With the electronic boom that the business world is experiencing today, practical solutions have emerged to finance small and medium start-up companies, including crowdfunding images, which rely on electronic platforms from which advertisements for financing requests for both emerging and existing projects are launched, after which users participate in the participation in the operations of contributing to support those projects. This emerging sector has already started working in several countries, but it is still in Kuwait subject to warnings, bans, and confused looks. The “Legal Opinion” surveyed the opinions of legal specialists in the field of commercial law and capital markets on the definition of crowdfunding, its mechanisms and obstacles to working in it according to the Kuwaiti legal system, as they confirmed that this emerging sector lacks a legal base in Kuwait, and it needs legislation to regulate its work. “Credit”: Digital transformation reduced the reception of our auditors in attendance by 80 percent two hours ago “Al-Asimah” municipality: 186 cars were lifted and 79 were released during November two hours ago Honor: The Central Bank is required to regulate this modern method of financing It is an honor for the Central Bank to keep pace with other countries by organizing this modern method of financing small and medium enterprises, due to the benefits it achieves for the investor and the beneficiary, as it enhances the growth of the national economy. He stressed that the crowdfunding system aims to support opportunities for growth and economic development for medium and small enterprises by facilitating and organizing modern financing activities, and it can be defined as: an activity to collect funds from participants through a digital platform, in order to grant credit in contracts to beneficiary enterprises – which are the companies (and projects) that are infinite. Only small, small or medium enterprises that seek financing through the crowdfunding platform with debt after obtaining a license to practice this activity, instead of resorting to the owner of the small and medium enterprise to the bank to obtain financing – a loan – for his project or requesting support and assistance from family and friends, He can search the Internet for special platforms to support small projects in which investors give their money to support these projects and pioneering ideas. Al-Sharaf added that debt crowdfunding is characterized by the fact that it carries out its activity through a platform based on the Internet or any other digital means such as electronic applications, and it is usually subject to the supervision of the central bank in some countries or the supervision of the Capital Markets Authority, where the beneficiary – the small company – offers His project and idea to the licensee of the crowdfunding activity B – the latter presents it on the website and the electronic platform to collect the necessary funds for this project, as it is characterized first by the low interest rate – the profits may be compatible with Sharia – compared to the traditional commercial loan from the bank and secondly by the speed of obtaining financing where he is committed The licensee is authorized to collect the amount within 60 days, as a maximum, provided that the amount is transferred to the beneficiary within 5 days after the completion of its collection. Also, as it is allocated for small projects, the value of the credit granted does not usually exceed one million Kuwaiti dinars – in order to achieve the desired goals, and the most important thing Owners of small and medium enterprises are encouraged to receive this financing because they will not give up shares or control shares of their companies to others, but rather they will retain full ownership for themselves and the founding partners. Al-Shammari: 3 forms of crowdfunding… quotas, subsidies, and lending. Assistant Professor of Commercial Law at Kuwait University, Dr. Fahd Al-Shammari, confirmed that crowdfunding is a financing channel that works by involving a large number of people who contribute small amounts to finance the ideas of initiators and owners of small and medium projects, where it is displayed The idea is presented by the project owner through a platform on the Internet, and if a company likes this idea, this company announces it to the public, without the need to resort to public subscription procedures that are carried out by the public shareholding company, continuing, “The European Union has defined crowdfunding as an invitation The public to finance and support an initiative or project, and this call is usually through websites on the Internet, by marketing this call through social media. Al-Shammari explained that the importance of crowdfunding lies in the fact that it will help owners of small and medium enterprises, startups, to obtain the necessary financing that they may not obtain from banks, especially after the global financial crisis, as banks tighten the lending policy, or by venture capital funds that tend to To focus on larger investments, and in certain geographical areas where technological innovation is abundant, in addition to being very selective in the companies in which they invest, and this is what makes it difficult for initiators to obtain the necessary financing. He added that crowdfunding includes three types, the first type is crowdfunding based on (quotas), i.e. owning a share in the project Equity-based crowdfunding, and the second type is crowdfunding based on donations, in which the contributions of individuals are in the form of donations. In crowdfunding, the third type is crowdfunding, which is based on contributing to the project in the form of “peer-to-peer lending”, in which individuals provide money to the owner of the idea in exchange for paying these contributions by the owner of the idea later without any interest. And Al-Shammari indicated that, given the importance of crowdfunding in supporting and financing small and medium enterprises, the US federal legislator issued in 2012 the Jumpstart Our Business Startups Act to amend some of the provisions of the Securities Act of 1933 by allowing owners of small and medium enterprises to resort to IPO-based crowdfunding. The Republic of France regulated crowdfunding in Decree No. 559 -2014 No. in 2014. At the beginning of 2018, the Saudi Capital Market Authority issued