DIFC Courts Jurisdiction: New Dubai Law Streamlines Operations & Dispute Resolution

Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai

 Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai has enacted Law No. (2) of 2025, a significant legislative development aimed at strengthening the Dubai International Financial Centre (DIFC) Courts. This new law comprehensively regulates the judicial and administrative structure of the DIFC Courts, redefining their jurisdictions and operational procedures.  

Enhanced Independence and Structure:

The law reaffirms the independent status of the DIFC Courts, encompassing the Court of Appeal, the Courts of First Instance, and the Small Claims Court.

These courts are mandated to exercise their duties and jurisdictions autonomously, adhering to the provisions of Law No. (2) of 2025, the broader DIFC legal framework, and the courts' established rules.  

Appointment and Authority:

A key aspect of the new law is the detailed specification of mechanisms for appointing the President and Director of the DIFC Courts. This includes outlining their respective jurisdictions and responsibilities and ensuring a clear and efficient leadership structure.

Introducing a Mediation Services Centre for Amicable Dispute Resolution:

Recognizing the importance of alternative dispute resolution, Law No. (2) of 2025 mandates the establishment of a dedicated Mediation Services Centre within the DIFC Courts. This center will provide a platform for parties to engage in mediated negotiations, facilitated by registered mediators, to achieve amicable settlements. The Centre’s President will determine its operating system, jurisdiction, and procedural guidelines. This addition underscores the DIFC Courts’ commitment to offering diverse and effective dispute resolution options.  

Exclusive Jurisdiction Clarified:

The new law explicitly defines the DIFC Courts’ exclusive jurisdiction, granting them the authority to hear and adjudicate civil, commercial, and labor claims and lawsuits involving the Centre’s bodies or institutions. This ensures a specialized and efficient handling of disputes within the DIFC ecosystem.  

Comprehensive Procedural Framework:

Law No. (2) of 2025 provides a detailed framework covering various aspects of litigation, including:

• Powers of the DIFC Courts: Clearly outlining the scope of judicial authority.
• Litigation Procedures: Standardizing processes for filing and conducting lawsuits.
• Evidence: Defining rules for the admissibility and presentation of evidence.
• Urgent Matters: Establishing procedures for expedited handling of time-sensitive cases.
• Enforcement: Streamlining the process of enforcing court judgments.
• Exemption from Pledge for Compensation: Addressing financial aspects related to litigation.
• Technical Defects and Procedural Errors: Defining how such issues are handled.
• Statute of Limitations: Setting time limits for legal actions.

Repeal of Previous Legislation:

This new law supersedes Centre Law No. (10) of 2004 and Law No. (12) of 2004, which previously governed the DIFC Courts. Any conflicting provisions in other existing legislation are also repealed, ensuring a unified and updated legal framework.  

Impact and Significance:

Law No. (2) of 2025 represents a significant step in enhancing the efficiency, independence, and effectiveness of the DIFC Courts. By providing a comprehensive and modern legal framework, Dubai aims to solidify the DIFC’s position as a leading international financial center with a robust and reliable judicial system.

UAE’s non-Muslim expats now register a will

Non-Muslim expatriates can now dictate where they want their assets to go when they die, after a decision to change rules governing wills. The changes will ensure there is no dispute or confusion over a deceased’s belongings and custody of children, and expats can register a will for about Dh500.

Abu Dhabi has had no way of registering wills drafted in the UAE or an expat’s home country.

Only Sharia was applied.

In most cases, a court would freeze the assets to ensure all heirs were contacted before the estate was split up, resulting in long delays and high legal costs. Yousef Al Ibri, Undersecretary at the judicial department, said the move was recognition of the "realistic needs" of all sectors of society in Abu Dhabi.

It laid down the legislative framework to protect the rights and freedoms of people of different faiths.

Mr Al Ibri said these rights would now be protected under the state’s constitution, "which affirms the enjoyment of foreigners of rights and freedoms prescribed in international charters".

 "This will have a positive effect on attracting people of distinguished expertise to work and live in Abu Dhabi," he said. "This decision will constitute a quality leap towards enhancing the competitive position of Abu Dhabi emirate, establishing it as an ideal destination for residence and investment."

Sheikh Mansour bin Zayed, Deputy Prime Minister and Chairman of the Abu Dhabi Judicial Department, approved the changes that came into effect on Tuesday.

Wills in Abu Dhabi will also be registered in English, not Arabic.

Dubai International Financial Centre’s Wills and Probate Registry, which is linked to the Dubai Government, is the only registration system for wills in the Middle East and North Africa. It has registered 2,500 wills since its inception in 2015.

