Overview

In a sign of the growing maturity of competition oversight in the Kuwaiti market, the Competition Protection Authority issued two new decisions in 2026 that amend how Law No. 72 of 2020 on Competition Protection is applied in practice: one resets the financial thresholds that trigger mandatory pre-merger notification, and the other introduces new rules for protecting confidential business information submitted to the Authority. Separately, two Constitutional Court rulings issued over the past two years have narrowed the Authority's power to impose financial penalties. This article walks through what businesses and investors need to know.

From Law No. 10/2007 to Law No. 72/2020

Kuwait's first competition law, Law No. 10 of 2007, remained in force for roughly 13 years before being fully repealed and replaced by Law No. 72 of 2020 and its amendments on Competition Protection. The new law was not a partial amendment — it redefined core concepts. For instance, the legislator abandoned the fixed market-share threshold (35% under the old law) used to define a "dominant position," replacing it with a more flexible test based on a party's ability to "influence the relevant market and act largely independently of competitors, customers, or consumers." The new law also introduced the concepts of "horizontal" and "vertical" relationships between competitors and established an independent legal department within the Authority to handle litigation and court appearances.

Update One: New Financial Thresholds for Merger Notification

  • Individual annual sales test: Parties to an economic concentration must obtain prior approval from the Authority if any party achieves annual sales within Kuwait exceeding KD 1,500,000, based on audited financial statements for the last fiscal year preceding completion of the transaction.
  • New "target entity threshold": Under the previous 2021 regime, notification was required once the parties' combined sales crossed a set figure, even if the target company itself was very small. Under the new decision, the obligation to notify only arises if the target company's own share meets an independent financial threshold.
  • In practice, this narrows mandatory pre-clearance review toward transactions with a tangible market impact, moving away from the broad coverage under prior Decision No. 26 of 2021. Companies planning a merger or acquisition must still submit their approval request at least 60 days before completion, along with the prescribed fees.

Update Two: New Rules for Protecting Trade Secrets

The second decision defines a "trade secret" as any commercially valuable information whose disclosure would harm a competitor — including financial information, cost-assessment methods, supply sources, customer and distributor lists, marketing plans, and pricing and cost structures. The key practical point: the burden of proving confidentiality rests with the party requesting it. A company submitting information to the Authority is responsible for proving that the information is genuinely confidential, and failing to submit a confidentiality request using the approved form forfeits the right to claim confidentiality later.

Financial Penalties: Authority's Power Narrowed by Two Constitutional Rulings

Article 34 of the Competition Protection Law had authorized the Authority's Disciplinary Board to impose financial penalties of up to 10% of a violating company's total revenue. This power has been substantially curtailed by two successive Constitutional Court rulings: the ruling of 5 February 2025 (Direct Constitutional Appeal No. 4 of 2023) found clause (1) of Article 34 unconstitutional, holding that tying the fine to total revenue regardless of the actual severity of the violation amounted to an "arbitrary penalty." A later ruling issued in June 2025 also found clause (5) of the same article unconstitutional. The practical effect: the Authority currently has no legal basis to impose financial penalties under the clauses the Court struck down, pending a legislative amendment which the Department of Legal Advice and Legislation has confirmed is under review ahead of submission to the Council of Ministers.

What This Means for Businesses

  • When planning a merger or acquisition: Assess the financial position of both the acquiring party and the target company separately against the new thresholds, and account for the 60-day notice period.
  • When sharing sensitive information with the Authority: File an explicit confidentiality request using the approved form at the time the information is submitted — delay forfeits the right to claim confidentiality later.
  • Regarding any past disciplinary action by the Authority: Companies fined under the clauses now declared unconstitutional should have their position reviewed, as those penalties have lost their legal basis.

Summary

Alpha Legal Group closely tracks these legislative developments and advises local and regional corporate clients on competition law compliance, including assessing economic concentration transactions and representation before the Competition Protection Authority.