United Arab Emirates

Applicable requirements as to the form of arbitral awards

Applicable legislation as to the form of awards

1     Must an award take any particular form?

The requirements for an award issued onshore are provided for under Article 41 of Federal Law No. 6 of 2018 on Arbitration (the Federal Arbitration Law), which states that the award must:

• be in writing;
• be issued by a majority of arbitrators;
• be signed by the arbitrators;
• state the reasons on which the award is based (unless otherwise agreed or not required under the applicable law);
• state the parties’ details;
• state the arbitrators’ details, including nationality;
• include the text of the arbitration agreement;
• give a summary of each party’s claims, statements and documents;
• if dispositive in nature, state the order made and the reasons on which it is based (if required to be stated); and
• specify the date and place of issuance of the award.

Under Article 44 of the Federal Arbitration Law, the arbitrators must notify the signed award to the parties within 15 days of issuance.

The Federal Arbitration Law does not apply to the special economic (or offshore) zones within the UAE – namely, the Dubai International Financial Centre (DIFC) and the Abu Dhabi Global Market (ADGM) – which have their own specific arbitration regulations.

Under Article 38 of DIFC Law No. 1 of 2008 (the DIFC Arbitration Law) and Article 50 of the ADGM Arbitration Regulations 2015 (the ADGM Arbitration Regulations), the award must be in writing and signed by a majority of arbitrators (if more than one). Article 41 of the Federal Arbitration Law and Article 50 of the ADGM Arbitration Regulations further provide that if there is no majority, the award must be made by the president of the arbitral tribunal alone. Unless otherwise agreed or in the event of settlement, the award must lay out the grounds on which it is based. It must also specify the date and arbitral seat, and fix the arbitration costs. A signed copy of the award must be delivered to each party.

Applicable procedural law for recourse against an award

Applicable legislation governing recourse against an award

2     Are there provisions governing modification, clarification or correction of an award? Are there provisions governing retractation or revision of an award? Under what circumstances may an award be retracted or revised (for fraud or other reasons)?

Article 49 of the Federal Arbitration Law allows a tribunal, upon request, to interpret any obscure or ambiguous part of an award. Unless otherwise agreed, the request must be made within 30 days of receipt of the award. The tribunal will have 30 days (which can be extended by 15 days) from receipt of the request to provide a written interpretation, which will become part of the award.

Article 50 of the Federal Arbitration Law allows for correction of any material errors in an award (clerical or computation), either upon request or on its own volition. A request for correction must be made within 30 days of receipt of the award. The tribunal will have 30 days to make the correction. This deadline may be extended by 15 days. Once made, the correction is notified within 15 days and forms part of the award.

Article 51 of the Federal Arbitration Law allows a party, within 30 days of receipt of an award, to request the tribunal to make an additional award on claims presented in the proceedings but not addressed in the award. If deemed justified, the tribunal has 60 days to issue the additional award (subject to a 30-day extension), which will become part of the award.

Should the arbitral tribunal refuse a request under Articles 49 to 51, the party may then approach the competent court to do so (Article 51(4)).

Under Article 54(6) of the Federal Arbitration Law, the court from which the annulment of an arbitral award is sought may suspend the annulment proceedings for a period not exceeding 60 days if it finds it appropriate, at the request of one of the parties, to give the arbitral tribunal an opportunity to take any action or rectify the form of the award that may eliminate the causes of annulment without affecting its content. Similar provisions are available under Article 41(4) of the DIFC Arbitration Law.

For offshore awards, Article 40 of the DIFC Arbitration Law and Article 52 of the ADGM Arbitration Regulations impose a 30-day deadline whereby a party may ask the tribunal to correct an error or provide an interpretation of a part of the award. If justified, the tribunal must do so within 30 days. It may correct any error on its own within 30 days of the date of the award. A party may also request the arbitral tribunal, within 30 days, to make an additional award which, if justified, it will do within 60 days.

Article 58(4) of the ADGM Arbitration Regulations expressly clarifies that the court must not undertake a merits review of an award on either fact or law.

In the UAE jurisdictions, an award may be challenged if any fraud or such other unlawful elements are found in procuring an arbitral award.

Appeals from an award

3     May an award be appealed to or set aside by the courts? What are the differences between appeals and applications to set aside awards?

Article 53(1) of the Federal Arbitration Law sets out the grounds on which an award can be set aside, which are that:

• no arbitration agreement exists or it is void or has become void under the law chosen by the parties (or under UAE law if no law is specified);
• either party was incompetent or lacked capacity to execute the arbitration agreement;
• an individual does not have the legal capacity to dispose of the disputed right under the law governing his or her capacity;
• a party was deprived of the right to present its case because it did not receive proper notice of the appointment of an arbitrator or of the arbitration, the tribunal breached the party’s right to due process or for any other reason beyond the party’s control;
• the award does not apply the designated law;
• the appointment of the arbitrators and establishment of the tribunal were not in accordance with the Federal Arbitration Law or the parties’ agreement;
• the proceedings were marred by irregularities that affected the award;
• the award was not issued within the specified time; or
• the award decides matters not falling within the terms of reference or exceed their scope. However, if those matters can be separated from those on which the tribunal had the authority to rule, only the portion of the award addressing issues on matters not submitted to arbitration may be set aside.

Article 53(2) of the Federal Arbitration Law allows a court to set aside an award on its own when (1) the subject matter of the dispute cannot be submitted to arbitration or (2) the award offends public policy or the morals of the state.

Although a party can apply for set-aside, it cannot appeal the merits of the award. However, it can appeal a court decision to dismiss a set-aside action (Article 54(1)).

