Kuwait's New Arbitration Law 2026: What Changes for Contracts, Disputes and Government Dealings

Short answer: Decree-Law No. 120 of 2026, published in Kuwait Al-Youm on 18 October 2026, gives Kuwait a standalone Arbitration Law of 108 articles in 15 chapters. It repeals the arbitration chapter of the Code of Civil and Commercial Procedure, Law No. 11 of 1995 on judicial arbitration, and any provision that conflicts with it (Article 4 of the decree-law). The headline changes are hard clocks (a 12-month default for the award, a 30-day window to attack it), a court-supported but court-light process, a Ministry of Justice licence for arbitration centres, an approval gate for arbitration clauses in State contracts, and criminal penalties for breaches of confidentiality. The decree-law sets no start date of its own (Article 6 only orders publication in the Official Gazette), so under Article 178, so under Article 178 of the Constitution it comes into force one month after publication, on or around 18 November 2026. It applies to arbitrations that begin after that date, so the time to review your clauses is now, before the next dispute.

Why this matters: for the first time, one law answers the questions that arbitrators and counsel in Kuwait have argued over for years: who appoints when the parties do not, how long a tribunal really has, what a court may do before and after an award, and what happens to a clause in a State contract. Most of the answers are sensible. A few are sharper than expected, and some sit in tension with each other. This article follows the law in the order you meet it in a live case, and focuses on what the text means in practice and where we expect it to be tested. Article references are given throughout for readers who want the full wording.

In this article: 1. Where the law applies, and to which cases | 2. Contracts with the State: the approval gate | 3. The arbitration agreement | 4. The tribunal: appointment, independence and exit | 5. Running the case | 6. Interim relief and the emergency arbitrator | 7. Jurisdiction and the merits | 8. After the award: deposit, enforcement and annulment | 9. Institutional and judicial arbitration | 10. Criminal exposure | 11. Deadlines at a glance | 12. What is still to come | 13. A working checklist

1. Where the law applies, and to which cases

Which arbitrations fall under the new law?

Any arbitration between public and private parties, or between private parties, whatever the relationship, if the seat is in Kuwait, or if it is held abroad and the parties choose this law (Article 2). Parties seated in Kuwait may adopt a centre's rules, but not against the law's mandatory provisions, and international conventions in force in Kuwait prevail. 'State bodies' is defined broadly to include ministries, public authorities and companies wholly owned by the State (Article 1).

Does it reach contracts and disputes that already exist?

The law does not apply to any arbitration pending when it comes into force, even one based on an earlier agreement, and steps taken under the old rules stay valid (Article 1 of the decree-law). The test is whether an arbitration is pending, not when the agreement was signed. A clause written in 2015 will be governed by the new law if the arbitration starts after around 18 November 2026. That is why existing contracts matter as much as new ones, and why a party that wants the old rules has a narrow window to start. Where the law is silent, the Code of Civil and Commercial Procedure applies so far as consistent (Article 2 of the decree-law).

One gap deserves mention: there is no chapter on foreign awards. Article 2 preserves international conventions, and the enforcement chapter (Articles 67 to 71) addresses awards issued in Kuwait. Counsel enforcing a foreign-seated award should assume the treaty route remains the one to use, and watch for guidance from the courts.

2. Contracts with the State: the approval gate

Can a government body agree to arbitrate?

Yes, but not on its own signature. Article 3 requires the opinion of the Fatwa and Legislation Department, then approval: by the Council of Ministers for contracts on developing and exploiting non-oil natural resources, and by the competent minister for all others, under Cabinet rules and without power to delegate. Contracts connected with Kuwait Petroleum Corporation and its companies follow conditions set by the Supreme Petroleum Council.

The law does not say what happens to a clause agreed without approval. We read the gate as a condition of validity, and we would not rely on any other reading. Contractors should ask to see the approval, and the opinion-and-approval step belongs in the project timetable, not at the signing table. Disputes between ministries, public bodies and wholly State-owned companies, or among those companies, go exclusively to judicial arbitration (Article 88; see Part 9).

