Galadari Advocates & Legal Consultants | View firm profile
As we step into 2025, the DIFC Courts continue to solidify their role as one of the most sophisticated commercial courts globally. No longer just a jurisdiction for companies with ties to Dubai, the DIFC Courts are increasingly the venue of choice for sophisticated parties looking for a neutral, efficient, and common-law forum to resolve high-stakes commercial disputes.
This update breaks down three major developments in the jurisdiction over the course of 2024:
- A Mature Common Law Jurisdiction. The amendments to the Law on the Application of Civil and Commercial Laws mark a pivotal step in solidifying the DIFC’s status as an independent common law jurisdiction.
- A Global Enforcement Hub. In a landmark ruling, the DIFC Court of Appeal overturned Sandra Holding, confirming its freestanding jurisdiction to issue worldwide freezing orders in support of foreign proceedings, even where there is no direct connection to the DIFC and proceedings are still pending.
- A New Conflicts of Jurisdiction Tribunal. Previously criticized for enabling delay tactics, the long-awaited successor to the Joint Judicial Committee brings much-needed clarity to the jurisdictional boundaries between the DIFC and onshore Dubai courts.
These developments reinforce the DIFC’s status as a world-class legal hub, enhancing its role as a bridge between emerging markets and established global economies.
- From Deference to English Law to the Development of a Distinct DIFC Common Law
The enactment of DIFC Law No. 8 of 2024 (the ‘Amendment Law’) marks a significant shift in the DIFC’s legal framework, moving from reliance on English law to an increasingly autonomous common law jurisdiction. One of the most notable changes is in Article 8(2)(e), where English law is no longer the final fallback. The previous version of this statute directed DIFC Courts to apply “the laws of England and Wales” when no other law was identified. In contrast, the final version now makes DIFC Law the ultimate governing framework, reinforcing the jurisdiction’s independence.
The Amendment Law also departs significantly from the proposed draft circulated earlier in 2024 (the ‘Draft Amendment Law’). Indeed Article 8A(3) appeared in the Draft Amendment Law to reinforce the role of English law by allowing DIFC Courts to adopt English common law doctrines unless expressly excluded. The Amendment Law is less emphatic, simply stating that the DIFC Courts “may have regard” to the common law of England and Wales, as well as the law of “other common law jurisdictions.”
It is submitted that the solution adopted in the final version of the Amendment Law is most suited to the role the DIFC has played—and will continue to play—in the future. The DIFC legal community is an amalgam of practitioners from different legal traditions, and its (codified) laws draw from multiple sources— for example, its DIFC contract and arbitration laws are based, respectively, on the UNIDROIT Principles of Commercial Contracts 1994 and the UNCITRAL Model Law on International Commercial Arbitration. Article 40(2) of the Law of Damages and Remedies provides for U.S.-style punitive damages, although this is rarely used in practice. This is recognized by the new Article 8B(3), which provides that where a DIFC Statute is based on an international model law, its interpretation may also be guided by international jurisprudence interpreting and applying such international model law, as well as interpretative aids and commentary published by international bodies regarding the international model law.
While English legal principles remain relevant, the DIFC is now clearly charting its own path, developing its own body of common law rather than merely transplanting English precedent. The DIFC is no longer just an extension of English legal thought but a mature, self-sustaining jurisdiction, shaping its own common law tradition in response to global financial and commercial needs.
- The DIFC as a Global Enforcement Hub after Carmon Reestrutura v. Antonio Joao
The DIFC Court of Appeal’s decision in Carmon Reestrutura v Antonio Joao [2024] DIFC CA 003 marks a significant shift in the court’s approach to worldwide freezing orders. Overturning Sandra Holding v Al Saleh [2023] DIFC CA 003, the court held that the DIFC can grant such orders in support of foreign proceedings, even when the dispute has no direct connection to the DIFC. This raises a broader question: would the DIFC be willing to provide interim relief in support of foreign proceedings, even where there are no assets or parties in Dubai or in the UAE?