As for offshore jurisdictions, the DIFC Arbitration Law (Article 41) and the ADGM Arbitration Regulations (Article 53) state that set-aside application is the only available recourse and provide the grounds for which set-aside is warranted, which are that:

• a party to the arbitration agreement lacked capacity;
• the arbitration agreement is not valid under the applicable law;
• the party against whom the award is invoked was not given proper notice of the appointment of an arbitrator or of the proceedings or was otherwise unable to present its case;
• the award decides on matters not falling within the terms of reference or exceed their scope but, if those matters can be separated from those on which the tribunal had the authority to rule, only the portion of the award addressing issues on matters not submitted to arbitration may be set aside; and
• the composition of the tribunal or the procedure was not in accordance with the parties’ agreement or, absent such an agreement, with the applicable law.

Article 62(1)(a)(vi) of the ADGM Arbitration Regulations provides for set-aside when the award is not yet binding or has been set aside by the competent authority in the arbitral seat or under the law of which the award was rendered.

Both the DIFC Arbitration Law (Article 41(2)(b)) and the ADGM Arbitration Regulations (Article 58(2)(b) empower a court to set aside an award when the subject matter of the dispute was not arbitral or it conflicts with UAE public policy. The DIFC Arbitration Law mandates set-aside when the dispute is expressly referred to a different body or tribunal.

Applicable procedural law for setting aside of arbitral awards

Time limit

4     Is there a time limit for applying for the setting aside of an arbitral award?

Article 54(2) of the Federal Arbitration Law imposes a time limit of 30 days, following the notification of the arbitral award, for a party to present a set-aside action.

Article 41(3) of the DIFC Arbitration Law and Article 58(2)(c) of the ADGM Arbitration Regulation require that an application for a set-aside action be made within three months, unless otherwise agreed.

Award

5     What kind of arbitral decision can be set aside in your jurisdiction? Can courts set aside partial or interim awards?

Article 53(2) of the Federal Arbitration Law allows a court to set aside an arbitral decision (partial, interim or final award) on its own if (1) the subject matter of the dispute cannot be submitted to arbitration, or (2) the award offends public policy or the morals of the state. Further, Article 53(1) of the Federal Arbitration Law sets out the grounds on which an arbitral decision can be set aside, which are that:

• no arbitration agreement exists or it is void or has become void under the law chosen by the parties (or under UAE law if no law is specified);
• either party was incompetent or lacked capacity to execute the arbitration agreement;
• an individual does not have the legal capacity to dispose of the disputed right under the law governing his or her capacity;
• a party was deprived of the right to present its case because it did not receive proper notice of the appointment of an arbitrator or of the arbitration, the tribunal breached the party’s right to due process or for any other reason beyond the party’s control;
• the award does not apply the designated law;
• the appointment of the arbitrators and establishment of the tribunal were not in accordance with the Federal Arbitration Law or the parties’ agreement;
• the proceedings were marred by irregularities that affected the award, or the award was not issued within the specified time; or
• the award decides matters not falling within the terms of reference or exceed their scope. However, if those matters can be separated from those on which the tribunal had the authority to rule, only the portion of the award addressing issues on matters not submitted to arbitration may be set aside.

Likewise, the DIFC Arbitration Law (Article 41) and the ADGM Arbitration Regulations (Article 53) provide the grounds for which set-aside is warranted, which are that:

• a party to the arbitration agreement lacked capacity;
• the arbitration agreement is not valid under the applicable law;
• the party against whom the award is invoked was not given proper notice of the appointment of an arbitrator or of the proceedings, or was otherwise unable to present its case;
• the award decides on matters not falling within the terms of reference or exceed their scope, However, if those matters can be separated from those on which the tribunal had the authority to rule, only the portion of the award addressing issues on matters not submitted to arbitration may be set aside; and
• the composition of the tribunal or the procedure was not in accordance with the parties’ agreement or, absent such an agreement, with the applicable law.

Competent court

6     Which court has jurisdiction over an application for the setting aside of an arbitral award?

The Federal Arbitration Law provides that the federal or local court of appeal that is agreed by the parties, or within the jurisdiction of which arbitration falls, has jurisdiction over an application for the setting aside of an arbitral award. The DIFC Arbitration Law empowers the DIFC Court to deal with applications for setting aside an arbitral award. The ADGM Arbitration Regulations provide that the ADGM Court has jurisdiction over applications for setting aside an arbitral award.

Form of application and required documentation

7     What documentation is required when applying for the setting aside of an arbitral award?

The following main documentation is required when making an application for setting aside an arbitral award before a court in the UAE jurisdictions:

• the original award or a certified true copy thereof;
• a copy of the arbitration agreement;
• if the award was not made in Arabic, a certified Arabic translation of the arbitral award from an accredited body. An English translation of the award (if it is in other language) would be required by the DIFC and ADGM courts; and
• a copy of the transcript of filing the judgment with the court.

The aforesaid documents are submitted to the courts by electronic means, or in other forms as may be designated. The concerned parties may be served all documents by electronic means of communication (e.g., emails) and will have full access to all documents through the court’s website.

Translation of required documentation

8     If the required documentation is drafted in a language other than the official language of your jurisdiction, is it necessary to submit a translation with the application for the setting aside of an arbitral award? If yes, in what form must the translation be?

To file an application for the setting aside of an arbitral award before a local court, if the award was not made in Arabic, a certified translation of the arbitral award into Arabic by an accredited body is required.

When seeking to enforce an award in the DIFC or the ADGM, if the award or agreement is not in English, the courts may request the party to provide a certified translation thereof.

A full translation of the required documents should be submitted with the application for the setting aside of an arbitral award.

Other practical requirements

9     What are the other practical requirements relating to the setting aside of an arbitral award? Are there any limitations on the language and length of the submissions and of the documentation filed by the parties?

The challenging party would be required to deposit a fee equal to 6 per cent of the claimed amount (with a cap of 40,000 dirhams) at the time of registering its application for setting aside an arbitral award before a local court under the Federal Arbitration Law. All submissions are made in Arabic; therefore, if necessary, the required documents (such as the final award, notification of issuance of the final award and arbitration agreement) should be translated into Arabic, which may incur the additional costs of translation. Generally, there is no limitation on the length of the submission; however, applications are made in a precise manner, with comprehensive relief therein, accompanied by the required documents.

