Under Kuwaiti law non payment of debt is not a crime and hence there is no prescribed mode of punishment under the Kuwaiti code. However, this does not mean that the debtor would be set free of all his liabilities towards the creditor. If the creditor chooses to pursue the matter he can seek extra judicial assistance and can imprison the debtor for a term not exceeding six months. But how a person interprets the procedure and applies it to his own situation would give it value because the court of law has relatively no role in this matter.

The procedure

The creditor should submit a written submission before the Expert department and if the head of the expert department decides to grant the plea the debtor would be imprisoned. The maximum term of imprisonment is six months. However, the term shall be determined based on the discretion of the officer and normally a period of one month imprisonment would only be awarded. If the debt is not paid fully during this initial term the debtor can be jailed any number of times until the period of six months is elapsed; unless he proves that he is financially incapable of repaying debt. On the other hand, irrespective of the completion of his term (6 months) in the prison the debtor would be asked to pay the debt without any deductions as he is sentenced to prison as an outcome of a less punitive and more due process oriented measure.

The shortfall of the system

Good regulatory practice necessitates the intervention of the court where the procedures would revolve around formal but precise rules.  Voluntary compliance, which is less wed to rules, stressing responsiveness and forbearance and preferring tools involving self-regulation, persuasion and negotiation may not always be effective in an issue like debt collection.

However, under the present system the rights of both the debtor and the creditor are limited by certain restrictions, which are mentioned hereunder;

  • The provision which is based on rule of natural justice forbids imprisonment if the debtor is not in a position to repay his debt The burden of proof is vested on the creditor who should prove that the debtor is financially sound or is willfully neglecting the repayment. In actual practice, imprisonment is more or less used as a test to confirm whether the debtor is financially sound or not.
  • The debtor should be offered an unvarying system where he can enforce his rights, as well. The debtor should be given the right to be heard and the right to present his perspectives fully and completely before a competent judge. For instance, if the non payment is due to the reason that the debtor’s assets or money is confiscated or blocked for a certain period of time he should be given a chance to repay it on an extended date. However, under the present system, more often, the debtor would at once be imprisoned if a complaint is lodged against him
  • The imprisonment based solely on the decision of an officer, where it is set as a coercive measure than a disciplinary measure may not be always fair or reasonable. Favoritism, foul pay, misjudgment etc can also play its role.
  • If the debtor is above the age of sixty five years or if he is the single guardian of children below the age of 15 or if he arranges a guarantor/guarantee he cannot be put in prison irrespective of whether he is capable of paying the debt or not. Unlike any other civil or criminal wrong, here old age is treated as criteria for punishment. But recent studies find that a change in the age composition of the workforce is a global phenomena and the number of business people or working class of 65 years and older is about twice that of those 40 to 49 years old.

To conclude, I would suggest that, this sort of arrangement has many hitches as the notch of irrationality is attached to it. Each system has its own distinct advantages and disadvantages, and the choice between them should be pragmatic (what works?) rather than ideological. When the decision is made by the head of the expert department to imprison a person, based on the request of the creditor, the authority to decide on the subject is vested on a single person, with no judicial process or procedure. This system could be more finely tailored if the issue is settled through the court of law rather than the execution department, where it would be given a broader repertoire based on facts, evidences and circumstances of a case. The judgment based on submission/tallying of evidences would rather be prudent than leaving it open before an officer. In the turbulent corporate world it is important to anticipate, recognize, and understand the legal situation beforehand; hence I recommend that judicial intervention is mandatory.