After long years of education and hard work you found yourself filled with great ideas but have no clue on how to make them into reality? One thing is to know everything you can in your field of expertise. But another when it comes to bothering with bureaucracy and laws of the country you are living. Not to mention planning on moving to another one. Reading this article you are probably searching for some insights into a corporate side of Kuwait. Its pros and cons of starting any business there and what to do. Throughout this text, we will provide you with all the basic necessary information you will need for startups in Kuwait. Whether you are a foreigner or a Kuwaiti, this guide will surely help you.
Useful information for newcomers
Although you probably know the basics it will not hurt to get more information regarding rules and legislation of Kuwait. As a foreigner, If you are thinking about relocating to Kuwait and starting a business there, then there are several major considerations you should make:
- As with any well-regulated economy, there are certain things you must provide to Ministry of Commerce before you get a business license. For example, after registering your company, you must provide the Ministry of Commerce with a proof that you possess enough investing money. The amount can vary, depending on the states. It usually goes somewhere from 10,000$ to 50,000$, the latter one is more common. They are considered as guarantees against liabilities. Of course, you can withdraw that money shortly after.
- The corporate side of Kuwait protects itself from frauds, harms, and misuses by restricting foreign business owners from their majority hold of the company. The corporate law requires you to have a Kuwaiti partner. That way Kuwait makes sure that the investments are being used properly and that no wrongdoings will happen. The government can even help you in your decision to relocate your business to Kuwait. Either by partly funding it or providing you with the best business movers Kuwait can offer.
- To work in any sector in Kuwait, you are obliged to have a substantial knowledge of the region. Researching business sector you will work with, having viable business plans, studying the market conditions. All that is necessary for successful business operation. One thing is also good to know. Having a credible plan cannot only attract local support but mostly government as well.
Types of businesses corporate side of Kuwait offers
As we mentioned before, you need to know what kind of business you are establishing in Kuwait. There are five legal entities. You can base your new company on one of them. Making sure you are well prepared before starting is very important! As for legal entities, these are the ones you should consider before opening a company:
- A limited liability company, or simply WLL (With Limited Liability), is the most basic form of company in Kuwait. It is easiest to form and its the most common one. There are rules though, you can’t do business in banking or insurance sector, nor can you have a majority in holding as a foreigner.
- A limited liability partnership is different than WLL. You can establish a business with either general partners or limited liability partners.
- Branch office – offers a company a possibility to circumvent the need for a partner. Note that corporate side of Kuwait and its laws prevent foreigners from opening branch offices unless they receive special permissions. When opening a branch office be sure to find the best Kuwait moving companies that can help you in relocating your office.
- A joint stock company – you can trade with the shares publicly. There is also an option where you do not offer the shares to the public. As mentioned before, the same law abides here. Foreigners can hold up to 49% of the company shares.
- Agreement with a local commercial agent – another way of doing business in Kuwait if you do not want to open a company there. They will do business in your name, import and distribute your products around the state. They either work for a fixed pay or percentage.
Legal obligations and registering your company
We mentioned what kind of companies and business you can start in Kuwait as a foreigner. When it comes to legal issues and company registering you will find that there are some benefits and bigger obligations you must accept as a foreign businessman. The corporate side of Kuwait is well structured and protective towards domestic entrepreneur. You will most likely have to use western/Arab joint firm. Before entering the economic market seek some of the advice provided to you by Arab – British Chamber of Commerce, Middle East Association, the DTI, and your Embassy. They can even give you useful information on Kuwait transportation guidelines that can help you in your starting up.
Foreign workers and business etiquette
Welle educated westerners work in their fields of expertise. In other cases, they wouldn’t be hired. Your educational background is checked very well and mostly hired as some senior worker. New workers are hired from third world countries and they do not take managing positions. As a future expat worker in Kuwait, show patience and always ask for pieces of advice. It is common etiquette in Kuwaiti culture to show that you are grateful and not aggressive. In a manner that you do not push it when it comes to negotiations. That can be a valuable thing when negotiating with moving companies. They are all done by tea and small talks. Kuwaiti people like to get to know someone better before doing business with them.
If you ever find yourself in a position to open a new company or some joint firm in Kuwait, then we hope this article helped you in making the first steps. You will find that corporate side of Kuwait is very giving towards those with good qualifications and great ideas for future businesses. If you are already working as a foreigner in Kuwait, share with us your thoughts and bits of advice. We are more than eager to hear from you!