Dubai Arbitration Lawyers UAE | Ratify Arbitration Award in UAE

Arbitral Awards in UAE sets out two stages: Ratification and Execution. This means that Arbitral Award must first be ratified so that it will subsequently enforce in the same way as court judgements issued by UAE courts. However, recent changes to arbitration in UAE have been introduced to pave way of simplifying the process of ratification and enforcement of the Awards govern by UAE laws.

Federal Law No. 6 of 2018 (the “New Arbitration Law”) governs the conduct of arbitration proceeding and the enforcement of arbitration awards in UAE. Under this law, it differentiates domestic and international arbitrations and the distinction between these has an impact on the process and procedure for the execution of the arbitral award.

The provisions of the Arbitration Law shall apply to:

• Arbitration conducted inside UAE unless parties agreed in writing to abide to the provisions of another arbitration law and provided further that it will not be contrary to public policy and morals.
• International Commercial Arbitration conducted abroad wherein the parties agreed in writing that UAE Arbitration Law will govern.
• Arbitration cases and disputes governed by the UAE law, except otherwise expressly excluded by special provisions

Under this new law, the enforcing party may now apply for recognition and enforcement of arbitral awards in UAE. Summary of the process involved are as follows:

• Enforcing party shall submit application to the Chief of the Court of Appeals in the Emirate wherein the award is sought to be recognized and enforced. The application must be accompanied by the following documents: original Arbitral Award or certified true copy; copy of the Arbitration Agreement signed by the parties; Certified Arabic translation of the award and copy of the transcript of filing the award with the Court of Appeals.
• The Court of Appeal is mandated to order recognition and enforcement of the arbitral award within 60 days from the receipt of the application, unless otherwise reasons to nullify the award exist based on the provisions of Article 53.1 of the Arbitration Law. Petition to review the court’s decision on the enforcement of the Award can be filed with the Court of appeal within 30 days.

It is important to note that the new law, however, is not intended to apply to foreign arbitral award therefore it does not affect the enforcement of foreign awards in the UAE. Under Civil Procedure Code, enforcing party to a foreign award in UAE must file a substantive case in the local courts of first instance and the decision of the court of First Instance will be subject to two level: Court of Appeal and Court of Cassation.

Advantages Of Franchise Dispute And Arbitration in Dubai UAE

Arbitration is an alternate dispute resolution whereby the parties recourse to a private court with nominated judges known as arbitrators.

It is widely used all over the world for resolving international disputes such as franchise due to their nature being neutral and unbiased.

The basis of its neutrality is all dependent on the selection of the arbitrator which is done so with the consent of both parties. It is flexible too with time, place and procedures even in some cases giving judgment on the basis of documents alone without summoning parties or their lawyers.

The court proceedings carried out by state courts are public whereas in arbitration there is privacy and confidentiality.

Furthermore verification of enforcement of the court judgments or the arbitral award is of prime importance prior to dispute resolution due to the fact that court judgment is not recognized in some countries where as arbitral award under New York convention is recognized and can be enforced internationally within 156 countries of New York convention.

The clauses under arbitration are to be enforced as written to avoid waste of money and time of both the parties.

Introduction to Terms of Reference in UAE

In law and indeed in many blogs pertaining to law, you will come across the phrase ‘Terms of Reference’. In broad, simple terms, this is a document in which scope and limitations are to be defined.

This document is used in International Arbitrations signed as an agreement between the parties and the arbitrator which defines the time period (usually 6 months if not defined), terms, language and place of arbitration. The intention is to make the arbitration proceedings quicker and to facilitate the implementation (execution) of the outcome of that arbitration.

Terms and conditions defined in a Terms of Reference govern the arbitration proceedings under civil and arbitration rule in the UAE.

Operating under these express Terms of Reference has the added benefit of ensuring there is far less opportunity or possibility for an arbitration award to be annulled.

The information provided in the Terms of Reference should include the dispute itself, right of appeal, submissions of particulars (the facts) and defense of the parties involved.

For Free Legal Consultation, Call Us Today!

Challenging Arbitration in UAE (Article 216) – Arbitration Award in UAE Courts

The conditions under which the parties to an arbitration award may challenge (make a request to annul) its validity are governed by Article 216 as follows:

a- If the required number of arbitrators to hear the case were not present or where the arbitrators were not legally appointed, qualified or competent.
b- If the arbitration award was reached with reference to inadequate, out of date or non-existent terms of reference.
c- If the award was made based on Terms of Reference in which the specific dispute is not mentioned, or if the arbitrator exceeds the limits of jurisdiction given under those Terms of Reference.

It is becoming increasingly common for the losing party to challenge an arbitration award by filing an annulment case claiming it to be invalid due to the person signing the contract not having official permission although an experienced legal professional in the arbitration field will be aware of this point and be well prepared to effectively deal with it.

There is a possibility that both parties gave up the right to object to an award by virtue of not objecting in the first possible instance. This highlights the importance of having help and guidance from persons who are not only competent in arbitration protocol but also who have experience with the local processes and procedures.

Appointing Arbitrator in Dubai | How An Arbitrator Is Appointed in UAE

Arbitration is an alternate independent body to resolve a dispute as an alternative to the court system.

When drawing up a contract, you can specify that in the event of a dispute, arbitration will be the jurisdiction to resolve it. Although it is possible to select more than one arbitrator to hear a case, the default number of arbitrators will be set to unless specified to the contrary. If the parties in a dispute are not able to agree on who the arbitrator will be, the arbitration center will select from qualified Dubai lawyers independently. It is possible to appeal that decision if either party has a valid cause to do so. It is also possible to appeal against the selected arbitrator if they are, for example, not independent, impartial or correctly qualified. Any such challenge needs to be made within 5 days of discovering any problem or discrepancy.

Some of the ways to appoint an arbitrator are as follows:

a- Through the court,
b- Through the Arbitration center
c- By specific request by name

It is mandatory to appoint the selected arbitrators in odd numbers 1, 3, 5, 7, 9. Under the Civil Procedure Code, Federal Law No. 11 of 1992, Article 206, ensure there can be no ‘stalemate’ in the matter. It goes without saying that any arbitrator appointed should be of sufficient capacity and good standing hence:

a- The arbitrators should not be a minor
b- He/she should not be guilty of a criminal offence
c- They should not be deprived of their legal capacity

For Legal Consultation, Call Us Today!

Arbitration Procedure in Dubai

Arbitration is an alternative dispute resolution court in the UAE and has been increasingly used as the chosen jurisdiction to settle matters that require a legal path to be followed. The fact that arbitration is on the rise and more commercial companies are inclined towards its use may be largely attributed to the fact that proceedings may be conducted in English. With a very high percentage of the population being expatriate who conduct much of their business in the English language, it follows that they may be more inclined to seek legal remedies in the same language.

Moreover, in arbitration a special body can be established to handle certain types of dispute which can result in quicker judgments (without appeal and cessation proceedings) making them cost effective overall when compared to broader and full UAE courts process.

Federal Arbitration Law in UAE

Recent years have continued to see both local and international investors attracted to investing in the construction sector which has enhanced Dubai’s reputation as an important international real estate investment market. The recent slump (decline or correction depending on your view) that has impacted the real estate market since 2008 did not halt a continuous influx of investment in the construction sector. For this reason, there are a growing number of disputes concerning many aspects of the delivery and release of such properties with the documentation having specified arbitration proceedings as the jurisdiction for any legal remedy.