	(85189,4643,'content','<p>Essam Al Tamimi did not build the region&rsquo;s largest Arab-owned law advisory and become recognised as one of his generation&rsquo;s brightest and most generous legal minds by luck, nor by &ldquo;sitting on a beach reading a book&rdquo; of the latter he is adamant.&nbsp; Like many of the best in this tough profession, his is a story of sheer, sheer determination, sweat and tears.&nbsp; It is a tale of great success born of long hours and clear vision. But unlike many of the most high profile of his peers, and lesser known to the public, his has been a journey coloured early on with academic failures, isolation and despair, making everything he has built today even more inspiring.<br /><br /><strong>The early years<br /><br /></strong>It will surprise many to learn that Essam was far from top of his class at school in the UAE.&nbsp; He was, in fact, one of the lowest achievers of his classes throughout, and across all subjects, at school.&nbsp; He can not recall what intrigued him about law originally, &ldquo;Possibly a movie or something&rdquo; he laughs.&nbsp; As fortune had it at that time, to encourage students in to law, lower grades were accepted and Essam made it into Al Ain University law school &ndash; where everything took a 360 degree turn.&nbsp; &ldquo;My life totally switched.&nbsp; I was suddenly in the library four hours a day, every day.&nbsp; Law lit something in me.&nbsp; After being the lowest in my school classes, I became a star pupil at college and I was soon encouraged to consider applying to the Ivy League law courses in the US.&rdquo;<br /><br />College in the States proved a tough and life defining path.&nbsp; &ldquo;I thought I knew everything about law when I left for Harvard. But when I got there I was at a great disadvantage that could&rsquo;ve threatened everything.&nbsp; Coming from a simple, Bedouin life, Harvard was a huge culture shock. I also struggled with the language and learning style.&rdquo;&nbsp; Essam recalls a heart-breaking misery and loneliness where he questioned his fundamental plan to follow law.&nbsp; But it proved to be an important challenge which honed the determination and single-vision focus that Essam attributes his many successes to date to.&nbsp; He made it through college in the US with a stronger determination to succeed than ever - &ldquo;It became about more than surviving college.&nbsp; I decided there, I didn&rsquo;t want to become just a lawyer &ndash; I decided I would become one of the very best lawyers.&rdquo;</p>\r\n<p><strong>Building the Foundation</strong></p>\r\n<p>This meant hard work.&nbsp; It meant years of typing his own pleadings in his bedroom at night, with no money to afford a clerk.&nbsp; It meant years of working 16 hour days.&nbsp; This dedication of course paid off and today he and his partners &ndash; whose crucial part in the Al Tamimi &amp; Company story Essam is keen to highlight &ndash; run the largest local law firm in the Middle East.</p>\r\n<p>In light of the empire that Essam and his partners have built, he has been able to reallocate these hours so that one-third of his time is now non-billable.&nbsp; A third of this time is spent contributing to law and regulation development around the region, a responsibility he takes very seriously.&nbsp; &ldquo;There&rsquo;s so much to be done and this work is a real passion of mine.&nbsp; You&rsquo;ll find an independent judicial system and set of laws at the heart of every peaceful and leading business market.&nbsp; Where my experience and passion for the cause can be of help, I give it &ndash; invited or otherwise&rdquo; he says with a smile.</p>\r\n<p>Strengthening the rule of law in the Middle East is a focus going forward at this stage in Essam&rsquo;s career. As is writing and lecturing.&nbsp; He is currently in the final stages of publishing another book on arbitration and researching for a paper on women and the law in Islam, something Essam feels has not been examined sufficiently until now.</p>\r\n<p>For the firm, he is working on nothing less than dominating every market in the Middle East.&nbsp; &ldquo;We&rsquo;ve chosen the best partners and people in all of our markets and even through the down-turn and Arab spring, we&rsquo;ve never taken one step back.&nbsp; We believe that Al Tamimi will be the biggest Arab law firm in every market in the Middle East.&rdquo;<strong><span><br /></span></strong></p>\r\n<p><strong>Life outside the Law</strong></p>\r\n<p>Unbelievably, Essam does have &lsquo;spare time&rsquo;.&nbsp; He has learned the art of time management and the value of an hour which is vital when balancing a young family and such a busy work life.&nbsp; &ldquo;I love to be with my family.&nbsp; I&rsquo;m currently teaching the children archery, a shared hobby, which is great fun.&nbsp; I also love to be outdoors &ndash; to fish, to ride horseback, to camp.&nbsp; I am a date tree that needs to be in the desert.&nbsp; I love to travel, but I couldn&rsquo;t live anywhere else in the world.&rdquo;</p>\r\n<p>And this home-loving nature extends to his favourite choice of restaurant, which he reports to be his home, and no less than his own cooking &ndash; &ldquo;You&rsquo;ll never eat better fish, anywhere in the world, than the fish I cook&rdquo;, he boasts, interestingly, with the same energy that is apparent when he talks about law.</p>\r\n<p>Essam considers himself a &ldquo;simple man&rdquo;, which is something very important to him.&nbsp; &ldquo;I eat simply, I live simply and I must end every day simply&rdquo;.&nbsp;</p>\r\n<p>Do these increasing non-billable hours, all this camping, cooking and &lsquo;simplicity&rsquo; mean that Essam may be losing his edge a little? Not at all, aside from his family, his biggest rush is always winning a case &ndash; &ldquo;I&rsquo;m a hunter.&nbsp; I need to hunt and I live for the kill.&rdquo;&nbsp;</p>\r\n<p>Despite early lifetime contribution awards under his belt, his mark firmly made on regional rule of law and surely nothing left to prove, Essam Al Tamimi still lives for the win. There&rsquo;s nothing less than Al Tamimi&rsquo;s. regional domination and evolution of the Middle East&rsquo;s judiciary on his plate now.</p>'),
