Through Law No. 8/2001 National Assembly of Kuwait has implemented provisions for direct foreign investment. According to this new law foreign investors would be able to accomplish commercial and economic projects inside Kuwait. The new legislation made it possible to have foreign holding up to 100%. Law No. 8/2001 specifically authorizes foreign-majority ownership and 100 percent foreign ownership in certain industries including: infrastructure projects (water, power, waste water treatment or communications); investment and exchange companies; insurance companies; information technology and software development; hospitals and pharmaceuticals; air, land and sea freight; tourism, hotels, and entertainment; housing projects and urban development.

Though the foreign firms are permitted to invest in petrochemical joint ventures they may not invest in the upstream petroleum sector. Per the legislation brought before Parliament in January 2004 a limited, restricted investment in the petroleum sector is allowed.

The law also ensures that the foreign investor will be given protection from confiscation or nationalization of any project authorized under the said Law. The Law allows total or partial assignment of the project and also gives the right to transfer abroad all profits and capital. In addition, the Law permits the Investment Committee to permit a tax holiday for a maximum of ten years and total or partial exemption from custom duties payable on imports of certain commodities.