KUWAIT Law and Practice Contributed by: Alex Saleh, Asad Ahmad, Khaled Al Makhezeem and Liana Rashid, GLA & Company
its level of investigative activity, including, in one case, fining a steel distribution company KWD250,000. This was equivalent to 1% of the company’s total revenues achieved during the fiscal year 2020/2021 and was imposed for the company’s non-compliance with the Kuwait CPA’s requests and persistent failure to provide the data and information requested for more than one month. In addition, the Kuwait CPA published a sanction on 30 March 2023 fining various food associations for abusing their domi - nant position. The authors are aware of a local company that submitted their filing with inaccurate information, and that, as a result, the Kuwait CPA overseeing the matter appropriately disregarded the erro - neous submission and directed the company to resubmit their filing with accurate informa - tion. This resulted in a major delay in obtaining clearance from the Kuwait CPA. The firm was engaged following the misfiling by another law firm in Kuwait and assisted the non-compliant company with making an appropriate filing with the Kuwait CPA. Through the firm’s relationship with the CPA, they are aware of instances where the CPA has sent out inquiry letters to companies outside of Kuwait, with no local presences, for potential gun jumping investigations. While these sanctions are not specifically related to merger control, they serve as evidence of the Kuwait CPA’s proactive approach to identifying violations and imposing penalties. 2.3 Types of Transactions The following types of transaction are con - sidered an economic concentration under the Kuwait Competition Law.
• The merger of two or more persons by amal - gamation or by a combination or merger of parts of persons, resulting in acquiring control or acquiring more control (see 2.4 Definition of “Control” ). • The acquisition, by one or more persons, or direct or indirect control over the entire or parts of another, person or persons, whether by acquisition of any assets, property rights or usufructs by purchase of shares or liabili - ties or by any other means. • The joint venture of two or more persons, resulting in performing, on a lasting basis, an autonomous economic or commercial activity, regardless of its legal form or the activity to be practised. 2.4 Definition of “Control” Article 1 of the Kuwait Competition Law defines control as “the legal or contractual relation - ship which, either separately or in combination, results in exercising decisive influence”. 2.5 Jurisdictional Thresholds Article 3 of the Kuwait Competition Law applies to acts committed inside or outside the State of Kuwait whenever these acts prevent, restrict or distort free competition in the State of Kuwait. Under Resolution No 26 of 2021, the current jurisdictional thresholds are as follows. • Where one of the parties to the concentration achieves annual sales in Kuwait exceeding KWD500,000, according to the audited finan - cial statements of the last fiscal year before the concentration. • Where the parties to the concentration collec - tively achieve aggregate annual sales exceed - ing KWD750,000, according to the audited financial statements of the last fiscal year before the concentration.
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