The power of being there

As you can see from the picture above, we are well on the way to renovating our physical business centre here in Kuwait, in the shadow of the British Embassy.  It's taken a long hard slog to get to this point, but the work (so far!) is really taking shape and going pretty smoothly.  

By 1 December we will be offering UK companies 9  "hot desks" in the centre, connected to reliable and fast wifi, with meeting space, refreshments and support from our team all included in one easy to understand price.  UK companies can come for the day, stay for a month - or even a year.  Just like our first customers have decided to.

All of us at the KBBC are really excited and very proud that FB Heliservices a subsidiary of Cobham Aviation have put their faith in us and decided to base themselves in the business centre.  FB Heliservices are based in Qatar and have taken the plunge to spend a couple of days in Kuwait a week as they try and get a foothold here in the market.  

Taking a long term view in Kuwait is essential.  It's not a place where things happen quickly - but when they do, if you have positioned your company correctly, you stand to do very well indeed.  And that's where we hope our business centre can help.  If you keep coming back to Kuwait regularly and use our home as your home-from-home you are far more likely to build the relationships, contacts and understanding you need to succeed here.  Just like Jerry and Tony from FB Heliservices have understood.  We wish them all the best and look forward to having them with us from 1 December.  Two sugars for me Jerry!!

How the KBBC can help

It's been a busy October for the KBBC, after achieving legal status as a With Limited Liability Not-For-Profit 51 % Kuwaiti 49% UK company here in the State of Kuwait.  No mean feat in itself, as we have become only the 3rd not-for-profit company here and the first with an international shareholding.  We've been able to motor on with developing our services and refining what we have to offer UK companies looking to do business here and for Kuwaiti companies looking to do business in Britain.  Here's what we have come up with:

Trade Services: Working with our UKTI colleagues, we've started to transition across Trade Services for UK companies from the UKTI Kuwait team to the KBBC.  And it's been an exciting start.  Just this October, KBBC has already delivered a high level VIP dinner event for a UK Investment Advisory company in the beautiful British Ambassador's Residence.  It was our pleasure to arrange an event in the exclusive Chairman's Club Kuwait to introduce 3 unique London property developments: Embassy Gardens, Wardian at Canary Wharf and London City Island to the Kuwait market.  We ended the month with the fantastic news that the KBBC had been selected to develop and deliver the Trade Mission programme for 15 Scottish companies by Scottish Development International, visiting Kuwait at the end of November.  We can support your company in doing business here in Kuwait just as easily.

Business Centre Services: Work has started on our brand new Business Centre, right next to the British Embassy in Kuwait City.  We're developing 9 "hot-desks" for UK companies to rent for the day, for the month or for the year.  Use our meeting rooms, wifi, and telephones, invite Kuwaiti contacts to call on you at a prestigious address and enjoy a coffee with other British businesses who can swap stories and offer advice on doing business in Kuwait.  When the time is right, through our relationship with the Kuwait Direct Investment Promotion Authority we can make your application to be up to 100% fully foreign owned Kuwaiti company, so you can grow and succeed even further in the market.

Subscriber Services: We will be launching our subscriber service in December, to build a network of Kuwaiti and British business leaders working together to take bilateral trade to an even higher level.  To share insight and support and to hear the latest developments and perspectives on the UK and Kuwait business environment from VIP Kuwaiti and British speakers.  All subscribers undergo a selection process so we feel comfortable and confident in making introductions.

Whatever your business needs in Kuwait, we can help.  So please get in touch and we look forward to welcoming you here soon.

Martin Hall, CEO - Kuwait British Business Centre

 

Doing Business in Kuwait

Doing business in Kuwait as a foreign, or British Company until recently was pretty simple – strictly speaking you couldn’t... International businesses had to:

  Establish a new Kuwaiti Company,

  Set up a Joint Venture, or

  Appoint a Kuwaiti Commercial Agent or a Kuwaiti Commercial Representative.A Kuwaiti Citizen’s share of the new business has to be no less than 51% (though the share of profits can be split differently). That all changed in 2013 with a new Foreign Direct Investment law allowing for the first time international companies to establish 100% fully foreign owned business in Kuwait and the creation of the Kuwait Direct Investment Promotion Authority (KDIPA). Notable investors in Kuwait under this new law include Microsoft, IBM, Huawei and Selex Galileo. The Kuwait British Business Centre has established a Memorandum of Understanding with KDIPA to handle the investor application process on behalf of UK companies. The Kuwait British Business Centre can also support UK companies choosing to do business in Kuwait via a more traditional route.

