KUWAIT Law and Practice Contributed by: Alex Saleh, Asad Ahmad, Khaled Al Makhezeem and Liana Rashid, GLA & Company
3.2 Type of Agreement Required Prior to Notification No binding agreement is required before noti - fication. It is sufficient for parties to file on the basis of a less formal agreement such as a let - ter of intent, memorandum of understanding or good faith intent by the parties to reach an agreement. 3.3 Filing Fees There are filing fees and applications must be accompanied by a receipt of payment of a fee equal to the lesser of: • one-tenth (0.1%) of the paid-up capital of both parties to the economic concentration; or • of the combined assets of both parties in Kuwait, whichever is less and not exceeding KWD100,000. It is worth noting the filing fees cannot be zero. 3.4 Parties Responsible for Filing Persons directly involved in the economic con - centration have to submit the application to the Kuwait CPA. These are typically the parties to the transaction agreement. Legal counsels usu - ally handle the filing procedures on behalf of their clients through the use of powers of attorney. 3.5 Information Included in a Filing An application requires a considerable amount of information and detail on the entities involved in the transaction and the subsequent financial consequences. An application requires the fol - lowing information to be included (to the extent it is available and appropriate). • An asset appraiser report provided that it belongs to one of the auditing offices approved by the CMA, with the relevant pay -
Law. Unfortunately, specific consequences for implementing a concentration before an approv - al from the Kuwait CPA, where an application is required, are not stated in the Kuwait Competi - tion Law. The Kuwait CPA may order the unwind - ing of a transaction for failing to comply with the procedures stipulated in the Kuwait Competition Law. The authors witnessed a situation in which a company that should have filed an application nonetheless proceeded to fulfil the comple - tion obligations outlined under the transaction agreement, specifically regarding the transfer of shares, without filing with the Kuwait CPA. The Kuwait CPA became aware of this, and, as a consequence, that company is likely to be fined between 1% to 10% of its annual turnover. The matter is being referred to the disciplinary board of the Kuwait CPA for their deliberation. 2.14 Exceptions to Suspensive Effect Unfortunately, there are no reliable sources of publicly available information on this issue. 2.15 Circumstances Where Implementation Before Clearance Is Permitted While possible, the circumstances where the authorities will permit closing before clearance are not specifically laid out in the Kuwait Com - petition Law.
3. Procedure: Notification to Clearance 3.1 Deadlines for Notification
An application must be filed at least 60 days from the date of the contract or agreement regarding the transaction.
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