The Ministry of Commerce and Industry is studying significant changes to how freelance and micro-business licenses are regulated in Kuwait. These proposed reforms aim to make it easier for entrepreneurs to start businesses while improving transparency in ownership and management structures, as part of Kuwait Vision 2035 objectives.
Freelance business activities currently cover around 120 specialized activities, including consulting, software design and programming, website development, fashion and clothing design, jewelry design, event photography, and beekeeping. These are small-scale enterprises that owners can operate without needing a traditional commercial establishment like an office or shop. Under existing rules, applicants must establish a one-person company, a legal form recognized under Kuwait’s Companies Law.
One of the most significant proposed changes involves ownership rules. Currently, Kuwaiti government employees are prohibited from owning freelance business licenses. The new proposal would allow government employees to own such licenses, marking a major departure from current restrictions. The reforms would also potentially expand participation to retirees and private sector employees, subject to proposed conditions and the appointment of a qualified Kuwaiti manager.
Another key proposal would allow freelance business owners to appoint a Kuwaiti manager from outside the ownership structure. Currently, the founder is generally required to manage the business personally. This change would create clearer separation between ownership and management, potentially making it easier for eligible Kuwaitis to establish and operate businesses while meeting regulatory requirements.
The proposed amendments would also introduce a closer link between specialized business licenses and educational qualifications. Applicants seeking licenses for specialized activities would need to hold a relevant university degree or specialized qualification. This requirement would also apply to certain consulting activities, ensuring that individuals offering professional or specialized services possess appropriate academic or technical credentials.
Additionally, the reforms would allow license holders to add other economic activities to their businesses when those activities are included in the Ministry of Commerce and Industry’s official business directory, subject to applicable licensing requirements.
The proposed changes are designed to address the current practice of registering businesses in the names of individuals who are not the actual beneficiaries, a situation that arises when legal restrictions make it difficult for the real business owner to obtain a license.
These amendments remain under study and have not yet replaced existing licensing rules. Current regulations continue to restrict one-person commercial licenses to Kuwaiti citizens and impose specific requirements.
What This Means for Expats: While these reforms primarily affect Kuwaiti citizens, expats should monitor these changes as they may influence the broader business licensing environment and potentially create new opportunities for partnerships or service provision to newly licensed freelance businesses.
Source: Arab Times
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