Helen Saulnier 
Key developments have been implemented throughout the UAE in the very last 12 months. Legislators and regulators have continued to refine neighborhood regulation to improve and implement worldwide ideal apply throughout the UAE. We have highlighted some of the main developments alongside with a selection of predicted modifications.
Work Law
UAE Labour Law
In November 2021, the UAE Cabinet approved the Federal Regulation No. 33 of 2021 (the New Labour Legislation) which will be successful as of 2 February 2022. The New Labour Regulation delivers a radical overhaul of the latest UAE Labour Legislation which will apply throughout the 7 emirates as nicely as the free of charge zones, other than for DIFC and ADGM.
The New Labour Legislation provides changes to work contracts as preset time period contracts, flexible functioning preparations, amendments to termination provisions, stop of support gratuity and prohibits discrimination and harassment along with numerous other improvements.
Implementing Regulations are referenced all through the New Labour Regulation and these Polices are nevertheless to be issued by the Ministry of Human Sources and Emiratisation. It is anticipated that these Polices will give additional element as to the meant procedure of the New Labour Regulation. Although it is not crystal clear when these Laws will be issued, we foresee that they will be issued on, or soon prior to, the efficient day, 2 February 2022.
Performing Week
Lately it was announced that from 1 January 2022, all UAE federal authorities entities will go to a 4 and a fifty percent working day performing 7 days. In addition, the doing work 7 days would get started on Monday and close on Friday. Importantly, all faculties will also improve to a Monday to Friday doing work 7 days. In light of these modifications, it is inescapable that private sector firms, the two onshore and offshore, will mirror these improvements and move to a Saturday and Sunday weekend.
Employers that intend to adjust the performing 7 days really should ensure that their staff are correctly educated of any proposed improvements. In addition, work contracts and procedures should be reviewed, and thought ought to be taken as to the arrangement for workforce who want to attend Friday prayers.
Amendments to the DIFC Employment Law
Early into 2021, the DIFC Authority introduced a session period of time on the DIFC Legislation No. 2 of 2019 (as amended by DIFC No. 4 of 2020). On 21 September 2021, the amendments have been mirrored in just DIFC Law No. 4 of 2021 (the New DIFC Law) along with the Work Polices 2021.
The key aspect of the amendments was to ensure that the DIFC Work Regulation operated as it was intended and to limit any prospective abuse of the regulations. As this sort of, the New DIFC Legislation narrowed the scope of the “Additional Payments” definition to assure that only these payments could be excluded from the calculation of the DEWS contribution and that any arrangement to limit the employee’s monthly wage would be null and void.
Yet another important transform was that the New DIFC Regulation extended safeguards to secondees as perfectly as limited-time period personnel supplying them with defense from discrimination and harassment.
ARBITRATION
Dubai Arbitration Reforms
This year brought sizeable changes to the Dubai Arbitration Centres.
In January the new DIFC-LCIA Arbitration guidelines have been revealed but by September the introduction of the Decree No. 34 of 2021 about the Dubai Worldwide Arbitration Centre (the Decree) altered the landscape for arbitrations in Dubai.
The Decree abolished the Emirates Maritime Arbitration Centre (EMAC) as nicely as the Dubai Global Finance Centre Arbitration Institute (the DAI).
The DAI offered the administration for the community concept of the London Court docket of Worldwide Arbitration, the DIFC-LCIA Arbitration Centre. The DIFC-LCIA operated under the DIFC-LCIA Arbitration Procedures which largely mirrored the LCIA’s.
The objective of the Decree was to create a single consolidated arbitration centre in Dubai recognized as the Dubai Worldwide Arbitration Centre (DIAC). Although the dissolution of the EMAC and the DAI was successful as 20 September 2021, Posting 9 of the Decree presents DIAC with a six-thirty day period grace period of time to regulate the centre in accordance with the new Decree. Posting 2 of the Decree presents that the headquarters shall be located onshore in Dubai with a department in just the DIFC (offshore).
These adjustments are of distinct relevance for get-togethers currently involved in arbitration but also to those people with agreements to resolve disputes under the rules of possibly DIFC-LCIA or EMAC.
As this sort of, it is predicted that new DIAC Rules shall be released in accordance with the Decree and shall update the present-day 2007 DIAC Guidelines.
LITIGATION
Dubai Courts: Applicable Interest
The suitable to claim desire was recognised in 1993 below the Federal Legislation No. 18 of 1993 establishing the Business Transactions Law. In the absence of a contractually agreed fascination fee, Report 76 of the Business Transaction Legislation furnished that a creditor could declare up to 12% fascination for each annum until complete settlement was acquired.
