DIFC Courts Spread Their Wings

In the DIFC Court I wrote about the 45 hectare free zone in Dubai known as the Dubai International Financial Centre ("DIFC") and the special English speaking common law jurisdiction within the Centre aptly described by its present Chief Justice Michael Hwang SC as a "common law island in a civil law ocean" (address to Lawasia Conference, Kuala Lumpur 1 Nov 2011) which has contributed greatly to the DIFC's success.

When I wrote that article in January 2011 the court's jurisdiction was limited by art 5 of Law No 12 of 2004 to disputes relating to the DIFC. The practical effect of this limit was shown by Sir Anthony Colman's decision in Corinth Pipeworks S.A. v Barclay's Bank PLC of 8 Feb 2011 which I discussed in my case note of 20 March 2011. In that case the court refused to entertain an action arising out of an allegedly false statement by an employee of the defendant bank made within Dubai but outside the Centre on the ground that it had no connection with the DIFC.

By a decree dated 31 Oct 2011 HH Sheikh Mohammed bin Rashid Al Maktoum, the ruler of Dubai who is also Vice-President and Prime Minister of the United Arab Emirates, has extended the DIFC courts' jurisdiction to cover any business dispute from any part of the world (see the DIFC courts' press release of 31 Oct 2011).

The significance of this announcement is that it should shortly be possible to resolve a much wider range of cases, including intellectual property licensing and maybe even some infringement disputes, before an English speaking common law tribunal applying rules of procedure modelled on the Civil Procedure Rules. Since the UAE is party to a number of international and regional agreements on the enforcement of judgments it may be possible to refer cases from other parts of the Middle East or North Africa. Clearly the parties have to consent to the jurisdiction of the DIFC courts unless they come within its jurisdiction on some other ground. No doubt that can be done by a choice of jurisdiction clause specifying the DIFC courts in a licence or other agreement.

Should anybody wish to discuss this article or the topic in general he or she should not hesitate to contact me on +44 161 850 0080 or complete my on-line contact form.

Background Reading

Jane Lambert "The Legal Order of the United Arab Emirates" 11 Nov 2011

Sir Anthony Evans "Dispute Resolution in the DIFC" 16 Feb 2009 (DIFC website)

Sir Anthony Evans "Dispute Resolution in the DIFC" Oct 2008 (DIFC website)

Michael Hwang SC "The Courts of the DIFC - A Common Law Island in a Civil Law Ocean" (DIFC website)

Jane Lambert "DIFC Courts" 7 Jan 2011 (JD Supra website)