3. The arbitration agreement

What does a valid clause need?

The party must be able to dispose of the rights in dispute (Article 4), and the agreement must be in writing or it is void (Article 5). Writing is read generously: signed documents, exchanged letters or electronic messages, an express reference to a document containing a clause, a request to arbitrate made in court and expressly accepted, or adoption of a model contract or convention with arbitration terms. Matters that cannot be settled by compromise cannot be arbitrated, but the financial rights flowing from them can (Article 6).

Agreements made after the dispute arises

A post-dispute agreement must state the subject of the dispute, and the court must record it in the minutes of the hearing, or the arbitration is void (Article 7). The text is written with a case already in court in mind, and we read the recording requirement that way. Read literally, though, it covers every post-dispute submission, so an out-of-court submission should define the dispute precisely, and parties with a pending case should make sure the court records the agreement. The court then stays that part of the case; once an award becomes final it ends the case, and if the arbitration ends without an award, the case returns to court unless the Court of Appeal has taken up the merits under Article 79.

Separability, and the court's duty to decline

The clause is independent of the contract: invalidity, rescission or termination of the contract does not touch a valid clause, except where a party lacked capacity, and a plea that the contract is void does not stop the arbitration unless the tribunal decides otherwise (Article 8). A court receiving a claim covered by a clause must decline jurisdiction if the defendant objects before any merits defence, unless the agreement is void, null or incapable of being performed, and the court case does not prevent the arbitration from proceeding (Article 10). Amiable composition requires express words and the arbitrators named in the agreement itself (Article 9), which will make it rare. Agreeing to a centre's rules is treated as delegating the procedure to that centre (Article 11).

4. The tribunal: appointment, independence and exit

Who can sit, and what must they disclose?

An arbitrator needs full capacity, no deprivation of civil rights for a felony or an offence involving honour or trust, and no unrehabilitated bankruptcy; staff of the Ministry of Justice arbitration administration are barred (Article 12). The arbitrator must accept in writing, declare no interest in the dispute, and disclose in writing anything that could raise serious doubts about impartiality or independence. That duty continues throughout the case (Article 13).

Appointment when the parties cannot agree

The number must be odd, and is three by default (Article 14). If the parties agree an even number, they have 30 days to add one. Under the default method in Article 15, each side names its arbitrator within 15 days of a request, and the two choose the chair within 15 days; if any step fails, the president of the competent court appoints from the Ministry of Justice register, by petition order, within 15 days. The order cannot be appealed, but a refusal can be taken to the urgent-matters judge, whose ruling is final. In institutional cases the centre appoints, and the court steps in only if the centre cannot.

Removal, challenge and replacement

An arbitrator can be removed only by agreement, and one removed without serious cause keeps the full fee and may recover compensation for moral and professional harm (Article 16). A challenge needs serious doubts about impartiality or independence, and is barred for the appointing party (unless the ground arose later), after the award or close of pleadings, or on a repeated ground (Article 17). In ad hoc cases, the challenge is made within 15 days of knowing the ground; if the arbitrator does not step down within 15 days, the challenger has 15 days to go to court, which decides within 15 days with no appeal. The arbitration continues meanwhile (Article 18). A replacement is appointed by the same method, and earlier steps stand unless the new tribunal finds they harmed the rights of defence (Article 20). Arbitrators are liable only for fraud or gross error (Article 21).

5. Running the case

The framework

The tribunal must respect fundamental principles of litigation and public policy, run the case without unnecessary delay or cost, and treat the parties equally (Article 22). The parties choose the procedure, including a centre's rules, and failing that the tribunal does (Article 23). The law sets out the contents of the request and the defence (Articles 24 and 25), allows amendments unless the tribunal refuses by reasoned decision (Article 26), and lets the tribunal proceed if a party defaults, without treating default as an admission (Article 27). The parties choose the seat and language, and the award may be in a different language from the proceedings (Articles 28 and 29). A tribunal secretary is bound by the same disclosure, impartiality and confidentiality rules as an arbitrator (Article 33).

