Law Permitting Foreign Participation in Kuwait
Shareholding Companies listed on the Stock Exchange
Law No. 20 for the Year 2000
The law seeks to give foreigners full participatory rights
at the Kuwait Stock Exchange by permitting ownership of shares in Kuwaiti
shareholding companies. The law allowing non-Kuwaitis to own shares, applies
to existing companies as well as to such companies that are to be established
after the operation of the law19.
A Kuwaiti shareholding company is a type of company recognized
under the Commercial Companies Law No. 15 of 1960. Under the present provisions,
foreign participation in such a company is expressly excluded20 in cases
where the shares of the company are listed on the Kuwait Stock Exchange.
Foreign participation upto 49% is permitted only for those companies (closely
held shareholding companies) whose shares are not listed on the stock exchange.
By virtue of this legislation, non-Kuwaitis shall be given rights to own
shares in any Kuwaiti shareholding company and to trade in securities listed
on the Kuwait Stock Exchange.
The Minister of Commerce and Industry, upon approval of
the Cabinet of Ministers, shall issue an order, regulating the acquisition
of shares by non-Kuwaitis including the maximum number of shares that may
be owned and the rights arising therefrom21.
The rules and regulations of the Kuwait Stock Exchange
regarding trading, settlement and setoff shall apply to the shares owned
by non-Kuwaitis in such companies that are listed on the stock exchange22.
19. Article 1, Law No. 20/2000
20. Article 68, Law No. 15/1960
21. Article 2, Law No. 20/2000
22. Article 3, Law No. 20/2000
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