For the first time, Kuwait has a dedicated, self-contained arbitration statute.

On 13 October 2026, Kuwait issued Decree-Law No. 120 of 2026 Promulgating the Arbitration Law, published in the Official Gazette on 18 October 2026. Containing 108 articles across fifteen chapters, this new law covers the arbitration agreement, the tribunal, procedure, emergency arbitration, awards, enforcement, annulment, institutional arbitration, judicial arbitration and criminal penalties. Its Explanatory Memorandum presents arbitration as a cornerstone of efficient justice and of confidence in the business environment, valued for its speed, specialisation, procedural flexibility and confidentiality.

Importantly, the new law repeals Chapter Twelve of the Civil and Commercial Procedures Law (Decree-Law No. 38 of 1980), which had governed arbitration for more than four decades, as well as Law No. 11 of 1995 on Judicial Arbitration in Civil and Commercial Matters. That said, the Civil and Commercial Procedures Law will continue to apply only where the new law is silent and to the extent it is consistent with it.

Scope and Transitional Rules

Subject to Kuwait’s international treaty obligations, Decree-Law No. 120 of 2026 applies to any arbitration seated in Kuwait, whether between private parties or between public and private parties, and whatever the nature of the legal relationship. It also applies to arbitrations seated abroad where the parties agree to submit them to Kuwaiti law. Parties remain free to adopt the rules of a particular arbitration centre, subject to the law’s mandatory provisions.

The new law does not apply to arbitrations already pending when it takes effect, even where the underlying agreement predates it, and steps taken under the previous legislation remain valid. Existing arbitration centres have one year from the law’s entry into force to bring themselves into compliance with it and its implementing decisions.

Notably, arbitration of disputes under contracts concluded by State bodies (which include ministries, public authorities and institutions and wholly State-owned companies) requires the prior opinion of the Fatwa and Legislation Department. Contracts for the development and exploitation of non-oil natural resources also require Council of Ministers approval, while other contracts require the approval of the competent Minister, who may not delegate that power. Moreover, arbitration in contracts involving Kuwait Petroleum Corporation and its subsidiaries follows procedures set by the Supreme Petroleum Council (pursuant to Article 3).

As such, contractors with Kuwaiti public bodies should factor these approval steps into contract negotiations.

The Arbitration Agreement

The law also sets out the conditions for a valid arbitration agreement. The agreement must be in writing, and the law takes a broad view of what qualifies as an agreement in writing (Article 5), expressly covering:

• signed documents;
• exchanges of paper or electronic correspondence;
• an express reference in a contract to a document containing an arbitration clause;
• a request for arbitration made before a court and expressly accepted by the other side; and
• an agreement to be bound by a model contract or international convention containing arbitration provisions.

That said, the law makes it clear that matters that cannot be settled by compromise cannot be arbitrated, although the financial rights arising from them can be (Article 6).

The separability of an arbitration clause is also addressed. Invalidity, rescission or termination of the main contract does not affect a valid arbitration agreement, unless the issue concerns a party’s capacity to agree to an arbitration clause. In addition, a court seised of a dispute covered by an arbitration agreement must decline jurisdiction if the respondent objects before making any substantive defence, unless the agreement is void, inoperative or incapable of performance.

The Tribunal and Institutional Arbitration Centres

Pursuant to Article 12, arbitrators must have full legal capacity, must not be employees or members of the Ministry of Justice’s arbitration department, must accept their appointment in writing, and must declare in writing that they have no interest in the dispute and disclose anything that could raise serious doubts about their impartiality or independence. That disclosure duty continues throughout the proceedings.

With regard to composition, tribunals must have an odd number of members, with three arbitrators as the default. Where the parties cannot agree on appointments, each party has 15 days to act, failing which the President of the competent court (or a delegate) appoints from the Ministry of Justice’s register of arbitrators. In institutional arbitration, however, the chosen centre makes appointments under its own rules.

Once the tribunal is formed, challenges must be raised within 15 days of learning of the grounds, with recourse to the court if unresolved, and the court’s decision is final. Notably, a challenge does not suspend the arbitration. As a further safeguard for arbitrators, they are liable only in cases of fraud or gross error.

The law also brings arbitration centres under a formal regulatory framework for the first time. As a starting point, no institutional arbitration centre may be established without a licence from the Ministry of Justice. Licence applications must be decided within 60 days, with silence counting as rejection. Even once licensed, a centre may not operate until the Ministry approves its arbitration, conciliation and mediation rules and its fee schedule. Thereafter, licensed centres must provide secretaries and hearing facilities (physical and virtual), deposit award files with the court and submit anonymised annual reports. In return, they are not liable for arbitrators’ errors, although they remain liable for their own fraud or gross negligence.

Procedure and Modern Features

Party autonomy remains central to the conduct of proceedings.

Parties are free to agree on procedure, including by adopting institutional rules in Kuwait or abroad. Failing agreement, the tribunal may determine the procedure, subject to fundamental principles of due process and Kuwait’s international commitments. At the same time, tribunals must act efficiently, avoid unnecessary delay and cost, and treat the parties equally. To keep matters moving, the first hearing must be notified within 30 days of the tribunal’s constitution and held within 60 days, unless otherwise agreed.

Beyond these core rules, several provisions reflect modern international practice:

• First, parties must disclose the sources of funding for the costs of the arbitration, which brings third-party funding into the open.
• Second, with the consent of all parties and the tribunal, third parties may join, and tribunals may consolidate related proceedings.
• Third, hearings, deliberations, submissions and signatures may all be conducted electronically, with the same legal effect as in-person steps.

In keeping with arbitration’s traditional appeal, proceedings are confidential, and awards may be published only with all parties’ written consent, although centres may publish anonymised extracts for research purposes. Lastly, a party that continues without objecting to a known irregularity within 15 days is treated as having waived the objection.

