UAE

Local Projects

Local, government and public authority projects in the UAE are generally self-financed. However, it is possible that projects which have traditionally been entirely government-financed may in the future be privately financed or funded through a public private finance initiative.

International projects

The size of the project will inevitably affect the way it is financed. Smaller projects in the UAE tend to be financed by lenders on a corporate or full recourse basis, while larger projects will be financed on a project finance basis. Generally this will involve the raising of finance on a limited recourse basis for the purposes of developing a large capital intensive project, where the borrower is a SPV. Repayment will depend on the terms of the financing agreement. Typically these large-scale projects will be based on the Loan Market Association standard finance documents.

In the UAE, some local banks are taking an active role in the financing of landmark projects. In some cases, Islamic finance structures have been incorporated, which provide another alternative to conventional financing.

Freezone companies can do business only within the range of freezones.

Virtual Offices are illegal

Main legal forms of UAE are as follows:

Sole proprietorship

Civil Company

Limited Liability Company(LLC)

Partnership

Private Share Holding Company

Public ShareHolding Company

Branch of Foreign Companies/Representative Office

Branch of GCC companies

Branch of Free zone company

Branch of UAE based companies

Under Sharia and UAE law, there is no spousal maintenance after a divorce. The wife shall get assistance from her divorcee for three months after the divorce, according to Article 69 of Federal Law No. 28/2005. (Idda months)

As set out at Article 146 Personal Status Law, the mother will have custody of young children. Unless the court orders otherwise, it is expected that custody will move from the mother to the father once the children reach the age of 11 for a boy and 13 for a girl

The UAE refers to the people with special needs or disabilities as ‘people of determination’ in recognition of their achievements in different fields. Since 2008, the UAE has implemented an inclusion policy for students of determination (students of disability) and facilitated their access in the education system. Education is a key pillar of the ‘National Policy for Empowering People of Determination’. The government is keen to provide an integrative education system in public and vocational education and adapt school curricula to cater their needs. It also provides qualified teachers and specialists, appropriate supportive technologies and learning materials.

Local Projects

The common forms of construction contracts in the UAE are based on the International Federation of Consulting Engineers (FIDIC) forms of contract. These are mainly:

The Conditions of Contract for Construction (Red Book).

The Conditions of Contract for Plan and Design Build (Yellow Book).

The Conditions of Contract for EPC/Turnkey Projects (Silver Book).

The 1999 editions of these FIDIC forms are the most commonly used versions in the UAE.

International Projects

FIDIC contracts are also common in international projects. However, there has been an increase in the use of tailored bespoke contracts in mega projects, including PPPs.

The major difference between a limited liability company and a Free Zone company is that a free zone company cannot conduct business in a non-free zone area without a local distributor or agent, whereas a mainland company can.

How long is a divorce? If the parties are able to reach agreement in respect of the divorce, arrangements for children and finances, the entire process of divorce in the UAE (through the UAE courts) can be concluded within three months.

Limitation of liability clauses are commonly used in construction contracts in the UAE and are generally enforceable by the UAE courts. However, limitation of liability clauses will not always be upheld by the UAE courts or by extension an arbitration tribunal. Statutory provisions on the limitation of contractual liability can be found in numerous provisions of the UAE Civil Code, for example:

Article 296 deals with tortious liability and provides that any provision which exempts a guilty party from liability is void.

Article 880 deals with decennial liability and provides that contractors, designers and architects will be liable for ten years following completion and handover of the construction works for structural defects or total or partial collapse of the building.

Regardless of the parties’ agreement, a court and, by extension, an arbitral tribunal, can adjust a contractually agreed compensation to a reasonable figure that equates to the actual loss suffered (Article 390, UAE Civil Code). This is relevant in the context of liquidated damages which are commonly applied to contractors in cases of attributable delay. In this case, a judge or arbitration tribunal can revise the agreed damages upwards or downwards to equal the actual loss suffered. This provision has been invoked by contractors to reduce the amount of liquidated damages agreed in the contract.

The UAE refers to the people with special needs or disabilities as ‘people of determination’ in recognition of their achievements in different fields. Since 2008, the UAE has implemented an inclusion policy for students of determination (students of disability) and facilitated their access in the education system. Education is a key pillar of the ‘National Policy for Empowering People of Determination’. The government is keen to provide an integrative education system in public and vocational education and adapt school curricula to cater their needs. It also provides qualified teachers and specialists, appropriate supportive technologies and learning materials.