Kuwait's New Arbitration Law... A Legislative Leap Enhancing Investor Confidence

Establishes a modern dispute resolution system and aligns with Gulf and international developments

Enhances Kuwait’s strength on the regional arbitration map

The law’s significance lies in unifying arbitration rules within a standalone statute

The new law enshrines fundamental, stable principles of international arbitration

Permits the use of modern communication means in managing proceedings

The UNCITRAL Model Law serves as a guiding legislative reference

A key message to the international business community that Kuwait is moving toward development

In a significant legislative step reflecting the State of Kuwait’s orientation toward modernizing its legal and investment environment, Law Decree No. 120 of 2026, issuing the Arbitration Law, was issued on October 13, 2026, and published in the Official Gazette on October 18, 2026. This marks a turning point in the regulation of commercial and investment arbitration, positioning Kuwait for a new phase of alignment with international standards and modern Gulf legislation.

The importance of the law lies in unifying the rules governing arbitration within a standalone statute, following their previous dispersion between the Civil and Commercial Procedures Law and Law No. 11 of 1995 concerning Judicial Arbitration. This enhances procedural clarity and legal certainty, which are among the most critical guarantees sought by both local and foreign investors.

Developments enhancing arbitration efficiency

The new law has enshrined fundamental, stable principles of international arbitration, most notably the separability of the arbitration agreement from the main contract, the competence-competence principle (the arbitral tribunal’s authority to rule on its own jurisdiction), and respect for the parties’ autonomy in selecting arbitrators, procedures, and the applicable law.

It also recognizes electronic arbitration agreements and permits the use of modern communication means in managing proceedings, holding hearings, exchanging documents, and using electronic signatures, granting these procedures legal validity.

Among the important new developments is the regulation of interim and conservatory measures by arbitrators prior to the formation of the arbitral tribunal, thereby enabling the protection of assets and urgent rights. The law also regulates the timelines for issuing awards, strengthens the confidentiality of proceedings, and obliges parties to disclose the sources of funding for arbitration costs to mitigate potential conflicts of interest.

The law dedicates provisions to regulating arbitration centers, licensing them, subjecting them to oversight, and setting controls for arbitration in state entity contracts, thereby achieving a balance between investment protection and safeguarding public funds.

Another notable feature is Article 79, which stipulates that the Court of Appeal shall adjudicate the merits of the dispute when ruling on the annulment of an arbitral award, subject to Article 78. This regulation aims to avoid wasting time and expenses.

Kuwaiti arbitration and the UNCITRAL Model Law

The new Kuwaiti law aligns closely with the principles underlying the UNCITRAL Model Law on International Commercial Arbitration (1985, as amended in 2006), particularly the separability of the arbitration agreement, party autonomy, competence-competence, procedural equality, interim measures, and judicial oversight of awards.

However, this alignment does not imply complete conformity. The Kuwaiti law includes specific national provisions regarding the regulation of arbitration centers, judicial arbitration, state contracts, confidentiality, and disclosure of funding. It also differs in certain judicial oversight mechanisms and annulment actions.

It is important to emphasize that the UNCITRAL Model Law serves as a guiding legislative reference rather than a binding international convention. Therefore, discrepancies between certain national provisions and the Model Law do not negate their compatibility with its fundamental principles.

Gulf arbitration laws… continuous legislative development

The Gulf Cooperation Council (GCC) countries have witnessed gradual development in their arbitration legislation.

In the Kingdom of Saudi Arabia, the Arbitration Law was issued by Royal Decree No. M/34 on April 16, 2012, serving as the effective legislative framework for the continued modernization of the judicial system and its affiliated institutions.

In the United Arab Emirates, Federal Law No. 6 of 2018 concerning Arbitration was issued, and subsequently amended by Federal Decree-Law No. 15 of 2023, reflecting the country’s commitment to developing its arbitration environment.

The Kingdom of Bahrain enacted Law No. 9 of 2015 concerning Arbitration, which is distinguished by its direct adoption of the revised UNCITRAL Model Law, making it one of the most internationally aligned legislative frameworks in the Gulf region.