Emergency and Interim Relief

One of the most notable innovations is the introduction of emergency arbitration in Chapter Five. Under this mechanism, parties may agree to appoint an emergency arbitrator to decide interim and conservatory measures before the tribunal is formed. Failing agreement, the court will appoint one within five days, and once appointed, the emergency arbitrator must rule within 15 days, which may be extended by up to ten days, and cannot sit on the main tribunal.

The decision binds the parties immediately and can be enforced through the courts. However, it may be challenged before the competent court within seven days and is not binding on the tribunal when it decides the merits. Alongside this regime, tribunals may also issue interim and partial awards, which are enforced by court order, and courts may grant interim relief before the tribunal is formed without this amounting to a waiver of arbitration.

Awards and Time Limits

When it comes to deciding the dispute, the tribunal applies the rules of law chosen by the parties or, absent agreement, those most closely connected with the dispute, having regard in each case to the contract terms and the trade usages applicable to the transaction.

The law also imposes firm time limits. Unless the parties agree otherwise, the award must be rendered within 12 months of the tribunal’s constitution, although the tribunal may extend this by six months and the parties may agree to further extensions. If the award is still not issued, any party may ask the court to set an additional period or terminate the proceedings, and an award issued in breach of these limits is void unless the parties agree otherwise.

As to form, awards must be in writing, reasoned and signed, and a majority signature suffices, while awards in a language other than Arabic require an official translation when deposited. Following the award, requests for correction, interpretation or an additional award must be made within 15 days of receipt, and the tribunal must rule within 30 days.

Enforcement and Annulment

Once the award is issued, the focus shifts to enforcement. Within 15 days of the award, the tribunal must deposit it, together with the arbitration agreement and case file, with the competent court. Although an award made in Kuwait has the force of res judicata, it becomes enforceable only by an enforcement order of the court President. Before granting the order, the President must confirm that the award does not conflict with an earlier judgment or award on the same subject, does not violate Kuwaiti public order, and has been properly notified, with the annulment period expired. Whether the order is granted or refused, that decision may be challenged before the Court of Appeal within 30 days, and the Court of Appeal’s decision is final.

On the question of challenges, the law draws a clear line. Awards cannot be appealed by any ordinary or extraordinary means and can be challenged only by an annulment action before the Court of Appeal, a right that cannot be excluded by prior agreement. Moreover, the grounds for annulment are exhaustive. They include:

• absence, invalidity or expiry of the arbitration agreement;
• a party’s lack of capacity;
• a fundamental procedural defect affecting the award;
• the tribunal disregarding a rule of law the parties expressly chose;
• irregular constitution of the tribunal (where objected to at the time);
• excess of jurisdiction (with severable parts preserved); and
• fraud, forgery or concealed decisive evidence.

In addition, the court must annul of its own motion where the award violates public order, concerns a non-arbitrable matter or contradicts an earlier final judgment or award between the parties.

The annulment process is also subject to strict timing. The action must be filed within 30 days of notification of the award or, in fraud and forgery cases, within 30 days of discovery, and the Court of Appeal must decide within six months, with its judgment being final. Filing does not by itself suspend enforcement, though the court may order a stay on serious grounds and require security. Perhaps most significantly, if the court annuls the award in whole or in part, it will itself decide the merits of the dispute, and the arbitration agreement survives except where the annulment rests on the agreement’s own absence or invalidity.

Judicial Arbitration

Rather than abolishing judicial arbitration, the law preserves Kuwait’s established system and brings it within the same statute in Chapter Thirteen. Under this model, tribunals sit at the Court of Appeal and comprise three judges and two arbitrators chosen by the parties, with the most senior judge presiding. These tribunals have exclusive jurisdiction over disputes between ministries, government bodies or public legal persons and wholly State-owned companies, or between such companies, and may also hear any other dispute the parties agree to refer. In terms of timing, awards must be rendered within six months of the first hearing, extendable by three months, but unlike ordinary arbitral awards, they may be challenged before the Court of Cassation within 30 days, on specified grounds and against a deposit of KD 500.

Criminal Penalties

To give these rules teeth, and unlike the previous regime, the law introduces criminal sanctions in Chapter Fourteen, with the Public Prosecution having exclusive authority to investigate and prosecute these offences.

The most serious offences relate to the licensing regime. Operating an unlicensed arbitration centre, operating before rules are approved or while a licence is suspended or cancelled, transferring a licence without approval, submitting false information to obtain a licence or registration, or impersonating a registered arbitrator or using the term “arbitration centre” without a licence, is punishable by imprisonment of up to one year and/or a fine of KD 3,000 to KD 30,000, and courts may also order closure of the centre and publication of the judgment.

Confidentiality is likewise protected, as disclosing arbitration secrets, or publishing an award without the parties’ written consent, carries imprisonment of up to six months and/or a fine of up to KD 10,000. Furthermore, penalties double for repeat offences, and the actual managers of a legal person face the same penalties where they knew of or contributed to the offence, with the entity jointly liable for fines and compensation.

What This Means for Businesses

Taken together, Decree-Law No. 120 of 2026 brings Kuwait’s arbitration regime much closer to international standards, with clearer rules on the arbitration agreement, tribunal independence, emergency relief, technology, funding disclosure and confidentiality, together with firm deadlines for courts and tribunals.

In light of these changes, businesses should review their dispute resolution clauses to confirm they meet the writing requirement, consider expressly providing for emergency arbitration, institutional rules and time limits, and note the approval steps required for arbitration clauses in government contracts.

For advice on how these new rules may affect your organization, contact GLA & Co.

Authors: Alex Saleh, Managing Partner, and Liana Rashed, Trainee Lawyer.