New restrictions appear to limit clients’ choice of counsel in UAE seated arbitrations – but is it a storm in a teacup?

On 27 November 2017, Ministerial Resolution No. 972 of 2017 (the “2017 Regulations”) of the Executive Regulations to the Federal Legal Profession Law No. 23 of 1991 came into force, replacing the previous Regulations issued in 1997.

The effect of the 2017 Regulations is arguably that only UAE nationals registered on the Roll of Practicing Lawyers (“Local Counsel”) can represent clients in the UAE national courts and arbitration proceedings seated ‘onshore’ in the UAE. The 2017 Regulations do not, however, apply to Dubai International Financial Centre (“DIFC”) Court proceedings, arbitrations seated in the DIFC, Abu Dhabi Global Market (“ADGM”) Court proceedings or arbitrations seated in the ADGM.

Non-UAE national lawyers (“International Counsel”) have never been permitted to appear before the UAE national courts and so the impact of the 2017 Regulations on these proceedings is limited. But the 2017 Regulations could be of great significance to arbitrations. We explore below the implications of this potentially significant and unexpected legislation on UAE seated arbitration proceedings (“Onshore Arbitrations”). Continue reading

Has the pendulum swung back in favour of the DIFC courts? Two new decisions of the Judicial Tribunal

We recently reported on three decisions of the Judicial Tribunal (please click here) following our commentary on the Judicial Tribunal’s controversial first decision in Daman v Oger and the effect on the Banyan Tree jurisdiction (click here). We concluded that, notwithstanding the absence of detailed reasoning in individual decisions, it was possible to piece together the Judicial Tribunal’s approach from its decisions taken as a whole. The two new decisions shine further light on that approach. Continue reading

China proposes dedicated “Belt and Road” court

Supreme People’s Court Monitor has published a highly informative article on proposals by the SPC relating to China’s”Belt and Road” initiative. These include establishing a dedicated court, along the lines of the Singapore International Commercial Court, to hear Belt & Road disputes. Click here to read the piece.

Our thanks to Susan Finder of SPC Monitor for permission to re-publish.

Sovereign immunity in the DIFC Court

Last week, the Dubai International Financial Centre Court issued its decision in Pearl Petroleum Company Limited & Others v The Kurdistan Regional Government of Iraq. The Court upheld its earlier decision which recognised two LCIA arbitration awards totalling US$2 billion issued against the Kurdistan Regional Government of Iraq (the “KRG”) and dismissed KRG’s arguments (1) that the enforcement proceedings should be set aside on the ground that the Court did not have jurisdiction to make such orders against it, and (2) that the DIFC Court should not decide issues of immunity and its waiver. Continue reading

The DIFC’s conduit jurisdiction under attack? The Dubai Court attempts to reverse Banyan Tree

Following on from our reporting on the controversial first decision of the Judicial Tribunal in Daman Real Capital Partners Company LLC v. Oger Dubai LLC, Cassation No. 1 of 2016 (JT) (click here), there has been significant commentary on the possible implications for the DIFC's status as a conduit jurisdiction, particularly in connection with the enforceability in the DIFC of Dubai-seated arbitral awards, commonly referred to as the 'Banyan Tree' jurisdiction. 

At best, the Judicial Tribunal's decision seemed to provide yet another forum for onshore award debtors to use guerrilla tactics to frustrate and delay satisfaction of awards and, at worst, appeared to rule out enforcement of onshore seated DIAC arbitral awards in the DIFC, effectively overturning Banyan Tree.

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Onshore Dubai partners with Offshore: DIAC looks to develop “closer ties” with the DIFC

The Dubai International Arbitration Centre (“DIAC”) is now implementing its new strategy, designed to develop its international presence and dispel any notion that it is an 'onshore' only institution.

