Federal Arbitration Law

Article (1) Definitions

Chapter One: Definitions and Applicability

For the purposes of this Law, the following terms and expressions shall bear the meanings assigned to them respectively, unless the context requires otherwise: The State (UAE): The United Arab Emirates. Arbitration: A method regulated by the law through which a dispute between two or more parties is adjudicated under a binding award rendered by the Arbitral Tribunal as agreed by the parties. The Arbitration Agreement: The agreement of the parties to submit to Arbitration, whether such Agreement is made before or after the dispute. The Arbitral Tribunal: The tribunal composed of a sole arbitrator or a number of arbitrators for the purpose of adjudicating the dispute under arbitration. The Court: The federal or local court of appeal which is agreed by the parties or within the jurisdiction of which arbitration falls. The Arbitral Entity: An entity or a center established for the purpose of conducting arbitral proceedings. The Delegated Person: Any natural or legal person to whom the parties agreed to grant any of the powers prescribed in accordance with this Law. The Body Concerned: The body delegated for arbitration or the Court. The Parties: The claimant and the respondent whatever their number. The Claimant: The party which requests to initiate the arbitral proceedings. The Respondent: The party against which the claimant initiates arbitral proceedings.

Article (2) Applicability

Chapter One: Definitions and Applicability

The provisions of this Law shall apply to: 1. Any arbitration conducted inside the State, unless its parties agree to submit it to the provisions of another arbitration law, provided that it does not conflict with the public policy and public morals of the State; 2. Any International Commercial Arbitration conducted abroad, the parties to which agree to submit it to the provisions of this Law; and 3. Any Arbitration arising out of a dispute concerning a legal relationship of a contractual or non-contractual nature, regulated by the laws in force in the State, except as expressly excluded by a special provision.

Article (3) International Character of Arbitration

Chapter One: Definitions and Applicability

The Arbitration is considered international arbitration, even if it is conducted in the State, in any of the following cases: 1. If the two parties to Arbitration have their principal place of business in two or more different countries at the time of conclusion of the Arbitration Agreement. However, if one of the parties has several principal places of business, the place which is very much relevant to the subject matter of the Arbitration Agreement shall be taken into consideration. If one of the parties to the Arbitration does not have a principal place of business, the place of his domicile shall be taken into consideration. 2. If one of the following places is located outside the country in which the principal place of business of any of the parties exists: a. The venue of Arbitration as determined by or pursuant to the Arbitration Agreement; b. Any place where a substantial part of the obligations of the commercial relationships between the two parties is implemented; or the place most relevant to the subject matter of the dispute. 3. If the subject matter of the dispute covered by the Arbitration Agreement is connected to more than one country; 4. If the parties have expressly agreed that the subject matter of the Arbitration Agreement is connected to more than one country.

Article (4) Capacity of Agree on Arbitration

Chapter Two: Arbitration Agreement

1. Only the natural person, who has the capacity to exercise its rights, or the representative of the legal person, who is authorized to conclude the agreement on arbitration, may enter into an agreement on arbitration, otherwise the agreement shall be null and void. 2. The agreement on arbitration may not be concluded with respect to the matters where conciliation is not allowed. 3. In the circumstances under which this law permits the parties to opt for the procedure to be adopted on a specific matter, any of the parties may authorize a third party to choose or decide on such procedure. Within the meaning of this Article, a third party is: 4. Any natural person or Arbitral Entity based either in the State or abroad.Unless otherwise agreed by the parties, the Arbitration Agreement shall not be terminated by the demise or expiration of one of the parties or. It may be enforced by or against the legal successor of such party.

Article (5) Forms of the Arbitration Agreement

Chapter Two: Arbitration Agreement

1. The Arbitration Agreement may be concluded prior to the occurrence of the dispute, whether in the form of a separate agreement or stipulated in a specific contract, concerning all or certain disputes which may arise between the parties. 2. The Arbitration Agreement may also be concluded after the dispute has arisen, even if an action has already been brought before a judicial body. In such case, the Agreement shall specify the issues subject to Arbitration. 3. Any reference made in a contract to any other document containing an arbitration clause shall be considered an agreement on arbitration, provided that the said reference is clear in treating such clause as an integral part of the contract.

Article (6) Divisibility of Arbitration Agreement

Chapter Two: Arbitration Agreement

1. The Arbitration Agreement shall be treated as independent from the other conditions provided for in the contract. The nullity, rescission or termination of the contract shall not have any effect on the Arbitration Agreement contemplated in that contract, provided that the said agreement is valid per se, unless the same is pertaining to the loss of the legal capacity of one of the parties. 2. Claiming that the contract containing the Arbitration Agreement is invalid, rescinded or terminated shall not entail the suspension of the arbitral proceedings and the Arbitral Tribunal may decide on the validity of such contract.

Article (7) Writing of the Arbitration Agreement

Chapter Two: Arbitration Agreement

1. The Arbitration Agreement shall be in writing; otherwise it shall be void. 2. The Arbitration Agreement shall be deemed to have met the writing requirements in the following cases: a. If it is included in an instrument signed by the parties or in the letters or other means of written correspondence between the parties, or made by an electronic mail in accordance with the regulations in force in the State governing the electronic transactions. b. If a reference is made in a written contract to a model contract, an international agreement, or any other document that includes arbitration clauses and the said reference is clear in treating such clause as an integral part of the contract. c. If an agreement to resort to arbitration is reached while the dispute is being considered by a competent court, the court shall render its ruling to confirm the arbitration agreement and the litigants shall initiate the arbitration proceedings in the set place and time and under the clauses governing thereof, and the court shall also rule that the action is null and void. d. If it is included in the written submissions exchanged between the parties during the arbitral proceedings or it is recognized before the courts, where one of the parties requests to refer the dispute to arbitration and the other party does not object to the same in its reply.

Article (8) Decision on the Dispute Covered by the Arbitration Agreement

Chapter Two: Arbitration Agreement

1. The court, before which an action was instituted regarding a dispute in respect of which an Arbitration Agreement exists, shall dismiss the action, if the Respondent moves to dismiss on this ground before making any other motions or plea on the subject matter of the action, unless the court finds that the Arbitration Agreement is void, or unenforceable. 2. Initiation of the proceedings referred to in the foregoing clause does not preclude the commencement or continuation of the arbitral proceedings or rendering of the arbitral award.

Article (9) Formation of the Arbitral Tribunal

Chapter Three: Arbitral Tribunal

1. The Arbitral Tribunal shall be constituted, on the basis of an agreement between the parties, of one or more arbitrators. Failing such agreement, the number of arbitrators shall be three, unless otherwise deemed by the body concerned. 2. Where there are several arbitrators, their number must be odd, otherwise the arbitration shall be null and void.

Article (10) BIS Conditions to be met by an Arbitrator from Members of Supervisory or Controlling Bodies at the Competent Arbitration Institution

Chapter Three: Arbitral Tribunal

1. With exception to the provisions of clause (B.1) of Article (10) of this Decree by Law, the Parties may appoint an arbitrator from board of directors, boards of trustees, or those of the similar status, of the supervisory or controlling bodies at the arbitration institution competent with administration of the arbitral case, if the following conditions are met: a. The regulations of the arbitration institution competent with the administration of the arbitral case does not prohibit it. b. The arbitration institution competent with the administration of the arbitral case shall have governance regulations special for regulating the work of the mentioned arbitrator in a manner that ensures the segregation of duties and impartiality, prevents conflict of interests or preferential advantage of the said member compared to their counterparts, and which regulates the mechanism of appointment, dismissal, and withdrawal of the arbitration if any of the determined conditions – in this regard – are met. c. The arbitrator shall not be member or the president of the arbitral tribunal. d. The parties to the arbitration case shall declare, in writing, their knowledge of the arbitrator's membership in the board of directors, board of trustees, or the supervisory or controlling bodies at the arbitral institution competent with the administration of the arbitral case in the State, and they don't have any objection or reservation to such appointment. e. The competent arbitration institution shall have a special mechanism for the safe reporting on the violations committed by arbitrators. f. The number of arbitral cases to which the arbitration is a member shall not exceed (5) cases per year. g. The arbitrator shall submit a written letter undertaking the following: 1. To refrain from exploiting his capacity in a manner that creates a conflict of interests or leads to him obtaining or enjoying a preferential advantage or interest compared to his counterparts. 2. Refrain from participating, deliberating, perusing, voting, attending meetings, or influencing in any way the proceedings of arbitration during the period of his appointment as arbitrator while he is a member of the board of directors, board of trustees, or those of a similar status of supervisory or controlling bodies at the arbitration institution competent with the administration of the arbitral case. h. Any other conditions or requirements determined by the competent arbitration institution. 2. The violation of the conditions referred to in this Article shall result in the invalidity of the arbitral award issued in the arbitration case and in the right of the parties to claim any civil damages from the competent arbitration institution and the violating arbitrator in accordance with the applicable legislation in the State.

Article (10) Conditions to be Met by the Arbitrators

Chapter Three: Arbitral Tribunal

1. In addition to the requirements agreed upon by the parties, the arbitrator shall meet the following: a. Shall be a natural person who is not a minor, interdict, or deprived of his or her civic rights for being declared bankrupt, unless he or she has been rehabilitated, or for having been convicted in a felony or misdemeanor involving breach of honor or trust, even he or she has been rehabilitated. b. Shall not be a member of the board of trustees or executive management or administrative apparatus of the arbitration institution competent with organizing the arbitral case in the State. c. Shall not have direct relationship with any of the parties to the arbitration dispute that impact his impartiality, integrity, or independence. 2. The Arbitrator is not required to be of a given gender or nationality, unless otherwise agreed upon between the parties to the Arbitration or provided for by law. 3. Any person nominated to be an arbitrator shall disclose in writing any circumstances which are likely to cast doubts on his or her impartiality or independence. Upon acceptance and throughout the arbitral proceedings, he or she shall immediately notify the parties and all the arbitrators of the occurrence of any circumstance that is likely to cast doubts on his or her impartiality or independence, unless he or she has previously advised them of such circumstance.

Article (11) Method of Nomination of the Arbitral Tribunal

Chapter Three: Arbitral Tribunal

1. The parties to Arbitration may mutually agree on the procedures to be followed to appoint the Arbitrator or Arbitrators, and on the period of time and method for effecting their appointment. 2. If the arbitration tribunal is composed of a sole arbitrator and the Parties fail to reach agreement concerning nomination of the Arbitrator within (15) fifteen days from the date of submission of a written request from one of the parties to inform the other party of the same, the body concerned shall appoint such arbitrator, at the request of any of the parties. Such decision shall not be subject to appeals in any way whatsoever, without prejudice to the provisions of Article (14) of this Law; 3. If three arbitrators are to be appointed, each party shall nominate one arbitrator. The two arbitrators thus appointed shall nominate the third arbitrator. If one of the parties fails to nominate its arbitrator within fifteen (15) days following the receipt of a request made by the other party, or if both the appointed arbitrators fail to arrive at an agreement concerning the nomination of a third arbitrator within fifteen (15) days after the latter of them was appointed, the competent court or the delegated person shall appoint such third arbitrator on an expedited basis upon a request made by one of the parties. Such decision shall not be subject to appeals in any way whatsoever, without prejudice to the provisions of Article (14) of this Law; 4. The body concerned, whilst nominating the arbitrator, shall take into consideration the provisions laid down in this Law and the conditions agreed upon by both the parties in order to ensure appointment of an independent and impartial arbitrator. 5. In cases where the delegated person fails to appoint an arbitrator in accordance with the procedures determined upon the agreement of the parties or in accordance with the provisions of this Law in case of failure to reach an agreement, any of the parties may request from the court to take the necessary action in order to complete the formation and appointment of the members of the Arbitral Tribunal. The award of the court shall not be subject to appeal in any way whatsoever. 6. If an application for appointment of an arbitrator is submitted to the body concerned, the applicant shall send a copy of such application at the same time to the other parties and to any arbitrator previously appointed in the same dispute. The application shall briefly refer to the subject matter of the dispute and any requirements required by the Arbitration Agreement to be met in the arbitrator to be appointed and all steps taken to appoint any other member in the Arbitral Tribunal. 7. The third arbitrator appointed in accordance with the provisions of this Article shall act as the presiding arbitrator of the Arbitral Tribunal. Such provision shall be applicable to the Arbitral Tribunal comprising of more than three arbitrators. 8. The court may, at the request of any of the parties, request from any arbitral entity in the State to provide it with a list of no more than six names of the persons specialized in the field of arbitration to appoint one of them, after the requesting party pays the fees prescribed in the arbitral entity. Such fees shall be deemed part of the arbitration costs.

Article (12) Issuing Decisions of the Arbitral Proceedings

Chapter Three: Arbitral Tribunal

Any decision in the arbitral proceedings where there are more than one arbitrator shall be taken the majority of the members of the Arbitral Tribunal, unless otherwise agreed by the parties, provided that the decisions on the procedural matters are issued by the presiding arbitrator if he is so authorized by the parties or the other members of the Arbitral Tribunal.

Article (13) Breach of the Arbitral Tribunal Nominations Procedures

Chapter Three: Arbitral Tribunal

In case one of the parties to Arbitration breaches the procedures to be adopted for nomination of the arbitrators as agreed upon between them; if both of them fail to have an agreement; if both the appointed arbitrators fail to arrive to an agreement with regard to an issue which requires their agreement; or if the third party, including the delegated person, fails to carry out the responsibility assigned in this regard, the court, at the request of one of the parties, shall initiate and carry out the required procedure or action unless the provisions laid down in the agreement stipulate some other mode for the completion of this procedure. The court's procedure shall not be subject to challenge by any means of challenge whatsoever.

Article (14) Challenge of the Arbitrators

Chapter Three: Arbitral Tribunal

1. An arbitrator may be challenged only if circumstances that give rise to serious doubts regarding his or her impartiality or independence exist, or if it is proven that the conditions agreed upon by the parties or prescribed by this Law were not satisfied. 2. A party to Arbitration may challenge the arbitrator appointed or co-appointed thereby only for reasons of which it becomes aware after the appointment has been made. 3. A notice of challenge may not be accepted from a party who has previously submitted a notice to challenge the same arbitrator in the same Arbitration on the same grounds.

Article (15) Procedures for Challenging the Arbitrator

Chapter Three: Arbitral Tribunal

The parties to Arbitration may agree on the procedures of challenging arbitrators. Failing that agreement, the following procedures shall be followed: 1. A party who intends to challenge an arbitrator shall notify the challenged arbitrator of the notice of his challenge in writing, indicating the reasons of challenge, and send a copy of such notice to the other appointed members of the Arbitral Tribunal and to the other parties within fifteen (15) days after the party making the challenge has been notified of the appointment of such arbitrator or has been aware of the justifiable circumstances of challenge. 2. If the challenged Arbitrator does not recuse himself or the other party does not agree to the challenge within fifteen (15) days from the date of notifying the arbitrator of his challenge in accordance with the provisions of Article (24) of this Law, the party making the challenge may submit a notice of challenge to the body concerned within fifteen (15) days to start from the end of the fifteen (15) days mentioned above. The body concerned shall decide on the notice of challenge within ten (10) days. Its decision shall not be subject to appeal by any way whatsoever. 3. The notification of the arbitrator of his challenge or submission of the notice of challenge to the body concerned shall not entail suspension of the arbitral proceedings. The Arbitral Tribunal, including the challenged arbitrator, may proceed with the arbitral proceedings and render the arbitral award, even if the body concerned does not decide on the notice of challenge. 4. The recusal of the Arbitrator or the agreement of the parties on his/her removal shall not be construed as an admission of any of the reasons of the challenge. 5. If the body concerned decides to remove the arbitrator, it may decide what it deems appropriate in terms of fees and expenses or decide the recovery of any fees or expenses paid to him. Such decision shall not be subject to challenge by any means of challenge whatsoever.

Article (16) Termination of the Arbitrator Mandate

Chapter Three: Arbitral Tribunal

1. If the Arbitrator is unable to assume his or her duties, fails to perform his or her task, interrupts the performance thereof in a manner which causes undue delay in the arbitral proceedings, or deliberately neglects to act under the Arbitration Agreement although he or she is notified through all notification and communication means applicable in the State, and if he or she does not withdraw on his or her own accord or the parties have not agreed to terminate his or her mandate, the body concerned may order termination of his or her mandate at the request of any party and after hearing the statements and defense of the arbitrator. The decision of the body concerned in this regard shall not be subject to appeals. 2. The authority of the arbitrator is personal and shall expire by his demise, loss of legal capacity or loss of one of his appointment conditions. The demise of the party which appoints the arbitrator shall not result in the termination of the arbitrator's authority, unless otherwise is agreed by the parties.

Article (17) Appointment of the Substitute Arbitrator

Chapter Three: Arbitral Tribunal

1. If the mandate of an arbitrator expires due to challenge, dismissal, withdrawal, or any other reason, a substitute shall be appointed according to the procedures followed in the appointment of the arbitrator whose mandate has expired. 2. The parties may, after appointment of a substitute arbitrator, agree to maintain any of the procedures previously taken and determine the scope of the same. If the parties fail to reach an agreement in this regard, the Arbitral Tribunal which is re-formed shall decide whether any of the previous procedures is considered valid and the scope of the same. Any decision issued by the re-formed Arbitral Tribunal shall not affect the right of any of the parties to challenge the procedures taken prior to the formation of the Arbitral Tribunal based on any reason arising prior to the appointment of the substitute arbitrator.

Article (18) General Jurisdiction Over Arbitration Measures

Chapter Three: Arbitral Tribunal

1. The competent court shall have jurisdiction to consider the arbitration matters referred to in this Law in accordance with the procedures in force in the State. Such court shall have exclusive jurisdiction until the completion of all arbitral proceedings. 2. The court's president may, at the request of one of the parties or the Arbitral Tribunal, order provisional or precautionary measures, as it deems appropriate, for the existing or potential arbitral proceedings whether prior to or during arbitral proceedings. 3. The measures referred to in the previous clause of this Article shall not entail the suspension of the arbitral proceedings nor shall it be deemed waiver of the Arbitration Agreement. 4. If the court's president issues an order in accordance with Clause (2) of this Article, the order issued thereby shall not cease to have effect in whole or in part except by virtue of a decision issued by the court's president.

Article (19) Jurisdiction of the Arbitral Tribunal to Decide on its Jurisdiction

Chapter Three: Arbitral Tribunal

1. The Arbitral Tribunal shall decide on any plea to the jurisdiction, including the plea claiming the non-existence or the invalidity of the Arbitration Agreement, or that it does not cover the subject matter of the dispute. The Arbitral Tribunal may decide on the same either in a preliminary decision or in the final arbitral award issued on the subject matter of the dispute. 2. If the Arbitral Tribunal decides in a preliminary decision that it is competent, any of the parties may, within thirty (15) days from the date of being aware of that decision, request the court to rule on that matter. The court shall decide on the request within (30) thirty days from the date of its submission at the court, and its decision shall not be subject to appeal by any means. The arbitral proceedings shall be suspended until the court decides on the request unless the Arbitral Tribunal decides to continue with the proceedings at the request of one of the parties. 3. The party requesting continuation of the arbitral proceedings shall bear the costs of arbitration if the court adjudicates that the Arbitral Tribunal has no jurisdiction.

