Plan to cancel the business licenses “closed doors”

Kuwait City, March 16: The Ministry of Commerce and Industry envisages the implementation of a new clause for the cancellation of licenses for companies that are not operational for six consecutive months. Sources indicated that this measure is being reviewed following the discovery of a large number of licenses, which were not used from their issuance. The proposed clause is in accordance with the law of companies and it is expected to be applied more broadly, sources have revealed.

According to the relevant article, a license will be revoked if the business activity has not been carried out for six consecutive months, without announcing the ministry, if the company expires, is dissolved or liquidated or if the license holder requests it. A license will be revoked and if it is not renewed within one year from its expiration date. This proposed measure coincides with the introduction of the request “trade” and with the requirement of registration of the beneficial owner.

The ministry has previously revoked the commercial licenses of companies in real estate, research and medical sectors that have not been active for six consecutive months. Several applicants approached the ministry, stating that they have forgotten their licenses for several years and asked for the implementation of this policy to accelerate the revocation process. It will apply to all commercial licenses for companies that have not notified the ministry, in accordance with Article 11/3 of Law no. 111/2013 regarding the licenses of commercial establishment. These decisions also follow a revision of the law of companies, its changes, executive regulations and trading establishment licenses.

Moreover, the license can be revoked if it is proved that the licensee has obtained the license through false information or forged documents; violated the conditions presented in the executive regulations; Violated health standards; Sold pampered, adulterated or harmful products; or lost the right to engage in trade in accordance with the law