Company Registration in Kuwait

Low taxes and less trade barriers- are you looking for a similar destination to start your business? If so, Kuwait can be your ideal destination. Visit us today to know more about exciting business opportunities for your enterprise in Kuwait.

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Company Registration in Kuwait- Introduction

Kuwait is rich in natural resources. It is a global top ten oil exporter. Even though the economy is primarily oil-based, the national development plan New Kuwait Vision 2035 stresses economic diversification. Many reforms have been taken to climb to the 83rd spot from the 97th spot among 190 countries in the World Bank’s 2020 Doing Business Report. If you want to expand your business to Kuwait, reach out to us at Enterslice. We are a one-stop solution that provides end-to-end business setup and support services. We guide you in choosing the appropriate legal structure for the business. We also do financial planning and budgeting for the expansion and provide tax advisory services to optimise tax implications and ensure compliance.

An Overview of Company Registration in Kuwait

Kuwait is a country located in the Middle East. It is popularly known as the ‘State of Kuwait’. Kuwait shares its national borders with Iran and Saudi Arabia. Arabic is the official language of Kuwait. Kuwait is primarily under the control of migrants from other nations. The currency of Kuwait, “Kuwaiti dinar”, is a highly valued currency across the world. The company incorporation process in Kuwait is a bit cumbersome, but it is still considered a centre of commerce for many businesses. Oil and gas are significant factors contributing to the country's economic growth.

You can embrace your Company Formation in Kuwait by following these steps

1. Finding a Partner

It would be best if you had a partnership and support from Kuwaiti to get the fundamental licenses to work in the country. Enterslice will guide you and help you get a Kuwaiti Partner.

2. Business Set-up

Business set-up activities in Kuwait vary based on the industry and type of company. Enterslice can support you and help you apply for business setup.

3. License Registration

A need to obtain additional licenses may arise to start operating your business in Kuwait. Enterslice will guide you and help you get these licenses in Kuwait.

Eligibility Criteria for Company Incorporation in Kuwait

1. Minimum Shareholder

At least two shareholders are required for company registration in Kuwait. Out of the two shareholders, at least one shareholder must be a national of Kuwait.

2. Minimum Directors

At least two directors are required for company registration in Kuwait. There is no bar on the nationality of the director.

3. Foreign Ownership Restriction

Foreign ownership is permitted but only till 49%. A Kuwaiti or a GCC national must hold 51% ownership in the company.

4. Minimum Capital Requirement

The minimum paid-up capital for Kuwaiti JV LLC is Kuwaiti Dinar 1000.

Procedure to incorporate a company in Kuwait

1. Application

The applicant has to apply for company incorporation in Kuwait to the Ministry of Commerce and Investment (MOCI). The application should accompany information on shareholders and directors of the company. The Social Security and the applicant's identity are required as evidence as a local partner. Apart from this, a copy of the lease agreement should also be attached.

2. Necessary Paperation

These specific Documents will have to be submitted: i) A copy of the information related to the articles of association of the company, ii) A copy of the information related to the commercial license in Kuwait, iii) a Commercial register copy, iv) Passport details of the applicant if the applicant is a foreign national v) Copy of the resolution by the shareholder.

3. Fee

KD 300 is required to be paid by the applicant as an administrative and ministerial fee to the MOCI. The manager must be the director of the company and must be managing the office in Kuwait. For forming a company, premises must be leased out.

Upon completion of the online application, approvals are carried out by the ministry. Approvals include reserving the name of the company. The department requires the company to deposit its paid-up capital in the bank, which would be frozen for a particular period.

4. Memorandum of Association Submission

A MOA draft must be submitted to the Department of Companies. On approval of the MOA, the certificate of incorporation will be granted.

5. Application for Membership in the Chamber of Commerce

Once the certificate of incorporation is granted, the company must officially apply for Chamber of Commerce and Industry membership. Other than this, membership has to be used by the public authority for civil information. Once it is carried out, the company will be officially registered.

Qualities you will find in the Services provided by Enterslice

1. Client Focus

Enterslice puts great emphasis on client focus. We prioritise the needs and complaints of our clients when offering any business service.

2. Timeliness

Enterslice is particular about time management as it is vital on the road to personal success and even more critical in the management of any business. We attend to all client’s needs to surpass the agreed timelines.

3. Adaptability

Enterslice has a unique quality of adapting to different levels of management and business environments. We believe that the synchrony created by business services catapults an organisation to great success

Tax Structures of Companies Incorporated in Kuwait

Kuwait levies a corporate income tax of 15% on locally registered companies. However, there have been discussions and proposals to introduce a corporate tax in the future. Kuwait generally does not impose withholding tax on dividends, interest or royalties. Kuwait has not even implemented a value-added tax (VAT) system. But Kuwait imposes customs duties on certain imported goods. The rates may vary based on the types of goods and their origin. Knowing the applicable customs duties for your specific business activities is essential. Employers and employees must contribute to the Public Institution for Social Security (PIFSS) for social security purposes. The contributions are calculated depending on the employee’s salary, and these funds go towards providing social benefits. Kuwait has entered into Double Taxation Treaties with numerous countries to avoid double-income taxation. These treaties impact the taxation of certain types of income, and businesses should consider the implications when operating internationally.