For registering an application for setting aside an arbitral award before the ADGM Court, the challenging party would be required to pay a fee of 9,175 dirhams. The DIFC Practice Direction No. 2 of 2019 provides a scale of fees applicable on claims under Article 41 (Application for setting aside as exclusive recourse against arbitral award) of the DIFC Arbitration Law.

Form of the setting-aside proceedings

10     What are the different steps of the proceedings?

An application for setting aside an arbitral award is submitted through an online registration portal. Once the application is approved by the concerned court, the defendant will be notified of the application and a hearing date will be fixed for submission of the defendant’s response. The parties’ representatives may assist the court by their oral submissions during the hearing. On receipt of the parties’ respective submissions, if the court finds the provisions satisfactory, it will proceed to render its decision. Generally, there is one round of written submissions between the parties; however, the court has discretion to request the parties for further submissions (orally or written) if so required.

Suspensive effect

11     Do setting-aside proceedings have suspensive effect? May an arbitral award be recognised or enforced pending the setting-aside proceedings in your jurisdiction?

Article 56 of the Federal Arbitration Law provides that the filing of an annulment action does not entail the suspension of the arbitral award. However, the court hearing the annulment action may order a suspension at the request of any of the parties if the request is based on serious grounds. The court will decide on a request for the suspension of an arbitral award within 15 days of the date of the first hearing scheduled for considering the request. If the court orders the suspension of the award, it may require the party requesting the suspension to post a security or monetary guarantee. Further, it must decide on the annulment action within three months of the date the order is rendered.

Rule 43.70(2)(b) of the DIFC Court Rules and Rule 234(3) of the ADGM Court Regulations provide that a court may adjourn enforcement proceedings pending its decision on set-aside.

Grounds for setting aside an arbitral award

12     What are the grounds on which an arbitral award may be set aside?

Article 53(2) of the Federal Arbitration Law allows a court to set aside an arbitral award on its own when (1) the subject matter of the dispute cannot be submitted to arbitration, or (2) the award offends public policy or the morals of the state. Further, Article 53(1) of the Federal Arbitration Law sets out the grounds on which an arbitral decision can be set aside, which are that:

• no arbitration agreement exists, or it is void or has become void under the law chosen by the parties (or under UAE law if no law is specified);
• either party was incompetent or lacked capacity to execute the arbitration agreement;
• an individual does not have the legal capacity to dispose of the disputed right under the law governing his or her capacity;
• a party was deprived of the right to present its case because it did not receive proper notice of the appointment of an arbitrator or of the arbitration, the tribunal breached the party’s right to due process or for any other reason beyond the party’s control;
• the award does not apply the designated law;
• the appointment of the arbitrators and establishment of the tribunal was not in accordance with the Federal Arbitration Law or the parties’ agreement;
• the proceedings were marred by irregularities that affected the award;
• the award was not issued within the specified time; or
• the award decides matters not falling within the terms of reference or exceed their scope. However, if those matters can be separated from those on which the tribunal had the authority to rule, only the portion of the award addressing issues on matters not submitted to arbitration may be set aside.

Likewise, the DIFC Arbitration Law (Article 41) and the ADGM Arbitration Regulations (Article 53) provide the grounds for which set-aside is warranted, which are that:

• a party to the arbitration agreement lacked capacity;
• the arbitration agreement is not valid under the applicable law;
• the party against whom the award is invoked was not given proper notice of the appointment of an arbitrator or of the proceedings or was otherwise unable to present its case;
• the award decides on matters not falling within the terms of reference or exceed their scope. However, if those matters can be separated from those on which the tribunal had the authority to rule, only the portion of the award addressing issues on matters not submitted to arbitration may be set aside; and
• the composition of the tribunal or the procedure was not in accordance with the parties’ agreement or, absent such an agreement, with the applicable law.

Decision on the setting-aside application

13     What is the effect of the decision on the setting-aside application in your jurisdiction? What challenges are available?

Article 54(3) of the Federal Arbitration Law provides that a judgment nullifying an arbitral award entails the cancellation of the award in whole or in part, depending on whether the nullification pertains to all or part of the award. If an interpretation has been issued on the part that is rendered nullified, the interpretation shall likewise be nullified.

Under Article 57 of the Federal Arbitration Law, a party can appeal a court order granting or denying enforcement of an award with the competent court of appeal within 30 days of the order being notified to the parties. This order may be further appealed to the Court of Cassation.

In offshore jurisdictions, the Court of First Instance’s decision to refuse recognition of an award can be appealed to the relevant court of appeal.

Effects of decisions rendered in other jurisdictions

14     Will courts take into consideration decisions rendered in the same matter in other jurisdictions or give effect to them?

Both onshore and offshore courts will generally consider the decisions rendered by other jurisdictions, particularly in relation to recognising or enforcing a foreign award. The courts shall refrain from recognising or enforcing a foreign award until after a set-aside application at the arbitral seat has been decided or the time limit for such an application has expired.

If a foreign award is set aside at the seat of the arbitration, it would not be possible to recognise or enforce the award in jurisdictions within the UAE.

Applicable procedural law for recognition and enforcement of arbitral awards

Applicable legislation for recognition and enforcement

15     What is the applicable procedural law for recognition and enforcement of an arbitral award in your jurisdiction? Is your jurisdiction party to treaties facilitating recognition and enforcement of arbitral awards?

The recognition and enforcement of awards issued onshore outside the UAE (i.e., foreign awards) are governed by an amendment to the Civil Procedure Code (i.e., Cabinet Decision No. 57/2018, which repealed Articles 235 to 238).

The UAE is also party to treaties that promote the recognition and enforcement of foreign awards, including the ICSID Convention and the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of 1958 (known as the New York Convention). The UAE has signed several bilateral investment treaties and is a member of multilateral agreements (i.e., the Investment Protection Agreement of the Organisation of Islamic Cooperation (1981), the Riyadh Convention on Judicial Cooperation between States of the Arab League (1983) and the GCC Convention for the Execution of Judgments, Delegations and Judicial Notifications (1996)).