Who is paying? The funding disclosure

Article 30 is one sentence long and may have the largest effect on how cases are run: the parties must disclose the sources of funding for the costs of the arbitration. The law does not say when, to whom, or what a failure to disclose leads to, and it does not define 'source'. Until the courts or centres give guidance, we would advise clients with third-party funders to disclose to the tribunal at the outset, and arbitrators to take it into account in their conflict checks.

Timetable, third parties and evidence

The tribunal must give notice of the first hearing within 30 days of its formation, and hold it within 60 days unless agreed otherwise (Article 31). It may decide on documents alone unless the parties require a hearing (Article 32). A third party may join only with its own consent and that of the parties and the tribunal, while the tribunal may consolidate related arbitrations pending before it after hearing the parties (Article 35). Tribunal-appointed experts can be questioned and challenged like arbitrators (Article 36), and the whole case may be run remotely, with a Minister of Justice decision on the details still to come (Article 39).

Silence is waiver: the 15-day rule

Article 38 deserves a place on every case-management checklist. A party that carries on knowing that the agreement, or a non-mandatory rule of the law, has been breached, and does not object within the agreed time or within 15 days of knowing, waives the objection. The same discipline applies to jurisdiction, which must be raised before any defence on the merits (Article 49).

Confidentiality

The proceedings are confidential: nothing submitted or deliberated may be disclosed without the parties' written consent or as the law allows (Article 40). Breach is now a crime (see Part 10).

6. Interim relief and the emergency arbitrator

Before the tribunal exists, a party may seek interim or protective measures from the court without waiving the clause; once the tribunal or an emergency arbitrator is in place, primary power passes to them (Article 51). The parties may agree to an emergency arbitrator, who cannot later sit on the merits (Article 41). If they have not agreed how to appoint one, the court president appoints within five days (Article 42). The emergency arbitrator must decide within 15 days, extendable by up to ten for serious reasons (Article 44). The decision binds at once and is enforceable under Article 52; the tribunal may later amend, revoke or confirm it, and is not bound by it on the merits; and a party may object to the court within seven days, with a final ruling within 15 (Article 45).

Interim and partial awards of the tribunal are enforced by court order on petition, subject only to a grievance within seven days (Article 50), and orders of the tribunal or emergency arbitrator get a seven-day enforcement track with no appeal (Article 52). The tribunal may also ask the court to compel witnesses, order production of documents or issue letters rogatory (Article 46).

7. Jurisdiction and the merits

Competence-competence, with a catch

The tribunal rules on its own jurisdiction, as a preliminary matter or in the final award (Article 49). If it upholds jurisdiction, that ruling cannot be challenged immediately, only through an annulment action against the final award. A respondent with a strong jurisdictional case will therefore see the merits heard before any court looks at the objection. Plan and budget for that, and raise the objection before any defence on the merits.

Applicable law and settlement

The tribunal applies the rules the parties choose, failing which those most closely connected with the dispute, by majority (Article 54), taking account of the contract and trade usage (Article 55). A settlement can be recorded in an award with full force (Article 57).

The award and the 12-month clock

The award is written, reasoned and signed, with majority signatures enough, and an official translation is required on deposit if it is not in Arabic (Article 58). A missing formal element does not void it if it can be supplied from the file, unless the defect is serious and prejudices the defence. It is deemed made at the seat, however and wherever signed.

Article 59 sets the clock: the agreed period, or failing that twelve months from the date the tribunal is fully formed. Unless the parties agree otherwise, the tribunal may extend by six months, the parties may extend further, and any party may ask the court president to set more time or end the arbitration. An award made outside these limits is void unless the parties agree otherwise. Twelve months is not long for a document-heavy construction or energy case, so the clause should say how long the tribunal has and who may extend it.

Costs, publication and post-award requests

The tribunal fixes and allocates costs, and the court may adjust arbitrators' fees on application unless the parties fixed them by agreement (Article 60). The award may be published only with all parties' written consent, though centres may publish anonymised extracts for research (Article 62). Within 15 days of receiving the award a party may seek correction, interpretation or an additional award on claims left undecided, and the tribunal must decide within 30 days (Articles 63 to 65). If it cannot reconvene, the court takes over (Article 66).

