ع
Economic expert and Kuwait Economic Society member Sultan Al-Jazzaf told Arab Times that the enactment of Commercial Concealment Law No. 78 of 2026 represents a critical transition from identifying economic problems to applying strict legislative solutions. Al-Jazzaf said the legislation will help build a stable competitive environment while improving Kuwait’s credit rating and attractiveness to investors compared with other regional economies. The expert framed the law as an essential element of the government’s wider financial and institutional reform program aimed at eliminating long-standing irregularities in the commercial sector. According to Al-Jazzaf the changes will restore confidence among legitimate investors and create opportunities for Kuwaiti professionals who have faced unfair competition from unlicensed operators.
Decree-Law No. 78 of 2026 published in the official gazette on August 9 prohibits any person from conducting economic activity without a proper license or by concealing the true operator in violation of ownership rules. The legislation imposes penalties of one to three years in prison and fines ranging from KD 10,000 to KD 100,000 or the equivalent of total illicit profits whichever is greater according to the decree-law text. Courts must also order confiscation of proceeds and equipment close offending establishments revoke licenses and deport convicted expatriates while protecting third-party rights. A separate provision doubles penalties for repeat offenses committed within five years of a final conviction.
The framework includes incentives for whistleblowers who can receive up to 10 percent of collected fines upon providing evidence that leads to conviction a Times Kuwait report on the legislation noted. Legal entities bear joint liability when violations occur in their name or for their benefit under the decree-law. Reconciliation remains possible before final judgment provided offenders pay at least half the maximum fine and correct their status but repeat violators are excluded from this option. The law applies across commercial investment industrial agricultural service and professional activities.
Al-Jazzaf called for comprehensive awareness campaigns to be launched in cooperation with the Kuwait Chamber of Commerce and Industry and civil society groups before the February 2027 implementation date. These initiatives should explain both the obligations and benefits of the law to ensure all stakeholders understand their positions he added in the Arab Times interview. The expert stressed that early education will smooth the transition and maximize the legislation’s positive effects on market transparency. Such campaigns align with parallel seminars hosted by the Fatwa and Legislation Department which opened its legal season with a panel examining the decree-law’s texts and applications according to Kuwait Times coverage.
Commercial concealment has allowed unlicensed operators often foreigners to run businesses behind Kuwaiti fronts circumventing foreign ownership caps set at 49 percent for many activities a pattern the new law explicitly targets. The decree-law defines concealment as enabling prohibited economic activity whether directly or through use of trade names and licenses. Government data reflected in multiple Arab Times reports indicate the practice has distorted competition and reduced revenue collection for years. Enforcement begins six months after publication providing businesses time to restructure arrangements.
The legislation forms part of efforts to align Kuwait’s regulatory environment with international standards while supporting national talent and legitimate enterprise. Al-Jazzaf noted that cleansing the market will open doors for serious local investors who previously competed on unequal terms. Industry assessments suggest the changes could reduce distortions that have affected sectors from retail to professional services. Officials have urged companies to review ownership and licensing structures ahead of the effective date.