Establishing a Company in Kuwait

Limited Liability Company

The quickest and easiest way of setting up a new Kuwaiti company for UK business and individuals is to establish a Limited Liability Company (WLL). The share of a Kuwaiti citizen or Kuwaiti company in the new WLL Company must be at least 51%. The process of forming a WLL is pretty simple and having been through it, KBBC can support you. It takes approximately three months. This type of company offers limited liability, with different levels of liability depending on the company objectives you incorporate under.

Closed Joint Stock Company

UK businesses can also establish a Closed Kuwaiti Joint Stock company (KSC Closed). Only Kuwaiti citizens may be shareholders of a joint stock company. However, the British business may own up to (49%) of the share capital, after attaining approval. KSC Closed companies cannot be established in banking or insurance. The process of forming a KSC Closed company takes up to six months.

Establishing a Joint Venture:

Joint venture companies do not have a legal personality in Kuwait. These companies may not conduct business in their own name. Business has to be done through the Kuwaiti Citizen forming the joint venture. In this case a British Company is personally responsible for the transactions they enter into with any third party. The liability of the transacting partner to the third parties is unlimited. Meanwhile, the liability of the non-transacting partner (the Kuwaiti) is confined to their share in the joint venture. The Kuwaiti partner in the new JV Company must guarantee the transacting partner, if the latter is a non-Kuwaiti citizen. The joint venture partners are exposed to unlimited joint liability, if the joint venture company deals with third parties in its own name. It makes no difference whether the joint venture partners were personally involved in the transaction or not.

Appointing a Kuwaiti Commercial Agent

Only Kuwaiti Citizens may act as Commercial Agents and they are broken down into three specific types.

First Type – Contracts Agency

In this type of agency agreement, the local agent undertakes to do the following under the contract:

a) Promoting the principal’s business on a continuous basis in the territory,

b) Entering into transactions in the name of the principal in return for a fee.

The agency contract must be written. Items of contract must define: the territory covered, the agent’s fees, the agency term, the product or service that is the subject of the agency, and any relevant trademarks. If the agent should establish showrooms, workshops, or warehouse facilities, the contract must be valid for a period not less than five years.

Second Type - Distributorship

Under this agency agreement, the local agent may act as the distributor of the principal’s product in a defined territory and in return for a percentage of the profit.

Third Type – Commission Agency

In this type of agency agreement, the agent concludes contracts in his/its own name. The principal’s name may not be revealed without his consent.

Commercial Representatives:

A commercial representative is a Kuwaiti individual or entity engaged by a foreign company to represent its business interests in Kuwait. Usually, the authority of a commercial representative is more limited than that granted to an agent. Fees may be paid as a fixed regular amount, a commission, or percentage of profits. Foreign companies accept full liability for all of the actions of its commercial representative, provided that all the actions are carried out or incurred within the scope of representation.

About the Kuwait British Business Centre

We exist to support and develop UK companies into doing business in Kuwait.

  We run a Subscriber Service, allowing British companies to access the advice of trusted providers here in Kuwait City.

  We offer a fully connected and professional Business Centre Service adjacent to the British Embassy for use by British Companies for a day, a month or a year.

  Our Trade Services offer more information or support in your specific sector whether that’s market research, support for a market visit of a list of distributors, agents or potential partners. For more information please see our website www.kbbcentre.com

Why Apple should have chosen Kuwait

The Middle Eastern press was excited about news last week that Apple has been granted an exemption from foreign ownership laws in the UAE to establish 100% control of its operations in the Country.  http://bloom.bg/1Lqlzkc There is already news about an Apple store opening in Dubai, with another being added in Abu Dhabi.  Many of the articles went on to talk about how the UAE want to bring in new legislation that would encourage FDI and will allow more international businesses to follow suit and own 100% of their UAE subsidiary.

