Monday, October 18, 2021

Decree No. 34 of 2021 enhances the status of the Dubai International Arbitration Centre

“Pursuant to the Decree, the Emirates Maritime Arbitration Centre and the DIFC Arbitration Institute will be abolished.”

Pursuant to the Decree, the Emirates Maritime Arbitration Centre (“EMAC”) and the DIFC Arbitration Institute (“DAI”) will be abolished.

EMAC was established in 2016 to provide the maritime industry with alternative specialised dispute resolution services in the Middle East. The DAI was established in 2004 under the umbrella of the DIFC Dispute Resolution Authority to promote the study and practice of arbitration. As part of DAIs initiatives, it entered into an agreement with the LCIA for the establishment of the DIFC-LCIA arbitration centre in 2008 and as a result of the Decree it is understood that the DIFC-LCIA centre will  cease to exist.

While the Decree is effective as of its publication date, DIAC has been granted a grace period of no more than six months to effectively replace the EMAC and the DAI. The objective of the Decree is to strengthen the position of Dubai as a reliable global centre for the settlement of disputes through alternative dispute resolution, including arbitration and mediation. The Decree provides that if the parties select the DIFC as the seat of an arbitration, the DIFC Arbitration law (as amended or replaced) shall apply and the DIFC Courts shall have jurisdiction to determine any case, application or challenge concerning arbitral procedures or the arbitral award issued in an arbitration administered by DIAC. If no seat is agreed between the parties, the DIFC will be the default seat.

A court of arbitration will be established within DIAC to undertake overall supervision of DIAC arbitrations with authority to supervise the application of the Decree and arbitration rules and procedures, appoint tribunals and fix the costs and expenses of arbitrations.

We understand that a consultation is underway between the LCIA and the Government of Dubai to ensure the effective management of ongoing and future arbitration cases and mediations where the parties have agreed that the DIFC-LCIA Rules will apply to the resolution of disputes between them.

If you require advice on the impact of this significant change to ongoing arbitrations or whether arbitration agreements in existing contracts should be amended, please get in touch with a member of our Dubai dispute resolution team.

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