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Civil Law
Civil matters in the United Arab Emirates are governed primarily by Federal Decree by Law No. (25) of 2025 concerning Civil Transactions Law, as amended. This law regulates contractual obligations, civil liability, property rights, compensation claims, and general civil disputes. It establishes the legal framework for rights and obligations between individuals and entities in non-commercial matters.
Civil law governs legal relationships that are not classified as commercial activities. Commercial law applies to transactions considered commercial in nature under Federal Decree-Law No. 50 of 2022 on Commercial Transactions and related legislation. The classification depends on the nature of the activity, the legal status of the parties, and whether the act is defined as a commercial act under UAE law.
Contracts are legally binding in the UAE when they satisfy the essential elements required by law. These elements include mutual consent through offer and acceptance, a lawful and defined subject matter, and legal capacity of the contracting parties. Certain contracts require specific formalities. For example, real estate transfers must be registered with the competent land department to be valid and enforceable.
A party that suffers harm due to breach of contract is entitled to compensation for actual and direct damage. The claimant must prove the existence of the breach, the occurrence of damage, and a causal link between the breach and the damage. Compensation is generally limited to damage that was foreseeable at the time the contract was concluded.
Corporate Law
Companies in the UAE are governed by Federal Decree-Law No. 32 of 2021 on Commercial Companies, as amended. This legislation regulates company formation, corporate governance, shareholder rights, director duties, mergers, acquisitions, restructuring, and liquidation.
Foreign investors may own one hundred percent of companies in most business activities under the current UAE law. Certain activities designated as strategically important may be subject to specific restrictions or additional approvals as determined by the competent authorities of each emirate.
Directors are required to act in the best interests of the company and exercise due care, diligence, and loyalty. They must avoid conflicts of interest and comply with the Commercial Companies Law and the company’s constitutional documents. Directors may incur civil liability for damages resulting from violations of their duties and may also face criminal liability where statutory provisions are breached.
Labor Law
Employment relationships in the private sector are governed by Federal Decree-Law No. 33 of 2021 on the Regulation of Labour Relations, as amended, together with its Executive Regulations. This law regulates employment contracts, working hours, leave entitlements, termination, and end-of-service benefits.
All private sector employment contracts must be for a specified term in accordance with current UAE labor legislation. The law permits renewal of fixed-term contracts upon agreement between the parties.
An employment contract may be terminated by mutual agreement, upon expiry of its term, or for a legitimate reason with proper notice as required by law. Termination without notice is permitted only in circumstances expressly provided for in the Labour Law. Arbitrary dismissal entitles the employee to compensation as determined by the competent court.
End-of-service gratuity is calculated based on the employee’s basic salary and length of continuous service. The calculation method is prescribed by Article 51 of Federal Decree-Law No. 33 of 2021. Gratuity is payable to employees who complete at least one year of continuous service.
Real Estate Law
Foreign nationals may own property in designated freehold areas, subject to the property laws of the relevant emirate. For example, Dubai Law No. 7 of 2006 permits foreign ownership in specified areas approved by the Government of Dubai.
Registration of real estate transactions with the competent land department is mandatory. Failure to register renders the transfer ineffective against third parties and may affect enforceability.
Eviction is regulated by emirate-specific tenancy laws. In Dubai, Law No. 26 of 2007, as amended, sets out the permissible grounds and procedures for eviction. A landlord must comply strictly with statutory notice requirements and legal procedures.
Criminal Law
Criminal offences are governed by Federal Decree-Law No. 31 of 2021, issuing the Crimes and Penalties Law, as amended. Criminal procedures are governed by the UAE Criminal Procedure Law.
Common financial crimes include fraud, breach of trust, forgery, and money laundering. The issuance of a cheque without sufficient funds has been largely decriminalized in ordinary cases, although criminal liability may still arise in specific circumstances prescribed by law.
Criminal proceedings generally begin with a police complaint, followed by an investigation by the Public Prosecution. If sufficient evidence exists, the case is referred to the competent criminal court. Judgments may be appealed in accordance with procedural law.
Data Protection Law
Personal data protection in the UAE is governed by Federal Decree-Law No. 45 of 2021, which regulates the Protection of Personal Data. Certain financial free zones, including the Dubai International Financial Centre and the Abu Dhabi Global Market, have their own independent data protection regimes.
The Personal Data Protection Law applies to controllers and processors that process personal data within the UAE, subject to specific statutory exemptions. Organizations must comply with the legal obligations when processing personal data.
Consent is required unless another lawful basis for processing applies under the law. Consent must be clear, specific, informed, and capable of being demonstrated by the controller.