Publications

The Dubai International Arbitration Centre (DIAC) introduced its new Arbitration Rules (new Rules) on 7 May 2007. The new Rules reflect the quality of the review undertaken by the Board of Trustees and demonstrate DIAC's ambition to be amongst the leading international arbitration centres in the world.

The new Rules remove some of the obvious limitations of their predecessors and appear to incorporate some of the best provisions of other, more well established sets of rules (such as the ICC, LCIA and UNCITRAL).

The overarching theme of the new Rules appears to be to increase the Tribunal's discretion to determine procedural issues in the absence of the specific agreement of the parties. The Rules also seek to introduce certainty to some of the fundamental elements of the arbitration process. They provide that, in the absence of agreement:

• The seat of the arbitration will be Dubai.
• The language of the arbitration will be the same as the language of the arbitration agreement.
• The Tribunal shall decide what governing law applies based on which law is most "appropriate".
• The dispute will be determined by a sole arbitrator unless a three person tribunal appears appropriate in the circumstances.
• The award will be final and binding on the parties and the parties irrevocably waive their rights to any form of appeal to any State Court "insofar as such waiver shall validly be made".

One of the most important elements of the new Rules is the ability of the Tribunal to grant interim relief. In a region where the ability to obtain injunctive relief from the State Court is severely limited, and, correspondingly, the enforcement of an injunction made by a foreign court is likely to be fraught with difficulty, this provision will be viewed by the international community as a significant step forward for the expeditious administration of justice in the UAE. The provision actually goes further than other rules as the Tribunal, under the new Rules, "may issue any provisional orders or take other interim or conservatory measures it deems necessary" (emphasis added).

However, the key to Dubai's emergence as a leading centre for International Arbitration lies not just with the establishment of a robust and user-friendly set of institutional rules (which the DIAC's new Rules undoubtedly are). Rather, the key lies with the supervision of the arbitration process and the enforceability of the award within the UAE. Here too, great progress has been and is being made.

The UAE ratified the New York Convention on 19 November 2006 and did so without any limitation of its obligations under the Convention. While, to the writers' knowledge, enforcing an arbitral award under the auspices of the New York Convention is yet to be tested in the UAE, the ratification of the Convention's full terms is undoubtedly a significant milestone. If the UAE is to succeed in becoming an 'arbitration-friendly' state, it is of course crucial that, in practice, its courts uphold international arbitration awards under the Convention.

In another important development, a new federal-level draft Arbitration Law, was released for public comment in September 2006. Its release triggered significant consultation between the relevant government ministries and the public and private sectors. The government received considerable comment from, among others, international law firms. The persons responsible for drafting the legislation are being assisted by a working group whose number include leading international arbitrators from around the world.

Given the UAE's, and Dubai's in particular, commitment to attracting foreign investment, the development of its international arbitration regime is important to foster confidence in the region. The DIAC's new Rules are a significant and welcome stride forward.