Doing Business In Kuwait

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How to Invest in Kuwait

The Foreign Investment Law (No. 8/2001) regulates foreign investments in Kuwait. Under the law it is intended to allow foreign investors to own up to 100% equity in Kuwaiti companies or ventures for special projects as determined by the Council of Ministers. Prior to the enactment of this law, foreign investors were subject to a ceiling of 49% (maximum) stipulated under the Law of Commerce No. 68 of 1980 and the Commercial Companies Law No. 15 of 1960. The law proposes to do away with such restrictions imposed upon foreign investors.

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The Ministry of Commerce is empowered to issue licenses to foreign investors, permitting up to 100% foreign equity participation in any economic project in Kuwait. Such projects shall be exempt from the provisions of Articles 23 and 24 of the Law of Commerce as well as from the provisions of Article 68 of the Commercial Companies Law, which require at least 51% local participation. Thus, the new law proposes to overcome what was regarded by many foreign companies as a pitfall in doing business in Kuwait.

Significant steps have recently been taken to implement this law. These steps include the setting up of the Kuwait Foreign Investment Bureau (KFIB) which facilitates filing of applications and the Foreign Capital Investment Committee, headed by the Minister of Commerce & Industry to process applications for grant of licenses. Ministerial Resolution No. 23 of 2003 issued by the Minister of Commerce & Industry contains the Executive Regulations. The Regulations provide the mechanism for the implementation of the law.

CMA is an independent body that supervises trading procedures, monitors transactions and detects conflict of interests. It can resolve conflicts between investors and companies, scrutinise profit reports given by listed corporations, guarantee transparency of information, regulate take-overs and merging operations and penalise illegal activities. In short, it's the capital market's policeman and detective that maintains a fraud-free market.

Source - UK Trade & Investment

 

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