Capitalisation and Debt

Capitalisation

  • The contractor's commitment will be 30% of the Supply Contract value, and in the same currency.

  • Contributions in non-monetary terms, such as licence arrangements, trade-mark use, research or development costs, will be assessed for capitalisation value according to normal business and accounting practices.

  • The Joint Venture will need to establish a cash equity investment of at least 30% of the total capitalisation required.

  • Adequate capitalisation of Joint Ventures shall be a pre-requisite and be calculated according to normal financial criteria.

Debt

  • Total debt cannot exceed 70% of the total initial capital value.

  • If the goods or services to be provided are changed after the contract has been signed, the contractor's commitment will be adjusted in a similar proportion.

The ownership and capital structure applies to ventures established in Kuwait. In an event that a contractor establish an overseas venture and has a Kuwaiti national as a shareholder in an existing venture, the ownership and capital structure shall be at the discretion of both parties, particularly according to the law of the host country. The Ministry of Finance (Program Executive Office) must approve any appointment or organization of an overseas project.