Dubai Ruler issues law on DIFC Courts

In his capacity as Ruler of Dubai, Vice President and Prime Minister of the UAE His Highness Sheikh Mohammed bin Rashid Al Maktoum issued Law No. (5) of 2017 partially amending Law No. (12) of 2004 on the Judicial Authority at Dubai International Financial Centre Courts (DIFC Courts).

In addition to civil and commercial claims, the new amendment expands the jurisdiction of DIFC Courts to include labour claims and actions arising out of labour contracts signed between DIFC companies and establishments and their employees.

The new Law amends the provisions of Article No. (5) of Law No. (12) of 2004 regarding the jurisdictions. The Article’s amendment includes the jurisdiction of the Court of First Instance, the jurisdiction of the Court of Appeal, the litigation procedures and the authorities of the execution judge.

The Court of First Instance will have exclusive jurisdiction to hear and determine the civil, commercial and labour claims and actions to which the DIFC or any DIFC body, DIFC establishment or licensed DIFC establishment is a party. The Court of First Instance shall have exclusive jurisdiction to hear and determine the civil, commercial and labour claims and actions arising out of or relating to a contract or promised contract, whether partly or wholly concluded, finalised or performed within DIFC, or performed or is supposed to be performed within DIFC pursuant to express or implied terms stipulated in the contract.

The Court of First Instance shall have exclusive jurisdiction to hear and determine the civil, commercial and labour claims and actions arising out of or relating to any incident or transaction, which has been wholly or partly performed within DIFC and is related to DIFC activities; or otherwise appeals against decisions or procedures made by DIFC bodies where DIFC Laws and DIFC Regulations permit such appeals and claim or action over which the Courts have jurisdiction in accordance with DIFC Laws and DIFC Regulations.

The Court of First Instance may hear and determine any civil or commercial claims or actions where the parties agree in writing to file such claim or action with it whether before or after the dispute arises, provided that such agreement is made pursuant to specific, clear and express provisions. The Court of First Instance may hear and determine any civil, commercial and labour claims or actions falling within its jurisdiction if the parties agree in writing to submit to the jurisdiction of another court over the claim or action but such court dismisses such claim or action for lack of jurisdiction. The Court of First Instance may not hear or determine any civil, commercial and labour claim or action in respect of which a final judgment is rendered by another court.

The new Law also amends the provisions of Article No. (5) of Law No. (12) of 2004 regarding the Jurisdiction of the Court of Appeal.

The Court of Appeal shall have exclusive jurisdiction to hear and determine appeals filed against judgments and decisions made by the Court of First Instance and request of interpretation by the Chief Justice of the Courts of any article of the DIFC Laws and DIFC Regulations upon an application submitted to him from any DIFC body, DIFC establishment or Licensed DIFC establishment; such interpretation shall have the same authority as the interpreted legislation. Judgments rendered by the Court of Appeal shall be final and conclusive, and shall not be subject to appeal.

The procedure outlined in the Rules of the Courts shall apply to civil, commercial and labour claims and actions heard by DIFC Courts and the Chief Justice of the Courts shall assign one or more of the Courts’ judges as execution judges.

Law No. (5) of 2017 is effective from the date of issuance and will be published in the Official Gazette.

The new Law boosts DIFC’s position as a global hub that attracts leading companies and talent in the financial industry. The law also helps to facilitate litigation procedures for employees based in DIFC.