Sean Hird, director of DIFC Wills and Probate Registry, said the announcement of a registry of wills and probate in Abu Dhabi was a positive move for people living and investing in the emirate. "At DIFC, we have been providing eligible individuals with the option for the past two years and now offer various options for people to protect their assets in Dubai and now RAK," said Mr Hird.

"We hope this encourages asset owners to tackle their significant ‘life admin’ by thinking ahead to safeguard their assets."

The death of a breadwinner or homeowner can mean assets being frozen for months, and tens of thousands of dirhams in legal fees, particularly in the event of a dispute.

Some Abu Dhabi law firms have been writing invalid wills for expats, despite the documents having no legal standing.

Hesham Elrafei, a legal consultant and founder of the UAE legal portal Lex Animata, said the cost of registering a will in Abu Dhabi was expected to be negligible.

Mr Elrafei said those with property on Reem, Yas and Saadiyat islands would also be able to ensure their properties were distributed without dispute.

"This is an affordable service, which will not exceed Dh500 a will and the door is now open for all non-Muslims living in Abu Dhabi to register as per their choice," he said.

"This is to secure and protect their assets and properties in Abu Dhabi, which includes real estate, bank accounts, stocks, cars and end-of-service gratuity.

"A non-Muslim expat can now easily register his will in English to whoever he chooses to, whether his wife, daughter or any member of the family."

Expats can add their UAE homes and properties to their will

For all those who’d been waiting eagerly for the launch of the DIFC Wills, which will ensure that wishes of testators are carried out even when it comes to immovable property, there’s finally good news.

After being much in discussion, DIFC is finally launching its Wills and Probate Registry by April 30, 2015.

The DIFC Wills and Probate Registry has been established under the jurisdiction of the DIFC Courts, however, it will operate as a distinct entity, as an ancillary body of the Dispute Resolution Authority, the third branch of the DIFC.

By virtue of the new Wills and Probate rules, individuals with assets in Dubai now will have the ability to register will in English language that creates legal certainty for the inheritance of their assets after death. It is a simple and efficient mechanism to pass on their estates according to their wishes, says DIFC.

As per the draft rules, those wishing to use the registry will have to pay about Dh10,000 to register their wills. This is more than double the charges that people incur with a normal will in Dubai and this includes lawyer’s fee, translation and attestation of wills with the Dubai Courts. But, there seems to be good news as the cost of registering a DIFC is likely to come down.

According to Diana Hamade, Attorney at Law & Legal Consultant, UAE Courts & DIFC Courts, International Advocate Legal Services, who is also a member of the drafting panel, revealed that the fee was set up at Dh10,000 but now they are looking into reducing it.

But even with the higher cost, many expats believe this could give them much needed peace of mind as it can reduce legal claims.

As of now, the expat will registered can only safeguard their interest as far as the movable assets are concerned but will fall short if there are any immovable assets in the country.

The Civil Transactions Law of the country applies to real estate inheritance in the county. The same law outlines the procedure. While a sub-article of the said article states that if a person dies in the UAE, then the law of her/his country shall apply when it comes to the disposition of his real estate assets in the country.

However, the subsequent article states that all assets including real estate shall be governed by the UAE law.

However, the DIFC wills are expected to change this. “The DIFC wills will be executed as per the testator’s wish and enforced in DIFC Courts. There is no application of Sharia or law of any sort,” explains Hamade.

Companies can take dispute cases to Dubai International Financial Centre ( DIFC) courts

Dubai: Companies will now be able to choose to have dispute cases heard in English common law courts.
A new law will allow businesses from Dubai and across the Gulf to use the courts of the Dubai International Financial Centre (DIFC), meaning that they can avoid the backlog that has plagued Dubai's traditional civil courts.
The move, which has been welcomed by both lawyers and local businesses, is likely to boost the workload at the DIFC, lawyers say, as companies are drawn to the opportunity to be awarded costs — an option not available in civil cases.
Major impact
But experts also point out that it will be some time before the law, signed by His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai yesterday, has a major impact on the DIFC courts.
The option to choose the jurisdiction of the DIFC will have to be written in new contracts, except in cases where the parties in existing disputes agree to have the case heard outside of the civil courts.
Nonetheless, lawyers were upbeat about the news last night.
Positive thing
"It's a positive thing and will be viewed positively by quite a lot of the international companies doing business in this region," Alec Emmerson, a consultant at Clyde and Company, told Gulf News.
Justice Sir David Steel, Associate Judge of the DIFC, said that the importance of the law was to give potential litigants the option of choosing civil or common law courts.
"It's a question of whether the initial participants in the dispute are enthusiastic about going to the Dubai courts or whether they would prefer to go the common law court," he said.
Steel added that while the ruling may eventually see an increase in cases before the DIFC, he did not anticipate a need for more resources.
"We will play it by ear," he said.

