The Direct Investment Promotion Authority aims to attract, attract and encourage foreign and local direct investment in Kuwait, by developing and improving the investment environment, facilitating procedures, removing obstacles in front of investors, providing ways of support and various facilities, and working to encourage partnerships that achieve development goals between the Kuwaiti investor and the foreign investor.
Direct investment concept
It is the investment that is made by employing the investor alone or with the participation of another investor in the capital directly in an investment entity inside Kuwait.
Issuance of a direct investment license
Applying for a license for direct investment through a specific investment entity shall be in accordance with the following cases:
- A Kuwaiti company is among the types of companies stipulated in the Companies Law, which are established for the purpose of direct investment, and the foreign investor’s share may reach 100% of the capital of a joint-stock company, a limited liability company, or a one-person company.
- A branch of a foreign company licensed to operate within the State of Kuwait for the purpose of direct investment
- A representative office whose objective is limited to studying the markets and the possibility of production, without practicing a commercial activity or the activity of commercial agents
The Board of Directors of the Direct Investment Promotion Authority sets the foundations and rules for licensing all investment entities. The Authority also sets forms for requests for transactions within its competence, receives applications and documents submitted by the investor, and delivers to the applicant a receipt proving the acceptance of his application for study.
Requirements for licensing applications
License request
The license application must include the information and documents required by the competent authorities, and they must be valid, and the investor should indicate the timetable for starting the procedures and preparatory works that precede the start of operation in the investment entity.
Conditions for accepting the license application to establish a Kuwaiti company
In order to accept the license application to establish a Kuwaiti company, it must be accompanied by a preliminary study that includes the following:
- The type of activity or project proposed to be undertaken
- The legal form of the company to be licensed
- Investment size
- Structure and sources of financing
- Economic and Environmental Impact
- Investor experience and capabilities
- The investment entity’s needs for national and foreign labor, land areas, raw materials and commodity requirements and the sources of their provision
- Estimated amount of water and energy needed annually
- The data or clarification requested by the Authority, prior to or subsequent to the submission of the application
Conditions for accepting a license application for a branch of a foreign company
An application for licensing a branch of a foreign company must include a preliminary study that includes the same data and conditions required for the establishment of a Kuwaiti company, in addition to an approved copy of the company’s articles of incorporation, articles of association, and its last audited balance sheet, indicating that it is still existing and carrying out its activities.
Conditions for accepting the license application to establish a representative office
An application for licensing a representative office must be accompanied by a statement that includes the following:
- The goal of establishing a representative office
- A certified copy of the foreign company’s memorandum of association and articles of association, its last audited balance sheet, and evidence that it is still existing and operating
- The data or clarification requested by the Authority, prior to or subsequent to the submission of the application
Deciding on applications for a direct investment license
The decision to decide on the license application is issued by a decision from the Director General of the Direct Investment Promotion Authority, within thirty days from the date of submitting the application. In the event that the Authority approves the license application, the procedures for establishing the investment entity and issuing the commercial license will be started.
The investment entity obtaining the license
The investment entity must, within one year from the date of issuance of the license, obtain the necessary approvals to start implementation, and the Director General may agree to grant the investor an additional period if he shows acceptable reasons, provided that this period does not exceed an additional year. The Board of the Investment Promotion Authority may also grant him another period of time to exceed the additional period granted by the Director General, and the investor must notify the Authority of the date of actual operation within thirty days from that date.
Appeal against the decision to reject the direct investment license application
In the event that the Direct Investment Promotion Authority rejects the license application, its rejection decision must be in writing and reasoned. The applicant has the right to appeal the rejection decision, as the lapse of thirty days from the date of receiving the grievance application officially without a response to it is considered a decision rejecting it.