Kuwait Overhauls Business Landscape: Local Agent Requirement Dropped for Foreign Companies

These reforms underscore Kuwait's commitment to building a diversified and inclusive economy.

Kuwait Overhauls Business Landscape: Local Agent Requirement Dropped for Foreign Companies

Kuwait’s Parliament has passed a transformative law, opening the doors wide for foreign companies to establish branches and operate within the country without the longstanding necessity of a local agent, according to media reports.

The amendment, which garnered overwhelming support with 57 votes in favor and only one against during Tuesday’s session, marks a significant departure from the previous regulations set in 1980.

Before this pivotal amendment, foreign companies were bound to conduct their operations in Kuwait through a local agent, and non-Kuwaitis faced restrictions in trade unless they partnered with a Kuwaiti holding a minimum share of 51 percent.

Removing these barriers signals a major shift in Kuwait’s approach to foreign business engagement.

With this move, the Parliament also revised the Public Tenders Law, ushering in a new era where non-Kuwaiti entities can actively participate in public tenders. 

The modification abolishes the authority of government agencies to limit competition exclusively to Kuwaitis, aligning Kuwait with its GCC counterparts—UAE, Saudi Arabia, and Qatar—that have already eased the local agent requirement for foreign firms.

Kuwait, traditionally reliant on oil revenues as an OPEC member, is strategically embracing economic liberalization measures to diversify its economy and reduce dependency on oil. 

The amendments not only present a more open and inclusive environment for foreign companies but also aim to foster increased participation of Kuwaiti citizens in the private sector.

While Kuwait had previously allowed select foreign companies, under specific conditions and through the Direct Investment Promotion Authority, to operate without a local agent, the recent legislative changes marked a more inclusive approach. 

These reforms underscore Kuwait’s commitment to building a diversified and inclusive economy, positioning itself as a more attractive destination for global businesses.

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