Introduction
On 27 September 2026, Decree-Law No. 94 of 2026 was published in the Official Gazette (Kuwait Al-Youm, Issue 1810), amending key provisions of Law No. 49 of 2016 Concerning Public Tenders. The amendments which enter into force three months from the date of publication introduce significant changes to Kuwait’s public procurement framework, affecting the governance of the Central Agency for Public Tenders (“CAPT”), petroleum-sector procurement, the use of commercial agents, and small and medium-sized enterprise (“SME”) participation. This article summarises the most consequential changes introduced by the Decree-Law.
Legal Basis and Regulatory Context
Law No. 49 of 2016 on Public Tenders was enacted to regulate procurement and tendering processes conducted by government entities within a framework of transparency, equality, and equal opportunity. However, practical application revealed a number of difficulties that hindered its effective implementation. The new Decree-Law should be read alongside related 2026 reforms, including Decree-Law No. 67 of 2026 (corporatisation of KPC and the prohibition on agents in petroleum contracts) and Decree-Law No. 78 of 2026 (the Commercial Concealment Law), which together signal a decisive policy shift toward transparency, direct foreign engagement, and the elimination of intermediary structures in Kuwait’s commercial landscape.
Key featuresof the amended Tenders Law
- Prohibition ontheUse of Agents (Article31):
The amended Article 31 is perhaps the most consequential amendment it prohibits the use of local agents or commission agents in all public contracting procedures, in accordance with rules to be approved by the Council of Ministers. This extends the agent ban introduced by Decree-Law No. 67 of 2026 (which applied only to KPC contracts) to all public tenders governed by Law No. 49 of 2016, representing a fundamental change in market access for foreign contractors.
- Petroleum Sector Procurement (Article 2/III, Item 3):
The financial threshold for contracts falling within CAPT’s jurisdiction is raised from five million to twenty million Kuwaiti dinars. Procurement committees replace the former procurement unit, operating under rules approved by KPC’s Board of Directors that must observe principles of transparency, governance, and equal opportunity. All petroleum operations as newly defined are expressly exempt from the Law regardless of value. The Supreme Petroleum Council is granted authority to authorise urgent procurement by KPC or its subsidiaries.
- Board Composition (Article 5):
CAPT’s Board of Directors is streamlined by removing the representatives of the state planning agency, the Public Authority for Manpower, and the National Fund for SME Development. The government entity representative overseeing the relevant tender now participates without voting rights.
- Higher Self-Contracting Threshold (Article 19):
Public entities may now contract without CAPT authorisation for amounts up to one million Kuwaiti dinars which represents a significant increase from the previous threshold. The Council of Ministers is empowered to adjust this threshold upward or downward based on the Board’s recommendation.
- SME Provisions and Product Priority (Articles 62 and 62 bis):
The price premium available to SMEs is reduced from 20% to 10% of the lowest accepted bid, and a new provision prohibits combining SME priority with product-origin priority in the same tender. The Council of Ministers is granted authority to designate the minister or public entity responsible for determining product priority in government procurement.
- Local Content Requirements (Article 87):
Contractors are now required to purchase no less than 30% of products from the Industrial Directory issued by the General Authority for Industry. The 30% subcontracting obligation to local contractors is maintained, with 10% allocated to SMEs.
Conclusion
Decree-Law No. 94 of 2026 represents a meaningful modernisation of Kuwait’s public procurement framework. By raising procurement thresholds, prohibiting the use of agents, and streamlining governance, the amendments aim to enhance efficiency, transparency, and direct participation in public tendering. Market participants particularly foreign contractors and service providers are encouraged to familiarise themselves with the new framework and assess the implications for their procurement activities in Kuwait.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
[View Source]