Dubai Government amends DIFC Law - provide greater legal clarity and transparency

His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, has issued Law No (7) of 2011, which includes amendments to a number of articles in Law No (9) of 2004 ('Original Law') that established the Dubai International Financial Centre (DIFC) as the first Financial Free Zone in the UAE.

Over the past seven years, DIFC has become the financial and business gateway between regional emerging markets and the international markets.

The amendments to the law provide greater legal clarity and transparency, and provide stronger support to DIFC's drive to become a global financial centre, complying with the highest levels of good governance and best practices.

Law No (7) of 2011, which incorporates the first ever amendments made to the Original Law, was enacted on the 4th of April, and published on Thursday, April 21, 2011, in the Official Gazette in both Arabic and English. It is in force with immediate effect. The new law comes as part of the Government of Dubai's ongoing strategic commitment to diversify the emirate's economy by supporting the growth of the banking and financial services sector through DIFC. The new law results from a consultative and collaborative process between the three DIFC bodies - the DIFC Authority (DIFCA), the Dubai Financial Services Authority (DFSA), and the DIFC Courts - and various Dubai government bodies, including the Legal Affairs Department of the Government of Dubai.

Following the Dubai Government's review of governance structures, the new law provides for the creation of a Higher Board comprising representatives of the three DIFC bodies. This Higher Board will be presided over by the DIFC President, Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, Deputy Ruler of Dubai, and will be invited to meet at least twice a year. The DIFC Higher Board will ensure that the three DIFC bodies operate in harmony and unity of purpose by strengthening the levels of coordination without affecting their independence.

Ahmed Humaid Al Tayer, Governor of DIFC said: "The amendments to Law (9) provide greater legal clarity and improve the corporate governance of DIFC. These changes further strengthen DIFC's legal and financial infrastructure as a whole, and reinforce the Government's commitment to the independence of each of the Centre's bodies. This is an important step forward in the growth of DIFC as a global financial hub and complements the Centre's continuous efforts to develop its services and increase its contribution to the UAE's economy." The new law includes a new article that defines the manner of appointment and the role of the Governor of DIFC. The Governor is appointed by the Ruler of Dubai upon the proposal of the DIFC President for a four year term that may be renewed.

The new law also clarifies the application of all Dubai laws to DIFC including governmental, financial and legal arrangements. This clarification creates many opportunities for future collaboration between DIFC and other government bodies, fostering cooperation and open dialogue thus enhancing the growth of banking and financial services, ancillary services and commercial and financial activities and strengthens its role in the region.

DIFCA-related amendments: Changes to the Original Law include a number of provisions that are specific to DIFCA. These confirm DIFCA's independence and put into place a corporate structure of a Board, CEO and executive body. The precise duties and powers of the Board and the executive have been defined, where the Board will be responsible to the DIFC President for the functions of DIFCA.

The new law also provides specific provisions clarifying that DIFCA is now responsible for establishing, regulating and developing the Centre's payment systems. DIFCA will coordinate with the Central Bank of the UAE in regulating, supervising, operating and using wholesale, large-value payment systems, including a multi-country, multi-currency Real Time Gross Settlement System, allowing the clearing and settlement of payments in foreign currencies in the DIFC.

David Eldon, Chairman of DIFCA said; "The new law will assist DIFC's continuous evolution and underlines its position as one of the world's top international financial centres. By emphasising the Centre's independence, the new law assures companies looking to establish a presence in the region that DIFC offers both a modern infrastructure and a world-class business environment." DFSA-related amendments: A DFSA-related article in the new law clarifies the roles and powers of the DFSA's Board and CEO, reinforcing the autonomy and authority of the DFSA's board.

The Chairman of the DFSA Board of Directors, Abdullah M Saleh, commented; "DFSA welcomes the new law as a further positive step in the development of the Centre. DFSA will continue its commitment to protect the integrity of DIFC and to realise the vision its Sheikh Maktoum. " DIFC Courts-related amendments: The amendments made to DIFC Courts-related provisions further reinforce the Government of Dubai's commitment to the independence of DIFC Courts, by guaranteeing its funding and authorising the Chief Justice to determine the Courts' rules, procedures, staffing and operation.

Michael Hwang, Chief Justice of DIFC Courts, said; "The revisions to the law further reinforce the autonomy and independence of DIFC Courts. A fair, efficient and transparent judicial system operating independently is a critical component of DIFC's offering as a world-class financial centre. We remain committed to uphold the laws of DIFC to the highest international standards, and the new law supports this commitment."