The legal system of United Arab Emirates
A federal civil-law system on the Egyptian model, with Sharia governing personal status and a large body of federal codes covering civil transactions, commerce, companies, labour and crime. What makes the UAE distinctive is that two financial free zones — the Dubai International Financial Centre and Abu Dhabi Global Market — are constitutionally carved out of the federal civil and commercial law and operate their own common-law systems, their own courts staffed largely by judges from England, Singapore, Hong Kong and Australia, and their own English-language legislation. ADGM applies English common law directly by statutory incorporation. A commercial question about the UAE cannot be answered without first establishing whether onshore federal law, DIFC law or ADGM law applies.
Legal tradition
United Arab Emirates belongs to the mixed (civil law and islamic law, with common-law financial free zones) tradition. A federal civil-law system on the Egyptian model, with Sharia governing personal status and a large body of federal codes covering civil transactions, commerce, companies, labour and crime. What makes the UAE distinctive is that two financial free zones — the Dubai International Financial Centre and Abu Dhabi Global Market — are constitutionally carved out of the federal civil and commercial law and operate their own common-law systems, their own courts staffed largely by judges from England, Singapore, Hong Kong and Australia, and their own English-language legislation. ADGM applies English common law directly by statutory incorporation. A commercial question about the UAE cannot be answered without first establishing whether onshore federal law, DIFC law or ADGM law applies.
How power is divided
Federal, and asymmetric in practice. Seven emirates, of which Dubai and Ras Al Khaimah maintain their own separate local court systems outside the federal judiciary entirely, while the others are integrated into it. Each emirate legislates in its own sphere, and the two financial free zones are separate legal jurisdictions with civil and commercial competence.
Where law comes from
- The 1971 Constitution
- Allocates competence; Sharia is a principal source of legislation.
- Federal decree-laws and laws
- Including the Civil Transactions Law, Commercial Transactions Law, Companies Law and Penal Code.
- Sharia
- Governs personal status; applied in family and succession matters, with separate rules for non-Muslims since 2022.
- Emirate-level legislation
- Dubai and Abu Dhabi in particular legislate extensively in their own right.
- DIFC and ADGM law
- Free-zone civil and commercial law displacing federal law within the zones; ADGM incorporates English common law directly.
The legal profession
Onshore advocacy before the federal and local courts is reserved to UAE nationals licensed by the Ministry of Justice, with foreign lawyers practising as legal consultants; pleadings onshore must be in Arabic. The DIFC and ADGM courts, by contrast, admit registered practitioners from any common-law jurisdiction and conduct proceedings in English, which is the principal practical reason parties opt into them. Notarisation before a public notary is required for powers of attorney, share transfers and real property dispositions.
Law by topic in United Arab Emirates
- Civil ProcedureCivil-law federal courts alongside common-law courts in the free zonesThe onshore courts apply the Civil Transactions Law in Arabic. The DIFC and ADGM operate independent English-language common-law courts with their own procedure inside the same country.
- Business & CorporateFull foreign ownership onshore since 2021, plus more than forty free zonesThe 2020 amendment to the Companies Law removed the general requirement for fifty-one per cent Emirati ownership of onshore companies, ending the sponsor structure for most activities.
- Constitutional LawA federation of seven emirates with substantial reserved powersThe 1971 Constitution creates a federation in which the seven emirates retain everything not expressly given to the federal government, including significant control over land and natural resources.
- Immigration & NationalitySponsored residence plus Golden and Green long-term visasMost residence is employer-sponsored and renewable in two-year cycles. The Golden Visa gives ten years and the Green Visa five, both without an employer sponsor.
- Employment & LabourFederal Decree-Law 33 of 2021 with mandatory limited-term contractsThe 2021 Labour Law abolished unlimited-term contracts, requiring all private sector employment to be on fixed terms of up to three years, renewable.
- Criminal LawA 2021 penal code overhaul, with sharia retained for some offencesFederal Decree-Law 31 of 2021 replaced the 1987 Penal Code and decriminalised consensual extramarital relations and alcohol consumption, while retaining sharia principles for certain categories.
- Family LawSharia personal status, plus a parallel civil family law for non-MuslimsPersonal status for Muslims follows sharia. Since 2022 non-Muslims can use a separate civil family law, first in Abu Dhabi and then federally, covering civil marriage, no-fault divorce and equal custody.
- Property & LandEmirate-level land law with designated foreign freehold areasLand is regulated by each emirate. Foreign nationals can own freehold only in designated areas, with Dubai and Abu Dhabi operating the largest and best-documented registers.
- Tax LawCorporate tax from 2023, VAT from 2018, still no personal income taxThe UAE introduced a nine per cent federal corporate tax for financial years starting on or after 1 June 2023. There is still no personal income tax.
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