8. After the award: deposit, enforcement and annulment

Deposit and enforcement

The tribunal deposits the award and file with the court clerk within 15 days (Article 67). The award has res judicata effect (Article 68), but an award made in Kuwait is enforceable only by order of the court president, on an application that must say whether an annulment action has been filed (Article 69). The president checks that the award does not conflict with an earlier judgment or award, does not offend Kuwaiti public policy, and has been properly notified with the annulment period passed without an action (Article 70). The order, or a refusal, can be challenged before the Court of Appeal within 30 days, which decides within 30 days with no further appeal (Article 71).

The only route against an award

Every ordinary and extraordinary appeal is closed (Article 72). The one remedy is annulment before the Court of Appeal, and it cannot be waived in advance (Article 73). The grounds are: no valid or subsisting agreement; incapacity; a fundamental procedural nullity that affected the award; displacement of a law the parties expressly chose; a tribunal formed contrary to the agreement or the procedural law, provided the point was raised before the tribunal; excess of mandate (severable where possible); and fraud, forged documents, or decisive documents withheld by the opponent. The court must also annul of its own motion for breach of public policy, non-arbitrability, or conflict with an earlier final decision between the same parties (Article 74).

The action must be filed within 30 days of notification, or, for fraud and forgery, from the date these come to light (Article 75). The Court of Appeal must decide within six months, and its judgment is final (Article 76). Filing does not suspend enforcement. The court may order a stay on serious grounds, ruling within 30 days and possibly requiring security, and if it stays enforcement it must decide the case within 90 days (Article 77).

What happens when an award is annulled?

Article 78 says annulment removes the award, but the arbitration agreement survives unless the annulment rests on the absence, lapse, invalidity or impossibility of the agreement itself. Article 79 then says that if the Court of Appeal annuls the award in whole or in part, it must take up the merits and decide the dispute. The two pull in different directions: if the clause survives, a party might expect a fresh arbitration; if the court must decide the merits, there may be nothing left to arbitrate. The most workable reconciliation, in our view, is that Article 79 governs the dispute decided by the annulled award, which the Court then decides itself, while Article 78 keeps the clause alive for other disputes under the same contract. The opening words of Article 79, 'subject to Article 78', leave room for a narrower reading, and the courts will have to settle it. The practical lesson is that annulment is not a free option: a party that loses the award may lose the arbitral forum too.

A tension counsel should watch

Article 70(3) conditions the enforcement order on the annulment period having passed without an action. Article 77 says that an annulment action does not stop enforcement. Taken literally, the first suggests an award cannot be enforced while a timely action is pending, and the second says it can. One reading is that Article 70(3) fixes the earliest moment to seek the order, after the 30 days if no action is filed, while Article 77 governs an action filed after the order is made. Another is that a party can seek enforcement despite a pending action and the court decides on a stay. Until the courts address it, both sides should prepare for both outcomes: the award creditor should apply for enforcement promptly and disclose any pending action as Article 69 requires, and the award debtor should file the annulment action and the stay application together.

9. Institutional and judicial arbitration

Arbitration centres need a licence

No institutional centre may be set up without a licence from the Ministry of Justice arbitration administration, on terms a ministerial decision will set (Article 80). The administration has 60 days to decide, with silence counting as refusal, and a refusal can be taken to the Minister (Article 81). A centre may operate only once the Ministry approves its rules and its fee schedule (Article 82). It must provide secretaries and facilities, serve notices effectively, deposit awards with the court, and file anonymised annual reports (Article 83). A centre is not liable for arbitrators' errors, but is liable for its own gross error or fraud (Article 84). Existing centres have one year to comply (Article 3 of the decree-law).

