| Embassy of The State of Kuwait Australia - New Zealand |
The basic premise for carrying out business in Kuwait is identified in the Articles (23) and (24) of the Kuwaiti Commercial
Code. Article (23) of the Code states that non-Kuwaiti citizens may not pursue any commercial activities in Kuwait,
unless having a Kuwaiti partner. This partner's share must not be less than (51%). Article (24) sets forth that any
foreign company may not establish a branch in Kuwait and cannot pursue its commercial activities in Kuwait unless
having a Kuwaiti agent.
On April 22, 2001, Kuwait's Parliament enacted Law No. (8) on Regulating Foreign Capital Direct Investment in Kuwait,
in an attempt to lure foreign investments. By allowing foreign ownership up to (100%) of business entities in certain
sectors, this Law draws an exception to the general rules governing doing business in Kuwait by foreign investors. The
implementing regulations that establish the guidelines for investment under the Law will be issued soon.
The following ways define how a foreign individual or entity may enter the market and carry out business in Kuwait:
• Establishing a company
• Concluding a joint venture agreement
• Appointing a Kuwaiti commercial agent
• Appointing a commercial representative
Establishing Company in Kuwait
As per the Kuwaiti Law, foreign individuals or entities may establish permanent presence in Kuwait through forming and
investing in the following Kuwaiti companies:
• Limited Liability Company (WLL)
• Closed Joint Stock Company (KSC Closed)
• Joint Stock Company
Limited Liability Company
Foreign individuals and corporates may establish a Limited Liability Company (WLL) in Kuwait. However, as per Article
(191) of the Companies Law, the share of the Kuwaiti citizen in the WLL company must be at least (51%). The process
of forming a WLL is simple, and it takes approximately three months. This type of companies provides a limited liability
shield. Since Kuwaiti citizens do not pay individual income tax, and only non-Kuwaiti corporate bodies pay corporate
tax, WLL companies do not pay taxes.
Closed Joint Stock Company
The other type of companies that can be established by non-Kuwaiti entities is Closed Kuwaiti Joint Stock company
(KSC Closed). Pursuant to the Kuwaiti Companies Law, Articles (68) and Article (94) state that KSC Closed companies
are exceptional type of Joint Stock Companies. As a rule, only Kuwaiti citizens may be shareholders of a joint stock
company. However, foreigners may own up to (49%) of the share capital of a Closed Joint Stock company (KSC Closed)
after attaining approval of the concerned authorities. Activities of KSC Closed company may not include banking or
insurance. The process of forming a KSC Closed company takes up to six months.
In addition to the taxes levied on profits made by the foreign company as a shareholder in a KSC Closed Company, the
KSC Closed Company must contribute with 5% in Kuwait Foundation for the Advancement of Science.
Joint Stock Company
In June 1999, Kuwait enacted a law permitting non-Kuwaitis to hold shares, for the first time, in publicly traded
shareholding companies. Pursuant to this new law, the restrictions and conditions of this right are to be defined by the
Minister of Commerce and Industry in the Implementing Regulations of the Law. Among these regulations is the
maximum amount of shares which non-Kuwaitis may hold and their corresponding rights.
Code. Article (23) of the Code states that non-Kuwaiti citizens may not pursue any commercial activities in Kuwait,
unless having a Kuwaiti partner. This partner's share must not be less than (51%). Article (24) sets forth that any
foreign company may not establish a branch in Kuwait and cannot pursue its commercial activities in Kuwait unless
having a Kuwaiti agent.
On April 22, 2001, Kuwait's Parliament enacted Law No. (8) on Regulating Foreign Capital Direct Investment in Kuwait,
in an attempt to lure foreign investments. By allowing foreign ownership up to (100%) of business entities in certain
sectors, this Law draws an exception to the general rules governing doing business in Kuwait by foreign investors. The
implementing regulations that establish the guidelines for investment under the Law will be issued soon.
The following ways define how a foreign individual or entity may enter the market and carry out business in Kuwait:
• Establishing a company
• Concluding a joint venture agreement
• Appointing a Kuwaiti commercial agent
• Appointing a commercial representative
Establishing Company in Kuwait
As per the Kuwaiti Law, foreign individuals or entities may establish permanent presence in Kuwait through forming and
investing in the following Kuwaiti companies:
• Limited Liability Company (WLL)
• Closed Joint Stock Company (KSC Closed)
• Joint Stock Company
Limited Liability Company
Foreign individuals and corporates may establish a Limited Liability Company (WLL) in Kuwait. However, as per Article
(191) of the Companies Law, the share of the Kuwaiti citizen in the WLL company must be at least (51%). The process
of forming a WLL is simple, and it takes approximately three months. This type of companies provides a limited liability
shield. Since Kuwaiti citizens do not pay individual income tax, and only non-Kuwaiti corporate bodies pay corporate
tax, WLL companies do not pay taxes.
Closed Joint Stock Company
The other type of companies that can be established by non-Kuwaiti entities is Closed Kuwaiti Joint Stock company
(KSC Closed). Pursuant to the Kuwaiti Companies Law, Articles (68) and Article (94) state that KSC Closed companies
are exceptional type of Joint Stock Companies. As a rule, only Kuwaiti citizens may be shareholders of a joint stock
company. However, foreigners may own up to (49%) of the share capital of a Closed Joint Stock company (KSC Closed)
after attaining approval of the concerned authorities. Activities of KSC Closed company may not include banking or
insurance. The process of forming a KSC Closed company takes up to six months.
In addition to the taxes levied on profits made by the foreign company as a shareholder in a KSC Closed Company, the
KSC Closed Company must contribute with 5% in Kuwait Foundation for the Advancement of Science.
Joint Stock Company
In June 1999, Kuwait enacted a law permitting non-Kuwaitis to hold shares, for the first time, in publicly traded
shareholding companies. Pursuant to this new law, the restrictions and conditions of this right are to be defined by the
Minister of Commerce and Industry in the Implementing Regulations of the Law. Among these regulations is the
maximum amount of shares which non-Kuwaitis may hold and their corresponding rights.
Introdction
Basics of Kuwait’s Economy ( 2007)
GDP per capita (bilion$) 38,925
GDP at market prices (billion $) 111.34
Value of exports (billion $) 61.43
Value of petroleum exports (billion $) 60.02
Current account balance (billion $) 52.73
Proven crude oil reserves (billion barrels) 101.50
Proven natural gas reserves (billion cu. m.) 1,780
Crude oil production* (1,000 b/d) 2,575
Marketed production of natural gas (billion cu. m.) 12.06
Refinery capacity (1,000 b/d) 936
Output of refined products (1,000 b/d) 272
Crude oil exports (1,000 b/d) 1,613
Exports of refined products (1,000 b/d) 739.1
GDP at market prices (billion $) 111.34
Value of exports (billion $) 61.43
Value of petroleum exports (billion $) 60.02
Current account balance (billion $) 52.73
Proven crude oil reserves (billion barrels) 101.50
Proven natural gas reserves (billion cu. m.) 1,780
Crude oil production* (1,000 b/d) 2,575
Marketed production of natural gas (billion cu. m.) 12.06
Refinery capacity (1,000 b/d) 936
Output of refined products (1,000 b/d) 272
Crude oil exports (1,000 b/d) 1,613
Exports of refined products (1,000 b/d) 739.1
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