Key changes to the DIFC Court Law - How does this affect dispute resolution before the DIFC Court going forward?

In Brief:

• Dubai has recently introduced significant legislative changes concerning the Dubai International Financial Centre Court (“DIFC Court”). The changes are made by virtue of Dubai Law No. 2 of 2025 (the “New DIFC Court Law”), which came into force on 14 March 2025.
• The New DIFC Court Law supersedes two other foundational laws dealing with various aspects of the DIFC Court’s (i) jurisdiction, (ii) practice, (iii) procedure and (iv) the  interface with the onshore Dubai Court, being: (a) DIFC Law No. 10 of 2004 (the “Old DIFC Court Law”) and  (b) DIFC Law No. 12 of 2004 (the “Judicial Authority Law”) (together, the “Old Laws”). The New DIFC Court Law replaces the Old Laws and annuls any conflicting provisions in other legislation. The regulations and decisions issued under the Old Laws remain in effect, provided they do not contradict the provisions of the New DIFC Court Law, until any new regulations and decisions are introduced to replace them.
• The New DIFC Court Law is important as it: (i) unifies several key provisions in the Old Laws into one law; (ii) bolsters the Court’s already existing well-established practices and procedures and (iii) provides clarity on certain issues. In this article, we discuss some of the key changes that the New DIFC Court Law has introduced.

1. Expansion and/or clarification of the DIFC Court’s Jurisdiction

One of the most important changes under the New DIFC Court Law is that there is now a single statute dealing with the Court’s jurisdiction, whilst previously, the relevant provisions regarding the Court’s jurisdiction were contained in both of the Old Laws.

The DIFC Courts now has jurisdiction over a greater variety of commercial disputes, even in cases where there is no nexus to the DIFC. The DIFC Court’s jurisdictional gateways are set out in Article 14 of the New DIFC Court Law. Examples of the DIFC Court’s clarified and/or expanded jurisdiction are the following:

1. Employment Claims - under the Old Laws, the DIFC Court had jurisdiction over employment claims, however, the New Law explicitly includes employment claims as a jurisdictional gateway, as outlined in Article 14(A)(1-3).
   
   
2. Trusts and Non-Muslim Wills - the DIFC Court previously had jurisdiction over disputes concerning trust instruments and non-Muslim Wills pursuant to the DIFC Trust Law (DIFC Law No. 4 of 2018) (as amended) and Dubai Law No. 15 of 2017 (Concerning Administration of Estates and Implementation of Wills of Non-Muslims in the Emirate of Dubai). The New Law explicitly includes claims with regards to DIFC Trusts and Non-Muslim Wills registered in the DIFC as a jurisdictional gateway (Article 14(A)(4)).
   
   
3. Arbitration Claims - whilst the Old Laws previously conferred jurisdiction on the DIFC Court with respect to arbitration claims,  the New Law explicitly includes arbitration claims as a jurisdictional gateway, pertaining to:
   
   
   1. 1. The ratification and recognition of arbitral awards under the DIFC Arbitration Law (Article 14(A)(5);
      2. Disputes arising from arbitration proceedings where the seat or legal place of arbitration is the DIFC (Article 14(A)(6)(i);
      3. Arbitral proceedings which take place within the DIFC and where the parties have not agreed on the seat or legal place of the arbitration (Article 14(A)(6)(ii); and
      4. Circumstances where the parties agree to the DIFC Court’s jurisdiction for disputes arising out of arbitration proceedings (Article 14(A)(6)(iii).
         
         
4. Express Opt-in Agreements - similarly as set out in the Judicial Authority Law, the New DIFC Court Law also states that parties, including those with no connection to the DIFC, can opt into the jurisdiction of the DIFC Court, whether before or after the dispute arises, provided that such agreement is made pursuant to specific, clear and express provisions (Article 14(B)). Conversely, the New DIFC Court Law provides that if a claim falls within the jurisdiction of the DIFC Court but the parties agree in writing to the jurisdiction of another court, the DIFC Court will uphold such decision (Article 14(C)(1)).
   
   
5. International Treaties - the New DIFC Court Law confers jurisdiction on the DIFC Court over claims and applications under any international treaty/convention to which the UAE has acceded or is a party (Article 14(A)(7)).
   
   
6. Interim Relief - in the recent decision of  Carmon Reestrutura-engenharia E Serviços Técnios Especiais.(SU) LDA v Antonio Joao Catete Lopes Cuenda [2024] DIFC CA 003, the DIFC Court of Appeal affirmed the DIFC Court’s free standing jurisdiction to grant interim relief (in that case, a freezing order) in support of foreign proceedings. This jurisdiction has now been given statutory effect in Article 15(4) of the New DIFC Court Law which makes it clear that the DIFC Court has jurisdiction to hear applications for interim measures in relation to foreign court and arbitration proceedings. This coupled with the Court’s very broad power to issue a wide range of interim orders (such as restitution, disgorgement, compensation, damages in substitution for an injunction etc) set out in Article 24 (C) of the New DIFC Court Law make the DIFC Court attractive to prospective litigants.

2. Changes to the Court of Appeal

A noteworthy change that the New DIFC Court Law has brought about is the creation of a five-judge panel in the Court of Appeal in “exceptional circumstances” (Article 17(A)). It is however yet to be seen what qualifies as “exceptional circumstances” because the legislation does not clarify this.