Judicial arbitration at the Court of Appeal

The law keeps arbitration inside the court system, with changes. A panel of three judges and two party-chosen arbitrators sits at the Court of Appeal, presided over by the senior judge (Article 87). It hears disputes the parties refer to it and, exclusively, disputes between State bodies and wholly State-owned companies (Article 88). The process is fast: hearings are fixed within days of the fee deposit (Articles 90 and 91), challenges to members go to the Court of Cassation within five days (Article 93), and the judgment is due within six months of the first hearing, extendable by three (Article 94). Unlike an ordinary award, it can be appealed to the Court of Cassation, whatever the amount, on four grounds including error of law, within 30 days and with a KD 500 deposit (Articles 97 and 98).

10. Criminal exposure

Only the Public Prosecution may prosecute offences under the law (Article 100). Running an unlicensed centre, operating before the rules are approved, assigning a licence without consent, giving false information to obtain a licence or registration, impersonating a registered arbitrator or misusing the name 'arbitration centre' carries up to one year in prison and a fine of KD 3,000 to KD 30,000, and the court may close the centre (Article 102). Disclosing a secret of the proceedings learned through the work, in breach of Article 40, or publishing an award without all parties' written consent, in breach of Article 62, carries up to six months in prison and a fine of up to KD 10,000 (Article 103). Penalties double for repeat offences (Article 104), managers can be liable personally, and the company is jointly liable for fines (Article 105).

The practical point for in-house teams and law firms is internal: an award or transcript sent to a wider group, a board paper summarising an award, or a press comment can now become a criminal matter. Confidentiality protocols should be updated to match.

11. Deadlines at a glance

For counsel who like a timetable: 15 days to nominate an arbitrator, to challenge one, for the court to decide a challenge or appointment, to deposit the award, and to ask for correction, interpretation or an additional award; 30 days for the first-hearing notice, for the extra arbitrator in an even-numbered tribunal, for a grievance against an enforcement order, and for the annulment action; 60 days to the first hearing; 7 days for a grievance against an interim award or an emergency arbitrator's decision; 12 months for the award, plus six; six months for the Court of Appeal to decide annulment; 90 days if enforcement is stayed.

12. What is still to come

Article 5 of the decree-law gives the Minister of Justice general power to issue the decisions needed to implement the law, and several pieces depend on decisions not yet issued: the Minister of Justice's decision on remote proceedings (Article 39); the licensing decision for centres (Article 80); the arbitrators' registers and their rules (Articles 107 and 108); judicial arbitration fees (Article 90); and the Council of Ministers' rules for ministerial approval of State-contract clauses (Article 3). Until they appear, the appointment and licensing workflows will be tested in practice.

13. A working checklist

For drafters: name the seat and the centre, and check the centre will be licensed; fix an odd number of arbitrators and the appointment method; state the language of the proceedings and of the award; set the time for the award and who can extend it; decide whether to adopt emergency arbitrator provisions; add a confidentiality clause that fits Articles 40 and 62; for State contracts, record the Fatwa opinion and the approval as conditions precedent; and review old clauses that point to the repealed code or to Law No. 11 of 1995.

For arbitrators and centres: update disclosure declarations to cover Articles 12 and 13 and the funding rule in Article 30; build the 15-day and 30-day deadlines into procedural orders; diarise the 12-month clock from the date the tribunal is fully formed; and prepare to be licensed and to file annual reports.

For disputes teams: file the jurisdiction objection before the first defence; object promptly to any irregularity, because 15 days of silence can be a waiver; calendar the annulment window from notification; and prepare for the tension between Articles 70 and 77 before the award arrives.

WEFAQ's view: the law is a serious step towards a modern regime, and its clocks, its support from the courts and its limits on court interference are welcome. Its weak points are the pending implementing decisions, the unresolved overlap between Articles 70(3) and 77, and the combined effect of Articles 78 and 79, which turns annulment into a forum risk. Clients with live contracts should review their clauses now, and anyone with a State counterparty should check the Article 3 approval before the next signature.

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Source: Decree-Law No. 120 of 2026 promulgating the Arbitration Law, with its explanatory memorandum; Kuwait Al-Youm Issue 1813, pages A32 to A52, dated 18 October 2026.

This article is provided for general information only and does not constitute legal advice. For advice specific to your circumstances, please contact WEFAQ Law Firm.