Iraq will review the status of all security companies after this week’s “flagrant assault” by contractors from the US firm Blackwater in which 11 people were shot dead, the government said on Tuesday.

Government spokesman Ali al-Dabbagh said the cabinet backed an Interior Ministry decision to “halt the licence” of Blackwater, which provides security for the US embassy, and launch an immediate investigation into the shooting.

Shi’ite cleric Moqtada al-Sadr, adding his voice to Iraqi anger over the incident, urged the government to “cancel this company’s work, and the rest of the criminal and intelligence companies” that employ tens of thousands of people across Iraq.

In fresh violence, four car bombs in Baghdad killed 17 people and wounded 50, police said. “Cabinet affirmed ... the need to review the situation of foreign and local security companies working in Iraq, in accordance with Iraqi laws,” Dabbagh said.

“This came after the flagrant assault conducted by members of the American security company Blackwater against Iraqi citizens,” Dabbagh said after a cabinet meeting.

Iraq’s Interior Ministry said 11 people were killed when Blackwater contractors opened fire at random after mortar rounds landed near the convoy.

US Secretary of State Condoleezza Rice telephoned Iraq’s Prime Minister Nuri al-Maliki on Monday to express regret over the death of innocent civilians, which the State Department said occurred during an attack on a US convoy.

Blackwater said its guards reacted “lawfully and appropriately” to a hostile attack. It said late on Monday it had received no official notice from Iraq’s Interior Ministry.

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