Royal Decree-Law on Government Sukuk Regulatory Framework
A decree-law No. 90 of 2026 has been issued to regulate the issuance and trading of government sukuk (Islamic bonds) in Kuwait. The law includes 35 articles that specify the details of issuing sukuk in Kuwaiti dinars as well as foreign currencies, whether in the local or international markets. The aim of the decree is to organize the issuance of sukuk against specific assets owned by the state, provided that these assets are not designated for public benefit or considered natural resources. It also allows for the replacement of assets during the sukuk term while maintaining their value. Additionally, the decree establishes a special-purpose company fully owned by the state to manage and issue these sukuk assets, with its capital determined by the state and not necessarily aligned with the total value of the issued sukuk. The law requires approval from the Central Bank of Kuwait for issuing sukuk in dinars within Kuwait. It also mandates supervision by a specialized Shariah board composed of qualified scholars to oversee the Islamic legal aspects of the sukuk in accordance with Islamic law. Issuers are exempt from taxes and fees related to the issuance process. Trading in the local or international markets can occur with the approval of the Minister, accompanied by specific announcements and regulations to ensure transparency. The law also stipulates that the Minister of Finance must issue the executive regulations within three months of the decree's publication, and it comes into effect from the date of its publication.
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