16/03/2025
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16/03/2025
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KUWAIT CITY, March 16: In response to the intensified efforts by business owners to update their key data and avoid penalties of up to KD 10,000 for failing to disclose the actual beneficiary, sources revealed that approximately 31,700 companies have disclosed their beneficial ownership information in just four days. This represents about 4.3% of the total valid licenses under the Ministry of Commerce and Industry, which stands at around 226,938. With this increase, the percentage of companies that have disclosed their data to date has risen to 55%.
The sources highlighted that the Ministry of Commerce has experienced a steady influx of commercial license holders in recent days. These visitors fall into two categories: the first group seeks clarification on the "actual beneficiary" mechanism and the procedural challenges they face, while the second group includes owners of suspended or expired licenses who have not submitted financial budgets for years. Ministry officials have informed these license holders that they must either regularize their status or request cancellation from the commercial register. As a result, some have moved to amend their status within the deadline, while others have opted to cancel their licenses.
Aligning with FATF Recommendations
The sources emphasized that the Ministry of Commerce aims to have at least 60% of companies covered by the beneficial ownership database disclose their information by June. Failure to comply will result in penalties, in line with the Financial Action Task Force (FATF) recommendations. These recommendations urge Kuwait to adopt stronger measures to combat money laundering and terrorist financing.
To streamline the process, the Ministry is finalizing the integration of the "beneficial owner" service into the Sahel Business program. This will allow license holders to complete the procedure through clear, step-by-step instructions. The Ministry has also clarified that all entities registered with the commercial register, including sole proprietorships and companies of all types, are required to disclose and register their beneficial ownership information under Ministerial Resolution No. 16 of 2025. However, companies listed on domestic or foreign stock exchanges and government-owned entities are exempt from this requirement.
Penalties for Inaccurate Data
The sources revealed that the Ministry is preparing to impose specific penalties on individuals found to have provided inaccurate information. The first step will involve verifying the accuracy of the data submitted by license holders. If false information is discovered, the individual will face penalties, though the exact nature of these penalties is still under legal consideration.
Currently, the Ministry has set a fine of KD 1,000 for failing to disclose beneficial ownership information after a grace period ending post-Eid, with penalties escalating to KD 10,000. Additionally, violators may face penalties under Law 106 on Combating Money Laundering and Terrorism Financing, which can reach up to KD 500,000.
Deadline Approaching
The sources warned that license holders who fail to disclose actual beneficiary data or cancel their expired licenses by the end of March will face penalties. They noted that the process of canceling a commercial license and removing it from the registry typically takes two to three weeks, as it involves coordination with various entities, including the Public Authority for Manpower. To avoid financial penalties, those wishing to cancel their licenses are advised to submit their requests immediately.
The Ministry has recently received a significant number of inquiries and cancellation requests from owners of inactive licenses, many of whom are seeking to avoid the financial penalties associated with non-disclosure of beneficial ownership data.
