Kuwait unveils sweeping charity law overhaul to strengthen transparency, stop donation abuse
New 96-article law calls for 10-year records, tighter donation rules; violators to spend up to 10 years behind bars
Kuwait is preparing a major overhaul of the rules governing charitable and humanitarian work, with a proposed decree-law designed to strengthen transparency, financial oversight and protection of donor and beneficiary data, while preventing charities and fundraising campaigns from being misused for money laundering or terrorist financing.
Approved by the Cabinet last July, the draft law contains 96 articles across seven chapters and would establish a new National Center for Charitable and Humanitarian Work to oversee the sector. It would also create the Kuwaiti Fund for Humanitarian Work and introduce new rules governing charities, foundations and fundraising campaigns.
One of the most significant changes is that no organization or individual would be allowed to conduct charitable activities or collect donations without the required licence and registration. Existing charities would have to bring their status and internal regulations into line with the new law within three months of the executive regulations being published. Failure to comply could result in dissolution.
Tighter controls on donations
The proposed law would impose stricter controls on how donations are collected, held and spent. Cash donations would require prior authorisation, with the permit specifying how the money can be collected and the maximum amount allowed. Donation proceeds would have to be deposited into designated bank accounts at banks supervised by the Central Bank of Kuwait.
Fundraising campaigns would generally have to be approved within 30 days, while emergency campaigns would have a three-day timeframe. Charities would also be required to disclose their annual budgets, activities and funding sources, verify the identities of donors, beneficiaries and project partners, and ensure that they are not listed on local or international sanctions lists.
Ten-year record-keeping requirement
The draft law places major emphasis on financial accountability. Charities would have to maintain records relating to fundraising campaigns and donor information for 10 years.
They would also have to report the proceeds of fundraising campaigns to the National Center within 15 days of a campaign ending, with the report approved by an accredited auditor, subject to exceptions for certain small campaigns.
Any transaction suspected of being connected to money laundering or terrorist financing would have to be reported to the Kuwaiti Financial Intelligence Unit through the centre.
Donor and beneficiary privacy
The proposed legislation would classify donor and beneficiary information as confidential. Such data could not be disclosed or circulated except where necessary to implement the law, under a court or investigative authority order, or with the prior consent of the individual concerned.
Special protections would apply to children receiving donations. Their personal information could not be disclosed, and photographing or recording a child for fundraising purposes would require the consent of a parent or legal guardian. Even then, a child’s refusal to be photographed would have to be respected.
Images or recordings that could humiliate, exploit or endanger a child would be prohibited, as would making assistance conditional on allowing the child to be photographed. Violations involving a child’s confidential information, images or recordings could carry up to five years in prison and a fine of between 2,000 and 5,000 dinars.
Tougher penalties for misuse of charity funds
The draft law proposes severe penalties for fraud, unauthorised fundraising and misuse of donations. Misappropriating money from a fundraising campaign could result in up to seven years in prison, while the maximum penalty could rise to 10 years when the offence involves an unlicensed campaign, impersonating a registered charity or using the name of an organisation that is no longer legally recognised.
Additional fines could range from 10,000 dinars to twice the value of the funds involved, depending on the offence. Organising, promoting or calling for an unlicensed fundraising campaign could result in up to two years in prison and a fine of 1,000 to 5,000 dinars. The penalty could rise to three years in certain cases involving impersonation or unregistered organisations.
Using donation money for financial speculation, illegal purposes, or activities that promote sectarianism, racism or threaten national unity could carry up to five years in prison and fines of 3,000 to 10,000 dinars. A licensed organisation that spends donation money on purposes other than those authorised could face up to three years in prison and a fine of 1,000 to 5,000 dinars.
Donations could be returned to donors
The proposed law would also provide a mechanism for recovering misused donations. If a court convicts someone of misappropriating donation funds, running an unauthorised campaign, violating fundraising rules or spending donations for unauthorised purposes, it could order the money—or its equivalent value—to be returned to donors.
If returning the money is not possible, it would be deposited into the proposed humanitarian fund for use in charitable and humanitarian activities.
New regulator to oversee the sector
The proposed National Center for Charitable and Humanitarian Work would operate as an independent public legal entity under the supervision of the competent minister. Its responsibilities would include licensing and monitoring charitable activities, assessing money-laundering and terrorist-financing risks, developing governance standards and maintaining databases and official records.
The centre would also issue a binding code of ethics for charitable and humanitarian work and work with other government authorities to prevent charitable activities from being exploited for illegal purposes. Until the centre’s board is formed and its operating regulations are issued, the Ministry of Social Affairs would carry out its responsibilities.
What this means for the public
For donors, the proposed law is intended to make charitable giving more transparent and traceable, while strengthening safeguards around personal information and the use of donated money.
For charities and fundraising organisers, it would introduce stricter licensing, reporting, identity-verification, financial and record-keeping requirements, with significant penalties for violations.
The proposed legislation would also replace Kuwait’s 1959 law regulating fundraising for public purposes, creating a broader legal framework intended to bring the country’s charitable and humanitarian sector under tighter institutional and financial oversight.
