Legal Systems in U.A.E

 

Country Profile

 

The UAE is a Federation established in 1971 between seven Emirates namely  Abu Dhabi, Ajman, Dubai, Fujairah, Ras Al Khaima, Sharjah and Umm Al Quwain in the area previously known as the Trucial Coast in the Gulf which were, until W.W.I, under Ottoman rule and becoming later British protectorates. The UAE is also a member of the GCC.

 

The UAE is one of the relatively larger countries in the Gulf with a land area of over 83,000 square Kilometers with a population of 2.6 million. During the comparatively short period since its foundation the UAE managed to create a stable country with a thriving economy based on free trade. The reputation of the Emirates as a free trade area was enhanced with rapidly developing free zones especially the Jebel Ali free zone in Dubai. Oil production which started in the early sixties mainly from fields in Abu Dhabi and to a lesser extent Dubai and Sharjah helped to maintain the development momentum. The average production in 1998 was 2.26 million bpd with over $10 billion in revenues. The UAE is also a member of OPEC.

 

The UAE similar to other countries in the Gulf adopts a free market economy with a thriving private sector. However, the State owns or has majority shares in public utilities and important trades. Their privatisation programme was recently started with the privatisation of the water and electricity department (WED) in Abu Dhabi.

 

Legislative Procedures 

The 1971 Constitution agreed by the Rulers of the Emirates provided that the Supreme Council of Rulers shall be the highest legislative authority in the UAE. The Constitution also provides for the establishment of a National Assembly whose members are appointed by the Emirates. Federal laws are promulgated by the Supreme Council of Rules approving laws presented by Federal Council of Ministers and the national Assembly. While the legislation of laws on substantive matters is reserved to the Federal Government which had in the past few years taken significant  steps to regulate corporate and commercial matters, local authorities in the different Emirates are authorised to issue Decrees regulating local matters. 

 

 

Main corporate and commercial laws 
Labour Law No. 8 of 1980.
Commercial Agencies Law No. 18 of 1981 (as amended).
Maritime Law No. 26 of 1981.
Commercial Companies Law No. 8 of 1984 (as amended).
Civil Transactions Law (the Civil Code) No. 5 of 1985
Trade Marks Law No. 37 of 1992
Commercial Transaction Law No. 18 of 1993. 

 

The Judicial System

To maintain harmony between them the Emirates were given the constitutional right to opt for joining the Federal judicial system or to maintain their own independent system. Except for Dubai and Ras Al Khaima who maintain their own judicial systems, the other Emirates have joined the Federal system.


The Federal UAE courts, similar to the courts in most of the countries in the Area, are organised to form two main divisions civil and criminal and are also generally divided to three stages of litigation namely courts of First Instance, Appeal and the Federal Supreme Court (colloquially referred to as Court of Cassation). The  jurisdiction of the third division, namely the Shariah courts, which initially was to review matters of personal status, was expanded in certain Emirates such as Abu Dhabi to include serious criminal cases, labour and other commercial matters. Important cases with a security aspect are referred to special courts.

 

Dubai and Ras Al Khaima initially organised their courts on two stages later expanded in Dubai by the establishment of the Dubai Court of Cassation.

 

 

The Judiciary

Although the trend began in recent years, to appoint an increasing number of  judges, who are UAE Nationals,  to the different divisions of the Federal courts by the Ministry of Justice from amongst graduates of recognised law/Shariah colleges, is continuing, there are still a few senior expatriate Arab judges serving especially in the higher courts. 

Judges who serve in the courts of the other Emirates are appointed by Emiri Decrees. 

 

 

The Legal Profession

Practicing lawyers have to be licensed to practice law in the Federal courts by the Ministry of Justice and in the Emiri Diwan in the other Emirates. Lawyers must be graduates of a recognised law/Shariah college. Although in the past expatriate Arab lawyers were licensed to practice at the Federal courts and the other Emirates, the general trend is to restrict such practice to qualified UAE nationals. Expatriates were given a period during which they had to transfer their practice to a national lawyer. 

 

UK, US and European law firms are only allowed to practice as legal consultants, but are not allowed to plead cases in the courts.

 

 

 

Laws Regulating Litigation 

Law regulating Appeals to the Federal Supreme Court No. 17 of 1978.
Federal Law Regulating the Legal Profession No. 23 of 1991.
Federal Law of Evidence in Civil and Commercial Transactions No. 10 of 1992.
Civil Procedures Law No. 11 of 1992 which the Emirate of Dubai decreed to apply in the Dubai Courts.  {footer}

 

 

UAE Company Law Update

To accommodate the rapid expansion of the several Free Zones established in the UAE and, for practical purposes, provide exemption to companies or joint ventures established in specific areas, the provisions of Article (2) of Federal Law Company Law No. (8) of 1984 which provides for the scope of application of the law were replaced by the new provisions in Federal Law No. (15) OF 1998.

 

The new amended Article (2) of this law retains the concept provided in the previous Article (2) providing that the provisions of the Company Law shall apply to commercial companies incorporated in the State or that establish their main centre of activity therein, and to all companies which establish their domicile therein.

 

However, the amended Article (2) excludes companies incorporated in Free Zones in the UAE from itís provisions. Regulations provided by the concerned free zones shall apply to these companies except when they are considered as UAE companies.

 

Except when companies are considered to be UAE companies, the new Article (2) provides a further exemption stating that the provisions of the Company Law shall not apply to oil companies operating in the different fields of oil and gas industry, as well as companies operating in various aspects of electricity, gas, water purification. The Council of Ministers is also authorised in accordance with the new provisions to issue decisions to provide companies with such exemption from the provisions of the Company Law or to provide for this exemption in special provisions in companies Memoranda and Articles of Association.

 

For further information and assistance in a specific matter, contact Abbas Al Hawai

 


Gulf Coordination Council (GCC)

 

News: GCC Customs

The GCC Summit recently held in Doha on 21, 22 December 2002, approved the application, from 1st January 2003, of a unified customs tariff of 5% on goods imported to GCC countries. Customs duties are presently charged by Member States at varying rates ranging between 4 to 12%. In a step expected to consolidate the establishment of a free trade area, the Summit further approved the cancellation of customs imposed on the exchange of goods between GCC Member Countries.

 

It was reported that this decision was made to expand trade between the GCC and the European Union, its major trading partner.

 

Profile

The GCC was established in accordance with an agreement concluded in 1981 in Riyadh, Saudi Arabia between: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and UAE. These countries declared that the GCC  is established in view of the special relations between them, their similar political systems based on Islamic beliefs, joint destiny and common objectives.

 

The geographic proximity of the these countries and their general adoption of free trade economic policies are factors that encouraged them to establish the GCC. 

 

The objectives specified were the achievement and enhancement of coordination in the different  areas between the member countries and their people and the adoption of similar systems in economic and financial matters, commerce and customs, education and culture, social affairs and health, information and tourism, legislation and administration, science, technical, industrial, mining, agriculture, the establishment of joint project in these areas and the encouragement of private sector activities for the general benefit and welfare of their people. 

 

Legislation

In 1982 the GCC countries concluded the joint Economic Agreement granting specific privileges and advantages to nationals of member countries to perform economic and trading activities in other member countries. This was followed by similar other agreements to encourage economic relations, trade and practice of professions in the member countries