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Business from home

I have noticed that a lot of people are doing business from their homes: like cooking and selling food to others, stitching clothes, renting wedding dresses, mini markets etc. They are also advertising the same in newspapers or on the Internet. Is this legal? If it is not, what is the punishment according to the law? If it is legal, to what extent is it permissible to do such businesses? Can I set up a mall for example?

Name withheld
Answer:
A lot of people are doing business without permission from home but all of this is illegal ... you could be arrested, fined or sent to jail and even deported. You need to have government permission for involvement in any kind of business, regardless of where you operate from.

All the small shops, tuition centers, summer schools, tailor shops, or any other businesses run from homes are totally illegal. Yes, people do also advertise these businesses but even these advertisements are illegal as a commercial license has to be provided before these advertisements can be placed.

Normally, the Kuwait Municipality and the Ministry of Commerce - which are supposed to check such activity ignores such small violations until it receives orders to stamp them out but “tolerance” of such activity doesn’t make it legal. The following is the procedure to start a business in Kuwait:

1. File an application with the Department of Partnerships (DOP) at the Ministry of Commerce (MOC) to set up the company, obtain background clearance.

2. Pick a name for the company and file an application with the Commercial Register.

3. Retrieve from the Department of Partnerships the notes addressed to the bank and to the municipality.

4. Deposit the legally required initial capital in a bank and obtain deposit evidence.

5. The Municipality inspects the company’s premises and issues a certificate.

6. Obtain a memorandum of association form from the Department of Partnership.

7. Sign and notarize the memorandum of association before a public notary.

8. Obtain from the Department of Partnerships a license to start activity.

9. Register with the Commercial Registry.

10. Register with the Kuwait Chamber of Commerce and Industry.

11. Register with the Civil Data Department.

12. Open a company’s labor file at the Ministry of Labor and Social Affairs.

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