Additional reporting by Andrew Pentol

Allegations of impropriety surrounding a duty free contract extension at Baghdad and Basra airports in Iraq are ‘flagrantly untrue’, according to Iraq Duty Free.

The duty free operator categorically denies allegations of corruption and bribery in securing an early concession extension in 2016, as unconfirmed local reports suggest anti-corruption authorities are commencing an investigation into a potential breach of Iraqi law.

The original contract was due to expire in March 2019, but the company secured the extension in December 2016 to March 2029 to facilitate a $2m investment into the duty free stores at the aforementioned airports.

Iraqi Duty Free, began in 2004 by Founder Ahmed Sarchil Kazzaz when parent company Financial Links entered into an agreement with the Iraq Civil Aviation Authority (CAA), initially signed a 15-year contract to operate arrivals and departures stores at airports such as Baghdad, Basra and Sulaimaniyah.

The agreement also includes the provision of luggage trolleys, lounge seats in departures and buses for staff to shuttle to and from the airport.

‘SMEAR CAMPAIGN’

In a direct statement issued to TRBusiness, Iraq Duty Free CEO Ahmed Kamal said: “Iraq Duty Free strongly refutes all such allegations regarding the contract renewal.

“The contract between Iraq Duty Free and Iraqi Civil Aviation Authority has passed through a number of legal and regulatory authorities before it was concluded. It was approved by the Iraqi Civil Aviation Authority and then further endorsed by the Ministry of Transportation.

“There was no legal impediment to prevent us renewing the contract before its expiry. Both parties were entitled by law to do so with mutual consent.

“The allegations are flagrantly untrue, baseless and designed to tarnish our reputation and business goodwill. It is a smear campaign and a witch-hunt.”

Shedding further light on the terms of the contract extension, Kamal commented: “The contract was entered into with relevant parties under the supervision of the Ministry of Transportation. We have not lagged behind in terms of implementing the provisions outlined in the contract.

“It is an investment contract and will cost us millions of dollars to develop and modernise the duty free shops and undertake other reconstruction and development work.”

The complete renovation of the stores is ongoing; the arrivals project at Baghdad International Airport is finished, however work is set to begin soon on the departure stores.