Privatization Law No. 37/2010 in Kuwait:

Privatization Law No. 37/2010 in Kuwait:

The decrease in productivity and efficiency of governmental sectors as a result of bureaucracy and administrative complexities is one of the most important motivations and justifications for Privatization. The philosophy and components of the Kuwaiti economy are based on the principle of a free economy that encourages individual initiative as set out in the Kuwaiti Constitution. Article twenty of the Constitution states that “the national economy is based on social justice and is based on cooperation between the public and the private activity and aims to achieve economic development, production, raising the standard of living and prosperity of citizens, within the limits of the law”.

The enactment of Law No. 37/2010 regarding regulating the privatization programs and its processes is a recognition by the Kuwaiti legislature of the ability of the private sector to play its main role in the development and its ability to participate and carry out the management of economic activities in the country to improve productivity level and economic prosperity, which leads to the expansion of the role and the scope of the private sector.

The Kuwaiti legislator has adopted this principle in article three of the aforementioned law states “the national economy is based on social justice, and its foundation is based on the cooperation between the public and the private activities, and its goal is to achieve economic development, increase production, raise the standard of living and achieve prosperity for citizens, all within the limits Law”.

Law No. 37 of year 2010 regarding regulating the privatization programs and its processes defined privatization as “transferring ownership of the public project in whole or in part” to the private sector in accordance with the provisions of this law.

The above mentioned law excluded from economic projects that are not subject to privatization the economic development projects related to the investment of a resource of natural wealth or a facility of public utilities, as it is required to be privatized by virtue of a law and for a limited time. This provision is consistent with Article 152 of the Constitution that states: “Every obligation to invest a resource of natural wealth or a public utility facility shall be by virtue of a law and for a limited time. Preliminary processes shall guarantee the rights of research and exploration operations, public tendering and competition…” This provision also accords with Article 153 of the Constitution, which states that “every monopoly is granted only by virtue of a law and for a limited time.”

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