On 27 September 2016, DIAC, arguably the leading arbitration centre based in onshore Dubai, inaugurated a new office in offshore Dubai, situated within the Dubai International Financial Centre (“DIFC”), cementing its new strategy of cooperation with the DIFC Dispute Resolution Authority (“DRA”). Prior to the move, on 20 September 2016, DIAC entered into a memorandum of understanding (the “DIAC-DIFC Memorandum”) with the DRA, the purpose of which is stated as being to “execute, consult, cooperate and exchange information….in areas of mutual interest that will further enhance their respective strategic interests and objectives”.

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Agreeing to Arbitrate in the UAE: “Apparent Authority” and Article 25 of the UAE Commercial Companies law

It has long been believed that an arbitration clause in a contract could not be enforced against a UAE company unless the person signing the contract had specific authority to bind the company to arbitration, and not simply authority to enter into the contract. In Ginette PJSC and (1) Geary Middle East FZE and (2) Geary Limited, however, the DIFC Courts held that an arbitral award should be recognised and enforced notwithstanding that the individual who signed the arbitration agreement (which was contained in a settlement agreement) on behalf of an Award Debtor did not have express authority to bind the Company to arbitration. 

The Award Debtor, Ginette PJSC (the “Company”), sought to set aside the DIFC-LCIA arbitral award on the basis that Article 103 of Federal Law No. 8 of 1984 (the “Old UAE Companies Law”) provided that a private joint stock company could only be authorised to enter into an arbitration agreement if the power had been granted to the individual in the company’s articles of association or if authority was given by way of a shareholder resolution or a power of attorney. Although the Company’s articles of association granted its board of directors the authority to enter into arbitration agreements, the Executive Managing Director, who signed the settlement agreement on behalf of the Company was not, it claimed, a member of the board. The Company argued that the DIFC Court should set aside the award under Article 41(2)(a)(i) of DIFC Law No. 1 of 2008 (the “DIFC Arbitration Law”) because the arbitration agreement was not valid under the law.  Continue reading

Gavin v Gaynor: Important further clarification on DIFC court jurisdiction and identifying place of arbitration

On 3 April 2016, the DIFC Court ordered a stay of proceedings on the basis that, in light of the existence of parallel proceedings in the Californian courts on substantially similar grounds, the Claimant's commencement of a claim before the DIFC Court constituted an abuse of DIFC Court process.

However, in reaching its conclusion, the DIFC Court gave further consideration to the application of the jurisdiction gateways provided in Article 5(A) of the DIFC Law No. 12 of 2004 (as amended) (the "Judicial Authority Law") and the Protocol of Jurisdiction between the Dubai Courts and the DIFC Courts, discussed in a different light in our previous bulletins on Bocimar v ETA and DNB Bank.  In addition, the decision in Gavin v Gaynor also sets an interesting precedent in respect of the DIFC Court's interpretation of arbitration agreements, including the possibility for the DIFC Courts to imply an agreement settling the seat of arbitration as the jurisdiction with "most connection" to the claim.

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Enactment of the Abu Dhabi Global Market Arbitration Regulations 2015: the creation of a new “pro-arbitration” seat in the Middle East?

The Abu Dhabi Global Market ("ADGM"), a financial freezone in the United Arab Emirates, has enacted new arbitration regulations based on the UNCITRAL Model Law to create a new "pro-arbitration" seat in the Middle East. The ADGM Arbitration Regulations 2015 (the "ADGM Regulations") were enacted on 17 December 2015, and allow contracting parties to choose the ADGM as the seat of arbitration – no link is required to the ADGM for it to have jurisdiction.

The ADGM was recently established by decree of the Ruler of Abu Dhabi in 2013 and began operating in 2014. Similar to the Dubai International Financial Centre (the "DIFC"), the ADGM operates its own self-contained common law legal system, however, the ADGM directly incorporates English common law and a list of English statutes into its legal system by reference. In contrast, the DIFC has created its own separate body of substantive laws, with English law only applied in the event of conflict or gaps in DIFC law.

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