Brief Overview of the Kuwaiti Arbitration System

The arbitration system in the State of Kuwait is one of the most important pillars underpinning the economic and business environment, enabling the swift and flexible resolution of disputes.

The Kuwaiti legal system is characterized by two main arbitration tracks: judicial (formal) arbitration, which is subject to state supervision, and voluntary (ordinary) arbitration, which is freely agreed upon by the parties.

First: The Legislative Framework for Arbitration in Kuwait

Arbitration rules in Kuwait derive their authority from two primary sources:

1. The Code of Civil and Commercial Procedure (Law No. 38 of 1980)

This law governs voluntary arbitration in Articles 173 to 188. It grants contracting parties the freedom to agree to refer their disputes to arbitration instead of ordinary courts, either through a prior agreement in the contract (an arbitration clause) or through a subsequent agreement after the dispute arises (an arbitration agreement).

2. The Law on Judicial Arbitration in Civil and Commercial Matters (Law No. 11 of 1995)

This law establishes a unique system that combines the flexibility of arbitration with the safeguards of ordinary courts.

Judicial arbitration panels are formed by decision of the Minister of Justice, chaired by a judge from the court, with two arbitrators selected as members.

This type of arbitration is competent to handle disputes that the parties agree to refer to it, or disputes relating to contracts concluded by government entities or state-owned companies when the value exceeds a certain threshold.

Second: The Basic Principles of Kuwaiti Arbitration Law

Writing as an Essential Requirement: Kuwaiti law requires that an arbitration agreement be in writing to be valid; otherwise, it is null and void.

Independence of the Arbitration Clause: The arbitration clause is considered an independent agreement separate from the main contract. The invalidity or termination of the underlying contract does not automatically render the arbitration clause invalid.

Legal Capacity: An arbitration agreement may only be entered into by those who have the legal authority to dispose of the rights in dispute.

Excluded Matters: Arbitration is not permitted in matters where settlement is not allowed (such as criminal cases, matters of lineage, personal status issues, and public order).

Waleed Abdullah Al-Anzi

College of Business Studies, Law Major