In his capacity as the Ruler of Dubai, His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE, issued Law No. (2) of 2025, pertaining to Dubai International Financial Centre Courts (DIFC Courts).
The provisions set forth in this new law aim to govern the judicial and administrative elements of the DIFC Courts in conjunction with the existing DIFC regulations. This legislation clarifies the jurisdictional scope and guarantees the independent functioning of the DIFC Courts, which include the Court of Appeal, the Court of First Instance, and the Small Claims Tribunal. Moreover, it delineates the procedural guidelines for appointing the Chief Justice and the Director of the Courts, along with their individual responsibilities.
Alternative dispute resolution pathway
The new law introduces an alternative dispute resolution pathway by creating a Mediation Centre. This facility allows parties to settle their disputes amicably with the assistance of mediators who are registered with the DIFC Courts. The president of the DIFC is tasked with establishing its operational framework, jurisdiction, and the procedures to be adhered to.
Under this new legislation, the DIFC Courts hold exclusive authority to hear and resolve civil, commercial, and labour claims involving the DIFC’s bodies or institutions. This applies to claims initiated by or against them, or where they are a party. The courts also manage claims related to the DIFC’s bodies, institutions, activities, and employees, including issues concerning trust deeds, non-Muslim wills, and the acknowledgment or enforcement of arbitration awards under DIFC arbitration law.
The law empowers the DIFC Courts to entertain requests for provisional and protective measures associated with cases under their jurisdiction. This encompasses identity and asset inquiries. Additionally, the courts are authorized to manage requests or arbitration proceedings initiated outside the DIFC, provided that suitable protective measures are instituted within the Centre.
Jurisdictional framework and procedures
The law extensively details the jurisdiction of the DIFC Courts, addressing litigation and evidence procedures, urgent matters, enforcement, exceptions to the compensation bond requirement, technical defects, procedural errors, and statutes of limitations.
Furthermore, this new legislation supersedes DIFC Law No. (10) of 2004 and Law No. (12) of 2004, which pertained to the DIFC Courts. It also nullifies any conflicting provisions found in other legislative texts. Regulations and decisions enacted under Law No. (10) of 2004 and Law No. (12) of 2004 will continue to be effective, as long as they do not contradict the stipulations of Law No. (2) of 2025, until new regulations and decisions are established to replace them.
