Minister of Justice: "Economic Circles" Law Enhances the Investment Environment
Justice Minister, Advisor Nasser Al-Sumeit, confirmed that the law establishing economic courts represents a qualitative leap in Kuwait’s economic justice system. This is achieved through the creation of specialized courts across all three levels of jurisdiction, the acceleration of dispute resolution, the development of enforcement procedures, and the expansion of e-litigation. These measures aim to enhance contract enforcement efficiency and raise confidence in the state’s legal and investment environment.
Speaking to KUNA on Wednesday, Advisor Al-Sumeit stated, “The law is based on the establishment of specialized economic courts at the Court of First Instance, the Court of Appeal, and the Court of Cassation. These courts have jurisdiction over the economic, commercial, and investment disputes specified by the law, assisted by a specialized technical office to support their work.”
He added that the law aims to expedite case resolution through a case preparation office responsible for completing documentation before cases are presented to the court, alongside regulating procedural and appeal deadlines to minimize the duration of disputes.
He pointed out that the law introduces a pre-litigation settlement and conciliation pathway, granting conciliation minutes the force of an executive document. This allows for the faster and less costly resolution of a portion of disputes.
He clarified that digital transformation is a core pillar of the law, implemented through the adoption of an electronic platform for litigation and enforcement procedures, an electronic case file, and a database of published judgments and legal principles.
He noted that the law places special emphasis on the enforcement of judgments by establishing a specialized enforcement administration, electronically linking it with relevant entities, developing attachment procedures, and adopting electronic auctions to ensure speed and effectiveness in enforcement.
The Justice Minister stressed that this law supports Kuwait’s competitiveness, enhances its attractiveness for investment, and consolidates the rule of law in economic disputes.
Below are the details:
**Economic Courts**
The law defines an economic dispute as any civil, commercial, or administrative dispute falling within the jurisdiction of the Economic Court according to the provisions of this law, whether jurisdiction is established based on the subject matter of the dispute, the law from which it arose, the decisions issued to implement or based on it, the status of the parties involved, or if jurisdiction extended to it. Administrative disputes concerning employee affairs and disputes involving workers are not considered economic disputes.
Activities regulated by laws falling under the jurisdiction of the Economic Court, as outlined in this law, are those that produce, trade, invest, finance, or provide services of a financial or commercial nature.
The law stipulates that the suspension of a financial transaction is a temporary precautionary measure issued by a judicial order, which temporarily prevents the debtor from conducting a specific transaction that would result in the transfer of ownership, reduction of the debtor’s financial liability, or the establishment of rights for third parties, for a specified period. This is without prejudice to obligations and rights stipulated by prevailing laws and without causing the suspension of an enforceable judicial ruling.
**Jurisdiction of the Economic Court**
The Economic Court has exclusive jurisdiction to adjudicate the following economic disputes:
* Disputes arising from the application of the provisions of Law No. 32 of 1968 concerning currency, the Central Bank of Kuwait, and the regulation of the banking profession.
* Disputes arising from the application of the provisions of Law No. 7 of 2010 concerning the establishment of the Capital Markets Authority and the regulation of securities activities.
* Reciprocal lawsuits between clients and banks or financial and commercial companies and institutions licensed by the Central Bank of Kuwait or the Capital Markets Authority, where the value exceeds 100,000 Kuwaiti Dinars.
* Disputes arising between partners, shareholders, or equity holders, or between any of them and the company, including requests for the dissolution and liquidation of the company and the accounting of its directors. This applies to joint-stock companies regardless of their capital, and to other commercial companies where the capital exceeds 100,000 Kuwaiti Dinars, as well as companies licensed by the Direct Investment Promotion Authority regardless of their capital. The provisions of this clause do not apply to non-licensed professional companies.
* Disputes concerning the investment of non-Kuwaiti capital in economic activities within the State of Kuwait.
* Disputes arising from oil contract agreements executed within the State of Kuwait.
* Disputes arising from the application of the provisions of Law No. 39 of 2010 establishing Kuwaiti joint-stock companies responsible for building and implementing power stations and water desalination plants in Kuwait.
* Disputes arising from the application of the provisions of Law No. 116 of 2013 concerning the promotion of direct investment.
* Disputes arising from the application of the provisions of Law No. 116 of 2014 concerning public-private partnerships.
* Disputes arising from the application of the provisions of Law No. 13 of 2015 approving the “Trademark System” law.
* Financial and contractual disputes arising from the implementation of contracts concluded in accordance with the provisions of Law No. 49 of 2016 concerning general tenders, where the value exceeds 100,000 Kuwaiti Dinars, excluding disputes related to tendering procedures, qualification, awarding, and complaints and appeals submitted to the competent authorities and the appeals committee stipulated in the aforementioned law.
* Disputes arising from the application of the provisions of Law No. 72 of 2020 concerning the protection of competition.
* Disputes arising from the application of the provisions of Law No. 118 of 2023 concerning the establishment of companies for the creation of cities or residential and economic development zones.
* Disputes concerning patents, trademarks, and industrial designs.