While the story made the front page of the Kuwait Times, it's not really news here in Kuwait - and here's why:

  • Kuwait already has an FDI law in place - It's actually a couple of years old and led to the creation of the Kuwait Direct Investment Promotion Authority (KDIPA) www.kfib.com.kw who are working to bring international companies to Kuwait, to diversify the economy and develop a private sector (non oil) future for Kuwait's youngsters.  The Kuwait British Business Centre is working very closely with KDIPA to bring UK companies who meet their criteria here.  Like Apple those companies can retain 100% of the ownership of their newly established Kuwaiti business
  • It's working - KDIPA have already had some pretty high profile successes through this method.  KDIPA announced back in April that their first investment licence had been issued to IBM.  Huawei were announced as investors, this June.  In both cases KDIPA represented the companies, did the legwork for them and ensured smooth passage through the relevant Kuwaiti Ministries and public bodies.
  • Kuwait has always been a staging post for the Middle East - In the eighteenth century, Kuwait rapidly became the principal commercial centre for the transit of goods between India, Muscat, Baghdad and Arabia.   This led to the establishment of a Kuwaiti elite by the first decades of the twentieth century (long before Kuwait discovered oil).  The wealthiest families were trade merchants who built their wealth on long distance commerce, shipbuilding and pearling.  

Kuwait's history in trading, business and forming beneficial partnerships across the region is as relevant today as it was then.  With markets across the Arab world opening up and attempting to develop the infrastructure and skills they need to achieve sustainability in the 21st century, basing yourself in Kuwait, with business friendly laws and a business friendly culture, suddenly seems pretty natural.  Maybe Apple might decide to take another bite.....

Martin Hall is the CEO of the Kuwait British Business Centre, the organisation established to drive up the UK's trade with Kuwait.
The Kuwait British Business Centre, working in association with KDIPA can support UK companies wishing to invest and do business in Kuwait.  For more information please contact us at info@kbbcentre.com

Kuwait and rise of the Instabusiness

Kuwait has the highest smartphone market penetration on the planet at 212% and according to Mideast Times, every Kuwaiti on average carries around two mobile devices. Some to separate business from pleasure and some just because they can’t make their mind up between the latest Samsung or Apple product.

For any UK company serious about doing business in Kuwait, making your mark here on social media is essential. Studies by Northeastern University show that Kuwait tweets more per person than any other country in the world.  Kuwait also dominates Instagram.  #Kuwait has been used in 8.2 million posts. While #USA has around 7.7 million.  Not bad, considering Kuwait has a population of 4 million and the USA, 300 million. 

The high awareness and usage of Instagram in Kuwait has spread to businesses, with everything from make-up to sheep (yes sheep) being sold through the app.  In April the American University of Kuwait held the first Instabusiness Expo with numerous Kuwaiti entreprenuers showcasing their companies.  Kuwaiti company Monkey Cookies started as a business run from home solely on Instagram and now has 4 stores, a distribution network and over 100,000 Instagram followers. https://instagram.com/monkey_cookies/?hl=en

Features like comments, likes, and even mentions give a great chance for a business to hear directly from their audience and gain feedback on products. With so many of the Kuwaiti population engaged on social media, it creates the trends and buzz that smart businesses wanting to be successful need to follow and the really successful ones need to drive.  One thing is for certain.  If you want to do business in Kuwait, you can’t simply ignore it.

Jarrah Al-Qabandi is a business intern working with the Kuwait British Business Centre as part of the LOYAC Summer internship programme.
LOYAC is a nonprofit organization headquartered in Kuwait working towards the overall development of youth. LOYAC design and develop many programs to facilitate the professional development and personal growth of the youth, ages 6 to 30.

Guest Blog by KBBC Summer intern Jarrah Al Qabandi

When you are thinking of Kuwait, many of the things that come to mind (and that are often portrayed by the media) are camels, flat vast deserts, and people living in tents. As a young Kuwaiti who has spent the majority of my life here, I can honestly say that is not true. Kuwait is actually a very modern, comfortable place to live, with exciting advancements in technology and transportation.  Kuwaiti architecture, once leading the region in the 1970’s and 1980’s is coming back to it’s prime with exciting airport, opera house and cultural centre projects. 

