Legal Principles Governing Contracts ,Swaps the Iranian Legal System

Swap literally means barter, exchange, trade, trade off and substitution. The term swap in oil trading and in a simple concept means that government or private sector receive oil or gas in the border of a country from the neighbors and deliver them to the specified people in other borders. In the 1990s, after the collapse of the former Soviet and the independence of Central Asian countries, oil trade with Iran gained importance. These countries needed to export their oil for their economic development. While the facilities to deliver oil to the consumers in Europe, Asia and US was too limited. Therefore in 1375 Iran and Kazakhstan signed an agreement under which 40 thousand barrels of light crude oil transferred from Kazakhstan to Tabriz and Tehran refineries and in return, Iran s light crude oil in the Persian Gulf would be delivered to Kazakhstan trading partners. In relation to the legal nature of the swap in accordance with legal system of Iran some lawyers know legal nature of swap contract in terms of international trade and commerce as one of the types of interaction and in conformity with exchange contract and know it as exchange contract. In exchange contract method, similar goods which are in different physical locations would be exchanged in order to reduce the cost of shipping and transportation barriers be eliminated. Legal nature of swap in accordance with available legal entities of legal structure in Iran is the same as the exchange that includes its own features and is different from other types of mutual trade practices in the field of international trade law and other distinguishing certain contracts in the Iranian legal system. Based on jurisprudence and law to create commitment, compromise and consensus do not have to be in the form of a special contract of certain contracts, but also private contracts to be concluded in any form or manner subject to the general rules of contracts are in force and is valid so the swap contract are also included under the Article 10 of the Civil Code.

Keywords:

Legal Issues , Swap , Contract , Oil