How is international arbitration implemented in the UAE during the new normal?

Posted by Dr. Hassan Elhais on January 25th, 2022

The number of arbitration cases being registered in the United Arab Emirates has been steadily increasing in recent years. This is especially so for Dubai in terms of commercial litigation, with arbitration being included as a standard clause for dispute resolution, whether relating to real estate matters, construction or commercial contracts. The year 2021 has seen critical changes in the arbitration sector with a new decree anointing the ‘Dubai International Arbitration Centre’ (DIAC) as a sole arbitral chamber in the emirate, which now essentially abolishes the Dubai International Financial Centre-London Court of International Arbitration (DIFC-LCIA). The said decree is in effect from September 2021 and establishes the Dubai International Arbitration Centre to act as the sole dispute-resolution seat in the emirate of Dubai.

In this article, we will particularly discuss international arbitration in the UAE and the provisions of the UAE Arbitration Law (Federal Law No. 6/2018 on ‘Arbitration’). It is important to note that the UAE Arbitration Law also applies to international, commercial arbitrations conducted outside the UAE if the parties to the dispute agree to the same. International arbitration has had its crucial impact felt during the Covid pandemic, where the international arbitration process demonstrated its resilience and flexibility in resolving disputes by delivering through technological means, including holding sessions remotely.

International arbitration rules concerning the use of technology:

Article 28(4) of the United Nations Commission on International Trade Law (‘UNCITRAL’) Arbitration Rules of 2010 (revised rules) allows for arbitral tribunals the power to have expert witnesses to be examined through means of videoconferencing.

Article 28

1. In the event of an oral hearing, the arbitral Tribunal shall give the parties adequate advance notice of the date, time and place thereof.
2. Witnesses, including expert witnesses, may be heard under the conditions and examined in the manner set by the arbitral Tribunal.
3. Hearings shall be held in camera unless the parties agree otherwise. The arbitral Tribunal may require the retirement of any witness or witnesses, including expert witnesses, during the testimony of such other witnesses, except that a witness, including an expert witness, who is a party to the arbitration shall not, in principle, be asked to retire.
4. The arbitral Tribunal may direct that witnesses, including expert witnesses, be examined through means of telecommunication that do not require their physical presence at the hearing (such as videoconference)

UAE arbitration process on the use of technology:

The UAE arbitration law is largely based on the international UNCITRAL model arbitration law. The DIAC Rules of 2007 and its amendments govern the arbitration proceedings of the Dubai International Arbitration Centre. Article 20 of the DIAC rules determines the place of arbitration and states that,

Article 20.1:The parties may agree in writing on the seat of the arbitration. In the absence of such a choice, the seat of arbitration shall be Dubai, unless the Executive Committee determines in view of all the circumstances, and after having given the parties an opportunity to make a written comment, that another seat is more appropriate.

Article 20.2: The Tribunal may, after consultation with the parties, conduct hearings or meetings at any place that it considers appropriate. The Tribunal may deliberate wherever it considers appropriate.

Article 20.3: The award shall be deemed to have been made at the seat of the arbitration.

Further, article 34.7 of the DIAC Arbitration rules 2017, states that, ‘The Tribunal shall only require witnesses who have submitted a written statement and who have been requested to provide oral testimony during the hearing, to swear an oath prior to giving oral evidence, subject to any mandatory provisions of the applicable procedural law. The Tribunal shall have the authority to accept oaths and conduct examinations in person or by electronic means including telephone or video conference or a combination thereof, provided it has first satisfied itself of the identity of the witness’.

Both the said articles thus essentially allow wide discretion to the tribunal to determine that a virtual setting would be the most appropriate venue. Further, there are express provisions and procedures incorporated in the rules that allow for conducting of witness hearings through electronic means of communication such as video conferencing (as included above).

In the Covid era, these flexible rules have proven their worth, and international arbitration in the UAE has demonstrated its resilience and effectiveness. This practice continues into the post covid era as well.