By Fiona MacDonald
May 12 (Bloomberg) -- Kuwait’s parliament approved a bill allowing the sale of state assets excluding the emirate’s crude oil and natural gas production industry, which is protected by the constitution.
The law, first proposed in 1993, also prohibits the sale of state-run refineries as well as the health and education industries. The bill was approved by 33 lawmakers and opposed by 28 in the second and final round of voting today. Opponents argued it would put local jobs at risk and undermine sovereignty.
The legislation will create a Supreme Council for Privatization, headed by the prime minister and comprising five ministers and three non-government members, to oversee sales, according to a copy distributed to the press.
It also sets out rules for how state companies should be sold. At least 35 percent of the shares should go to listed companies and other institutions approved by the council, the law says. As much as 20 percent would be allocated to government bodies chosen by the council, 5 percent to Kuwaiti employees of the company, and the remaining 40 percent sold in an initial public offering.
Kuwait Airways Corp., the emirate’s unprofitable carrier, is already due to be sold by March 2011 under a plan that would see 40 percent of its stock sold to the public, 35 percent to a strategic investor and 5 percent to employees. The sale was originally scheduled for 2009.
--Editors: Ben Holland, Louis Meixler.
To contact the reporter on this story: Fiona MacDonald in Kuwait at fmacdonald4@bloomberg.net
To contact the editor responsible for this story: Shaji Mathew at shajimathew@bloomberg.net
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