Weekly roundup: Court ruling unravels Sudani government’s deal with KRG

The Federal Supreme Court ruled on January 25 that both paid and pending budget transfers by Baghdad to the Kurdistan Region were illegal. The lawsuit was filed by the Governor of Wasit Mohammed Mayahi and MP Mustafa Sanad from Basra. Sudani’s cabinet passed a resolution last month to pay the monthly salaries of public sector employees in the Kurdistan Region for November and December 2022. Finance Minister Taif Sami had declined to sign off on the transfers citing legal reasons, resulting in the appointment of the KDP’s Masoud Hayder as deputy finance minister in order to push payments through. The Court’s latest verdict is consistent with its ruling from last year that deemed the Kurdistan Region’s oil sales illegal, affirming that Baghdad could not transfer funds until finances were resolved and that the KRG’s oil sales were subject to federal oversight.