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

Kuwait is cracking down on illegal business activities with its new anti-concealment law, Decree-Law No. 78/2026. Published in the official gazette, the law aims to regulate economic activities, promote transparency, and ensure fair competition by prohibiting unlicensed commercial operations and the concealment of illegal business practices.

The legislation, effective six months after publication, introduces severe penalties for violations. Article Three outlines prison sentences ranging from one to three years and fines between KD10,000 and KD100,000, or an amount equivalent to the total profits gained, whichever is higher. Fines can be multiplied based on the number of offenders or violations.

Article Five establishes liability for the de facto owner of a legal entity if they were aware of the violation or negligent in their duties. The legal entity itself will be held jointly responsible with its employees for violations committed in its name or for its benefit.

Convicted individuals face asset confiscation, business closure, license revocation, and deportation for expatriates, while protecting the rights of bona fide third parties. The law also doubles penalties for repeat offenses within five years of a final conviction, aiming to strengthen deterrence. Reconciliation is possible under certain conditions, requiring payment of at least half the maximum fine and correction of the violation, but is not permitted for repeat offenders.

Furthermore, Article Nine introduces a financial reward for individuals who contribute to uncovering commercial concealment crimes, capped at 10 percent of collected fines, provided credible evidence leads to a final conviction. Designated employees will be granted judicial police powers to enforce the law.