Operations Flexibility


As we have previously mentioned, the government of Kuwait issued PDIK Law in order to facilitate and attract the foreign investments to Kuwait therefore the PDIK Law was elastic an flexible to enable the foreign investors from operating in Kuwait with the necessary protection, incentives and also flexibility, PDIK Law took into consideration that two or more foreign investors may decide to merger into one larger entity based on that the merger of two or more investment entities can be carried out with the consent of the board of KDIPA, following a joint request submitted to the KDIPA in this regard, and the new entity resulting from the merger shall be a legal successor to the merged entities and shall replace such entities in their rights and obligations. The new entity shall automatically enjoy the shortest periods remaining for exemptions and incentives granted to any of the merged investment entities.

In addition to the above, there is not any restriction upon the foreign investor regarding disposal or transferring the shares – in whole or in part- of the licensed investment entity established under PDIK Law to any other foreign investor or to a Kuwaiti investor, subject to obtaining the approval of the board of KDIPA. Once the approval is obtained then the new owner or assignee shall replace the original owner in rights and obligations.

Furthermore, the investor shall have the right to transfer abroad his profits, capital or proceeds resulting from the disposal over his shares or participation in the investment entity or the compensation set forth in this PDIK Law. Moreover, employees in the investment entity shall have the right to transfer their savings and entitlements abroad also all international conventions in force in the country related to investments and the avoidance of double taxation shall be observed in respect of the profits generated by the foreign investments in Kuwait under PDIK Law.


As a protection for the foreign investors, PDIK expressly stated that no investment entity, licensed in accordance with the provisions of PDIK Law, shall be confiscated pursuant to PDIK Law nor be deprived of its property except in the public interest and only in accordance with the applicable laws and against compensation equivalent to the true economic value of the expropriated project at the time of expropriation, estimated in accordance with the economic situation prior to any threat of expropriation. The due compensation is to be paid as soon as the said decision is taken.