Digital commerce, online adverts, sales require license; violators face jail term, 1,000 to 10,000 dinars fine

• Mandatory Licensing for Digital Commerce
• Clear Advertising and Consumer Transparency Rules
• Strict Regulation of Influencer Marketing
• Penalties Including Jail and Fines
• Enhanced Consumer Rights and Digital Oversight

Advertising or promoting products, goods, and services through social media platforms or buy-and-sell applications will no longer be allowed without obtaining a license from the Ministry of Commerce and Industry, under an Amiri decree regulating activities in the digital commerce sector.

The move aims to keep pace with global digital transformation while balancing innovation, consumer protection, and transparency in commercial transactions.

The announcement of the decree sparked widespread debate across social media platforms, accompanied by numerous questions regarding those subject to the law, licensing procedures, advertising standards in digital commerce, applicable fees, and potential penalties.

The law is set to come into force six months after its publication in the Official Gazette. After that period, obtaining a license from the Ministry of Commerce will become mandatory for conducting any digital commercial activity inside Kuwait, whether by individuals or companies, reports Al-Rai daily.

Advertisements must clearly disclose the identity of the product or service provider, pricing, specifications, and contact details, while misleading or false promotional content is strictly prohibited.

The decree permits providers to offer logistical services such as storage, shipping, transportation, and direct delivery through modern technological solutions or licensed entities inside or outside the country. However, additional charges may not be imposed on consumers unless clearly stated in advance within the electronic contract terms.

When influencers are involved in promotional campaigns, providers must retain all related data, contracts, and records for at least five years and submit them to the Ministry upon request.

Payments to influencers must also be made through reliable methods that comply with anti-money-laundering regulations and instructions issued by the Central Bank of Kuwait. Any deceptive or misleading promotional practices are prohibited.

Responsibility for violations falls on the actual manager of a legal entity if awareness or benefit from the violation is proven. The decree also allows reconciliation procedures in certain offenses to enhance procedural flexibility and reduce judicial burdens.

Under Article 39, violators may face imprisonment of up to one year and fines ranging from KD 1,000 to KD 10,000, or one of these penalties. Violations include submitting false data, providing forged documents, offering illegal products or services, breaching public order or health regulations, or refusing to comply with decisions of the Dispute Settlement Committee.

Penalties may be doubled in cases of repeat offenses, alongside confiscation of tools or funds linked to violations and closure of the offending business.

The Ministry of Commerce has been tasked with regulating and supervising the digital commerce sector, issuing rules for electronic auctions and intermediary platforms, and preparing a schedule of financial penalties.

The decree also requires providers to maintain a business address, disclose commercial registration details and contact information, and clearly present contractual terms, including product descriptions, final pricing, payment methods, offer duration, and return policies.

Consumers are granted the right to withdraw from contracts within 14 days of receiving a product, or to return or replace it without additional cost, provided the product remains in its original condition, except in specified cases.

Certain Ministry employees will be granted judicial enforcement authority to monitor violations. The decree forms part of a broader government strategy to regulate the digital economy, strengthen confidence in electronic transactions, safeguard consumer rights, and create a more transparent and disciplined digital marketplace in Kuwait.

It also requires adherence to national cybersecurity standards, regular data protection updates, and limits electronic payment processing to entities licensed by the Central Bank, while prohibiting additional payment fees without prior approval.