Kuwait

Kuwait

Privatization of power and water desalination plants

13 May 2010

The Parliament of Kuwait passed a privatization law, opening the door for transferring public-sector assets to local and foreign private ownership, and the establishment of new, private-sector companies in which the Government has a minority stake. The law stipulates that public shareholding companies must be established to run entities slated for privatisation and that at least 40 percent of the shares must be sold to Kuwaitis in an initial public offering. A maximum of 20 percent of the shares will be held by Government institutions and 5 percent by a company's Kuwaiti employees, leaving at least 35 percent to be sold at auction to private or foreign investors. The Government will also retain a "golden share" in the privatized firms, giving the State ultimate veto power over any plans by the new companies. The law also includes a series of restrictions on firing or cutting the pay of Kuwaiti employees. The bill expressly excludes the production of oil and gas, oil refineries, and health and education services. Each individual State privatization will also still have to pass through Parliament. The privatization law passed Parliament on 13 May 2010 and which will come into effect after six months.

Type:
  • Entry and establishment (Ownership and control)
Industry:
  • Services (Electricity, gas, steam and air conditioning supply)
Inward FDI:
No
Outward FDI:
No
Sources: