Reforms to UAE’s civil procedure law take effect

Madelaine Power of Pinsent Masons said Federal Law 42 of 2022, which introduced a host of changes to the UAE’s civil procedure rules, was the first of “a considerable number of new laws in the pipeline” that parties should take into consideration. Upcoming legislation in 2023 will target judicial reform in relation to evidence in civil and commercial transactions, cybercrime, the legal profession, experts, translators and notary publics,” she said. Federal Law 42 applies to all legal proceedings before the onshore UAE courts that have yet to be decided, and also repeals Federal Law No 11 of 1992 regarding civil procedure.

Under the new law, which came to effect on 2 January 2023, while the official language of the court remains Arabic, the court can now grant permission to hear statements of non-Arabic-speaking litigants, witnesses and others through an interpreter after an oath has been taken. It is now also possible for the Chairperson of the Federal Judicial Council or the head of the local judicial body to decide that English be the language of trials, procedures, judgments and decisions in respect of certain tribunals that are assigned to hear more specialised proceedings.

“These changes increase the attractiveness of doing business in Dubai for commercial clients and give more certainty and transparency around the procedure adopted before the onshore Courts. Recognising the international nature of the UAE’s business community, these reforms improve the accessibility of the UAE Courts for non-Arabic speakers. There has been, however, no further clarification yet on which tribunals are affected,” Power said.

There is also a new requirement for a claimant to serve a certified translation of the proceedings in English if the defendant’s native language is not Arabic unless there is a prior agreement to provide a translation in a third language. This requirement applies to all civil and commercial proceedings, except for labour proceedings initiated by the employee and workers, as well as personal status proceedings.

The new law also amends the rules for service of proceedings outside the UAE’s jurisdiction. Service outside the jurisdiction is now effected 21 working days from the date of the correspondence from the Ministry of Foreign Affairs to the diplomatic mission in the foreign country containing the notice and/or documents to be served. “In the absence of a treaty between the UAE and the foreign country where service is to take place, service outside of the jurisdiction is quite complex,” Power said.

She added: “The clearly expressed and new streamlined process for service outside of the jurisdiction is therefore very much welcomed and will help speed up the progression of proceedings."

She added: “Under the old law, the process included various diplomatic channels of the UAE as well as the foreign jurisdiction where the foreign party was to be served. This new reform is intended to give parties more certainty and confidence in their proceedings being progressed. Parties to be served will need to be more vigilant as their receipt of refusal of the process may no longer be a ground to avoid liability.”

The new law also confirms that cheques are ‘enforceable instruments’, a requirement for them to be enforced by the onshore courts. This change is in line with the position adopted by Federal Law 14 of 2020, which amended certain provisions of the Federal Law 18 of 1993 that concerned commercial transactions. Mariam Hassaballah of Pinsent Masons said: “This confirmation means that parties can now also start enforcement proceedings in respect of dishonoured cheques without having to commence substantive proceedings, although this was already applied in practice.”

Federal Law 42 of 2022 also brings the Court of Appeal process in line with a similar practice followed in the Court of Cassation, which holds in-chambers reviews of appeals. The Court of Appeal will have 20 working days to issue a reasoned decision rejecting the appeal for procedural or substantive reasons or set a date to hear the substance of the appeal. Hassaballah said: “UAE litigators have grown accustomed to an almost automatic appeals process. But changes in the law now mean that appellants must carefully consider their arguments to avoid procedural or substantive dismissal in chambers. Respondents will therefore be seeking to identify any and all reasons for which the appeal should be dismissed.”

The new law also halves the time limit for an appeal to Cassation from 60 days to 30 days. However, the new time limit will not apply to cassations filed prior to 2 January 2023. In relation to ongoing proceedings, it will not apply to time-related provisions where the time limit begins prior to the new law coming into force. Additionally, the new time limit will not retrospectively apply to judgments issued prior to the new law coming into force.