With a population of around 4 million, with only 1.2 million Kuwaiti citizens and estimates putting Kuwait anywhere from the top 3 to top 10 richest countries in the world, Kuwaitis like me are lucky to be able to enjoy a very luxurious lifestyle including fancy cars, expensive clothing, and thousands of dollars worth of decor in their homes. Kuwaitis like the best of what they can buy, respect quality and often look for British brand names as a mark of history, heritage and quality.   Fashion is highly marketed in Kuwait, with many Kuwaiti friends of mine taking on the fashionista role.  Always staying in style, and never being caught in something unfashionable.  That extends to mobile phones, cars and accessories, not just fashion.

Trends are very quick to become popular here in Kuwait. As soon as someone posts something on social media (which is enormously popular) about a new object they bought or a new style of clothing, the trend takes off with teenagers here and will prove very big very fast. With the Kuwaiti youth’s high disposable income they have easy access to a large variety of brands and stores from all around the world.  There are opportunities here for many businesses including the UK. 

Due to the size of Kuwait, getting around is the 6,880 square miles is very easy, with most destinations almost always 20 minutes from where you are!  Safe and cheap taxis scatter the city. Kuwait is undergoing a transformation to become better geared up to support and develop the business community.  Various Kuwaiti entities are attempting to show how beneficial it is for international companies to start their business here. With all this to offer, I think you could do very well by starting your development into the Middle East in Kuwait.

I know if you are interested, the Kuwait British Business Centre would be glad to help kick-start your development into the Gulf and provide help on how to get yourself up and running in no time!

Jarrah Al-Qabandi is a business intern working with the Kuwait British Business Centre as part of the LOYAC Summer internship programme.
LOYAC is a nonprofit organization headquartered in Kuwait working towards the overall development of youth. LOYAC design and develop many programs to facilitate the professional development and personal growth of the youth, ages 6 to 30.

Kuwait - A nation of firsts

A lot of the challenge of securing British businesses success here in Kuwait, is getting the companies to come in the first place.  Often enticed by the bright lights and big plans of the UAE, or bowled over by the sheer scale of ambition in Qatar, or the size of the Saudi Arabian market - Kuwait is often an afterthought.  The Kuwait British Business Centre encourages you to take a fresh look at Kuwait, who's history shows dynamic and exciting achievements, often leading the Middle East as they went.

  • Kuwait established the World's first sovereign wealth fund, the Kuwait Investment Office in London in 1953, the precursor to the Kuwait Investment Authority, rumoured to have $592 Billion under management worldwide.

  • Kuwait leads the Arab world in foreign investment, with $8.4bn FDI outflows in 2013

  • Kuwait is a constitutional monarchy and has the oldest directly elected Parliament among the Arab states of the Persian Gulf.  Female suffrage was granted in 2005.  Kuwait has female MPs and Cabinet Ministers.

  • Al Arabi magazine was first published in Kuwait in 1958.  The magazine went on to become the most popular magazine in the Arab world.  Kuwait is still known for its free press and fierce defence of freedom of speech.

  • The Kuwait Stock Exchange was established in 1983 (the first in the Gulf) and now has a market capitalisation of over $100bn

  • Kuwait has the oldest modern arts movement in the Arabian Peninsula and began awarding scholarships in the arts in 1936. The first Gulf country to do so.

Whether in politics, business or the arts, Kuwait has a story to tell, and a bright future ahead.  UK companies enjoy a long history of trading and partnering with Kuwaiti firms, relatively little competition and with the opportunity for long-term productive relationships, maybe it's time you looked at Kuwait again? it would be our pleasure to help you when you do.

 

Ramadan Kareem!! What a British Business needs to know.

The Islamic holy month of Ramadan is rapidly approaching, probably starting on the 18th of June.  It will be my 3rd Ramadan spent in Kuwait (see the picture I took last year) and while some UK business people think that it's a time to avoid visiting - you may find that with a bit of hard work and the support of the KBBC you could make Ramadan work for you.

