Recent Trends In Arbitration In UAE

Posted On - 26 December, 2025 • By - Bini Saroj

Introduction

The United Arab Emirates is on a transformative journey that aims at establishing it as a leading global platform for trade and investments. As the backbone of establishing the UAE on a global podium for trade and investments lies the essential and paramount need for a sophisticated legal framework that is predictable and efficient when it comes to the resolution of a potential dispute that could arise. Coming into focus as the backbone of commercial justice is the aspect of arbitration that provides a party involved with the essentials of neutrality, enforcement, and flexibility that are fundamental when it comes to conducting business that borders on more than one country.

There have been a number of seminal legislative and court decisions in the past few years that have significantly transformed the landscape. The setting up of a contemporary Federal Arbitration Law modelled upon the UNCITRAL Model Law, the evolution of finance centre-turn-key regimes in Abu-Dhabi Global Market (ADGM) and Dubai International Financial Centre (DIFC) regimes in particular, and the evolution of a clearly pro-arbitration approach by the domestic courts indicate a paradigm shift. The aforementioned developments have rationalized concerns relating to the powers and abilities of arbitrators in terms of efficiency and finality of awards, among other factors.

It is pertinent to note that since the Federal Arbitration Law (Law No. 6 of 2018) was ratified in the UAE in the year 2018, there has been a trend in the year 2025 of the UAE Courts delivering arbitration-supportive judgments. Such has been made clear through various recent Court of Cassation rulings in the UAE.

The enforcement of the current Federal Arbitration Law (Law No. 6 of 2018) based on the UNCITRAL Model Law, the progressive regimes in Abu Dhabi Global Market (ADGM) and Dubai International Financial Centre (DIFC), and judicial policies in support of arbitration under the domestic laws suggest that there has been a paradigm shift.

The decision in case number 2025-980 issued by the Court of Cassation in Abu Dhabi on the 16th of October 2025 is a good example in this respect and relates to a number of issues that can be highlighted:

