Since the UAE Federal Arbitration Law came into force on 15 June 2018, a number of procedural developments have been introduced in relation to both the conduct of arbitration proceedings and the enforcement of arbitration awards before the local UAE courts. The Federal Arbitration Law has repealed the Arbitration Chapter of the UAE Civil Procedures Code and has addressed the common pitfalls that existed under the old arbitration regime.
This has been a welcome development for the international arbitration community and has reinforced the UAE’s drive to become a leading international arbitration hub. Businesses operating and doing deals in the UAE now have access to a more flexible and efficient arbitration process, particularly in relation to the enforcement of arbitration awards.
Scope of application of the Federal Arbitration Law
The scope of application of the Federal Arbitration Law is quite broad in the sense that it applies to existing and future arbitration proceedings, unless the parties have agreed to contract out of it.
The Federal Arbitration Law also specifically distinguishes domestic and international arbitrations, whereby it would qualify as international if:
- the parties’ headquarters are located in two or more countries at the time of conclusion of the agreement; or
- the place/seat of arbitration or the place of the subject-matter of the dispute is located outside the UAE.
Procedure for the enforcement of arbitration awards
New procedural developments
One of the main developments introduced under the Federal Arbitration Law is the expedited procedure for the enforcement of arbitration awards.
Under the Federal Arbitration Law, any enforcement application for the enforcement of an arbitration award can now be brought directly before the UAE Court of Appeal, which shall in turn issue its enforcement order within 60 days from the date of filing of the application. This is not without exception particularly when a party can demonstrate that one of the nullification grounds set out in Article 53 of the Federal Arbitration Law has been satisfied.
The new procedural developments also set a 30-day time limit for a party to challenge the validity of a final award before the relevant UAE Court of Appeal. A challenge to the validity of the final award may also be made in defense to an enforcement application filed by an award creditor outside the 30-day time-limit.
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To speak to us in relation to any arbitration issues in the UAE, please feel free to contact one of the lawyers below, or your usual Baker McKenzie contact.