Kuwait holds the unique concept and tradition of a "Diwanyia" very close to it's heart.  A Diwanyia is both a room (or a specially added separate meeting hall) at a Kuwaiti home as well as the name given to the concept of men gathering together, receiving guests, neighbours and friends to discuss current events, exchange views and become better acquainted.  The good thing is (and it's something us Brits struggle with!) everyone is invited.  There's no invitations, no guest list, no RSVP - if you know the Diwanya is on just turn up...you will greeted with open arms.  In fact, with a British accent and even a vague understanding of the Premier League - you'll practically be a celebrity!  During Ramadan, all of the bigger Kuwaiti families publish the dates and time of their Diwanyia's in the local paper, including the Kuwaiti merchant families who are the best route into doing business here - whether you are a medical devices company or a lawyer.

You'll be treated to as many cups of arabic coffee as you can drink, (shake your cup to indicate you've had enough - or it will keep being refilled) dates and many varied sweets, nuts, desserts and cakes.  A polite "La shukran" is fine when you've had enough.  Talk about the weather, talk about the UK, the football, politics but wait for your host to bring up business.  You can stay between 5 minutes and 55 minutes, chances are you'll know when the time is right to say goodbye.  While you might not get a contract on the back of 15 minutes in a Diwanyia, it is a superb way to build your contact network, engage in some uniquely Kuwaiti culture and form a meaningful and memorable bond with a potential business partner. 

If you're interested we can help.  We'd be happy to work through the lists of published Diwaniyas (and some that aren't) find the right ones for your company and help make the introductions.  In Kuwait's busy Ramadan traffic we can even drive you from Diwanyia to Diwaniya then back to your hotel for some much needed shut-eye....just don't drink too much coffee!

Don’t wait, it could be too late! A guest blog from Kieron Peacock, Headmaster TES Kuwait

If you are moving, or contemplating a move, overseas and have children of school age you might find the following useful.

British education in the Middle East is booming.  One of our most exportable commodities seems to be the development of schools around the world offering a British education.  From Kazakhstan to Kuwait, Brazil to Brunei and The Netherlands to Nigeria, British education is becoming a global phenomenon, and carries a kite-mark of confidence that stands for a quality education.  But does it really?  Like a common answer to many questions, “it depends.” 

In simple terms, when contemplating a move overseas my advice is, like all good pupils should, do your homework….

Check out school websites; read the latest inspection reports; study academic results, if they are readily available; see if there are any blogs about education in the region; does the school advertise the percentage of native English speakers or those of British descent?  Word of mouth is often the best way, but be aware that not all HR and relocation staff actually know the schools well enough to be able to help you make an informed decision.  Interestingly enough, a good number of those giving advice about schooling in countries around the world to Brits relocating don’t actually have children themselves so have never really considered education in the same way that parents do.  However, there are a number of outstanding relocation experts in businesses and large multi-national corporations offering excellent advice to would-be employees about education.  What you quickly need to work out is whether or not you have one of them!  Ask them specific questions: Does the school follow the English National Curriculum?  Is it an IB or IGCSE/A-level school, or both?  What is the language of the playground?  Where did the teaching staff train?  What qualifications do they have?  Is there a high turnover of staff?  What facilities does the school have?  Does the school achieve good results in examinations?  If so, how do they compare to the UK norms?  How many pupils attend the school?  How many classes are there in each year group?  How does the pastoral care system work?  What is the provision for children with learning differences or special needs, if any?  What does the extra-curricular programme offer?  Now, this might seem like overkill, but you will certainly get a feel for whether or not your ‘adviser’ is giving good advice based upon knowledge or if they are not up to it.  If in doubt, go directly to the school and seek answers to these questions.  Websites should also be able to tell you much of this, so it may not do you any harm to ask an adviser a question that you already know the answer to.  You only get one shot at your child’s education so be prepared to be assertive about it.    

