From Regulatory Agencies to Regulatory Ecosystem: The Evolving Iranian Regulatory Regime

Following the international trend of the proliferation of regulatory agencies as a central part of modern governance systems, this paper studies the evolution of public sector and the gradual formation of the Iranian regulatory landscape, its main stages, its institutional arrangement, the challenges it has been facing, and the extent that it has improved the performance of the governance system as a whole. As such, the paper explores the period when the main regulatory functions were mainly performed centrally by the ministerial departments, towards a time when several semi-independent regulatory bodies were gradually established in the late 1990s. It then discusses the post-privatization era following the amendment of Article 44 of the Constitution in 2005, characterized by a huge wave of the privatization of state-owned enterprises and a plethora of national acts passed by the Parliament officially proposing the establishment of the National Competition Council and sectoral regulatory authorities. Building upon such a contextual analysis, the paper sheds light on the very recent institutional developments within the Iranian regulatory regime facilitating the agencies' performance and functionality improvement. They include, though by no means limited to, the creation of oversight bodies, intermediary institutions, regulatory research departments, as well as networks providing regulatory cooperation and convergence. Altogether, this paper argues that the Iranian regulatory regime is now evolving towards a complementary institutional configuration, which is called here a “Regulatory Ecosystem”.