Different Types of Business Structures in Kuwait

1. Kuwait Joint Venture LLC

This is one of the most preferred business structures. This form of entity requires at least one director of any nationality. The shareholding of this type of entity should be 51%, controlled by Kuwaiti shareholders. Foreign shareholders can own only 49% of the stake. Shareholders and directors enjoy limited liability. The minimum paid-up capital of this entity is KD 1000.

2. Wholly Owned Foreign Entity

The Kuwaiti Foreign Direct Investment Law allows 100% foreign ownership in this entity. However, consent and approvals are required from the Kuwaiti Direct Investment Promotion Agency (KDIPA) to form this type of entity. Registering this entity takes about 180 days. The minimum paid-up capital of this form of entity is between USD 70,000 to USD 1,40,000.

3. Kuwait LLP

LLP in Kuwait is another preferred business structure. In this type of entity, there are partners. At least one partner must be a local individual. This form of entity enjoys certain tax benefits. Annual Statements are required to be submitted by this entity.

4. Kuwait Free Zone Company

Free zones are tax-free zones. Customs and other duties would also not be imposed on companies that carry out activities in the free zone.

5. Kuwait Joint Stock Company

Kuwait Joint Stock Company is similar to public limited companies. They offer their shares in the public stock exchange. Foreign shareholding can be up to 49% unless the KDIPA grants an exemption. Registration with the Ministry of Commerce and Investment is required to form this entity.

6. Branch office/ Representative Office

If you wish to conduct business as a foreign company, then opening a branch or representative office in Kuwait would be proper. A branch or representative office is only an extension of a foreign parent company. The branch office has no liability; the parent company bears all the liability.

7. Commercial Agency Agreement

If limited capital is required to be invested in Kuwait, then choosing this type of structure would be appropriate. An investor going for company incorporation in Kuwait can consider this agreement with an agency, as the agency will oversee all the operations of representing the company in Kuwait.

Infrastructural facilities in Kuwait

Kuwait has invested significantly in developing its infrastructure facilities to support economic growth and enhance its residents' overall quality of life. It has an extensive road network and major highways connecting different country regions. The country has a public bus system, and plans for a metro rail system have been considered to improve public transportation. Kuwait International Airport is the leading international gateway. The airport has undergone expansion and improvements to accommodate increasing passenger traffic. Kuwait has several ports which handle cargo and facilitate trade. Kuwait has seen ongoing residential and commercial real estate developments to meet the growing demand. The country has invested in cultural centres, museums and recreational facilities.

Necessary Papers required for Company Incorporation in Kuwait

The Documents required for company incorporation in Kuwait are as follows: i) A copy of the Memorandum of Association of the company. ii) A company of information related to the articles of association of the company iii) Name Reservation Certificate iv) A copy of information related to the commercial license in Kuwait v) A copy of the commercial register vi) Passport details of the applicant if the applicant is a foreign individual vii) Copy of resolution taken by the shareholders about the company viii) Power of Attorney, if required. ix) Lease Agreement x) Commercial Registration Application xi) A certificate of registration from the Public Authority for Civil Information (PACI).

Benefits of working with Enterslice that you can’t miss

1. Highly Professional and Reliable Team

When dealing with professional services, having a professional and reliable team is essential for a smooth and successful experience, whether for company incorporation, compliance or other business-related services.

2. In-depth knowledge and understanding of local rules and regulations

Enterslice has a profound experience and knowledge of local rules and regulations in company incorporation, compliance, and business consulting.

3. Strong Connection with Kuwait Authorities

Enterslice has a strong connection with Kuwait authorities, which is a valuable asset for businesses operating in Kuwait. The connection facilitates smoother interactions, enhances regulatory compliance and contributes to positive relationships with relevant government agencies.

Benefits of Company Incorporation in Kuwait

1. Economic Stability

Kuwait has a relatively stable and prosperous economy, primarily driven by its significant oil reserves. The government’s focus on economic diversification has contributed to stability. Kuwait is one of the world’s leading oil producers and exporters. The economy mainly depends on oil reserves, providing the government with significant financial resources. The government’s revenue is primarily derived from oil exports, enabling it to invest in infrastructure, public services and various economic development projects.

2. Business-Friendly Environment

The Kuwaiti government has created a more business-friendly environment, including initiatives to streamline business processes and attract foreign investment. The Kuwait Direct Investment Promotion Authority (KDIPA) plays a crucial role in promoting and facilitating direct investments in the country. It aims to simplify investment procedures and enhance the overall business environment.

