Laws Regulating Economic Activities in Dubai

History & Background:
Prior to the legislation of Law No. 13 of 2011, business operations in Dubai were regulated by few federal laws, creating licensing, and classification. Law No. (13) was introduced to unify these processes under the Dubai Economic Department. The legislation is underpinned by several Federal Laws, have a look:

• Federal Law No. 5 of 1975: For Commercial Registering.
• Federal Law No. 8 of 1984: For Companies Law
• Federal Law No. 5 of 1985: UAE Civil Code
• Federal Law No. 3 of 1987: UAE Penal Code
• Federal Law No. 37 of 1992 – Trademarks Law

Law No.13 of 2011, also known as “Law Regulating the Conduct of Economic Activities in the Emirate of Dubai”. These laws provide a cohesive legal infrastructure and legal base, that supports Law No. (13), and offering uniformity in legal practices throughout the UAE. All the economic activities in Dubai are properly regulated by the law. Law no. 13 of 2011 concerns the conduct of economic activities in the Emirates of Dubai.  This law laid down a strong foundation for reshaping the structure of economic activities. It reshapes the legal and administrative structure of Dubai. Law regulating Conduct of Economic Activities in the Emirate of Dubai was enacted to streamline the licensing procedure. It contributes towards Dubai’s global standing. The law has immensely supported Dubai to position itself as a premier commercial and economic destination of the world.

This law has adhered to a centralized procedure for licensing. Mainly, the license is obtained from the Department of Economic Development (DED). The law has also simplified the regulatory procedures. It even reinforces the fairness and transparency in every business operation and transaction. All the huge entrepreneurs, large-scale investors, and big enterprises need to understand the law. It is instrumental for survival, growth, and smooth business operations in Dubai.

Therefore, Lawyers in Dubai, law firms in Dubai, and attorneys in Dubai play a crucial role. They help businesses to stay aligned with their legal obligations.  It also assists them to ensure legal compliance with the law and thus, avoid any compliance pitfalls.

Previously, the business operations inside Dubai were mainly administered by the sectorial and federal statutes. This has resulted in a great deal of difficulties and inconsistencies. It has also hindered the regulation and classifications that created chaos.

Considering the inconsistencies and non-compliance, law no 13 was introduced in the year 2011.  This was introduced with the intention to unify the processes and also facilitate the regulatory process.

It was conducted by the Department of Economic Development (DED). Therefore, the old and outdated laws were replaced with more modern yet unified laws to support the Dubai economy.

The legislation was underpinned by a range of federal decree laws. It may include Federal Law No. 5 of 1975 regarding the Commercial Register, Federal Law No. 8 of 1984 concerning Commercial Companies Law, Federal Law No. 5 of 1985 on Civil Transactions (UAE Civil Code), Federal Law No. 3 of 1987 related to Penal Code, Federal Law No. 37 of 1992 on Trademarks, Federal Law No. 10 of 1992 concerning Law of Evidence in Civil and Commercial Transactions, and Federal Law No. 18 of 1993 on Commercial Transactions. It provides the uniformity that is required in legal practice. Therefore, the emphasis is placed on integrating federal laws with Dubai regulatory models. This not only ensures consistency but also localized the processes.

It primarily applies to all the individuals and entities operating inside Dubai. Those who seek to conduct economic activities in Dubai must adhere to the law. It redefines economic activities from a broader perspective. Moreover, it also encompasses the commercial, agricultural, industrial, and professional services that want to earn profits and revenues. It is not applicable to entities operating in free zones. The law is generally applicable to revenue-generating entities who are engaged in commercial and economic activities in Dubai. It is for the establishments that are legally operating their operating in designated areas.

Besides, the license is an essential ingredient to formally and lawfully operate in Dubai.  The Department of Economic Development (DED) offers a legit and valid license that is mandatory for conducting operations. No business can conduct economic activities in Dubai without securing a valid and legitimate license. The rules of engagement are very strict and enforceable. Dubai has focused on aligning its economic activities with urban planning, environment, and safety standards.

Law firms in Dubai render their legal services to obtain formal approval from the DED. The lawyers in Dubai assist in determining the business models. They also provide legal guidance concerning the jurisdiction of this law that ensures compliance from inception. Moreover, the trade name should also be approved by the Department of Economic Development (DED). Here attorneys in Dubai will assist in complying with the guidelines.

For it, they will cater the factors like uniqueness, cultural sensitivity, and commercial appropriateness. Other than the basic approval, some entities require additional approvals from other concerned authorities in Dubai. Therefore, the lawyers in Dubai will be engaged with authorities such as Dubai Municipality, the Ministry of Economy, and others.

Law No. 13 of 2021 greatly empowers the Department of Economic Development (DED). It supports the regulatory and enforcement authority to ensure compliance. It is often related to inspectors making unannounced visits with licensing terms. The law is strict in Dubai and thus, in case of non-compliance, the penalties are harsher. Non-compliance can result in heavy charges, temporary closures, permanent seizure of business, license suspension, litigation, and much more.

The entities have the leverage to make appeals. They must be made within 15 Days of receiving the administrative decisions. DED will respond within 30 working days.  Law firms in Dubai regularly represent clients in making appeals. They often draft detailed responses with the help of inspection reports. Well-equipped lawyers in Dubai advise on mitigating strategies that help in reducing penalties. Their expertise and experience assist businesses with enforcement and compliance. As a result, it will preserve the operational continuity.