The Dubai government has issued a new law to widen the jurisdiction of the DIFC Courts: an important development which will be of significance to all international businesses with interests in the Middle East.

The law is expected to allow businesses to elect in their agreements for the DIFC Courts to resolve their commercial and civil disputes, regardless of where the parties are located, or where the contract is to be performed.

The DIFC Courts are an attractive forum for international businesses to resolve their disputes in the Middle East. They offer high international standards in the resolution of disputes, use the English language in proceedings and are based on a familiar legal system.

However, their jurisdiction has to date been narrow. There have also been some uncertainties regarding the relationship between the Dubai courts and the DIFC Courts. Our recent e-bulletin summarises the previous position (click here). The new law may bring an end to these concerns.

This development will be welcomed by the international business community. An important consequence will be that overseas investors into mainland Dubai will be able to choose DIFC Court jurisdiction and apply for enforcement of a DIFC judgment in Dubai without re-examination of its merits, if the enforcement protocol between the Dubai courts and the DIFC Courts remains unchanged. It may also provide a forum for the resolution of regional disputes with the possibility of enforcing DIFC judgments under a regional Middle East treaty, such as the Riyadh Convention.

The law has not yet been published in the Official Gazette.