A new dawn concerning the process to enforce English court judgments in the UAE
On 13 September 2022, the UAE Ministry of Justice (the MoJ) issued a circular to the Director General of the Dubai Courts in which the MoJ confirmed that English Court judgments can and should be enforced by the UAE Courts under the principle of reciprocity (the MoJ Circular). This should pave the way for a more favourable and streamlined approach to enforce civil judgments between the UAE and the UK.
The recognition of foreign judgments in the UAE
No treaty exists between the UAE and the UK concerning the mutual recognition and enforcement of civil judgments. Accordingly, a party seeking to enforce an English Court judgment in the UAE must rely on the provisions of UAE law applicable to enforce foreign judgments.
Under UAE law, the process to enforce a foreign judgment is governed by Article 85 of the Implementing Regulations of the UAE Civil Procedure Code. Article 85 provides that judgments and orders issued in a foreign jurisdiction can be enforced in the UAE under the same conditions that apply to enforce judgments and orders provided for in the law of that foreign jurisdiction. Put simply, the UAE will enforce a foreign judgment (e.g., an English Court judgment) where there is reciprocity of enforcement between the UAE and the relevant foreign jurisdiction (e.g., the English Courts).
Until recently, there was very little reciprocity between the UAE and the UK in terms of their respective courts enforcing each other’s judgments. This, combined with the absence of a treaty, made it challenging to enforce civil judgments between the UK and the UAE.
A new dawn
A significant change came in 2020, with the English High Court's judgment in Lenkor Energy Trading DMCC v Puri (2020) EWHC 75 (QB) (Lenkor), in which the High Court enforced a Dubai Court judgment. Here, the Dubai Courts had granted a judgment against the defendant, Mr Puri, a British national, holding him liable for the amount of a cheque that was not honoured. Mr Puri defended subsequent attempts to enforce the judgment on, among other things, public policy grounds. The English High Court rejected these arguments and concluded that there were no public policy grounds for refusing to enforce the Dubai Court judgment. The decision was upheld by the English Court of Appeal.
Lenkor stands as a seminal precedent that the UAE Courts may rely on as satisfying the reciprocity principle with respect to any future application to enforce English Court judgments in the UAE. Importantly, the recent MoJ Circular expressly mentions the decision in Lenkor which adds further weight to the MoJ’s directive to the Dubai Courts to enforce judgments issued by the English Courts:
“We find that this [the reciprocity] principle is met given that English courts have enforced a judgment rendered by the Dubai Courts under a final judgment handed down by the High Court of Justice in [Lenkor] which is judicial precedent and binding principle for all English courts according to their judicial system”
Now, a party seeking to enforce an English Court judgment in the UAE can rely on the MoJ Circular and the decision in Lenkor. This is a positive development in the UAE enforcement landscape.
The MoJ Circular also provides arbitral award creditors with options under section 66 of the UK Arbitration Act. Section 66 provides that where the English Courts grant leave to enforce an arbitration award, a judgment may be entered in terms of the arbitration award which may be enforced in the same manner as any judgment of the English courts. In principle, it seems that a judgment entered under section 66 may be enforced in the UAE.
It is important to note that the MoJ Circular is not binding on the UAE Courts. Moreover, even if the UAE Courts find that Lenkor satisfies the principle of reciprocity, they may nonetheless decline to enforce an English Court judgment on other grounds. It is therefore unlikely that these developments will have an immediate impact. The future will depend on whether the UAE Courts establish a consistent line of judicial authority enforcing English judgments.
If you are affected by anything in this article or the implications of enforcing foreign judgments in the UAE, please feel free to contact Adam Vause and Andrew Massey.