Dubai as an Arbitration-Friendly Jurisdiction
DIFC Court of Appeal Confirms Enforceability of Arbitral Awards Granting Interim Relief Issued in Non DIFC-Seated Arbitrations
The Dubai International Financial Centre’s (DIFC) Court of Appeal has recently confirmed, in CA 001/2024, that a provisional award granting interim measures, issued by a tribunal in a non DIFC-seated arbitration, is enforceable as an award in the DIFC Courts.
Background
The claimant in a London-seated arbitration applied to the DIFC Court of First Instance for an order recognizing and enforcing a “Provisional Award on Interim Relief” (Provisional Award). The nature of the interim relief at issue was a proprietary injunction, a freezing order and an order for ancillary disclosure. The defendant challenged the enforceability of the Provisional Award under DIFC Law No. 1 of 2008 as amended (Arbitration Law). The Court of First Instance rejected the defendant’s arguments and issued an order recognizing and enforcing the Provisional Award.
The Court of First Instance held that Article 24 of the Arbitration Law (contained within Part 3) – which empowers the tribunal in a DIFC-seated arbitration to order interim measures and entitles a party in whose favour an interim measure has been granted to seek enforcement from the DIFC Court of First Instance – was not the only provision that gave the court jurisdiction to enforce interim measures and did not exclude other routes of enforcement. The court noted that Articles 42 to 44 (contained within Part 4) provide for the recognition and enforcement of an arbitral “award” regardless of the jurisdiction in which it was issued, and Article 44 expressly states that recognition or enforcement may only be refused on specified grounds (none of which applied). The Court of First Instance therefore considered that it was a matter of interpretation whether the Provisional Award was an “award”. The court held that it was. The court noted that, although the Arbitration Law does not contain a definition of an arbitral award, Article 24(1) provides that a tribunal can award interim measures “in the form of an award or another form” and there is nothing in the Arbitration Law to suggest that such an award issued in a non DIFC-seated arbitration would not be an award for the purposes of recognition and enforcement under Part 4.
DIFC Court of Appeal’s Decision
On appeal, the defendant argued that interim measures ordered by a tribunal could only be enforced under Article 24, which is limited to DIFC-seated arbitrations, regardless of whether they were made by way of an award or order. Articles 42 and 43 concern the recognition and enforcement of awards which are final on their merits (whether partial or final), but not interim or provisional awards. The Court of Appeal rejected these arguments, confirming the lower court’s finding that a provisional or interim award is an award for the purposes of recognition and enforcement under the Arbitration Law.
The Court of Appeal acknowledged the different parts of the Arbitration Law relating to the DIFC Court’s supervisory jurisdiction over DIFC-seated arbitrations and the later provisions relating to its enforcement jurisdiction over awards made in other states, but found that there was nothing within Articles 42 to 44 to suggest that there is any basis for concluding that a provisional or interim award falls into a different category from a partial or final award. There was no basis for importing a requirement of finality of the determination of issues, as argued by the defendant. Further, the court held that there is no reason in principle why an award which is interim or provisional and therefore binding for a limited period should not be treated as an award for the purposes of enforcement and, as a matter of policy, every reason why it should be.
Commentary
This judgment is helpful in confirming the DIFC Court’s jurisdiction to enforce awards for interim relief issued in non DIFC-seated arbitrations. It also supports the widely held view that the DIFC is an arbitration friendly jurisdiction.
About the Firm
The firm’s Litigation and Dispute Resolution team, renowned for international litigation and dispute resolution techniques, has a long history of acting as counsel on high-stakes international arbitration mandates. Our lawyers in Dubai have experience with all of the major arbitration institutions within the region and are fully equipped to represent clients with respect to complex, high-value disputes in the UAE and wider Gulf region.
This publication/newsletter is for informational purposes and does not contain or convey legal advice. The information herein should not be used or relied upon in regard to any particular facts or circumstances without first consulting a lawyer. Any views expressed herein are those of the author(s) and not necessarily those of the law firm's clients.
