Law and Legal Risks of the UAE Construction Industry

Law and Legal Risks of the UAE construction Industry is the subject of our legal study today. The United Arab Emirates or UAE is known for its classic construction industry. This industry has seen splendid growth after 2004 and the recent post-pandemic development has left the world behind due to its mega and classic construction projects. Especially the construction and development of DUBAI and ABU DHABI have set the precedents for other countries. The ambitions of local rulers in UAE provide the world with a new business sector where it is not easy to excel and survive though. However, the UAE has made remarkable and splendid progress. Apart from this, we can’t ignore the challenges which come along with success. Managing legal risks is an important part of any business. Businesses can’t survive, without managing risks though taking risks is part of business strategy too. Hiring legal support and assistance becomes inevitable. We will be discussing the importance of “Law and Legal Risks Covering” strategies in the UAE here.

If you are into this industry or about to enter then first you need to learn the Law applied in UAE. Because you are not the professional yourself you need to hire the Law for understanding. You need to learn the Law and Legal Risks of UAE construction Industry from such Advocates. The LAW applied in UAE for the construction industry, is drafted separately which is part of UAE General Law. Mostly legal matters and legal disputes are handled, through UAE Civil and Commercial Law. Because most of the cases do fall into Civil Law implementations. These are the corporate disputes resolved or settled under UAE Civil Law jurisdiction. If the nature is partially or fully Criminal then a criminal Case can also be opened.

It is advised and recommended by the experts and standards of law, that contractual duties must be performed well. For example, if a new project is going to be started then the documentation to start that project should be very much clear between or among parties. The documentation towards, government requirements can’t be left incomplete because nothing can be started without submitting the entire documentation to concerned legal departments. The government will not allow you to start the business or any project if the required submissions are found missing or incomplete.

The contracts between/among the partners, vendors, sellers, buyers, and suppliers must be made very clear and comprehensive. Even the agreements with the employees working in the construction industry must be very clear stating all the important clauses, responsibilities, rewards etc. All the offer letters and all internal agreements must be drafted by expert Emirati Labour and Employment Lawyers who have expertise majors in UAE Labour and Employment Law.

• All such agreements must be drafted by the Advocates or Legal Consultants, who have the ability and experience to draft all such important agreements. All such agreements must be relevant to local laws and include compliance with UAE Laws. Though the CIVIL CODES and BUSINESS LAWS are almost the same all over the world, following international CIVIL Laws but there are a few things as well which do not relate to UAE SHARIA LAW. That needs to be properly checked and managed accordingly. Therefore, the top attorneys are required to draft the best-required documents/agreements with compatibility with local laws.
• Despite paying the best care and attention, nobody can stop the disputes. Disputes always had to have happened. It should be mentioned in the agreements that in case of dispute the jurisdiction will be Courts or Arbitration. If Arbitration is found convenient then it should be selected with the consensus of both parties and it should be mentioned in the agreements.
• The other few factors like risk-taking, insurance, liabilities, profit sharing, liability sharing, capital details, bank details etc can also be mentioned in the agreements. If a developer is signing the construction units to buyers, then SPA must be contained each and every part of selling and buying. Now there is one advancement that developers are drafting very elaborative SPA covering each and every part of the selling and buying deal. This removes the issues which were used to be created due to the silence of agreements.

The legal aid can be taken in two ways. When it comes to a Construction Company then first, we need to identify the legal need. They need legal support in following ways;

• Drafting Business Agreements
• Drafting Partnership Agreements
• Drafting Employment Agreements
• Drafting SPA
• Drafting Booking Forms
• Legal AID in Court Cases

From buyers’ point of view the legal aid by the lawyer can be as follows;

• Law Office can help the buyers to understand the SPA.
• Law Office can help the buyer to finish the business deal properly as per Law.
• Law Office can help the buyer or buying the companies to buy the properties lawfully.

When disputes are referred to court, or taken to court then Emirati Advocates are needed. These Emirati Advocates must be from credible and trustworthy law companies. If a case is lost in court, then it means all the tangible and intangible assets can be lost. Therefore, competent lawyers or teams of lawyers should be hired which is only possible when a reliable legal platform is engaged.

THEREFORE, it is always advised that the Construction Industry, needs special legal support and they prefer to have an internal legal counsel or legal department. If it is not possible then they must tie up with the Law Companies on a permanent legal support system. Law Companies like AL Shaiba Advocates and Legal Consultants can serve construction companies better than several average or small legal companies. We have recommended several times here that always prefer to hire the top advocates with good names but from a reliable legal platform. The construction Industry is one of the key businesses in the world therefore no single mistake can be afforded.