The Kuwait News Agency reported that Decree-Law No. 120 of 2026 promulgating a new Arbitration Law was issued on October 13. The legislation comprises 108 articles spread across 15 chapters and establishes an integrated framework for both institutional and ad hoc arbitration proceedings. The explanatory memorandum attached to the decree-law noted that Kuwait’s ongoing development plans to transform the country into a leading financial and commercial hub required a contemporary arbitration environment capable of building trust among investors and businesses.
Kuwait had previously relied on arbitration provisions contained in the Civil and Commercial Procedures Law along with the 1995 Judicial Arbitration Law, statutes that the new decree explicitly repeals. The fresh legislation unifies all arbitration rules into a single independent text while expanding and integrating the principles of judicial arbitration. This shift responds to the limitations of the earlier framework which the memorandum described as insufficient for current commercial and investment demands.
The law imposes specific safeguards on arbitration in contracts involving state entities with the goal of protecting public funds without preventing those entities from participating in the process. Its scope is defined by a territorial link to arbitrations seated in Kuwait and by party agreement for certain proceedings held abroad. These rules remain subordinate to Kuwait’s international treaties and mandatory legal provisions according to the decree-law text.
A dedicated department at the Ministry of Justice will oversee the licensing and regulation of arbitration centers under the new system. Centers already in operation must adjust their status to meet the updated standards within one year of the law taking effect. The statute also establishes registers for arbitrators and centers while prescribing penalties including fines and imprisonment for unauthorized operation of such facilities.
Modern procedural tools form a key part of the legislation including a formal system for interim and precautionary measures along with recognition of electronic methods for hearings document exchange and overall proceedings. Arbitrators incur civil liability solely in cases of fraud or gross error rather than criminal accountability for their rulings. A separate chapter addresses offences connected to the arbitration framework completing the regulatory structure.
The decree-law was prepared with reference to the UNCITRAL Model Law on International Commercial Arbitration and other international standards while preserving elements unique to Kuwait’s legal system the explanatory memorandum stated. It imposes defined timelines for procedural stages and restricts the grounds for challenging arbitral awards to promote greater efficiency. The unified approach is intended to position arbitration as a swift reliable alternative for resolving civil and commercial conflicts.