Article (20) Time Limit of File a Plea to the Jurisdiction of the Arbitral Tribunal

Chapter Three: Arbitral Tribunal

1. The plea to the jurisdiction of the Arbitral Tribunal shall be filed within the period prescribed for the submission of the defense by the Respondent referred to in Article (30) of this Law. If the plea is concerned with that the Arbitration Agreement does not cover the matters raised by the other party while the dispute is being entertained, the plea must be filed no later than the hearing following the hearing in which the plea is filed; otherwise, the right to file such plea shall lapse. In all cases, the Arbitral Tribunal may accept a late plea if it deems the delay to be justified. 2. The appointment or co-appointment of an arbitrator by one of the parties shall not preclude that party's right to file any of the pleas referred to in Item (1) of this Article.

Article (21) Interim of Precautionary Measures

Chapter Three: Arbitral Tribunal

1. Subject to the provisions of Article (18) of this Law, unless otherwise agreed by the parties, the Arbitral Tribunal may, at the request of any party or on its own accord, order that interim or precautionary measures be taken by one of the parties as the Arbitral Tribunal considers fit in respect of the subject matter of the dispute, and particularly the following measures to: a. Preserve evidence that may be material to the resolution of the dispute; b. Take the necessary measures to maintain goods that constitute part of the subject matter of the dispute such as the order to deposit the same with a third party or sell the perishable goods. c. Preserve the assets and property out of which a subsequent award may be satisfied; d. Maintain or restore the status quo pending determination of the dispute; or e. Order an action to be taken in order to prevent current or imminent harm or prejudice to the arbitral process or refrain from taking an action that may cause harm or prejudice the arbitral process. 2. The Arbitral Tribunal may require the applicant for interim or precautionary measures to submit a sufficient security to cover the expenses of such measures. It may also obligate the applicant to bear the damage resulting from the enforcement of such orders if the Arbitral Tribunal subsequently decides that the applicant was not entitled thereto. 3. The Arbitral Tribunal may amend, suspend or repeal an interim measure ordered to be taken by it upon a request made by any party or at its own initiative in extraordinary cases and under a prior notice sent thereby to the parties. 4. The party for whom an order to take an interim measure has been issued after obtaining a written permission from the Arbitral Tribunal may request the competent court to order the enforcement of the order issued by the Arbitral Tribunal or any part thereof within (15) fifteen days from the date of receipt of the request. Copies of any request made to obtain the permission or enforcement under this Article shall be sent to all the other parties at the same time.

Article (22) Impleader and Intervention in Arbitration

Chapter Four: Arbitral Proceedings

The Arbitral Tribunal may, at the request of any party, permit the impleading or intervention of any third party as a party to the dispute, the subject matter of the arbitration, whether at the request of one of the parties or the intervenor, provided that such party is a party to the Arbitration Agreement after giving all the parties, including the third party, an opportunity to give their statements.

Article (23) Determination of the Procedures to be Followed

Chapter Four: Arbitral Proceedings

1. The parties may agree on the procedures to be adopted by the Arbitral Tribunal to proceed with the arbitration, including their right to decide that such procedures shall be subject to the rules applicable in any arbitral organization or entity in the State or abroad. 2. If there is no agreement to follow certain procedures, the Arbitral Tribunal may, subject to the provisions of this Law, determine the procedures it deems appropriate, in a manner not inconsistent with the fundamental principles of litigation and international conventions to which the State is a party.