a regulation regulating the procedures and requirements for obtaining a license to use financial technology as a tool of financial innovation. And in 2021, the Saudi Central Bank issued rules for practicing crowdfunding activity with debt, which aim to regulate licensing provisions for companies operating in crowdfunding. Al-Mutawa: Legislation must be reviewed in order to protect the funds of citizens and residents. Lawyer Ahmed Al-Mutawa said, “The relevant legislation must be reviewed in order to protect the funds of citizens and residents and to advance the legitimacy of these operations, such as the law establishing the Capital Markets Authority, the companies law, the monetary law and the Central Bank of Kuwait, especially since the comparative legislation, including the state Gulf countries that allowed people to finance economic and social projects such as small and medium enterprises to invest in securities through collective financing operations for these projects. He stated that in view of the spread of calls on social media aimed at financing economic and social projects such as small and medium enterprises to invest in securities through collective financing operations for those projects in which certain amounts are collected from a number of shareholders, the Markets Authority realized the seriousness of these calls and published a press release on the 26th. March 2020, through which she called on citizens and residents to wait and beware of participating in these calls, in order to protect the funds of citizens and residents, and calls on them to communicate with the authority and the regulatory authorities, to ensure the legality of the procedures of these activities and that the parties promoting them obtain the required licenses, before participating in them in a way that protects their rights and money. Al-Mutawa added, “Well, the Capital Markets Authority did by warning against measures that violate public order, and if I think that the authority should go and publish a statement calling on the legislator and the government to sift through legislation in order to complete the process of advancing the State of Kuwait to be a financial and economic center, such legislation would enhance the freedom of individuals.” In financing operations for a specific project in order to invest in securities in order to obtain a profit or benefit » Colliding with economic and legal obstacles Dr. Fahd Al-Shammari, assistant professor of commercial law at Kuwait University, indicated that the unique idea of crowdfunding collides with economic and legal obstacles. The legal obstacle is that the Kuwaiti Companies Law does not allow Non-shareholder companies resort to the public to obtain capital, which is known as public subscription. Therefore, small and medium projects that mostly take the form of limited liability companies are not allowed to go public, as this act constitutes a crime punishable by law in its current form. 10 billion dollars in “crowdfunding” investments. In 2025, he added, “Among the famous models of crowdfunding platforms is the Kickstarter platform, which succeeded in raising more than $ 4 billion in 2019, as well as the Indiegogo, GoFundMe, Fundable, Go Get Funding, and Crowdcube platforms, which played a fundamental role in highlighting the importance of crowdfunding based on Subscription. Risks of Website Fraud Professor of Law, Dr. Sharaf Al-Sharaf confirmed that despite the simplification of procedures and encouragement of crowdfunding activity, it is not without risks, the most important of which are fraudulent websites that may take money and invest it in an activity other than the activity designated for it, or that do not comply with the terms and regulations for raising funds and how to It is disbursed or returned to investors in the event that the required amount is not completed. Therefore, one of the basic guarantees was that the Central Bank monitored the activity to provide reassurance to the participant in the financing and the beneficiary, by obliging the licensee to the rules of disclosure, maintaining the confidentiality of information, non-conflict of interests, and signing a service agreement between the parties to the relationship that clarifies the rights And the obligations of each of them, as this activity – like others – is ultimately subject to the supervision and control of the Central Bank, which obliges the licensees to develop appropriate plans for business continuity in emergency cases, adhere to the principles of behavior and work ethics, and protect customers in order to preserve national credit and financial stability. Companies established from crowdfunding must obtain investment licenses from the “money market” regarding public order. Attorney Ahmed Al-Mutawa explained that it is decided by the judiciary that whenever the street prohibits a certain economic activity from individuals and restricts it to some people, then that prohibition is related to the system It is not permissible to violate it, since what was stipulated by the legislator in the provision of Article 54 of Law 32/1968 in the matter of cash and the Central Bank of Kuwait, and after defining the banks and institutions whose basic business and practice is usually accepting deposits for use in banking operations such as granting loans and advances and so on. From the work of banks, and Article 56 of the same law decided on the basis that it is not permissible to practice the banking profession except from institutions that take the form of joint-stock companies that are authorized in their founding decree to do so, and therefore the invitation to individuals to finance economic projects to invest in securities through collective financing operations In the form of money investment contracts between shareholders and between companies, it is considered prohibited, and as a result of violating the prohibition contained in the aforementioned law, these contracts are invalid due to the financing process carried out by persons who are not permitted to carry out such contracts. Such operations, considering that accepting funds from companies or individuals in order to invest them in securities activity in order to invest them for a specific period and then return them with profits added to them becomes an act of the banks’ work and it is not permissible for individuals or legal persons that violate their legal form