Non-profit Companies in the Kuwaiti Companies Law No. 1 of 2016

Dr. Farouk Ibrahim Jassim
Assistant Professor of Commercial Law
College of Law – University of Al-Mustansiriyah – Baghdad – Iraq


Non-profit companies represent a new type of companies which was approved by the Kuwaiti Companies Law by Decree Law No. 25 of 2012 and established in Companies Law No. 1 of 2016. However, this regulation raises several questions, the first of which is the purpose of regulating this type of companies within Companies Law provisions, considering that the activities carried out by this type of companies can be carried out by other legal systems such as Associations. The second question is concerned with the adequacy of the provisions adopted by the Companies Law No. 1 of 2016 to regulate the provisions of this type of companies.
In order to shed light on the legal system of this type of companies and answer some of the raised questions, the paper adopts an analytical approach, which includes some provisions of legislation and comparative jurisprudential opinions. The paper is divided into three sections: the definition of the non-profit company and its characteristics, the distinction between the non-profit company and other similar systems, and the establishment of the non-profit company.
The paper concludes that there are some shortcomings and deficiencies in the Kuwaiti legislator’s regulation of this type of companies and recommends a more detailed and comprehensive regulation, either under a special law or through a special section within the provisions of the Companies Law. The paper also recommends that the legislator defines the objectives of the non-profit company as a decisive solution for possible disputes and adopts the limited liability company as a form for the non-profit company, which is more suitable for the activity of this type of companies.

Key words: commercial law, types of companies, profit, single window, institution, association.

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