Saturday , November 18 2017

DBA insurance mandatory for all cos doing business with US govt

With it being Discover America Week (A series of events hosted by the US Embassy, which highlight the close relationship between the USA and Kuwait), I felt compelled to discuss an American law that is applicable here in Kuwait.

Defense Base Act (DBA). I know what many of you are thinking. Yes, an Act is a Law, which informs the public of rules and regulations about specific situations. In this case, the Defense Base Act focuses on US Defense Bases throughout the world.

Established in 1941, with the primary goal of protecting workers on military bases outside the United States by providing compensation for injury, disability or death to persons employed under a contract entered into with the US. Thus, the majority of contracts with the US government in connection with the procurement of commodities, services and construction, require Defense Base Act coverage.

This requirement is very important for companies and individuals conducting business or looking to conduct business with the United States Military in the State of Kuwait. Many believe they are not subject to US laws because the work is performed on foreign soil and/or the contracting company is not an American entity. This is the furthest from the truth because the Defense Base Act applies to any and all parties performing services regardless if the base is outside of American borders.

According to the US government, DBA insurance is mandatory for all services, construction, and supply contracts that include installation, maintenance, or training on a US government installation or facility. Bidders should be made aware that although DBA insurance is mandatory, the government does not evaluate the DBA estimate during source selection, and the DBA coverage is covered by the contract amount. This should incentivize bidders knowing liability will be limited in the case of injury, disability or death to any of their workers while fulfilling contracts.  In addition to the DBA, companies in Kuwait should take initiative to become informed about any foreign laws, that could apply to their business operations.

najmahbrown@aladwanilawfirm.com

By Najmah Mateese Brown, Esq.

 

 

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