In practice, the onshore courts have utilized desire at a price of 9% for every annum where functions were being not bound by a mutually agreed contractual charge.
On 9 June 2021, the Courtroom of Cassation issued a unanimous conclusion to revise its longstanding exercise. Resolution No. 1 of 2021 (the Resolution) was issued, binding the Dubai Courts to use an fascination fee of 5% for each annum exactly where parties were not sure by an agreed level. Whilst this Resolution applies to the Dubai Courts only, we can hope that the Courts of the other emirates will utilize a similar curiosity price.
Payment Order
2021 has clarified the scope for lenders to get well money owed by a quick-observe method recognized as a payment get. This will allow lenders to obtain a monetary judgment as opposed to elevating a substantive assert at the Dubai Courts.
This year, the Court of Cassation clarified that these kinds of statements necessary to be supported by penned evidence confirming that the credit card debt experienced been approved, or acknowledged, as becoming thanks by the debtor.
In addition, the UAE Civil Course of action Code was amended in August 2021 to deliver that the Dubai Court experienced jurisdiction to hear a personal debt circumstance, even if the circumstances for issuing a payment order were being satisfied. This eliminated the hazard of the Courtroom dismissing the situation and delivered reassurance to litigants.
UAE Penal Code
A new UAE Penal Code is expected in the new year which will form section of a number of new reforms introduced in 2022.
The new UAE Penal Code shall modernise the present legislation. A variety of amendments relate to bounced cheques which is a felony offence in the UAE. The Federal Decree No. 14 of 2020 amended the Industrial Transaction Legislation No. 18 of 1993 and the new amendments shall be effective as of January 2022.
The amendments generally aim on the decriminalisation of bounced cheques and partial payment of a cheque. These amendments give a confined requirements for a bounced cheque to have a criminal sanction and will decrease the broad variety of actions at the criminal court docket. In addition, a payee can provide consent in producing for the lender to concern any total readily available to the drawer of a cheque in which there are insufficient funds. In essence, this offers consent that the harmony is owing and a civil action could be lifted for the stability.
Corporate & COMMERCIAL
The New Businesses Regulation
In an hard work to create the nation’s lawful framework, the UAE federal government has issued Federal Legislation No 32 of 2021 (the New Corporations Legislation) which is to occur into drive on 2 January 2022. The New Companies Legislation replaces Federal Law No. 2 of 2015 (the 2015 Firms Regulation) which has been the main laws guiding commercial transactions given that its inception.
The New Businesses Law will consolidate and repeal the 2015 Businesses Legislation and its amendments, as perfectly as employ key changes in professional governance and transactions. To give a short summary of the expected modifications, the New Organizations Legislation addresses mergers and acquisition transactions with the recognition of two new corporate vehicles, (i) the distinctive goal acquisition enterprise, and (ii) the particular purpose auto. The New Companies Law also supplies for numerous governance and administration provisions relating to Constrained Liability Companies and Public Joint Stock Firms.
Implementing restrictions and more steering are expected to be issued in the new calendar year.
The New Factoring and Assignment Legislation
Federal Regulation No. 16 of 2021 on Factoring and Transfer of Accounts Receivables (the Factoring Law) which was entered into power on 8 December 2021, presents the 1st regulatory framework to handle distinct transactions about factoring and assignment of receivables. Formerly, the only advice readily available for these transactions was Federal Law No. 5 of 1985 on Civil Transactions Regulation which addressed facets of governing the assignment of debt, and Federal Law No. 4 of 2020 on Securing Curiosity with Moveable Residence which tackled features of assignments above receivables taken by way of safety.
The implementation of this legislation unifies the restrictions which utilize to assignments in the UAE and presents a foundation for the development of a new authorized regime. The Factoring Legislation addresses the requirements for assignments and transfers of receivables in the region, as properly as supplies advice on how to establish the validity and precedence of competing statements more than assigned receivables.
SUMMARY
2021 has viewed sweeping modifications throughout many sectors effecting the UAE and freezones as reforms align to worldwide specifications. The pace of legal and regulatory adjust will continue very well into 2022 with even further reforms and restrictions predicted. It will be exciting to see how these modifications unfold in follow during 2022.
For further information and facts, or to talk about in far more detail any of the over modifications, be sure to call Joanna Stewart ([email protected]) or on 04 343 8897 in which our crew will be delighted to guide you.
December 2021
