Recently, the UAE introduced Federal Law No. (15) of 2023 (The “Amendments”), which substantially revised the previous Federal Law No. (6) of 2018. The Amendments have been strategically crafted to enhance the arbitration processes in the country by addressing various aspects of the arbitration process, such as the selection of arbitrators, the procedures for arbitration, the use of technology in arbitration, and the impartiality of arbitrators.

Review of the key amendments

1. Article 10 of the Amendments now explicitly forbids the selection of an arbitrator who has a direct connection with any of the parties involved in the arbitration, as such a relationship could potentially undermine the arbitrator’s impartiality and independence. Another noteworthy change involves the relaxation of the restriction concerning the appointment of arbitrators from the supervisory or controlling bodies of arbitration institutions. This exception allows parties to appoint such an arbitrator subject to specific conditions:
   • obtaining the parties’ consent,
   • disclosing the arbitrator’s affiliation with the institution,
   • ensuring the arbitrator’s non-involvement in the decision-making of the arbitration institution,
   • and setting limits on the number of arbitration cases the arbitrator can handle in a single year.
2. Article 23 of the Amendments confirm the parties’ entitlement to establish the procedures that the arbitration tribunal must adhere to during the arbitration process. This includes the option to subject these procedures to the regulations of any arbitration organisation or institution, whether domestic or international. Nevertheless, if the parties cannot reach an agreement regarding these procedures, the arbitration tribunal can decide on its own taking into consideration both the applicable law and the fundamental principles of justice, as well as any international agreements to which the country is a signatory.
3. One significant change involves the applicability of arbitration law regarding virtual and online arbitration procedures. Article 28 of the Amendments permit parties to mutually determine how and where the arbitration will take place. In cases where there is no mutual agreement, the arbitration tribunal has the authority to decide on the method and location of arbitration, taking into account the specific circumstances of the case and the convenience of the parties involved. To keep up with the emerging practice of conducting international arbitration proceedings, the Amendments now mandate that arbitral institutions must furnish all the essential technology required to facilitate remote hearings.
4. Article 33 of the Amendments additionally authorise the arbitration tribunal to determine whether it should conduct oral hearings for the presentation of evidence and oral arguments, or if it should opt for a “documents only” procedure where the parties submit written documents and other evidentiary materials.

Conclusions

These Amendments became effective on 16 September 2023, and are in line with the UAE’s goal of establishing itself as a prominent global center for arbitration. This legislative step underscores the UAE’s dedication to the field of arbitration, illustrating the country’s ongoing effort to evaluate and enhance the Federal Arbitration Law in accordance with best practices. This commitment is aimed at ensuring that the UAE remains an appealing choice for those seeking arbitration services, marking another stride in its journey toward becoming an established international arbitration hub.

For more information in this regard, please contact:

Zijad Hanic
Counsel
[email protected]