A single judge may exercise the Court of Appeal’s jurisdiction to hear applications for permission to appeal (“PTA Application”) (Article 17(F)). It was anticipated that the New DIFC Court Law would contain provisions permitting an appellant to file a PTA Application directly before the Court of Appeal, thereby avoiding the requirement in the current DIFC Court Rules to first seek permission to appeal from the lower court. Although the New DIFC Court Law did not remove this requirement, this may be amended by the legislature in due course. From our experience of handling appeal matters, appellants are often reluctant to seek permission to appeal directly from the lower court first (as required under the current rules), as they have a perception that lower court judges (who are considering an application for permission to appeal their own decision) are less likely to grant them permission to appeal  than a judge of the Court of Appeal.

3. Contempt of Court

Article 35 of the New DIFC Court Law clarifies the DIFC Court’s powers when a party is found to be in contempt of court and arguably makes it clearer that the DIFC Court does not have the power to imprison anyone found to be in contempt of court. Offences for which a party may be considered to be in contempt of court include (inter alia) the following: (i) willfully insulting a judge, court officer or lawyer conducting business in the DIFC Court (ii) willfully damaging DIFC Court property; (iii) willfully disrupting proceedings or misbehaving; (iv) failing to comply with DIFC Court orders; (v) insulting or defaming the DIFC Courts or a court officer and (vi) willfully submitting fraudulent evidence to the DIFC Court.

Prior to the New DIFC Court Law coming into force, we have seen DIFC Court Freezing Orders (issued pursuant to Part 25 of the DIFC Court Rules (and by reference to Schedule A)) in which the penal notice accompanying the order refers to imprisonment.

However, Articles 35(A) and 35(B) of the New DIFC Court Law have clarified that the DIFC Court has the power to: (i) impose a fine on a party that is found to be in contempt of court and/or (ii) take any measure it deems necessary to ensure the proper administration of justice or (iii) refer the matter to the Attorney General of the Emirate.

We have acted in cases in which the DIFC Court has referred a party to the Attorney General in Dubai for being in contempt of court, however, we are not aware that the Attorney General has taken any action against any such party other than imposing a travel ban in  rare cases. This is most likely because contempt of court is not a criminal offence under the criminal laws of the UAE and therefore no specific sanctions would apply. However, it is clear from Article 35 of the New DIFC Court Law that the DIFC Court does not have the power to imprison a party for being in contempt of court. It is likely that any previous standard wording in the DIFC Court Rules (referring to a party’s imprisonment for being in contempt) will be amended accordingly.

4. Enforcement

The enforcement procedure is contained in Articles 29 to 32 of the New DIFC Court Law. As a first step, a party must obtain an “Enforcement Writ” from the DIFC Court, which must include the items listed in Article 30(B) of the New DIFC Court Law.

Article 31 of the New DIFC Court Law sets out the jurisdiction of an Enforcement Judge in the DIFC Court to enforce final judgments and orders issued by the Court within the DIFC. Where the object of enforcement is outside the DIFC, Article 32 of the New DIFC Court Law sets out the process by which a DIFC Court judgment or order can be enforced in the wider UAE via the onshore Dubai Court (i.e. by the DIFC Court requesting the deputisation of another court for the enforcement).

Article 32(B) of the New DIFC Court Law clarifies that an onshore Dubai Court Enforcement Judge may not examine the merits of the case.

Article 32(C) of the New DIFC Court Law expands the  interface between the DIFC Enforcement Court and the Dubai Enforcement Court, in that: (i) the Dubai Court Enforcement Judge must inform the DIFC Court Enforcement Judge of any action taken with regard to the enforcement proceedings; (ii) the Dubai Court Enforcement Judge must transfer any funds received  to the Enforcement Section of the DIFC Court and (iii) if there  is any reason why the Dubai Enforcement judge could not enforce a DIFC Court Writ, they must inform the DIFC Enforcement Judge of their decision.

5. Establishment of a DIFC Mediation Centre

Article 13 of the New DIFC Court Law establishes a Mediation Centre (“Centre”) within the DIFC Court framework. The Centre’s objective will be to consider disputes and to attempt to resolve them amicably, so as to save litigants the time and cost associated with formal DIFC Court proceedings.

6. Appointment of Assessors

Article 24 of the New DIFC Court Law provides that the DIFC Court has the power to appoint “assessors” to provide the Court with any relevant opinions required. The “assessors” are essentially court appointed experts, akin to the court appointed experts in the onshore UAE Courts. This procedure therefore sets the DIFC Court apart from other common law courts that do not have the same type of procedure.

7. Statute of Limitations

Article 28 of the New Law clarifies that all proceedings which fall within the DIFC Courts jurisdiction must be filed within 6 years from the date of the event which gave rise to the proceedings (unless the DIFC Laws or DIFC Regulations provide otherwise).

8. Conclusion

The provisions in the New DIFC Court Law are very helpful and practical as they simplify and consolidate important legal provisions regarding the DIFC Court’s jurisdiction, practice and procedure into a unified law, thereby providing more certainty to practitioners and litigants. The New Law therefore further enhances the DIFC Court as a leading forum for dispute resolution.

Our DIFC Court team is very well placed to assist clients in a wide ranging scope of matters before the DIFC Courts. If you require any assistance, please contact our DIFC Court team for further information: Zarghona Fazal, Partner, Head of DIFC and ADGM Litigation, z.fazal@hadefpartners.com; Maria Lezala (Senior Associate), m.lezala@hadefpartners.com; or Kim Mullins (Associate), k.mullins@hadefpartners.com