KUWAIT Law and Practice Contributed by: Ezekiel Tuma, John Cunha and Luis Cunha, ASAR – Al Ruwayeh & Partners
1.3 Key Industries We have seen growth in M&A activity during 2025. While activity in the healthcare and aviation sectors remained robust, 2025 saw a distinctive surge in the oil, gas and utilities sectors.
datory takeover provisions are triggered. While pur - chasers previously leaned on block trade mechanisms (which raised certain competing bid issues impacting completion), off-market/special trade mechanisms (which are now provided for under the Boursa Rule Book) are becoming more of the norm. These allow for a direct purchase of shares in a listed company in a more streamlined manner (although certain restric - tions do apply including in relation to the purchase price per share and the total purchase price). 2.2 Primary Regulators The regulatory bodies are, primarily: • the MOCI; • the CMA; • Boursa Kuwait (previously known as the Kuwait Stock Exchange); • the CPA; and • other sector-specific regulators, as the case may be. 2.3 Restrictions on Foreign Investments Subject to certain exemptions, foreign nationals are prohibited from engaging in business in Kuwait through a corporate entity established in Kuwait with - out at least one or more Kuwaiti partners maintaining at least 51% of the participation interests. Applicable exceptions to the general rule include enti - ties wholly owned by the Gulf Cooperation Council (GCC), companies listed on Boursa Kuwait, compa - nies licensed under Kuwait’s Foreign Direct Invest - ment Law (Law No. 116 of 2013) and certain compa - nies established in connection with projects approved under Kuwait’s Public Private Partnerships Law (Law No. 116 of 2014). There was also an amendment dur - ing 2024 to the Commercial Law (Law No. 68 of 1980) (“Commercial Law”) which allows a foreign entity to establish a branch of itself in Kuwait; however, as reg - ulations to implement these reforms remain outstand - ing, the MOCI is yet to allow the establishment of such a branch. Please see 3.1 Significant Court Decisions or Legal Developments in this regard. Certain commercial activities are also restricted to Kuwaiti nationals. These include commercial agency services, printing presses, advertising and publishing
2. Overview of Regulatory Field 2.1 Acquiring a Company
Companies in Kuwait may be acquired through a merger or an acquisition. The Companies Law (Law No. 1 of 2016) (“Companies Law”) and its executive regulations (issued under Ministerial Resolution 287 of 2016), the Capital Markets Law (Law No. 7 of 2010) (CML) and the executive regulations of the CML (Law No. 72 of 2015, as amended) (“CML Bylaws”) primarily govern M&A in Kuwait. An acquisition of shares or assets of a company is ordinarily effected by an asset or share purchase agreement. Where the target is listed (ie, it is a Kuwait- incorporated company listed on Boursa Kuwait), the transaction may also be subject to the takeover regime under the CML and the CML Bylaws. There are three forms of merger provided for under the Companies Law and the CML Bylaws, as follows: • “amalgamation”, which is defined to entail the transfer of the entire business of one company (including all its assets and liabilities) to another; • “consolidation”, which is defined to entail the liqui - dation of two or more companies and the formation of a new company into which the merged compa - nies’ assets and liabilities are transferred; and • “division and amalgamation”, which is defined as the division of a company’s financial assets and liabilities into two parts or more and the transfer of each part into an existing company. The CML Bylaws also provide for various means of acquiring another company, and this primarily relates to voluntary and mandatory acquisitions. It is not uncommon for purchasers that are seeking to acquire a Kuwaiti listed company to adopt a creeping strategy until they come into possession of more than 30% of the voting shares of a listed company, whereafter man -
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