faces significant financial pressures.
Read more: 2026 budget: Iraq confronts unprecedented fiscal strain
