Additional DIFC laws enactedPress Release 26 Jun 2005 12:28 pm
His Highness Sheikh Maktoum Bin Rashid Al Maktoum, Ruler of Dubai, enacted five laws dealing with legal obligations, employment and security interests, and the Board of Directors of the DIFCA has issued the companies regulations.
These laws and regulations are among the body of legislation dealing with non-regulated activities which DIFCA is charged with administering under Law No. 9 of 2004. The Dubai Financial services Authority (DFSA) is charged under Dubai Law No. 9 of 2004 with administering all DIFC legislation concerning the regulation of financial and ancillary services. Prior to the submission of the laws to the DIFCA Board of Directors, the draft laws and regulations were posted on the DIFCA website to solicit comment from the international financial and legal community. In accordance with Dubai Law No. 9 of 2004, these laws and regulations were developed by the DIFCA Legislature, acting through its Legislative Committee, in consultation with the DFSA
The new laws are:
The Employment Law No. 4 of 2005
This law provides for minimum employment practices comparable to established international standards, so as to promote fair treatment of employees and employers.
The Law of Obligations No. 5 of 2005
This law creates a framework for claimants to seek recovery for non-contractual claims and sets out the rules as to when obligations arise and how disputes involving them are resolved.
The Implied Terms in Contract and Unfair Terms Law No. 6 of 2005
This law provides for fairness and certainty in contracts governed by the laws of the DIFC by providing terms and conditions not normally included in contracts and assures the necessary framework for their enforcement.
The Law of Damages and Remedies No. 7 of 2005
This law creates the structures necessary to assure the recovery of damages and other forms of relief to claimants within the DIFC.
The Law of Security No. 9 of 2005
This law defines various forms of security interests as collateral for repayment of debts and prescribes the process for their perfection and enforcement.
The regulations consist of the DIFC Companies Regulations, which are issued by the Board of Directors of the DIFCA pursuant to the authority given to the Board by Law No. 9 of 2004. These regulations prescribe the processes and procedures to be followed for compliance with DIFC Companies Law No. 2 of 2004 with respect to the formation and administration of legal entities registered in the DIFC, the transfer of incorporation of legal entities to and from the DIFC, and set out the fees and other costs associated with such formalities.
Commenting on the issuance of these laws and regulations, Dr Omar Bin Sulaiman, DIFCA Director General, said,
“The DIFC is a distinct legal jurisdiction. This is a critical component of the overall offering of the DIFC and a major factor in the decisions of the numerous financial institutions that have applied for and received licenses to operate here.
In the development of this legal system we have sought input from the world’s leading capital markets so as to ensure that we provide the world’s financial communities with the legal certainty they require. The issuance of these laws and regulations confirms our commitment to the continuing development of a framework which they will understand and within which they will feel comfortable operating. This legal framework was set in motion with the passage of the first set of laws in September of 2004 and the process is on-going. Other laws are planned for passage later this year in keeping with the DIFC’s promise of providing the best-in-class legislation addressing the full breadth of operations permitted to be carried out in and from the DIFC.”