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Arbitration has become an increasingly popular method of dispute resolution in the UAE, offering numerous advantages over traditional litigation. The UAE arbitration law formalities, primarily modeled on the UNCITRAL Model Law, provide a framework for arbitration, ensuring fairness, efficiency, and enforceability. This blog delves into the formalities and procedural requirements under the UAE Arbitration Law.
The Federal Law No. (6) of 2018 on Arbitration defines arbitration as “a law-regulated procedure where the parties agree to submit their dispute to an arbitral tribunal that makes a binding decision on the matter” (Article 1). The UAE Arbitration Law, modeled on international best practices, ensures a structured and fair arbitration process.
Common Formalities in UAE Arbitration
Arbitration Agreement Requirements
Written Agreement: An arbitration agreement must be in writing, or it will be deemed void (Article 7(1)).
Legal Capacity: A natural person with legal capacity and specific authority must conclude the agreement to arbitrate (Article 4(1)).
Post-Dispute Agreements: Parties can make agreements after a dispute arises, even if court proceedings have begun, as long as the agreement specifies the matters to be arbitrated (Article 5(2)).
Appointment of Arbitrators
Procedure Flexibility: Parties can agree on the method of appointing arbitrators and the timeline for their appointment (Article 11(1)).
Sole Arbitrator: Parties may mutually agree on a sole arbitrator. If they fail to do so within fifteen days of a request, an appointment can be made by the relevant arbitration center (Article 11(2)).
Three Arbitrators: Each party appoints one arbitrator, and the two appointed arbitrators choose the third. If appointments are not made within the specified timeframe, the arbitration center will make the necessary appointments (Article 11(3)).
Language of Proceedings
Choice of Language: Parties can choose the language of the proceedings. If no language is chosen, Arabic will be the default language.
Interim and Partial Awards
Issuance of Interim Awards: The arbitral tribunal can issue interim and partial awards to address various needs such as preserving evidence or maintaining the status quo (Article 21, Article 39(1)).
Time Frame for Final Award
Time Limits: Parties must issue the final award within the agreed timeframe. If no timeframe is specified, they must issue it within six months from the date of the first hearing, with the option to extend by an additional six months (Article 42(1)).
Formalities Across Different Jurisdictions in the UAE
Federal Arbitration Law
Onshore Arbitration: Governed by the UAE Arbitration Law, which is largely based on the UNCITRAL Model Law but with certain deviations to suit the local legal environment.
Legal Capacity: The requirement for legal capacity under Article 4(1) reflects the UAE’s federal laws, ensuring that only authorized persons can enter into arbitration agreements.
Dubai International Financial Centre (DIFC)
Common Law Framework: The DIFC follows a common law system, separate from the federal civil law system, and the DIFC Arbitration Law governs its operations.
Technological Provisions: The DIFC Arbitration Law incorporates provisions for the use of technology in arbitration.
Confidentiality: Explicitly protects the confidentiality of arbitration hearings and awards.
Arbitral Institutions in the UAE
Dubai International Arbitration Centre (DIAC)
DIAC is the largest arbitration center in the region, with a modern governance framework aimed at becoming the leading arbitration center in Dubai.
Abu Dhabi International Arbitration Centre (arbitrateAD)
The newly launched arbitrateAD aims to replace the ADCCAC, bringing reforms to Abu Dhabi’s arbitration landscape.
International Islamic Centre for Reconciliation and Arbitration (IICRA)
Specializes in resolving disputes in line with Sharia law, important for Islamic financial institutions.
Sharjah International Commercial Arbitration Centre (Tahkeem)
Promotes economic and investment stability through its arbitration procedures.
International Chamber of Commerce (ICC)
The ICC has a regional office in Abu Dhabi, facilitating effective case management for arbitrations in the Middle East.
Saudi Center for Commercial Arbitration (SCCA)
The SCCA’s extension into the DIFC offers additional choices for arbitration, with proceedings in both Arabic and English.
Conclusion
The UAE Arbitration Law and its accompanying regulations provide a clear, structured framework for arbitration. Adhering to the outlined in the UAE Arbitration law formalities, parties can ensure a smooth and effective arbitration process. For further guidance on UAE Arbitration Law Formalities in the UAE, reach out to top law firms in Dubai or Dubai Lawyers.