Cabinet Approves Draft Decree-Law Converting Kuwait Airways Into a Wholly State-Owned Shareholding Company

At its meeting on Tuesday 14 July 2026, chaired by the Prime Minister Sheikh Ahmad Al-Abdullah Al-Ahmad Al-Sabah, the Council of Ministers approved a draft decree-law transforming Kuwait Airways Corporation into a shareholding company wholly owned by the State. The Deputy Prime Minister and Minister of State for Cabinet Affairs, Shareeda Al-Maousherji, confirmed after the session that the draft has been referred to His Highness the Amir Sheikh Meshal Al-Ahmad Al-Jaber Al-Sabah for final approval. The instrument had not been issued or gazetted as at the date of this note, and its operative text is therefore not yet public.

The significance lies in what changes and what does not. The proposal alters the carrier's legal form — from a public corporation to a shareholding company, with the share capital, board and governance architecture that form brings — while leaving ownership entirely with the State. That is corporatisation, not privatisation, and it is a deliberate departure from the earlier statutory direction: Law No. 6 of 2008, as subsequently amended, contemplated conversion into a shareholding company accompanied by a strategic investor stake and a public offering, leaving the State a minority holder. That framework was never brought to completion.

Several points will only be answerable once the decree-law is published. Chief among them are the company's authorised and issued capital and who subscribes it; the mechanism transferring the Corporation's assets, liabilities, contracts and licences to the new entity; the treatment of existing employees and their accrued entitlements; the governance model and the extent of ministerial oversight retained; the position of Law No. 6 of 2008 and whether it is repealed; and any transitional period before the conversion takes effect.

WEFAQ's view: Counterparties should read this as a change of corporate personality rather than a change of control. Suppliers, lessors, financiers and code-share partners contracting with the Corporation should identify now whether their agreements contain change-of-entity, assignment or novation provisions that a statutory transfer would engage, and whether any consent or notification is triggered. Well-drafted statutory conversions usually carry universal succession language that preserves existing contracts, but that is a matter for the decree-law's text, which is not yet available. We will report on the operative provisions once the instrument is gazetted.