The recognition and enforcement of offshore awards are governed by Article 42 of the DIFC Arbitration Law and Article 55 of the ADGM Arbitration Regulations. The provisions in the above-mentioned treaties also apply offshore.

The New York Convention

16     Is the state a party to the 1958 New York Convention? If yes, what is the date of entry into force of the Convention? Was there any reservation made under Article I(3) of the Convention?

The UAE ratified the 1958 New York Convention in August 2006 without reservation. The Convention applies to awards being enforced in the UAE, including the DIFC (DIFC Arbitration Law, Article 42) and the ADGM (ADGM Arbitration Regulations, Article 60).

Recognition proceedings

Time limit

17     Is there a time limit for applying for the recognition and enforcement of an arbitral award?

There are no specific provisions in the Federal Arbitration Law, DIFC Arbitration Law and ADGM Arbitration Regulations regarding a time limit for applying for the recognition and enforcement of an arbitral award. However, as general practice, a party wishing to enforce an arbitral award must submit a request for the confirmation of the award and order to enforce, after issuing a notice of demand to the award debtor and providing sufficient time (e.g., two weeks) for the award to be settled.

Competent court

18     Which court has jurisdiction over an application for recognition and enforcement of an arbitral award?

Article 55 of the Federal Arbitration Law mandates that an enforcement application for a domestic award onshore be made to the Chief Justice of the competent court of appeal.

The Federal Arbitration Law is silent as to the enforcement of arbitral awards issued outside the UAE. However, under Cabinet Decision No. 57/2018, an application for enforcement need only be submitted to the competent execution judge.

UAE’s offshore jurisdictions each have their own competent courts for the enforcement of arbitral awards, namely the courts of first instance.

Jurisdictional and admissibility issues

19     What are the requirements for the court to have jurisdiction over an application for recognition and enforcement and for the application to be admissible? Must the applicant identify assets within the jurisdiction of the court that will be the subject of enforcement for the purpose of recognition proceedings?

A petitioner seeking to enforce a domestic award onshore must comply with the Federal Arbitration Law (Article 55). The enforcement of a foreign award depends on the state in which it was issued, as the UAE has executed treaties with states for the recognition of awards. Under Cabinet Decision No. 57/2018 (Article 85), the court must confirm the following before enforcing a foreign arbitral award:

• the court does not have exclusive jurisdiction over the dispute and the foreign court was competent in accordance with the rules of international jurisdiction established by its law;
• the award was made in accordance with the law of the arbitral seat;
• the parties to the arbitration were summoned and duly represented;
• the award has the force of res judicata in accordance with the law of the seat; and
• the award does not conflict with the judgment of a domestic court and is not contrary to public policy or the morals of the state.

The use of the DIFC courts to enforce foreign judgments in onshore Dubai has been a topic of discussion in the UAE. The Joint Judicial Committee for the Dubai Courts and DIFC Courts rules on the ability of DIFC courts to enforce awards outside the DIFC.

A petitioner seeking to enforce an award in the ADGM must comply with the formalities in Article 56 of the ADGM Arbitration Regulations.

Under UAE law, an applicant is not bound by any law provision to identify assets in the UAE to recognise or enforce an arbitral award.

Form of the recognition proceedings

20     Are the recognition proceedings in your jurisdiction adversarial or ex parte? What are the different steps of the proceedings?

A petition for recognition of an award is obtained ex parte but the recognition proceedings themselves are adversarial. Article 55 of the Federal Arbitration Law mandates that the petition be made with the Chief Justice (or anyone he or she delegates), who then serves it on the respondent. The respondent can challenge the award with a set-aside action or when opposing the petition to confirm the award.

Articles 85 and 86 of Cabinet Decision No. 57/2018 require a party seeking to enforce a foreign award onshore to file a petition with the execution court in the jurisdiction in which enforcement is sought. The judge will have three days to render his or her decision and this can be appealed by the respondent.

Application for recognition and enforcement of awards in the DIFC (regardless of where issued) can be made without notice. Nevertheless, the court may instruct the applicant to serve the application on the respondent if the set-aside deadline has not yet expired, or there is some doubt about regularity of the award or its service on the respondent.

Rule 232 of the ADGM Court Procedure Rules 2016 provides that an applicant seeking enforcement can make an application without notice. If permission to enforce is granted, the order must be then served on the respondent (Rule 234).

In the UAE jurisdictions, the parties’ representatives may assist the court by their submissions (written or oral) during the hearing. The courts do not address issues relating to the merits of the case as decided by an arbitral tribunal in its award, and deal with only the procedural irregularities or other grounds to challenge an award as specifically mentioned in the relevant laws. Generally. the courts do not conduct cross-examination of parties; however, they may invite a party for this purpose if an issue is not determined through documents. On receipt of the parties’ respective submissions, if the court finds these satisfactory, it will proceed to render its decision. Generally, there is one round of written submissions between the parties. However, the court has discretion to invite the parties for further submissions, if so required.

Form of application and required documentation

21     What documentation is required to obtain recognition?

Article 55 of the Federal Arbitration Law requires that a party seeking enforcement must submit an application to recognise the award. The application must be accompanied by:

• the original award or a certified copy;
• a copy of the arbitration agreement (translated into Arabic);
• an Arabic translation of the award, attested by a sworn translator (if issued in any other language); and
• a copy of the minutes of filing of the original award in court.

A party seeking to enforce an award offshore must submit an arbitration claim form with the original, or duly certified copy, of the award and arbitration agreement. If these are not in English, the court may request the party to provide a translation. The aforesaid documents are submitted to the courts by electronic means, or in designated forms, and the concerned parties may be served all documents by electronic means of communication (e.g., emails). They will also have full access to all documents through the court’s website.

Translation of required documentation

22     If the required documentation is drafted in a language other than the official language of your jurisdiction, is it necessary to submit a translation with an application to obtain recognition? If yes, in what form must the translation be?

