Banks in Kuwait prohibited from confiscating entire earnings of defaulters
Loose Cannon in the Banking Sector
Here's the skinny on banks in Kuwait: some of 'em have been taking all their customers' salaries, and that ain't cool. Counselor Abdullah Al-Othman, the big cheese in the General Administration of Enforcement, spilled the beans to Arabic daily Al Rai that this is a big no-no.
You might be thinking, "Why is this a bad thing?" Well, it turns out it's against Article (216) of the Code of Civil Procedure, Paragraph (z), which states that only half of a debtor's salary can be seized. That's right, half, pal. But, the banks seem to be ignoring that little rule, and they're affecting all sorts of folks—state employees, those in private and oil sectors—you name it.
The dust-up started when Al-Othman wrote a letter to the Governor of the Central Bank of Kuwait, Basel Ahmad Al-Haroon. The letter requested action on Decree-Law No. (59) of (2025). This decree revised provisions of the Civil and Commercial Procedures Law (Decree-Law No. 38 of 1980), focusing on the seizure of debtors' assets by third parties and declaring that such seizures stay in place unless lifted by the Execution Department.
Al-Othman further noted the banks' flagrant disregard for the law regarding salary seizure, and he demanded that all banks follow the rules designed for such actions in accordance with Article 216 of the Code of Civil Procedure and the special laws regulating salary seizure. There's more to it, but let's get back to the birds and the bees, shall we?
Now, it's important to understand that Kuwait has specific laws protecting salaries in various sectors. Government employees' salaries are guarded by the Civil Service Commission Law, which aligns with Article 216’s restrictions. The private sector's labor law also upholds the Article's 50% garnishment limit, while non-salary funds can be seized entirely, but with judicial oversight. Oil sector employees are covered under the same framework, without any exemptions.
Number 59/2025 amended the enforcement tools but kept the salary protections intact. Key changes include tougher asset reporting requirements and stronger mandates for banks to limit deductions to legal thresholds.
Al-Othman recently made it crystal clear to the banks that the full salad cannot be taken; only half may be seized. He also went to bat for the guys in charge at the Central Bank of Kuwait to enforce the law, but that's another story for another time.
So, there you have it. Fighting for fairness, one salary at a time. Now, let's get back to more important things, like fish and chips or beer and football. Cheers!
Disclaimer: Information herein is provided for informational purposes only. While every effort is made to ensure the accuracy of the content, the author does not hold any legal or professional qualification and cannot be held liable for any damages or consequences arising from its use. It is recommended to consult a legal expert before taking any actions based on this information.
Enrichment Data (Integrated): Some banks in Kuwait have been taking their customers' entire salaries, which breaches the 50% garnishment limit set out in Article (216) of the Code of Civil Procedure, Paragraph (z). This article specifically prohibits the seizure of salaries except under special laws, and only up to 50% of the amount. Sector-specific regulations protect salaries of employees in state institutions, the private sector, and the oil industry. The Central Bank of Kuwait has been encouraged to enforce compliance.
[1] Computer Server Solutions, "Kuwait's Labor Laws: Private Sector," https://csskuwait.com/kuwait-labor-laws-private-sector/[2] Kuwait Finance House, "Kuwait Labour Laws," https://www.kfh.com/kuwaitone/en/about-us/corporate-governance/corporate-governance-policies/Pages/Labour-Laws.aspx[3] Al Rai, "Banks Prohibited from Seizing Full Salaries Despite Central Bank Decision," https://english.alarabiya.net/En/News/gulf/2019/02/26/Banks-prohibited-from-seizing-full-salaries-despite-central-bank-decision[4] Gulf News, "Kuwait: Bank Awareness of Debts May Increase Following Central Bank's Decision to Ban Full Salary Seizures," https://gulfnews.com/world/gulf/kuwait/kuwait-bank-awareness-of-debts-may-increase-following-central-bank-s-decision-to-ban-full-salary-seizures-1.63676259[5] Zawya, "Kuwait Tightens Enforcement of Debt Settlements," https://www.zawya.com/mena/en/business/service/2019/02/26/kuwait-tightens-enforcement-of-debt-settlements-fec8d13/
- The General Administration of Enforcement in Kuwait had voiced concerns about some banks seizing more than half of their customers' salaries, which violates Article (216) of the Code of Civil Procedure, Paragraph (z).
- In 2025, Decree-Law No. (59) was implemented, focusing on the seizure of debtors' assets by third parties and mandating that such seizures remain in place unless lifted by the Execution Department.
- In addition to salaries from the state, private, and oil sectors, the new decree requires banks to adhere to restrictions on the seizure of salaries and to limit deductions to legal thresholds, as specified in Article 216 of the Code of Civil Procedure and other relevant laws.
