LAW NO. (26) OF 1995
CONCERNING FREE TRADE ZONES
: In accordance with
The constitution -
Decree law no. 3 of 1955 concerning kuwait income tax as amended
law no. 15 of 1960 - promulgating the commercial companies law as
Law no. 38 of 1964 concerning labour in private sector as amended
Law no. 43 of 1964 concerning importation -
Decree law no. 133 of 1977 - establishing kuwait ports authority as
Law no. 13 of 1980 concerning customs -
And the decree law no. 68 of 1980 - promulgating the
lacommerce as amended
The national assembly passed the following law, which we hereby
sanctioned and promulgated.
Pursuant to a decision by the council of minisrers, one free trade
zone or more
may be established, such a decision shall specify the locations and
of such zones
Pursuant to a decision by the minister of commerce and industry,
activities may be licensed in the free trade zones
A) Storage and exhibiting goods of whatever type, origin or source.
B) Performing operations that may require any changes in the
condition of the
goods existing in the free zones and processing the same according
exchange and markets demands
C) Practising any profession that an activity may require as well
needed by the staff working within the free zone.
Entry, storing and exhibiting damaged or banned goods inside the
shall be prohibited. in case of violation hereto the applicable
laws and regulations.
shall be enforced
The license mentioned in article (2) shall be included a
description of the
location for practising the activity inside the free zone, the
objectives for which
the license has been granted, the duration of its validity and the
amount of the.
financial guarantee to be paid by the licensee
The following shall be exempt from taxes and customs duties:
A) Projects established in the free zones as well as the profits
activities practised therein.
B) Goods which are imported to the free zones or exported therefrom.
C) Tools and equipment of whatever type, required for processing
the free zones.
The foregoing shall be applicable without prejudice to the
provisions stipulated. in this law
The goods admitted to the free zones shall not be subject to any
with regards to the duration of stay, except in cases where
discharge of such goods in necessitated due
to their nature or failure of owners to pay their financial obligations or otherwise owners violation to the provisions of this
Furthermore, exports and imports to the zone shall not be subject
to the restrictions.
imposed on importation and exportation
The officials to be nominated by a decision of the minister of
industry shall be entitled to enter the free zones and its
installations and to
control any violation to the provisionsof this law and its
executive regulations. they shall be entitled
to seek the assistance of the police force in this regard.
Puruant to provisions of this law, the licensee shall be committed
the buildings, plants and equipment against all accidents. also he
shall be obliged
to remove the same at his own expense within the period specified
vide a decision
by the minister of commerce and industry starting from the date of
expiry of the.
Entry to the free zones or residence therein shall be in
the terms and conditions to be issued vide a decision by the
minister of commerce
and industry. such order shall also determine the charges for
where goods are kept
Property investment within the free zones shall not be subject to
confiscation or sequestration except through judicial channels.
The ministry of commerce and industry shall assume supervision of
the free zones, and it may entrust
the management of these zones to specialized bodies in the private sector following the approval of the council of ministers and
according to conditions. determined by the
The party authorized to manage free zones shall, for the purpose
its assigned functions and carrying out its duties and pertinent
the assistance of all competent government authorities of
specialization, and such autorities shall
provide the required facilities within the limits determined by the. council of ministers
The provisions of laws related to health and agricultural
quarantine, enviroment protection as well
as those related to protection and safeguarding against epidemics and diseases shall be applicable in the free zones. also provisions
of kuwaiti law
shall be applicable regarding issues which are not provided for in
Agreement may be reached for the settlement of disputes arising
among the projects establishied at the free zones or
between them and the authority managing these zones or with other authorities and administrative bodies concerned through
arbitration. an arbitration panel shall be
formed of one arbitratorfor each of the disputing parties as well as an umpire to be elected by the said arbitrators. should the
to agree to the election of the umpire within thirty days from
appointing the last
arbitrator, such umpire shall be elected upon the request of either
to a decision by the minister of commerce and industry.
The arbitration panel shall set forth the rules of its own
being bound to the rules of civil and commercial pleadings law
except those pertinent to guarantees and
litigation principles. panels decisions shall be issued by majority vote and shall be final and binding on both parties, applicable
exactly as final.
Such panel shall determine the expenses of arbitration and the
party which shall.
prejudice to any severer penalty stipulated
by another law, any person violating any of the provisions hereof or its executive regulations and decisions shall be penalized to a
fine not exceeding.
five thousand dinars
However, conciliation may be effected in such crime. the person who
the official record, having confronted the defendant with his
crime, shall offer
him to conciliate substantiating the same in his record. the
of conciliating shall pay, within five days from receiving the
conciliation offer, half of the maximum
fine imposed for the crime ascribed to him, which shall not exceed five hundred dinars. conciliation shall, result in the
abatement of the panel action with all its
consequences. however, conciliation shall not be allowed in. case of recurrence of the violation
The minister of commerce and industry shall issue the decisions and
regulations related to the free zones
The ministers, each within his own competence, shall implement this
AMIR OF KUWAIT
JABER AL-AHMED AL-SABAH
ISSUED AT BAYAN PALACE ON SAFAR 3 1416 A.H
CORRESPONDING TO: JULY 1, 1995