Kuwait Tightens Crackdown on Commercial Concealment

Kuwait has issued a new decree-law with stricter penalties to fight commercial concealment. The law includes prison terms, heavier fines, business closures and other measures to improve transparency and regulate economic activity.

Decree-Law No. 78 of 2026 was published in the official gazette Kuwait Al Youm last Sunday. It will take effect six months after publication.

The new law aims to create a more organised business environment, support fair competition and stop people or companies from carrying out commercial activities without the required licences. It also targets cases where the real owner of a business is hidden in violation of the law.

Under the law, individuals and legal entities are not allowed to carry out economic activities alone or with others without the proper licences. They also cannot operate beyond the scope of those licences.

The law also bans helping or allowing others to carry out unlicensed commercial activity, whether directly or indirectly.

Violators can face prison from one to three years and fines from 10,000 Kuwaiti dinars ($32,500) to 100,000 dinars ($325,000), or an amount equal to the illegal profits, whichever is higher. The fines may increase depending on the number of offenders or violations.

The decree also makes the beneficial owner of a company responsible if they knew about the offence or failed in their management duties.

Courts must order the confiscation of assets and profits gained from commercial concealment. They must also revoke business licences, close the businesses involved and deport expatriates convicted under the law, while protecting the rights of good-faith third parties.

Repeat offenders who commit commercial concealment within five years of a final conviction will face double penalties.

The law also allows settlement before a final court ruling, if the offender pays at least half of the maximum fine and corrects their legal status. However, repeat offenders are not eligible for settlement.

To encourage public reporting, the law offers financial rewards of up to 10 per cent of the fines collected for people who provide credible information that leads to the detection and conviction of commercial concealment offences.

It also gives designated officials judicial enforcement powers. Anyone who blocks inspections or gives false information to investigators can face up to six months in prison and fines of up to 10,000 dinars.