Cabinet: Facilitating Company Establishment

The Cabinet approved, during its meeting today, a draft law decree amending certain provisions of the Companies Law issued by Law No. 1 of 2016, with the aim of facilitating company establishment and enhancing confidence in dealing with them, in line with the state’s direction toward a more flexible and transparent business environment.

Sharida Al-Muwasharji, Deputy Prime Minister and Minister of State for Cabinet Affairs, said in a statement that this came during the Council’s meeting held in the conference room of the administrative building in the third phase of Martyr’s Park.

He clarified that the aforementioned draft law decree exempts the documentation requirement for all legal procedures and actions related to companies from their establishment throughout their existence and for any amendments to their contracts and articles of association. Instead, it suffices to have them written and signed by the partners or their representatives. Registration in the Commercial Register is treated as the act of authentication, which renders the company contract, its amendments, and the resolutions of its Extraordinary General Assembly enforceable against third parties. The “closed company” (Mahaseh) status was abolished, as it is not subject to registration or publication.

He added that the draft law decree permits freelancers to establish a professional company with a single person. It also includes transitional provisions granting existing offices and companies a one-year period to regularize their status, while preserving the validity of contracts and companies established prior to the law’s implementation.

He noted that the Cabinet has submitted the draft law decree amending certain provisions of the Companies Law issued by Law No. 1 of 2016 to His Highness the Amir, Sheikh Meshal Al-Ahmad Al-Jaber Al-Sabah.

The Cabinet also approved a draft law decree amending Article 3 of Law No. 5 of 1982 concerning the establishment of the Bait Al-Zakat, which includes reconstituting its board of directors and reducing its membership from 12 to 7 members.

Al-Muwasharji stated in a statement that the amendment aims to create a more flexible and effective board of directors for Bait Al-Zakat. The board will be chaired by the Minister of Awqaf and Islamic Affairs, with the General Director of Bait Al-Zakat serving as Deputy Chairman, and including as members the Undersecretary of the Ministry of Awqaf and Islamic Affairs, the Undersecretary of the Ministry of Social Affairs, Family and Childhood, the Undersecretary of the Ministry of Finance, the Secretary-General of the General Secretariat of Awqaf, and the General Director of the Public Authority for Affairs of the Court.

He noted that the Cabinet has submitted the draft law decree to His Highness the Amir, Sheikh Meshal Al-Ahmad Al-Jaber Al-Sabah.