Effective Enforcement of Arbitration Agreements and Incorporation by Reference: This case highlighted the UAE courts’ tough stance on the enforcement of valid arbitration clauses. The Court reiterated that, in accordance with Article 7 of Federal Law on Arbitration No. 6/2018, an arbitration agreement should be in writing, and that an arbitration agreement could be sufficiently incorporate by reference into the contract. It was clear that the separate agreements were couched in the following terms:”All the conditions of the main contract will remain unchanged.” The effect of this is that they sufficiently incorporated the arbitration clause found in the main contract.
Arbitration of Multi-Party Construction Disputes: The decision marks a significant milestone concerning complex multi-party disputes characteristic of construction projects. The Court confirmed that a constellation of interrelated agreements and subcontracts leading from a master contract may make all parties subject to a clause referring disputes to arbitration in the master contract to prevent inconsistent decisions being made./
This issue has a crucial impact upon efficient dispute resolution in the construction industry, as it prevents two separate dispute resolution procedures in two separate dispute resolution bodies such as the arbitration court and a state court.
Judicial Restraint upon Finding a Valid Arbitration Clause: The Court showed a disciplined and arbitration-friendly procedural stance. The Court declared that if a valid arbitration clause exists, it is obligatory to dismiss the case from the court’s jurisdiction and it must not address other procedural challenges including standing (locus standi) and the prematurity of claims. The Cassation Court showed that the decision made by the lower court was erroneous because it addressed issues beyond its jurisdiction. This is consistent with the role of a court as a gatekeeper between the dispute resolution process and the relevant dispute resolution forum.
Validity of arbitration clauses despite non-payment of fees: Recently, Dubai’s Court of Cassation has overturned its previous stance on arbitration clauses, having found that an arbitration clause remains valid notwithstanding the closing of the case due to the non-payment of advance fees, unless there is already an award.
Arbitral tribunals are also able to grant anti-suit injunctions: The Dubai Court of Cassation recently made an important judgment in which it upheld the ability of an arbitration tribunal to order an anti-suit injunction in relation to arbitration administratively seated in the UAE and confirmed the arbitral tribunal’s competence to order interim measures.
The case evolved from an ICC arbitration seated in Dubai, where the arbitral tribunal made an order restraining a respondent from filing any claims before other courts relating to matters falling within the ambit of arbitration. The anti-suit injunction was challenged before the Dubai Court of Appeal and was set aside on grounds that it contravenes the right of access to courts and the Federal Arbitration Law.
The decision of the court below was overturned in this particular case, and jurisdiction is restored in favor of the arbitral tribunal, with a lack of jurisdiction in courts in mainland Dubai. The anti-suit injunction is affirmed.[1][2]
Interim awards are enforceable. A decision rendered by the Dubai International Financial Center Court of Appeal in March 2024 indicated that foreign and local interim awards are capable of enforcement as final awards under the Dubai International Financial Center Arbitration Law and that it is consistent with the New York Convention rules. [3]
Explanations on signature in arbitral awards:
It is noted that traditionally, there was an understanding that every arbitral award issued in a UAE-seated arbitration or a foreign arbitral award intended to be enforced within the UAE (particularly in Dubai) is required to have a signature at the bottom of each page to be valid and enforceable. Some Emirates took a differing view, with the Ras Al-Khaimah Court of Cassation taking the stance that an award is not required to have a signature at the bottom of each page, which was followed by the Abu Dhabi Court of Cassation in a number of cases.
This ruling brings consistency to the stance in the UAE and also serves to emphasize the fact that the UAE is a friendly place for enforcement and would be welcomed by legal practitioners in the UAE as well as other countries.
Unilateral Arbitration Agreements Not Enforceable
A contractual dispute arose between a contractor and a subcontractor over payment under two separate agreements of subcontract, which contained identical provisions for arbitration. The provision provided that if a dispute cannot be resolved through an amicable agreement, then it shall be submitted to either: i) an arbitral tribunal at the Dubai Chamber of Commerce; ii) to the local courts of the UAE; with the choice of forum to rest with the contractor. A case was filed by the subcontractor before the Dubai Court of First Instance, but through an argument that arbitration was not the proper forum for resolving the dispute before the Court of First Instance of Dubai, which was overruled and thereafter appealed before the Court of Appeal for lack of jurisdiction of the Dubai courts to hear the case based on the provision of the arbitration clause that granted to the contractor sole discretion to refer the dispute to the appropriate forum for resolution of any dispute between them. It was overruled, but an appeal was filed with the Court of Cassation.
Unilateral arbitration clauses are also quite widely used (for example, in banking, employment, or insurance contracts) because they can limit a party to only one forum in a dispute. Such a decision may now lead a party to examine their existing contract and arbitration agreement and decide afresh about their joint intention
It was only in February 2024 that the Court of Cassation confirmed that it was well within the powers of a lower court to partially annul an ICC award in order to render the tribunal’s cost order unenforceable. It is relevant to note that in March 2025, the Dubai Court of Cassation seem to have clarified the issue of the recoverability of legal costs in the case. Significantly, the Court held that if the parties agree with the intention of resolving the dispute in accordance with the given set of arbitration rules (such as the ICC rules), they are bound by the rules, with the exception of the rule which is not in accordance with the public policy. As a consequence of existing cases, for arbitrations taking place in the UAE, it is recommended that the tribunal be empowered to grant costs by including a provision in the arbitration agreement or by specifying this in the tribunal’s first procedural order or terms of reference.

Conclusion

The UAE has established itself in a positive and arbitration-friendly manner in relation to an intentionally transformative development in its legal framework. The UAE has passed an updated Federal Arbitration Law and enjoys an advanced system in financial free zones such as the DIFC and the ADGM. Notably, it is all being energized by the attitude of the UAE courts in relation to arbitration issues brought before them in two very significant decisions recently passed.

The judiciary has been actively supporting and sustaining the fundamental values of arbitration through recognition of the validity of arbitration clauses, confirmation of the enforceability of interim awards, and recognition of the jurisdiction of arbitration Tribunals to grant anti-suit injunctions. At the same time, they have clarified fundamental issues of a procedural nature, namely formalities of signature of arbitration agreements and marked out appropriate delimitations of acceptable practice against unilateral arbitration clauses. Such pointed developments, such as modernization through legislation, specific institutional infrastructure, and an arbitration-friendly judicial attitude, together indicate that the UAE is not only open for business but is carefully establishing itself as a world-class platform for international dispute resolution. As far as international business and arbitration professionals are concerned, today the UAE offers an attractive, neutral, and efficient platform for arbitration with an ever-clear vision towards becoming one of the top-notch global hubs for commercial justice and business. It is clear, with very little doubt, that arbitration in the UAE is becoming evermore sophisticated and internationally compatible.