3. Political Stability

Kuwait has a history of political stability, which is essential for businesses seeking a secure operating environment. Kuwait operates under a constitutional monarchy with a parliamentary system. The Emir is the head of the state, and there is a constitution that outlines the political structure and principles. Kuwait has experienced transitions of leadership through peaceful means. Changes in leadership, including the appointment of a new Emir, have typically occurred without significant unrest.

Challenges of Incorporating a Company in Kuwait

1. Foreign Ownership Restrictions

There are restrictions on foreign ownership in specific sectors and certain forms of entity. Companies may need to consider these limitations when planning to establish a presence in Kuwait.

2. Bureaucracy and Administrative Processes

Kuwait has been working on streamlining administrative processes, but bureaucratic procedures can still be time-consuming. Navigating through various government offices for permits and approvals may pose challenges.

3. Dependent on Oil Reserves

Kuwait’s economy has been heavily reliant on oil reserves. Efforts are being taken to diversify the economy; the dependency on oil can expose businesses to the volatility of global oil prices.

4. Language Barrier

The official language of Kuwait is Arabic, and many official Documents and procedures are in Arabic. Differences in language can be a challenge for businesses that do not have Arabic-speaking staff.


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Company Incorporation Services provided by Enterslice

1. Decide the Business Structure

Enterslice will guide and support you in choosing the business structure you want to establish.

2. Reserve a Business Name

Enterslice will help you select a unique and appropriate name for your company. Ensure the proposed name complies with Kuwaiti naming conventions and is not already used.

3. Commercial Registration

Enterslice obtains a commercial registration certificate from the MOCI. This certificate is essential for conducting business in Kuwait.

4. Legal Advisory Services

Enterslice provides legal advice on business operations, finances, IP protection, etc.  We also ensure that all legal and regulatory compliance are duly complied with.

Oil and Gas Sectors in Kuwait

The oil and gas sectors are paramount to Kuwait’s economy as they are the primary drivers of revenue and economic development. Kuwait is one of the world’s leading oil-producing countries, and its energy industry is central to shaping the nation’s economic landscape. Kuwait is a member of the Organisation of Petroleum Exporting Countries (OPEC) and participates in efforts to manage global oil production levels. The Kuwait Petroleum Corporation (KPC) oversees oil explorations, production, and export activities. Kuwait has a well-developed oil refining industry. The country has refining facilities. The petrochemical industry is closely linked to Kuwait's oil and gas sectors.

Our Commitment to Excellence

1. Quality Service

At Enterslice, we are committed to providing our clients with top-notch services, ensuring that their business needs are met with precision and accuracy. Our team of dedicated professionals go above and beyond to deliver exceptional results.

2. Client Satisfaction

Your satisfaction is our priority. We aim to meet your expectations by understanding your needs, addressing your concerns and providing personalised solutions. We value your trust and work tirelessly to ensure your complete satisfaction.

3. Continuous Improvement

We believe in constantly evolving and improving our services to stay ahead of the curve. Our team is committed to staying up-to-date with the recent industry trends and best practices to provide innovative solutions that drive success.

The robust and respected banking system

Kuwait boasts a strong and well-respected banking system that is crucial to the country’s economic development. The Central Bank of Kuwait is a regulatory and supervisory authority overseeing the banking and financial sector. The Central Bank of Kuwait plays a crucial role in maintaining the country's monetary stability and financial integrity. Kuwait’s banking sector operates within a robust regulatory framework established by the Central Bank of Kuwait. Regulations are designed to ensure the stability and integrity of the financial system while promoting fair competition. Kuwait’s banking sector has demonstrated resilience and strength, even in the face of global economic challenges.

Direct Investment Promotion Law

Kuwait has a framework for promoting and regulating direct investment through the Kuwait Direct Investment Promotion Authority (KDIPA). The legal foundation for foreign direct investment in Kuwait is primarily established by the Foreign Direct Investment Law, which was enacted to encourage investment and support economic diversification efforts. The law aims to simplify procedures, provide incentives, and create a more favourable environment for both local and foreign investors.

Frequently Asked Questions

A foreigner must have a Kuwaiti partner with 51% shareholding if he wants to open a company in Kuwait.

A company in Kuwait must be set up by fulfilling the following

i) It must be between two or more persons.

ii) Partners must have a clear criminal record and no conviction record.

iii) The share of the non-Kuwaiti partner must be limited to 49%.

iv) Foreign partners must have a valid residency visa.

v) The managing partner must not be a government employee.

15% is the corporate tax rate in Kuwait.

Indian passport holders who apply for a Kuwait Business visa can do business in Kuwait.

Yes, Kuwait is a tax-free country with no income tax.

Dubai is better as it is more developed than Kuwait.

Kuwait is a safe country, but in recent times, there has been an increased risk of terrorism, including threats against military bases.

The official language in Kuwait is Arabic.

For a family of four, the estimated monthly costs are 934.5 KD.

Petroleum is Kuwait's most successful business, providing for nearly half of Kuwait's GDP.

We partner with more than 100+ companies

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