Kuwait Court of Cassation principle number 162

A contract involving a foreign element. The rule is that, as regards the substantive conditions for its formation and the effects arising from it, it is subject to the law expressly or implicitly chosen by the contracting parties. Absence of such choice in the contract. It is subject to the law of the contracting parties’ common domicile if they share a domicile. The law of the state in which the contract was concluded applies if their domiciles differ. Cases of exception include: contracts concluded by owners of factories, shops and farms with their workers and employees. Application of the law in force in the place where the management centre of these businesses is located. The principal centre of these businesses being abroad. An example concerning application of Kuwaiti law to a commercial establishment whose management centre is in Kuwait. Article 59 of Law 5 of 1961 regulating relationships involving a foreign element.