KUWAIT Law and Practice Contributed by: Ezekiel Tuma, John Cunha and Luis Cunha, ASAR – Al Ruwayeh & Partners
directly and without a Kuwaiti agent/partner (under the amended Article 31 of the Tenders Law). While foreign parties should now generally be able to establish a branch in Kuwait under the Amend - ment Law through which they can conduct their business affairs, the MOCI is not currently applying these changes and will only begin to do so once new implementing regulations have been issued which give effect to these amendments. As of writing hereof, these implementing regulations remain outstanding. There have also been developments regarding the ownership of land. In this regard, Decree Law No. 7 of 2025 was issued, which amended Decree Law No. 74 of 1979. Amongst other things, the amendments permit listed companies with non-Kuwaiti sharehold - ers, as well as Kuwait licensed real estate funds and investment portfolios, to own real estate. The amend - ments also permit companies licensed by the Kuwait Direct Investment Promotion Authority (which could include companies wholly owned by foreigners) to own real estate properties required for the manage - ment of their operations or the housing of their staff. Prior to these amendments, only companies wholly owned by Kuwait or GCC nationals could legally own real estate. These amendments pave the way for for - eigners to make indirect investments in Kuwait real estate, which marks a significant and potentially posi - tive shift in the regulation of real estate ownership in Kuwait. Significantly, Kuwait is also in the process of reforming its tax laws. As an initial step in this process, the Law of Taxation on Multinational Entities No. 157 of 2024 (“MNE Tax Law”) was issued on 30 December 2024 pursuant to the global “base erosion and profit shift - ing” (BEPS) initiatives and the OECD Pillar II Model Rules; implementing regulations were since also issued on 29 June 2025. Under the MNE Tax Law, and subject to certain exemptions/qualifications, multina - tional entities operating in Kuwait which form part of a group which generates annual revenues of EUR750 million or more are subject to a tax of 15% on their Kuwaiti profits. It is noteworthy that this is not in addi - tion to the existing income tax obligations imposed on foreign parties; rather, the MNE Tax Law seeks to
ensure that such multinational groups pay tax on their Kuwaiti income at an effective rate of 15%. The CMA recently passed Resolution No. 108 of 2026 regarding the Launch of the Regulatory Environment for the Emerging Companies Market in the Exchange. The initiative introduces a new market segment aimed at supporting the capital-raising needs of smaller and emerging businesses. This development seeks to address fundraising difficulties that were being expe - rienced by smaller and emerging companies (includ - ing start-ups) and sets up a tailored platform that will enable such businesses to raise capital under a regu - latory framework designed to balance flexibility with investor protection. In what marks a significant step to formalising Kuwait’s online marketplace, Kuwait has approved a new Digi - tal Commerce Law on 1 March 2026. The Law will enter into force one month after the publication of its Executive Regulations, which are to be issued within one year from the publication date of the Law. This Law introduces a comprehensive framework govern - ing commercial activities conducted through web - sites, digital platforms, applications and social media channels impacting online sellers, digital platforms and social media merchants (which include registra - tion, licensing, management and ongoing reporting requirements). This Law also seeks to implement pro - visions which would, amongst other things, impact on revenue stability and valuation; for example, man - datory payment and cooling-off periods are being provided for, and strict return and refund policies are being imposed, creating possible volatility in reported and future earnings. The introduction of the Digital Commerce Law may necessitate a shift in the scope of legal due diligence and valuation modelling for transactions involving targets with a digital footprint. 3.2 Significant Changes to Takeover Law Save for the establishment of a branch and the pos - sible ownership of land by a foreign party as set out in 3.1 Significant Court Decisions or Legal Devel - opments , there have been no significant changes to takeover law in the past 12 months.
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