For the enforcement of onshore awards in the UAE, an award issued in a language other than Arabic must be fully translated into Arabic. The translation must be attested by a sworn translator.

When seeking to enforce an award in the DIFC or the ADGM, if the award or agreement are not in English, the courts may request the party to provide a certified translation thereof.

A full translation of the required documents should be submitted with the application for the setting aside of an arbitral award.

Other practical requirements

23     What are the other practical requirements relating to recognition and enforcement? Are there any limitations on the language and length of the submissions and of the documentation filed by the parties?

In all three jurisdictions, an application for recognition and enforcement requires payment of a court fee. Under the Federal Arbitration Law, an application for recognition or enforcement to the concerned court should be in Arabic. Applications before the DIFC and ADGM courts should be in English.

There are no specific restrictions imposed by the jurisdictions in the UAE in relation to the length of submissions or of the documentation filed by the parties.

Recognition of interim or partial awards

24     Do courts recognise and enforce partial or interim awards?

Interim and partial awards are enforceable in the UAE (Federal Arbitration Law, Article 39). A party seeking to enforce an interim or partial award must apply to the chief justice of the competent court of appeal (or anyone he or she delegates). Article 21(4) of the Federal Arbitration Law requires a party seeking to enforce an interim order to obtain prior written permission from the tribunal.

Article 24 of the DIFC Arbitration Law permits a party to apply to the DIFC Court of First Instance to enforce an interim measure, provided that the applicant has first obtained written permission from the tribunal.

Article 28 of the ADGM Arbitration Regulations provides that a party seeking to enforce an interim measure must make an application to the ADGM Court of First Instance or ‘any competent court’, with notice to the opposing party.

Grounds for refusing recognition of an arbitral award

25     What are the grounds on which an arbitral award may be refused recognition? Are the grounds applied by the courts different from those provided under Article V of the New York Convention?

Article 55(2) of the Federal Arbitration Law provides that the grounds for which an onshore court can refuse recognition of an award are the same as those entitling it to grant a set-aside action under Article 53(1).

The grounds for which a court can refuse enforcement in the DIFC and the ADGM mirror those under the New York Convention (Article V), that is, where a party has established that:

• a party to an arbitration agreement lacked capacity;
• the arbitration agreement is not valid under the applicable law;
• the party against whom the award is invoked was not given proper notice of the appointment of an arbitrator or of the proceedings or was otherwise unable to present its case;
• the award decides on matters not falling within the terms of reference or exceed their scope. However, if those matters can be separated from those on which the tribunal had the authority to rule, only the portion of the award addressing issues on matters not submitted to arbitration may be set aside;
• the composition of the tribunal or the procedure was not in accordance with the parties’ agreement or, absent such an agreement, with the applicable law; and
• the award has not yet become binding on the parties or has been set aside or suspended by a court of the jurisdiction in which, or under the law of which, that award was made.

Recognition and enforcement of an award may be refused if a court finds that:

• the subject matter of the dispute was not arbitral under the applicable law; or
• it would be deemed contrary to UAE public policy.

Effect of a decision recognising an arbitral award

26     What is the effect of a decision recognising an arbitral award in your jurisdiction?

Under the Federal Arbitration Law (Article 55), the judge has 60 days from receiving an application to recognise and enforce an award, unless there are grounds calling for set-aside. Under Article 56, an action for set-aside does not stay enforcement. However, the court may issue a stay upon request if a party can establish good cause. The court must decide on a request for suspension of an arbitral award within 15 days of the date of the first scheduled hearing. If the stay is ordered, the court has 60 days to decide on the set-aside application. If the court orders the suspension of the award, it may require the party requesting the suspension to post a security or monetary guarantee.

In the DIFC, a party applying for award enforcement must submit the original award (or a duly certified copy) and the original arbitration agreement (or a duly certified copy). Pursuant to Article 41 of the DIFC Arbitration Law, recourse to the court against an arbitral award may be made only by an application for set-aside. Once the award has been ratified by the court, it will be enforceable both within and outside the jurisdiction to the extent permitted under the Judicial Authority Law.

Articles 55 and 56 of the ADGM Regulations provide that an award issued in the ADGM be enforced as if it were a judgment of a court within the jurisdiction, and all the court’s powers in respect of the enforcement of judgments will apply to its enforcement.

Decisions refusing to recognise an arbitral award

27     What challenges are available against a decision refusing recognition in your jurisdiction?

Under Article 57 of the Federal Arbitration Law, a party can appeal a court order granting or denying enforcement of an award with the competent court of appeal within 30 days of the order being notified to the parties. This order may be further appealed to the Court of Cassation.

In offshore jurisdictions, the court of first instance’s decision to refuse recognition of an award can be appealed to the relevant court of appeal.

Recognition or enforcement proceedings pending annulment proceedings

28     What are the effects of annulment proceedings at the seat of the arbitration on recognition or enforcement proceedings in your jurisdiction?

Article 56(1) of the Federal Arbitration Law clarifies that a set-aside action will not stay enforcement of an award. However, the court may nonetheless stay enforcement on request when good cause is shown. The court must decide on a request for a stay of enforcement within 15 days of the date of the first scheduled hearing.

Rule 43.70(2)(b) of the DIFC Court Rules and Rule 234(3) of the ADGM Court Regulations provide that a court may adjourn enforcement proceedings pending its decision on set-aside.

The courts of onshore and offshore jurisdictions in the UAE will generally consider the decisions rendered by other jurisdictions particularly in relation to recognising and enforcing a foreign award. The courts shall refrain from recognising and enforcing a foreign award until after a set-aside application at the arbitral seat has been decided or the time limit for such an application has expired. Therefore, if annulment proceedings at the seat of the arbitration are successful and the foreign award is set aside at the seat of the arbitration, it would not be possible to recognise or enforce that award in the UAE jurisdictions.

Security

29     If the courts adjourn the recognition or enforcement proceedings pending annulment proceedings, will the defendant to the recognition or enforcement proceedings be ordered to post security?

