License renewal halted of 147,300 institutions and companies in Kuwait

• Trade officials pay special attention to processing FATF comments in compliance with international standards

• 748 Joint-stock companies have not registered their data.

• 50,320 Individual institutions have exceeded the deadline.

• 96,274 Personal companies have not disclosed their data.

Informed sources told Al-Rai that Kuwait’s Ministry of Commerce and Industry, stopped renewing or issuing of commercial licenses for around 147,300 companies, including joint-stock companies, sole proprietorships, and partnerships, that have not disclosed the actual beneficiary data. This affects approximately 65% of the 226,915 entities required to register such information.

The sources noted that the Anti-Money Laundering and Terrorism Financing Department imposed a financial penalty of 500 dinars on each entity that failed to disclose the actual beneficiary data. This action was taken on October 28, in accordance with Article 15 of Law 106 on Anti-Money Laundering and Terrorism Financing.

Sole proprietorships topped the list of entities failing to register actual beneficiary data, with 50,320 out of 63,759 establishments (79%) non-compliant. In contrast, joint-stock companies were the most responsive, with 955 out of 1,703 companies providing the required data, leaving 748 companies unregistered.

As for personal companies 65,179 of 161,453 registered their data, meaning that 96,274 personal companies (nearly 60%) did not comply in registering their data.

The sources stated that the Ministry of Commerce’s actions against companies and institutions failing to disclose actual beneficiary data are part of efforts to implement international recommendations, particularly those from the Financial Action Task Force (FATF).

These measures aim to combat money laundering and terrorist financing, while closing potential loopholes that could be exploited.

The sources revealed that officials at the Ministry of Commerce are giving special attention to addressing FATF’s concerns to maintain Kuwait’s classification in this area.

The procedures implemented are aligned with the application of binding international standards to ensure compliance with global regulations.

Regarding the suspension of activity for violating companies, the sources noted that the suspension will be lifted once the situation is rectified, but the 500-dinar fine will remain.

The sources also mentioned that a committee is being considered to review grievances related to this issue. Additionally, amendments are expected to be made to the Ministry’s systems to streamline the process for reviewers.

Explaining further, the sources highlighted that, in line with the procedures followed until the deadline, the Ministry of Commerce’s Information Systems Center created an electronic portal for registering actual beneficiary data with the Commercial Registry Department. The portal is linked to the Anti-Money Laundering and Terrorism Financing Department.

Additionally, the Ministry launched an awareness campaign to educate the public about the concept of the actual beneficiary and provide detailed guidance on the registration process.

The sources revealed that the Ministry of Commerce sent notifications via the ‘Sahel’ app to encourage commercial license holders to disclose the actual beneficiary data, while outlining the legal consequences for non-compliance.

Furthermore, the sources explained that the Commercial Registry Department processes registration requests, while the Anti-Money Laundering and Terrorism Financing Department monitors the number of registrants and non-registrants for the activities under its supervision.

83.6 % jewelry companies’ data disclosed

Notably, jewelry companies have been among the most responsive in disclosing beneficial owner data, with 1,301 companies providing the required information, compared to 254 that did not comply. This results in a disclosure rate of 83.6% in this sector.

Real estate brokers ranked second, with 1,184 disclosing beneficial owner data, while 357 did not, resulting in a compliance rate of 78.6%.

The banking sector followed in third place, with 100 registered entities and 45 unregistered, yielding a compliance rate of 69%.