The Law of Establishment of the Development Organization (now known as the Development Law) enacted in 1967—a significant example of development legislation in Iran—can be compared to the Law on Implementation of the Policies of Article 44 of the Constitution passed forty years later in 2007 (the Privatization Law).
While the Development Law sought to modernize Iran's economy and foster national prosperity, it introduced an innovative partnership model between the government and the private sector. This model relied on the purchase of private property to revitalize the economic capacities of the private sector itself—positioning the state as a collaborator rather than a competitor. Conversely, the Privatization Law prioritized the sale of public assets as a mechanism to promote social justice, shifting the state's role from partner to vendor.
A fundamental difference between these two laws lies in their contractual nature. Partnership contracts, as envisioned by the Development Law, generate shared profits through cooperation, aligning the interests of both parties. In contrast, commutative contracts—such as those governing sales—often result in one party's gain at the expense of the other. The Development Law sought to leverage state authority in favor of citizens' economic empowerment, positioning the government as a stakeholder in the private sector’s growth rather than an external force.
This distinction is particularly evident in property ownership. The Development Law allowed the government to acquire and retain companies to strengthen them (Article 5, Paragraph b), reinforcing their capacities before returning them to the private sector. Meanwhile, the Privatization Law sells off state-owned companies—often to buyers whose financial eligibility is not thoroughly vetted. This practice raises critical questions, as the government is not the owner of public property but merely its custodian on behalf of the people—especially regarding Iran’s land and natural resources. Even when acting as a representative of the people, the state’s authority does not equate to full ownership, but rather to a sovereign duty of stewardship.