A court may, upon a petition to adjourn the recognition and enforcement proceedings pending the annulment proceedings, order the applicant to post security or provide a money guarantee (Federal Arbitration Law, Article 56(3)).

The DIFC Arbitration Law (Article 44(2)) and the ADGM Arbitration Regulations (Article 57(1)(c)) provide that a court may order a party requesting a stay to post appropriate security. Pursuant to Practice Direction No. 1 of 2017, the presiding judge in the DIFC will evaluate the merits of the respondent’s challenges when deciding whether to order the respondent to pay the amount of the award into the court.

Recognition or enforcement of an award set aside at the seat

30     Is it possible to obtain the recognition and enforcement of an award that has been fully or partly set aside at the seat of the arbitration? If an arbitral award is set aside after the decision recognising the award has been issued, what challenges are available?

Both onshore and offshore courts will generally refrain from recognising and enforcing a foreign award until after a set-aside application at the arbitral seat has been decided or the time limit for such an application has expired. If a foreign award is set aside at the seat of the arbitration, it would not be possible to recognise or enforce that award in the UAE jurisdictions.

Service

Service in your jurisdiction

31     What is the procedure for service of extrajudicial and judicial documents to a defendant in your jurisdiction? If the extrajudicial and judicial documents are drafted in a language other than the official language of your jurisdiction, is it necessary to serve these documents with a translation?

Chapter 1 of Cabinet Decision No. 57/2018 sets out the procedure for service in the UAE. Notice by a litigant or the court may be served by a process server or, if authorised by the court, the litigant or his or her agent (Article 3). Under Articles 6 and 7 of Cabinet Decision No. 57/2018, service may be performed electronically or, where not possible, in person at the head office of the respondent’s legal representative or any of its partners. In the absence of a legal representative, notice shall be delivered to an employee of the respondent’s offices. As a last resort, notice may be made by way of posting or publication.

Part 9 of the DIFC Court Rules and Part 4 of the ADGM Court Regulations prescribe the different ways in which documents may be served on the opposing party, and the circumstances in which service must be performed by the court.

Chapter 1 of Cabinet Decision No. 57/2018 further provides (under Article 5(3)) that if the official language of the defendant is not Arabic, the plaintiff shall be bound to attach to the notice a certified translation in English, unless there is an earlier agreement between the parties to attach the translation in another language. In other offshore jurisdictions, the official language is English and any correspondence in any other language should be translated into English.

Service out of your jurisdiction

32     What is the procedure for service of extrajudicial and judicial documents to a defendant outside your jurisdiction? Is it necessary to serve these documents with a translation in the language of this jurisdiction?

Service of process for individuals domiciled abroad and who cannot be served via electronic means and for private companies is governed by Article 7(6) of Cabinet Decision No. 57/2018. A copy of the notice shall be delivered to the Ministry of Justice so as to refer it to the Ministry of Foreign Affairs, which shall communicate it to the respondent by diplomatic means (unless a treaty applies).

Rules 9.53 and 9.54 of the DIFC Court Rules state that court permission to serve process outside the DIFC is not required, but the serving party must ensure it complies with the laws of the jurisdiction in which service is being made.

Rules 23 to 25 of the ADGM Court Regulations govern service outside the jurisdiction which, inter alia, require that a party seeking to serve a claim form on the respondent must provide a notice specifying the grounds on which it is entitled to serve the claim form outside the jurisdiction.

In all UAE jurisdictions, a translation in English or Arabic (or mutually agreed language of communication) must be attached to the documents served on a defendant if the official language of the defendant is not Arabic or English (as the case may be). In on-shore courts, the official language is Arabic, whereas in off-shore courts, the official language is English. Furthermore, English is the recognised international language. Therefore, even if a defendant is not a native English or Arabic speaker, the language of communications and documents must correspond to the official language of the respective jurisdiction.

Identification of assets

Asset databases

33     Are there any databases or publicly available registers allowing the identification of an award debtor’s assets within your jurisdiction?

There are no databases publicly available to a creditor to locate the assets of a debtor. Both the DIFC and the ADGM have company registers but these contain only limited information.

Information available through judicial proceedings

34     Are there any proceedings allowing for the disclosure of information about an award debtor within your jurisdiction?

Article 18 of Federal Law No. 10 of 1992 on Evidence in Civil and Commercial Transactions permits a litigant to apply for a court order compelling its opponent to disclose information.

Rule 25.1 of the DIFC Court Rules and Rule 71.1 of the ADGM Court Regulations allow a party to apply for a court order directing a party to provide information about the location of property or assets, or to provide information in relation thereto.

Enforcement proceedings

Attachable property

35     What kinds of assets can be attached within your jurisdiction?

The attachment of movable, immovable or tangible assets, including, but not limited to, bank accounts, stocks, bonds, revenues and shares, are possible under all UAE jurisdictions.

Availability of interim measures

36     Are interim measures against assets available in your jurisdiction?

Interim measures against assets are provided for under UAE federal law, in particular Chapter 8 of Cabinet Decision No. 57/2018. Certain limitations on the use of interim measures against sovereign state assets apply. Article 106(1) provides that public funds of the UAE or of its emirates (including waqf funds) cannot be attached. Article 106(10) prohibits attachment of the funds of foreign embassies and diplomatic bodies enjoying diplomatic immunity under the condition of reciprocity.

Interim measures are also available under Part 25 of the DIFC Court Rules and Part 10 of the ADGM Court Procedure Rules, and these include injunctions, declarations and orders (including freezing orders).

Although there is currently no precedent from the ADGM courts suggesting that interim measures against assets owned by a sovereign state may be enforced, there is at least one judgment by the DIFC Court in which it was held that a properly drafted sovereign immunity waiver clause will be upheld (see Pearl Petroleum Company Limited & Others v. The Kurdistan Regional Government of Iraq [2017] DIFC ARB 003).

