Selecting an Authorised Representative in Iran and Managing Exclusive Agency Risk

1. Key takeaways

In Iran, the local authorised representative — the statutory agent and importer — is not a service provider. GRZAN’s assessment is that this party is the responsible entity and the rights holder: the company that submits the dossier, holds the registration and the import licence, and answers to the authorities inside the country. Foreign manufacturers cannot hold a medical device registration in their own name, which means the entire legal relationship with the Iranian market runs through one locally registered company. That concentration of control is a structural feature of the system, not a negotiable detail. GRZAN’s judgment is that 3 matters must be written clearly into the agreement — ownership of the registration and the IRC, the mechanism for changing the licence-holding entity, and the conditions under which the exclusivity clause can be released. Each of the three addresses the same underlying question: who actually controls the market position once the registration is granted. If any of them is left vague, the foreign company’s voice in the Iranian market is lost at the very moment the registration is completed, because from that point onward the local entity holds everything the authorities recognise. A well-drafted contract is therefore not administrative housekeeping; it is the only instrument a foreign manufacturer has for balancing a structural imbalance that no amount of goodwill can remove.

• The authorised representative is the responsible entity and the rights holder, not a service provider.
• Foreign manufacturers cannot hold the registration in their own name; it must sit with a locally registered company that acts as authorised representative and/or importer.
• Three contract essentials: ownership of the registration and the IRC, the mechanism for changing the licence-holding entity, and the release conditions for the exclusivity clause.
• Exclusivity should be bound to quantified performance metrics and a defined term, with automatic conversion to non-exclusive status if the metrics are not met.
• Transferability of the registration between entities must be confirmed with IMED through the local entity before signing.

2. Legal basis

The obligations described in this article rest on the local licence-holder system and on the Law on Regulation of Medical, Pharmaceutical and Food and Beverage Affairs. The items below set out the basis on which each requirement stands, together with its verification status.

1. Local licence-holder system: a foreign manufacturer must appoint a company legally registered in Iran to act as authorised representative and/or importer. That company submits the dossier, holds the registration or import licence, and bears the in-country obligations — see public industry sources; the official Iranian document number has not been released through public channels, so this item is a practical estimate.
2. Law on Regulation of Medical, Pharmaceutical and Food and Beverage Affairs, FAOLEX LEX-FAOC227692, dated 20 June 1955, Article 3.
3. Exclusive agency practice: Iranian importers commonly require an exclusive agency agreement before committing to a product — this is a practical estimate, based on public industry sources.

3. Expert insights

Insight 1: whoever holds the registration holds actual control. Because foreign manufacturers cannot hold a registration, it necessarily lands in the name of the local entity. This is an institutional constraint that cannot be avoided — it can only be balanced through contract terms. The core of that balance is an agreed obligation on the agent to cooperate in changing the licence-holding entity under defined conditions. Companies that treat this as a formality discover too late that every downstream question — who can respond to authority queries, who can apply for updates, who can transfer the product to a new importer — depends on the name on the registration certificate. The contract is the only place where this can be addressed before it becomes a problem.

Insight 2: the exclusivity clause is a double-edged sword. Exclusivity gives the agent a real incentive to invest in developing the market, but it also locks in the manufacturer’s options for the entire duration of the arrangement. If the agent underperforms, the manufacturer has no lawful route to appoint a second partner while the exclusivity stands. GRZAN therefore recommends that any exclusivity clause be bound to quantified performance metrics and set for a defined term, with automatic conversion to non-exclusive status if the metrics are not met by the end of that term. This converts exclusivity from an open-ended grant into a conditional, measurable commitment, and it gives both sides a clear, objective test rather than a discretionary judgment.

Insight 3: the feasibility of changing the licence-holding entity must be verified in advance. Whether the Iranian system permits a registration to move from one legal entity to another is the precondition that determines whether the contract clauses on entity change can actually be implemented. This cannot be assumed. It must be confirmed with IMED through the local entity before the agreement is signed. If the transfer procedure does not exist in practice, even the best-drafted change mechanism remains unenforceable, and the manufacturer should renegotiate the commercial terms with that reality in mind.

4. Practical recommendations

• Write the ownership clause in specific terms: state clearly that although the registration and the IRC are recorded in the agent’s name, the agent has a binding obligation to cooperate in any change of the licence-holding entity.
• Build trigger conditions into the change mechanism: list the situations that trigger a change — breach of contract, failure to meet performance targets, loss of the agent’s legal qualification — together with the deadline for the agent’s cooperation in each case.
• Bind exclusivity to quantified metrics: combine minimum purchase volumes or market investment commitments with a defined term, and provide that the arrangement automatically becomes non-exclusive if the metrics are not achieved.
• Verify transferability before signing: have the local entity confirm with IMED that the transfer procedure for the registration is feasible in practice, and record the answer in the project file.

5. Verification checklist

• □ The contract clearly states the ownership of the registration and the IRC, together with the agent’s obligation to cooperate in changes
• □ The trigger conditions and cooperation deadlines for changing the licence-holding entity are listed
• □ The exclusivity clause is bound to quantified metrics and a defined term, with a mechanism for automatic conversion to non-exclusive status if targets are missed
• □ The transferability of the registration between entities has been confirmed with IMED through the local entity
• □ Due diligence on the agent’s business registration, business scope and track record has been completed

Regulatory information verified as of 29 October 2026.

How GRZAN can help. GRZAN provides medical device and IVD registration, quality system, authorised representative and local testing support for the Iranian market. Our team coordinates local import arrangements, and supports post-market vigilance obligations. Business enquiries: info@grzanglobal.com