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What legal requirements are there for recognition of an award? Must reasons be given for the award? Does the award need to be reviewed by any other body?
Pursuant to Article 215(1) of the UAE Civil Procedure Law, an arbitral award may not be enforced unless it has been ratified by the court, provided that the court has reviewed the award and ascertained that the award contains no obstacles to enforcement.
Article 212(5) provides that the arbitrators’ award shall include the reasons for the award and the order made.
Timeframe for delivery
Are there any time limits on delivery of the award?
Under Article 210(1) of the UAE Civil Procedure Law, unless the parties agree otherwise, the tribunal is required to pass judgment within six months of the date of the first arbitration hearing.
Does the law impose limits on the available remedies? Are some remedies not enforceable by the court?
The UAE Civil Procedure Law does not impose any limits on the remedies available to the parties.
What interim measures are available? Will local courts issue interim measures pending constitution of the tribunal?
Under the UAE Civil Procedure Law, tribunals do not have inherent powers to order interim measures. By agreement between the parties, the tribunal may be empowered to order interim measures.
Article 22 of the UAE Civil Procedure Law provides that the court has the power to issue both preliminary and interim precautionary orders, even where it does not have jurisdiction in the primary action.
Article 29 specifically provides that a party may apply to the summary proceedings judge or court for chattels, real property or other assets to be placed under the protection of the court, provided that it can show good cause to fear immediate danger to the assets if they remain in the hands of the party in possession.
Under Article 159, an appeal against any such order must be brought within 10 days.
Under Articles 252 to 254, the summary proceedings judge may order the attachment and preservation of assets. Article 255(2) provides that where a summary order has been obtained, proceedings to finally establish the claimant’s entitlement must be commenced within eight days thereof.
Can interest be awarded?
Interest can be awarded under Articles 76, 88 and 90 of the Commercial Transactions Law (Federal Law 18/1993). Pursuant to Article 88, interest may be awarded only if the debt is known. Under Article 90, interest will be accrued from the maturity date of such debts, unless it is otherwise provided for by law or agreement.
At what rate?
Article 76 provides that where the parties have failed to agree on a rate of interest, the rate shall be calculated according to the current rate of interest in the market, provided that this does not exceed 12%. In practice, the courts have typically awarded 9%.
Is the award final and binding?
Yes, if accepted by the court. According to Article 215(1) of the UAE Civil Procedure Law, the award shall not be enforced unless it is ratified by the court, which will consider any obstacles to enforcement and has jurisdiction to rectify any material errors in the award.
According to Article 217(1) of the UAE Civil Procedure Law, parties are not permitted to appeal an arbitral award.
What if there are any mistakes?
Article 214 of the UAE Civil Procedure Law provides that when considering whether to ratify an award, the court may remit the award to the arbitrators so that they may consider any issues which have been omitted or clarify any issues which are insufficiently specific for the purposes of enforcement.
Under Article 215 (applying Article 137), the court has the power to correct computational, clerical, typographical or other errors in the award either of its own motion or on the application of one of the parties.
Institutional arbitration rules may also grant arbitrators certain powers to correct and amend arbitral awards.
Can the parties exclude by agreement any right of appeal or other recourse that the law of your jurisdiction may provide?
The UAE Civil Procedure Law does not specifically allow or prohibit the parties from excluding their rights to recourse against the award.
What is the procedure for challenging awards?
Under Articles 216(1)(a) to (c), an aggrieved party may invite the court to annul the final award when it comes before it for ratification. Applications to annul and to ratify an award are made by the commencement of an ordinary action in the court of first instance. The fees to be paid and the procedure to be followed in the court of first instance are the same as those for any other action. The courts will annul the award if:
- the award was issued in the absence of an arbitration agreement;
- the arbitration agreement was invalid or had expired through prescription;
- the tribunal exceeded its jurisdiction;
- there was a defect in the method by which the arbitrators were appointed;
- without authority, the award was issued by some of the arbitrators in the absence of others;
- the award was issued pursuant to an arbitration agreement that failed to identify the dispute;
- a party to the arbitration agreement lacked competence to agree to arbitration;
- an arbitrator was not qualified to act according to the minimum requirements of the law of the seat or the terms of the arbitration agreement; or
- the award or the procedure adopted by the tribunal is tainted by invalidity.
On what grounds can parties appeal an award?
The parties are not permitted to appeal an award (Article 217(1) of the UAE Civil Procedure Law), although they can challenge ratification or resist enforcement (Article 216(1) of the UAE Civil Procedure Law).
What steps can be taken to enforce the award if there is a failure to comply?
After receiving an execution judgment, the UAE courts will notify the award debtor of the requirement to make payment within 15 days. If such payment is not made, the execution judge can order forcible measures to ensure payment, with the assistance of the court bailiffs.
Can awards be enforced in local courts?
How enforceable is the award internationally?
Arbitral awards issued in the United Arab Emirates are generally enforceable internationally, particularly in New York Convention signatory states. The United Arab Emirates also maintains bilateral agreements on the reciprocal enforcement of judgments and arbitral awards with certain states.
To what extent might a state or state entity successfully raise a defence of state or sovereign immunity at the enforcement stage?
Under Article 247(1) of the UAE Civil Procedure Law, public and private properties owned by the United Arab Emirates or any of its constitutive emirates are immune from attachment to debt or seizure. It is unlikely that the UAE courts will enforce awards where debts are due from the UAE government or government-owned entities, even if the award or judgment is in favour of a party which has a signed sovereign immunity waiver from the government or government-owned entity.
Are there any other bases on which an award may be challenged, and if so, by what?
The UAE Civil Procedure Law provides no additional grounds under which an award may be challenged.
How enforceable are foreign arbitral awards in your jurisdiction?
Generally speaking, final awards which are not subject to challenge in the jurisdiction of the seat of the arbitration are enforceable by the UAE courts, particularly if the award is issued in a New York Convention signatory state. Before the United Arab Emirates acceding to the New York Convention, it had no substantial track record of enforcing foreign arbitral awards.
Will an award that has been set aside by the courts in the seat of arbitration be enforced in your jurisdiction?
The UAE courts may refuse to enforce an award that has been set aside by the courts in the seat of arbitration on the basis of Article V(1)(e) of the New York Convention.
Article 235(2)(d) of the UAE Civil Procedure Law requires an award to be final and unchallengeable in the jurisdiction of its seat in order to be capable of enforcement in the United Arab Emirates.
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