What Contracts Must Be Governed by UAE Law
When operating in the UAE, certain contracts are required by law to be governed by UAE legislation and resolved in local courts. Understanding these requirements is crucial for businesses and individuals to ensure compliance and avoid legal complications. Below is a breakdown of contracts that must mandatorily adhere to UAE laws:
1. Real Estate Agreements
Contracts involving UAE-based properties, such as purchases, leases, and development projects, are governed by UAE laws. These agreements are predominantly under the jurisdiction of UAE courts to ensure compliance with local real estate regulations.
2. Employment Agreements
Employment contracts in the UAE are subject to the UAE Labor Law. Disputes arising from such agreements are initially addressed through the Ministry of Human Resources and Emiratization. If unresolved, the matter is escalated to the UAE local courts.
3. Agency Agreements
Contracts with UAE commercial agents must be governed by local laws and resolved in UAE courts if they are to be registered with the UAE Ministry of Economy. This ensures the protection of both the principal and the agent under the UAE’s commercial agency framework.
4. Governmental Contracts
Agreements involving governmental bodies or public institutions are strictly subject to UAE statutory regulations. These contracts fall under the jurisdiction of local courts to ensure adherence to the public sector's legal framework.
5. Personal and Family Law Agreements
Matters such as marriage, divorce, custody, and inheritance for Muslims are strictly governed by UAE personal status laws. These issues must be resolved within the UAE judicial system to align with the country's family law statutes.
6. Maritime Agreements
Contracts related to maritime activities are generally governed by UAE maritime laws and are subject to resolution in local courts, unless parties explicitly agree otherwise.
Contracts in DIFC and ADGM
For contracts executed in the Dubai International Financial Centre (DIFC) and Abu Dhabi Global Market (ADGM), different rules apply. Contracts related to real estate, employment, or dealings with the free zone authorities must comply with the respective free zone laws. However, other commercial contracts may allow parties to select alternate governing laws, offering more flexibility in these jurisdictions.
Conclusion
Understanding which contracts must be governed by UAE laws is essential for compliance and legal clarity. Businesses and individuals operating in the UAE mainland, DIFC, or ADGM should consult legal experts to ensure their contracts adhere to the relevant legal frameworks. By doing so, they can mitigate risks and streamline dispute resolution when necessary.
Agreements involving governmental bodies or public institutions are strictly subject to UAE statutory regulations. These contracts fall under the jurisdiction of local courts to ensure adherence to the public sector's legal framework.
Arkhurst & Abdellah Solicitors, UAE.
Understanding which contracts must be governed by UAE laws is essential for compliance and legal clarity. Businesses and individuals operating in the UAE mainland, DIFC, or ADGM should consult legal experts to ensure their contracts adhere to the relevant legal frameworks. By doing so, they can mitigate risks and streamline dispute resolution when necessary.