Dubai Issues Law No. (2) of 2025 Regulating DIFC Courts

The law strengthens judicial efficiency, expands dispute resolution mechanisms, and enhances the DIFC Courts’ role in international arbitration and financial litigation.

Key Changes and Their Impact on DIFC Courts

1. Establishment of a Mediation Centre (New Introduction)
   • A dedicated Mediation Centre is now part of the DIFC Courts framework, offering an alternative dispute resolution mechanism.
   • Mediators registered with the DIFC Courts will help parties amicably resolve disputes, reducing the burden on formal litigation.
   • Positive Impact: This will promote faster resolutions, lower litigation costs, and greater flexibility in commercial dispute settlement.
2. Expanded Jurisdiction of DIFC Courts
   • Exclusive Jurisdiction: DIFC Courts now solely handle civil, commercial, and labour claims involving DIFC institutions, employees, and activities.
   • Extended Authority: The Courts now oversee matters related to:
     1. Trust deeds and non-Muslim wills.
     2. Recognition and enforcement of arbitration awards under DIFC Arbitration Law.
   • Provisional & Protective Measures: The DIFC Courts can issue identity and asset inquiries, as well as other protective orders, in cases within their jurisdiction.
   • Handling External Arbitration Cases: The law permits DIFC Courts to process arbitration cases filed outside the DIFC, provided protective measures are implemented within the Centre.
   • Positive Impact: Expanding jurisdiction ensures stronger judicial oversight, making DIFC a more attractive and reliable financial hub for businesses and investors.
3. Strengthened Judicial Governance & Appointments
   • The law clearly defines the roles and appointment process of the Chief Justice and the Director of DIFC Courts.
   • The governance structure now ensures full judicial independence while maintaining administrative efficiency.
   • Positive Impact: This ensures greater clarity, transparency, and consistency in court operations.
4. Legislative Transition & Repeal of Previous Laws
   • Law No. (10) of 2004 and Law No. (12) of 2004 are officially repealed.
   • Existing regulations under the repealed laws remain in force until new regulations are introduced, provided they do not contradict Law No. (2) of 2025.
   • Positive Impact: This transition guarantees legal continuity while modernizing the regulatory framework of DIFC Courts.
5. Enhanced Litigation & Enforcement Procedures
   • The law clarifies litigation, enforcement, and procedural rules, including:
     1. Urgent matters & enforcement mechanisms.
     2. Exceptions to the compensation bond requirement.
     3. Statutes of limitations, procedural errors, and technical defects.
   • Positive Impact: These refinements eliminate procedural ambiguities, ensuring faster case resolution and greater efficiency in DIFC’s legal system.

Effective Date

Law No. (2) of 2025 will be published in the Official Gazette and came into effect on March 14, 2025.

For further insights on how these changes impact businesses, arbitration, and financial dispute resolution, or for legal assistance, feel free to contact our legal team.

How We Can Assist

Our legal team is registered with the DIFC Courts as Practitioner Lawyers with Rights of Audience, DIFC Court Wills Registry as Registered Wills Draftsmen, and as DIFC-registered Arbitrators, ensuring comprehensive legal support within the DIFC legal framework.

With extensive expertise in DIFC litigation, arbitration, and estate planning, we are well-positioned to assist with:

• Litigation and dispute resolution before the DIFC Courts.
• Drafting and registering non-Muslim wills under DIFC jurisdiction.
• Arbitration proceedings governed by DIFC Arbitration Law.

For tailored legal guidance on how these regulatory changes impact your business, dispute resolution strategies, or estate planning, feel free to contact our team.