In Carmon Reestrutura, the claimant alleged the misappropriation of USD 20 million, with some funds traced to Emirates NBD. The DIFC initially granted a freezing order in support of proceedings in Hong Kong, but this was set aside following Sandra Holding, which had restricted DIFC jurisdiction in the absence of a clear connection to the DIFC. On appeal, the Court of Appeal reversed course, holding that the DIFC’s power to recognize and enforce foreign judgments necessarily includes the ancillary power to prevent asset dissipation. Drawing on Mercedes-Benz AG v Leiduck [1996] and PT Bayan Resources TBK v BCBC Singapore Pte Ltd (2015), the court emphasized that freezing orders are crucial to preventing enforcement from being frustrated.
This decision positions the DIFC Courts as a potential global enforcement hub. Could creditors use the court to secure assets in states that are parties to the Riyadh Arab Agreement for Judicial Cooperation, or in countries with which the UAE has in place bilateral treaties for the enforcement of judgements? The DIFC’s common law system, procedural efficiency, and recognition of international enforcement principles could make it a preferred venue for creditors facing enforcement challenges in civil law jurisdictions
The question now is how far this reasoning will extend. If creditors begin testing the DIFC’s role in cross-border enforcement, Carmon Reestrutura may be just the beginning of a broader shift, positioning the DIFC as a key jurisdiction for securing and enforcing international judgments.
- Clearing the Bottleneck: the New Judicial Authority
On April 3, 2024, the Ruler of Dubai issued Decree No. 29/2024 establishing the Judicial Authority for Resolving Jurisdictional Conflicts Between DIFC Courts and Judicial Authorities in Dubai (the ‘Judicial Authority’), replacing the Joint Judicial Committee (‘JJC’) that had been created under Decree No. 19/2016 to tackle abuse of the DIFC’s conduit jurisdiction. The new framework ensures that jurisdictional disputes between the DIFC Courts and other UAE judicial bodies are resolved efficiently, eliminating procedural tactics that have historically delayed proceedings and undermined the credibility of Dubai’s legal system.
Under the previous system, litigants frequently exploited jurisdictional conflicts to stall proceedings, creating uncertainty and procedural paralysis. The lack of binding precedent meant that similar cases could produce inconsistent rulings, further encouraging delays. The new Judicial Authority eliminates these inefficiencies by serving exclusively as a final arbiter of jurisdictional conflicts, stripping away advisory functions that previously bogged down decision-making. Crucially, its decisions now carry binding precedential effect, ensuring consistency and predictability in future cases.
- Exclusive Judicial Function: The Judicial Authority no longer serves an advisory role, focusing solely on resolving jurisdictional disputes. However, Article 4 allows the Ruler or Chairman to assign additional duties if required.
- Binding Precedent: the Judicial Authority decisions now set legal principles that all Dubai courts, including the DIFC Courts, must follow (Article 9(b)). This prevents inconsistent rulings and limits opportunities for forum shopping.
- Automatic Stay of Proceedings: this is a departure from the position under Lakhan v. Lamia [2021] DIFC CA 001, where a “genuine conflict” was required to impose a stay. Under the new system, court proceedings and execution actions are automatically stayed, and limitation periods are suspended as soon as a case is referred to the Judicial Authority. This prevents parties from using parallel litigation to frustrate enforcement.
Since the Judicial Authority became operational in July 2024, it has already rendered 12 decisions, thus it is already working at a much faster pace than in the previous system. This development reinforces Dubai’s reputation as a credible and efficient legal hub, preventing jurisdictional conflicts from being used as a tool for procedural impropriety.
Summing Up
The DIFC Courts have evolved. No longer just a niche jurisdiction catering to businesses with ties to Dubai, they are fast becoming a global judicial powerhouse—a court of choice for high-stakes commercial disputes, where speed, predictability, and enforcement capability define the playing field.
The Carmon Reestrutura ruling positions the DIFC as a potential global enforcement hub, capable of issuing worldwide freezing orders even in cases with no direct ties to the jurisdiction. The Amendment Law cements the DIFC’s evolution into a fully independent common law system, free from automatic deference to English law. And with the new Judicial Authority, Dubai has finally closed the door on procedural abuses that stalled cases and eroded confidence in its legal system.
All considered, these developments eliminate uncertainty and reinforce the DIFC’s status as a court that doesn’t just compete with the world’s best—it sets the standard.
Authors: Rodrigo Carè and Hrishita Roy