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Doing Business
through a Kuwaiti Agent
Doing business under the auspices of a local Kuwaiti
agent is another machinery on the furtherance of which a
foreign party can acquire legal presence in Kuwait . The
foreign party cannot register itself or open a branch
office in its own name in Kuwait , whatever title that
office may have unless it first appoints a local agent;
which is a condition precedent for establishing such an
office. This is because Article 24 of the 1980
Commercial Code of Kuwait expressly provides:
" No foreign company
may establish a branch of its own, in Kuwait and it may
not undertake commercial activities in Kuwait unless
through a Kuwaiti agent. "
The Commercial Law categories the most important types
of commercial agencies. These include:-
1. Contracts Agents;
2. Commission Agents; and
3. Commercial Representatives.
1. Contracts Agency :
It is a contract between the foreign party and the local
(Kuwaiti) agent, under which the local agent undertakes
to continuously urge and negotiate in a certain
territory of activity on concluding deals for the
interest of the principal / foreign party in
consideration for remuneration. The contracts agent is
independent of his principal even though he acts in the
name on the account of the principal/ foreign party.
2. Commission Agency
:
It is a contract between the foreign party and the local
(Kuwaiti) agent, whereby the commission agent
undertakes, in consideration for remuneration, to carry
out in his own name any legal act on account of the
principal ( Article 287(1)).
3. Commercial
Representative :
It is a contract whereby any person who is entrusted by
a merchant to carry out some of his business whether at
his place of business or elsewhere by means of an
employment contract shall be deemed to be a commercial
representative. A merchant shall be responsible for the
transactions and contracts made by his representative
within the limits of the authority granted to the
representative by the merchant).
Registration of the
Agency Agreement
Following the execution of an agency agreement, it is
imperative (by Law No.36/1964) on the Commercial
Organization to register same with the Ministry of
Commerce and Industry Kuwait . Assuming that the agency
agreement has been concluded and duly registered, the
agent in its capacity as sponsor can issue work and
residence permits and visas for foreign party's
personnel.
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