Jurisdiction within United Arab Emirates

Authors: Abdullah Ishnaneh and Bassel Boutros

Upon executing an agreement, one of the most important aspects to contractual parties is the clause pertaining to the governing law and jurisdiction in the event any dispute arises between them.

While the parties may believe that by opting for a specific jurisdiction, that this jurisdiction will automatically be competent to examine and rule on a dispute which may take place in the future, especially if the subject of the agreement is not related to any public order matter, this is far from reality.

Article 20 of Federal Law No. 11/1992 on the Civil Procedures Code (the “CPC”) stipulates that UAE Courts have jurisdiction to examine claims against UAE citizens and claims against foreigners who reside, or whose chosen domicile is the UAE.

Furthermore, Article 21 of the CPC states that UAE Courts have jurisdiction over claims filed against a foreigner who has no domicile or residence in the UAE, if one of the defendants has a domicile or resides in the UAE.

In this context, UAE Courts will consider any clause which designates another jurisdiction to examine and rule on the dispute as null and void and will proceed with examining the case, if a foreigner has a domicile or a residence in UAE or even if one of the defendants has a domicile or resides in the UAE. Either party may ask the UAE Courts to apply a governing foreign law as determined in their agreement but will have to provide the court with a copy of the complete foreign law with the required attestation.