Procedure for interim measures

37     What is the procedure to apply interim measures against assets in your jurisdiction?

Articles 18 and 21 of the Federal Arbitration Law authorise courts and tribunals to apply interim measures against assets under the cover of the general rules governing this matter provided for in Cabinet Decision No. 57/2018 (as discussed in questions 25 to 31). These measures are ex parte if applied by a court (in accordance with Article 18) but adversarial if applied by a tribunal (under Article 21) as it would take place during the arbitration.

Part 25 of the DIFC Rules provides that interim measures may be issued prior to and following issue of a claim form. Applications can be made with or without notice. Applications with notice must state the order sought and the time and location of the hearing (which cannot be less than three days), in addition to providing evidence and a draft of the proposed order itself. Urgent applications are made without notice and must provide evidence justifying why notice has not been provided.

Rule 72 of the ADGM Court Regulations provides that an interim measure application may be made before a claim has been brought, but only when it is urgent or if it is in the interests of justice to do so. Rule 64 requires an applicant to file an application notice, witness statement and a draft of the order sought. If made before a claim is issued, the application must be accompanied by an undertaking to the court to the effect that it will submit a claim within two days of the application notice being filed. Applications without notice may be made if permitted by a Rule, Practice Direction or the court.

Interim measures against immovable property

38     What is the procedure for interim measures against immovable property within your jurisdiction?

Article 113 of Cabinet Decision No. 57/2018 governs interim measures (i.e., seizures) against immovable property. To obtain an interim measure, the applicant must submit an official copy of the title deed of the property to be seized with its petition, and comply with the requirements provided under Article 111.

Part 46 of the DIFC Court Rules provides specific procedures for obtaining charge orders in relation to securities and funds in court, while Part 47 allows for the attachment of future assets, including money in court and future earnings. Part 25 of the DIFC Rules provides that a petitioner may apply for interim relief on either an ex parte basis or by giving notice to the other side. The application notice must state the order sought and the date, time and place of the hearing. The application notice and supporting evidence must be served as soon as practicable after issue and in any event not less than three days before the court is due to hear the application.

Part 32 of the ADGM Court Regulations provides that charging orders may be obtained on interests in trusts, stock, securities and other intangible interests held by the court.

Interim measures against movable property

39     What is the procedure for interim measures against movable property within your jurisdiction?

Articles 111(2) and 115 of Cabinet Decision No. 57/2018 govern the procedure for an interim measure against movable property when sought by a landlord against a tenant to secure a right to collect rent. Articles 111 and 112 are applicable to all other cases in which an interim measure is sought against movable property.

Interim measures against intangible property

40     What is the procedure for interim measures against intangible property within your jurisdiction?

Article 111 of Cabinet Decision No. 57/2018 lays down a general rule for all interim measures, including those sought against intangible property. However, Articles 147 and 148 provide that interim measures may be applied against stocks, bonds, revenues and shares.

Attachment proceedings

41     What is the procedure to attach assets in your jurisdiction?

Article 111 of Cabinet Decision No. 57/2018 provides that a UAE court can issue a provisional seizure of assets and property if a creditor can show that, inter alia:

• the debtor does not have a stable residence in the jurisdiction;
• the creditor fears, on the basis of firm evidence, that the debtor might flee, or smuggle or conceals his or her funds; and
• the debt securities are at risk of being lost.

Before issuing an order for seizure, the court may request any statements, evidence or affidavits, and conduct any necessary investigations with the assistance of the competent administrative authorities, when it is deemed necessary.

Article 113 provides that, if the debtor does not hold any writ of execution or if the debt is not of a specified amount, the judge may order a provisional seizure and temporarily estimate the debt owed based on the creditor’s petition.

If a seizure is ordered by a magistrate of summary justice, the creditor must file an action for the establishment of right within eight days of the issuance date of the seizure order. In response, the debtor can file a grievance against the seizure order.

Article 109 of Cabinet Decision No. 57/2018 provides that the debtor can have the attachment released by depositing with the court’s treasury a sum approximately equal to the sum owed.

Part 48 of the DIFC Rules governs enforcement against a debtor’s assets. Following issuance of an order for seizure, an enforcement officer shall deliver to the debtor, or leave at each place where execution is levied, a notice informing the debtor of the execution. Orders issued by courts in the DIFC are generally enforceable onshore in light of a reciprocal enforcement protocol (Dubai Law No. 12 of 2004 (as amended by Dubai Law No. 16 of 2011).

Part 32 of the ADGM Court Regulations allows a party to apply for a charging order against a debtor’s assets. If issued by the court, an interim charging order must be served on the debtor and a hearing will be scheduled to determine whether a final charging order should be issued. The creditor, having obtained the final charge order, can then request the court to order the sale of the property.

Attachment against immovable property

42     What is the procedure for enforcement measures against immovable property within your jurisdiction?

Articles 149 to 169 of Cabinet Decision No. 57/2018 set out the procedure for attachment of real estate. If the execution judge is satisfied with the seizure petition, he or she will communicate the seizure to the competent department. The debtor will then be notified of the seizure within seven days and, should he or she not object, the sale of the property will be ordered. The execution judge, before selling the property via auction, should notify the debtor to pay the debt within a month. In two limited circumstances, the debtor may request an extension of this deadline. In any event, the debtor’s residence cannot be attached unless the debt arises from a mortgage on the property (Article 106).

The DIFC Court Rules and the ADGM Court Regulations do not provide for any specific provisions governing immovable property.

Attachment against movable property

43     What is the procedure for enforcement measures against movable property within your jurisdiction?

Under Article 128 of Cabinet Decision No. 57/2018, the seizure of movables shall proceed on the basis of the case minutes, which shall include, inter alia, the writ of execution, details of the goods seized and the method of seizure. The debtor shall be asked to sign the seizure minutes. The seizure shall not require removal of the seized objects from their location except by virtue of the order of the execution judge. The judge will appoint a receiver to take possession of the seized items. The debtor can apply to the court to have the seized items sold at auction and use the proceeds to pay the creditor. It should be noted that Article 106 of Cabinet Decision No. 57/2018 specifies various categories of movable property that are immune from attachment.

