Recent amendments to the ADGM’s founding law
04 June 2020
Enforcement route between the ADGM and onshore Abu Dhabi Courts is confirmed, but the ADGM Courts cannot be used as a ‘conduit jurisdiction'.
Recent amendments to the ADGM’s ‘founding law’ implement a number of notable improvements and clarifications to the role of the ADGM as a regional and international hub for litigation and arbitration.
On 27 May 2020, Abu Dhabi Law No (12) of 2020 amended Abu Dhabi Law No (4) of 2013 to confirm that:
- judgments and arbitral awards will be enforced between the ADGM Courts and the onshore Abu Dhabi Courts without a re-examination of the merits (a codification of the enforcement route in the Memorandum of Understanding dated 11 February 2018); and
- the ADGM Courts cannot be used as a ‘conduit jurisdiction’ for onward enforcement of foreign judgments and foreign arbitral awards before the onshore UAE Courts. This amendment will avoid the ADGM Courts facing the same complex and controversial issues that have arisen from the DIFC courts being used as a ‘conduit jurisdiction’. To take advantage of the ADGM’s favourable enforcement framework, parties must submit their original dispute for determination by the ADGM Courts or by arbitration seated in the ADGM.
Other amendments confirm that:
- the ADGM is an ‘opt in’ jurisdiction which does not require any nexus to the ADGM;
- the ADGM Courts have exclusive jurisdiction over certain disputes, similar to the ‘jurisdictional gateways’ that apply to the DIFC Courts (under the DIFC Judicial Authority Law, Law No.12 of 2004); and
- the ADGM Courts are Courts of Abu Dhabi, which makes it clear that ADGM Court judgments and ADGM-seated arbitral awards are of equivalent legal status to Abu Dhabi Court judgments and Abu Dhabi-seated arbitral awards, both within the UAE and also under international treaties and conventions to which the UAE is a signatory.
These changes confirm the significant benefits in choosing the ADGM as the agreed dispute resolution forum where enforcement of the judgment or arbitral award will need to take place in onshore UAE or the wider Middle East and North Africa.
Please let us know if you would like to discuss this development with our Middle East disputes team.