So, what should you do if you are relocating to Kuwait and have a child or children of school age?  Well, the reassuring fact is that thousands of Brits have had their children educated most successfully at British schools in Kuwait.  If you seek advice from someone that knows the schools and you visit the schools’ websites you will get a feel for the quality of British education available in Kuwait.  While you will find a broad selection of good schools here it makes sense for me to tell you a little bit about the school I proudly lead.  The English School, Kuwait has successfully educated thousands of British pupils over the years.  The vast majority of these pupils invariably look back upon their time as a ‘golden time’ in their education as there is something very special about the school.   The English School, or TES as it is more commonly known, was the first British curriculum school to be established here in Kuwait over 60 years ago.  Initially the school provided an education for the children of British Embassy staff keen to keep their children with them rather than at boarding school.  The school now has well over 600 pupils with almost 50% of them British and 75% native English speakers.  The school caters for children from 2 ½ (Pre-Kg) to 13 years of age (Year 8)  and we pride ourselves on delivering excellence in the classroom and in extra-curricular activities, and in developing in each child the school’s core values of, Confidence, Empathy, Integrity, Positivity and Respect.  We only go up to Year 8, but that means that our older students get to experience taking on positions of responsibility and take the lead in the school.  We also pride ourselves on being able to prepare pupils thoroughly for the next phase of their education leaving us as confident learners and teenagers, ready to embrace the next part of their journey.  Our leavers mainly go on to British curriculum secondary schools here in Kuwait and a number head back to UK boarding schools and schools around the world.  We consider that a TES education is good preparation for just about any secondary school on the planet.

Like all good schools, places are at a premium, but the nature of the Middle East expat workforce in general is that there is inevitable turnover.  If you have children and think TES might be the school for you, early registration is the key.  Something  that applies to all of Kuwait’s British Schools.  As soon as you can, and as a matter of considerable urgency, go to the Admissions section of our website and complete an on-line Application Form.  The school’s Registrar will get back to you regarding ‘what next’ and will provide information on the likelihood of a place (or places) being available.  We facilitate remote on-line testing at a child’s current school if applying for a Year 3 (currently a Year 2 pupil) place or above and in all cases request a reference from the school.  If a child does sufficiently well in the on-line testing, a space is available, and we receive a positive reference, a place will be offered.  For younger children, a positive reference may well suffice.  If we haven’t got space a wait-list place will be offered.  If we are not sure whether to offer a place or not we might organise a Skype chat and also seek further information from the child’s current school, especially if extra support might be required for the child concerned.  If we are still not sure, we may say that we are not prepared to offer a place without seeing the pupil here for interview in Kuwait.  In this latter scenario we will not hold a place open on a ‘maybe’, so the sooner we see the child the better so that we can make an informed decision.  Of course, we do, at any stage in the above scenarios, reserve the right to say no, although we do pride ourselves on being able to support most children, but not those with relatively pronounced learning difficulties.

My top tips for finding the right school overseas are as follows:  

1.       Do your homework and do not always assume that the relocation contact is the expert

2.       Register early to avoid disappointment.  We have had to say ‘no’ to countless parents that didn’t think to initiate the process of education immediately a post is offered.  In fact, don’t wait until then as it may already be too late.  Education options need to be a key priority and consideration from the outset.

3.       If you can, go and look at a school as a part of your research to get that all-important gut-feeling about the place.  If you can’t, scrutinise the website to see what it tells you.

There are some fantastic British educational institutions now around the world and there is no doubt that these schools, coupled with the experience of living in a different culture, provide an outstanding education.  Expat children are more worldly wise, they also seem to develop a robustness and open-mindedness through their experiences.  Of course, living and working overseas is not for everyone, but when families embrace an opportunity to experience something new, education is a vital piece of the jigsaw.  Quality exists in abundance in British education overseas, you just need to know where to look.   If you are lucky enough to land a great job overseas and well-organised enough to secure a quality education for your children, savour the moment as it might just turn out to be your ‘golden time.’  Good luck!

Kieron Peacock

Kieron Peacock has significant experience in education having taught in a large Nottingham city comprehensive school, a highly selective independent London boys day school, a co-educational independent school in Bermuda, and been a senior manager and Deputy Head at one of the UK’s leading co-educational boarding prep schools in Dorset.  He has been an inspector (Independent Schools Inspectorate) of independent schools since 2001, is a member of their international panel and is currently Headmaster at The English School, Kuwait