The DIFC Court Rules (Rule 48.3) and the ADGM Court Regulations (Rule 182) set out specific provisions for the sequestration and delivery of movable property if that property has been the subject of dispute between the parties.

Attachment against intangible property

44     What is the procedure for enforcement measures against intangible property within your jurisdiction?

Articles 116 to 127 of Cabinet Decision No. 57/2018 outline the procedure for the seizure of credits held by a debtor towards a third party. Seizure shall take place without notice on the debtor and payment shall be made by the garnishee by depositing the debt with the court’s treasury. Articles 147 and 148 of Cabinet Decision No. 57/2018 set out specific provisions for the seizure of stocks, bonds, revenues and shares.

Part 46 of the DIFC Court Rules sets out specific procedures for obtaining charge orders in relation to securities and funds in court. Part 47 allows for the attachment of future assets, including money in court and future earnings.

Part 32 of the ADGM Court Regulations provides that charging orders may be obtained on interests in trusts, stock, securities and other intangible interests held by the court.

Attachments against bank accounts

45     Is it possible in your jurisdiction to attach bank accounts opened in a branch or subsidiary of a foreign bank located in your jurisdiction or abroad? Is it possible in your jurisdiction to attach the bank accounts opened in a branch or subsidiary of a domestic bank located abroad?

In all UAE jurisdictions, it is possible to attach the bank accounts opened within a branch or subsidiary of a foreign bank located in the UAE. However, it is not possible to attach bank accounts opened in branches or subsidiaries located outside the UAE of either foreign or domestic banks.

Enforcement against foreign states

Applicable law

46     Are there any rules in your jurisdiction that specifically govern recognition and enforcement of arbitral awards against foreign states?

There are no specific rules that govern recognition and enforcement of arbitral awards against property owned by foreign states in the UAE.

Although the DIFC and ADGM rules and regulations govern the enforcement of foreign awards, these do not set out specific provisions for recognition and enforcement of awards against foreign states.

Availability of interim measures

47     May award creditors apply interim measures against assets owned by a sovereign state?

Interim measures against assets are provided for under UAE federal law, in particular Chapter 8 of Cabinet Decision No. 57/2018. Certain limitations on the use of interim measures against sovereign state assets apply. Article 106(1) of Cabinet Decision No. 57/2018 provides that public funds of the UAE or of its emirates (including waqf funds) cannot be attached. Article 106(10) prohibits attachment of the funds of foreign embassies and diplomatic bodies enjoying diplomatic immunity under the condition of reciprocity.

Interim measures are also available under Part 25 of the DIFC Court Rules and Part 10 of the ADGM Court Procedure Rules, which include injunctions, declarations and orders (including freezing orders).

Although there is currently no precedent from the ADGM courts that suggests interim measures against assets owned by a sovereign state may be enforced, there is at least one judgment by the DIFC Court in which it was held that a properly drafted sovereign immunity waiver clause will be upheld (see Pearl Petroleum Company Limited & Others v. The Kurdistan Regional Government of Iraq [2017] DIFC ARB 003).

Service of documents to a foreign state

48     What is the procedure for service of extrajudicial and judicial documents to a foreign state? Is it necessary to serve extrajudicial and judicial documents with a translation in the language of the foreign state?

Article 7(6) of Cabinet Decision No. 57 of 2018 sets out the procedure for the service of documents on persons who have a known domicile abroad. This procedure involves a copy of the notification being delivered to the Ministry of Justice, which in turn refers it to the Ministry of Foreign Affairs, which communicates the notification through diplomatic channels. However, alternative mandatory means of service may be applicable under international agreements to which the UAE is a party.

The procedures governing the service of documents pursuant to these international agreements also apply to DIFC and ADGM proceedings.

Chapter 1 of Cabinet Decision No. 57/2018 further provides (Article 5(3)) that if the official language of the defendant is not Arabic, the plaintiff shall be bound to attach to the notice a certified translation in English, unless there is an earlier agreement between the parties to attach the translation in another language. In other offshore jurisdictions, the official language is English and any correspondence in another language should be translated into English or other relevant language of the foreign state.

Immunity from enforcement

49     Are assets belonging to a foreign state immune from enforcement in your jurisdiction? Are there exceptions to immunity?

There is no UAE law that expressly grants a foreign state sovereign immunity from enforcement proceedings.

Waiver of immunity from enforcement

50     Is it possible for a foreign state to waive immunity from enforcement in your jurisdiction? What are the requirements of waiver?

There is no waiver of sovereign immunity under UAE law as domestic law does not provide foreign states with immunity from enforcement. However, the DIFC Court has recognised waiver of sovereign immunity by a state under English law (see Pearl Petroleum, Dana Gas PJSC and Crescent Petroleum Company International Limited v. The Kurdistan Regional Government of Iraq (DIFC ARB/03/2017)).

Piercing the corporate veil and alter ego

51     Is it possible for a creditor of an award rendered against a foreign state to attach the assets held by an alter ego of the foreign state within your jurisdiction?

Domestic law does not provide foreign states with immunity from enforcement and an award creditor may execute an award against assets of a foreign state.

An award creditor may encounter difficulties in enforcing an award against a sovereign state through its assets held by alter ego. The reason is that the principle of alter ego may not be applied by a court to permit enforcement of an arbitral award against a third party who is not an award debtor. What an award creditor would be required to prove, and how it should be proved before a court, are opaque tasks without much judicial guidance. However, any fraud or such other criminal acts (to be determined by the concerned court) committed by an award debtor, particularly to impede the execution of an award against it, or its assets through its alter ego, could trigger piercing the corporate veil and may allow an award creditor to find recourse for enforcement of its award.

In the UAE jurisdictions, once an award has been issued by an arbitral tribunal in an arbitration case, a court has no power to amend or vary the award. Therefore, an award creditor, who intends to impose liability on a third party under the principle of alter ego and to overcome the expected hindrances, should do so, if allowed under the relevant arbitration agreement or applicable laws, during the proceedings before the foreign tribunal.

Notes