Kuwait issues comprehensive regulatory bylaw for charity foundations

Minister of Social Affairs, Family and Childhood Affairs, Dr. Amthal Al-Huwailah, has issued a ministerial decision enacting a new regulatory bylaw governing the establishment, management, and supervision of charitable foundations across the country.

The regulation aims to enhance transparency, improve governance, and ensure strict compliance with existing laws pertaining to charitable work, reports Al-Rai daily.

Key Provisions of the New Bylaw

No Activity Before Official Declaration — Individuals or entities may not engage in any charitable or social activity unless the charity is officially declared according to prescribed procedures. No contracts may be signed in the charity’s name before its official recognition by the Ministry.

Strict Donation Rules and Approvals — Charities are prohibited from soliciting donations or organizing charitable activities without prior written approval from the Ministry of Social Affairs. Any changes to the charity’s location, operational scope, or establishment of branches require official authorization.

Mandatory Internal Governance — Each charity must draft and implement internal financial and administrative regulations. Additionally, annual audited financial and administrative reports must be submitted to the Ministry.
Unannounced Inspections Permitted — The Ministry reserves the right to inspect charities at any time without prior notice through authorized staff who may review all records, data, and operational activities.

The following are the founding and announcement procedures:

• A charity must have at least 10 Kuwaiti founders aged 21 or older, with clean legal records.
• Candidates for the board must be at least 30 years old.
• A bank certificate confirming a deposit of KWD 10,000 is required.
• The Ministry will coordinate with relevant government bodies (Kuwait Municipality, Fire Force, Real Estate Registration) for final approvals.
• Upon completing procedures, a ministerial decision will be published in the Official Gazette, granting the charity legal personality.
• The board of directors must include 5 to 9 members, over the age of 30 and with appropriate academic qualifications; the board is responsible for operational oversight, compliance with model bylaws, and submitting annual reports; the board elections must be held by secret ballot and announced publicly and the Ministry must be informed of elected board members.

Penalties and Violations

• If a violation is found and not corrected within one week of notification, all charity accounts will be frozen until resolved.
• The Ministry can suspend advertisements or initiate dissolution procedures in cases of repeated or severe violations, non-submission of financial reports, or falsification of data.
• The Council of Ministers may order dissolution if the charity no longer serves its public purpose, violates laws, or fails to maintain minimum membership.

Liquidation and Asset Transfer

• In the event of dissolution, a committee will be formed to liquidate assets, under ministerial supervision.
• After liquidation, remaining funds will be transferred to the Ministry, which will determine their appropriate allocation.
• The dissolved charity’s board must surrender all property and documentation to the liquidation committee.

This new bylaw reinforces Kuwait’s commitment to a transparent and accountable charitable sector, empowering authorities to ensure that charitable activities align with national laws and public interest.