In the State of Qatar, Law No. 2 of 2017 was issued, promulgating the Arbitration Law in Civil and Commercial Matters, based on modern principles of international arbitration.

In the Sultanate of Oman, the Arbitration Law was issued by Royal Decree No. 47 of 1997, and amended by Royal Decree No. 3 of 2007, with ongoing efforts to develop the legislative and institutional framework.

With the issuance of Law No. 120 of 2026, Kuwait has joined the Gulf legislative modernization trajectory through an independent law that combines international standards with national specificities.

Parallel institutional development in chambers of commerce arbitration centers

Gulf developments have not been limited to national laws but have extended to arbitration regulations of chambers of commerce and specialized centers.

In Kuwait, the Kuwait Center for Commercial Arbitration, affiliated with the Kuwait Chamber of Commerce and Industry, was established in 1999.

In Saudi Arabia, the Saudi Center for Commercial Arbitration stands out, having issued its new effective rules in May 2023, as a specialized national institution for managing commercial disputes. In the UAE, multiple arbitration institutions exist, including the Dubai International Arbitration Center with its 2022 rules, the Abu Dhabi International Centre for Arbitration with its 2024 rules, alongside the Sharjah International Commercial Arbitration Centre. In Bahrain, the Bahrain Chamber for Dispute Resolution operates under its updated 2022 arbitration rules, while the Qatar International Centre for Conciliation and Arbitration, affiliated with the Qatar Chamber, manages disputes under its updated effective rules since January 2025. Meanwhile, the Sultanate of Oman has witnessed institutional development through the Oman Center for Commercial Arbitration, which updated its rules in 2026 pursuant to Decision No. 3 of 2026, incorporating enhancements to expedited arbitration procedures, digitalization, and funding disclosure.

These developments underscore that Gulf competition in the field of arbitration now encompasses the quality of institutional rules and the efficiency of dispute management, alongside the modernization of national legislation.

The Gulf Arbitration Center toward a new system

In the context of the evolution of Gulf arbitration, the Gulf Cooperation Council (GCC) Commercial Arbitration Center holds particular significance. It was established by a decision of the Supreme Council of Heads of State of the GCC at its fourteenth session in Riyadh in 1993, and designated the Kingdom of Bahrain as its headquarters, serving as a joint GCC institution for resolving commercial disputes.

Based on my experience serving as Secretary-General of the Center since 2021, I have worked on reviewing and amending the legal framework governing the Center’s operations. This effort aims to update its provisions and develop its mechanisms to align with the transformations witnessed in international commercial arbitration, thereby enhancing its role in facilitating trade and investment among GCC member states. It is anticipated that the institutional process for issuing a new statute for the Center will be completed after its submission to the ministers of the GCC member states and the fulfillment of the approval procedures by the Supreme Council of Heads of State of the GCC.

This development represents a significant step toward refining the legal framework for joint Gulf arbitration and strengthening the center’s position as a regional institution capable of handling cross-border commercial and investment disputes.

Updating the center’s system in parallel with the evolution of national legislation will enhance Gulf legal integration and provide a more harmonious environment for investors and market participants in the Gulf Cooperation Council (GCC) countries.

Kuwait: From Legislative Reform to Confidence Building

The promulgation of Kuwait’s new Arbitration Law is not merely an addition to the legislative framework, but a step toward building a clearer investment environment capable of resolving disputes efficiently.

However, the success of this law will remain contingent upon the efficiency of its implementation, the independence of arbitration institutions, the specialization of the judiciary, the swift enforcement of awards, the qualification of arbitrators, and the development of rules and procedures. Investors seek not only promising economic opportunities, but also a legal system that enables them to anticipate risks, protect their rights, and resolve disputes through fair and effective means.

In this regard, Arbitration Law No. 120 of 2026 sends an important message to the international business community that Kuwait is advancing the development of its legal system to align with international standards, thereby enhancing its economic competitiveness and its standing in the Gulf arbitration landscape. Modern legislation lays the foundation for trust, but it is the efficient implementation of this trust that transforms it into sustainable investment and a firmly established economic position for the State of Kuwait, placing it among advanced countries in the fields of investment and international arbitration.