Running an Illegal Business in Kuwait? Jail, Heavy Fines and Deportation Could Follow

It prohibits engaging in commercial activities without obtaining a license or concealing individuals engaged in economic activities in violation of the law. It prohibits a natural or legal person from engaging in economic activity for their own account or in partnership with others without obtaining a license or exceeding the scope of the granted license. It prohibits enabling any person to engage in economic activity in violation of the law, whether directly or indirectly.

Article Three stipulates a prison sentence of not less than one year and not more than three years, and a fine ranging from KD10,000 to KD100,000, or the equivalent of the total profits obtained, whichever is higher, or one of these two penalties. Fines are multiplied according to the number of violators or the number of violating activities.

Article Five holds the de facto owner of the legal entity liable if it is proven that they were aware of the violation or that it occurred as a result of their breach of administrative duties. It also states that the legal entity is jointly liable with its employees when the violation is committed in its name or for its benefit.

Article Six obligates the court, upon conviction of those involved, to order the confiscation of funds and profits obtained from the commercial concealment offense, in addition to closing the establishment, revoking the license, and deporting the expatriates involved, while respecting the rights of bona fide third parties.It increases the penalty in the event of a repeat offense of commercial concealment within five years of the date of the final conviction.

Article Seven stipulates doubling the prescribed penalty, in a step aimed at strengthening deterrence and preventing the recurrence of violations. It allows reconciliation in the crimes stipulated in the law, subject to certain regulations, before or during legal proceedings and before the final judgment is issued. This reconciliation is contingent upon payment of at least half the maximum fine, and the offender is required to remove the violation and correct the legal status. Reconciliation is not permitted for repeat offenses.

Article Nine allocates a financial reward to whoever contributes, other than the perpetrator, to uncovering and reporting a commercial concealment crime. This reward is capped at 10 percent of the total fines collected, provided that credible evidence is presented and a final conviction ruling is issued. The law grants judicial police powers to employees designated by the concerned minister. It prohibits obstructing the work of judicial officers, such as preventing them from conducting inspections and oversight, refusing to provide the required documents and information or providing misleading information. It stipulates up to six months imprisonment and a fine not exceeding KD10,000 for related offenses.