	(85190,4643,'_content','field_59b649b5c8b2b'),
	(85191,4643,'lawUpdateArticleMonth','4640'),
	(85192,4643,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(85193,4643,'content_description','Essam Al Tamimi did not build the region’s largest Arab-owned law advisory and become recognised as one of his generation’s brightest and most generous legal minds by luck, nor by “sitting on a beach reading a book” of the latter he is adamant. \r\n'),
	(85194,4643,'_content_description','field_59b641c07f473'),
	(85195,4643,'pageSummary','Essam Al Tamimi did not build the region’s largest Arab-owned law advisory and become recognised as one of his generation’s brightest and most generous legal minds by luck, nor by “sitting on a beach reading a book” of the latter he is adamant. \r\n'),
	(85196,4643,'_pageSummary','field_59e59b307dec8'),
	(85197,4643,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-5/march-4/interview-a-moment-with-essam-al-tamimi-founder-senior-partner-of-al-tamimi-company.html'),
	(85198,4643,'_currentURL','field_59d35123ab1e7'),
	(85199,4643,'_yoast_wpseo_metadesc','Essam Al Tamimi did not build the region’s largest Arab-owned law advisory and become recognised as one of his generation’s brightest and most generous legal minds by luck, nor by “sitting on a beach reading a book” of the latter he is adamant.'),
	(85200,4644,'content','<p><strong>Introduction<br /></strong></p>\r\n<p>The Draft Jordanian Investment Law (the &ldquo;Draft Law&rdquo;) aims to attract and encourage both local and foreign investment in Jordan, as well as, reinforce confidence in the investment environment in Jordan for the organization, revitalization and development of the economic environment.&nbsp; The Draft Law is still under study, having recently undergone its second reading.&nbsp;</p>\r\n<p>The Draft Law tackles the following issues:</p>\r\n<p>a)Tax exemptions;<br />b)Investors&rsquo; rights;<br />c)A one-stop shop investment window;<br />d)Development and Free zones, and the relevant tax and customs exemptions;<br />e)Residency in Development and Free Zones; and<br />f)The establishment of an Investment Board, as well as, a Higher Investment Committee.&nbsp;</p>\r\n<p>In this article, we will examine the sections regarding tax exemptions, investors&rsquo; rights, and the one-stop shop investment window.&nbsp;</p>\r\n<p><strong>Tax exemptions<br /></strong></p>\r\n<p>The Law currently in force is the Investment Promotion Law No. 16 of 1995, (as amended) (the &ldquo;Investment Law&rdquo;). Economic projects within the following Sectors or Sub-sectors currently enjoy tax exemptions under the Investment Law:</p>\r\n<ol>\r\n<li>Industry;</li>\r\n<li>Agriculture;</li>\r\n<li>Hotels;</li>\r\n<li>Hospitals;</li>\r\n<li>Maritime Transport and Railways;&nbsp;</li>\r\n<li>Leisure and Recreational Compounds;</li>\r\n<li>Conventions and Exhibition Centers;&nbsp;</li>\r\n<li>Pipeline transportation and distribution services for water, Gas and Petroleum derivatives as well as its exploitation.</li>\r\n</ol>\r\n<p>The Draft Law, on the other hand, seeks to change the emphasis from one that is sector specific, to one that is specific to goods and services that benefit from tax exemptions.&nbsp;</p>\r\n<p>Article 4 of the Draft Law applies tax exemptions to all areas of Jordan, except Free Zones and Development Zones (where specific provisions of the Draft Law apply.)&nbsp;</p>\r\n<p>The Council of Ministers, upon the recommendation of the Minister of Trade and Industry, as well as, the Minister of Finance based on the recommendation of the Technical Committee (created by virtue of the Draft Law), shall issue comprehensive tables of goods and services that shall benefit from tax exemptions, whereby the proposed structure is the following:&nbsp;</p>\r\n<ol>\r\n<li>A table for goods imported into Jordan that shall be exempt from Customs Duties, and subject to General Sales Tax at 0%;&nbsp;</li>\r\n<li>A table for services that shall be subject to General Sales Tax at 0%; and</li>\r\n<li>A table for goods and services in certain economic sectors that shall be exempt from Customs Duties and subject to General Sales Tax at 0%.</li>\r\n</ol>\r\n<p><strong>Foreign Investment<br /></strong></p>\r\n<p>Article 10 of the Draft Law adopts a similar definition of &lsquo;Invested Foreign Capital&rsquo; as the Investment Law, whereby Invested Foreign Capital is considered to be any monetary investment in Jordan by a non-Jordanian, whether in cash or in kind, or any rights with a monetary value, which are deemed to include:</p>\r\n<ol>\r\n<li>Amounts transferred by the foreigner into Jordan;&nbsp;</li>\r\n<li>Imported assets in-kind;</li>\r\n<li>Intangible property rights, such as licenses, patents, trademarks and trade names registered in Jordan;</li>\r\n<li>Profits, returns and reserves resulting from Invested Foreign Capital in an economic project in Jordan, which is used for increasing the capital of the economic project or undertaking, or for investment in another economic project;&nbsp; and</li>\r\n<li>Shares in an economic project resulting from the capitalizing and swapping of the debts of the investor.</li>\r\n</ol>\r\n<p>The Non-Jordanian Investor shall be entitled, under the Draft Law, to the following:</p>\r\n<ol>\r\n<li>Remittance abroad of all or part of the Invested Foreign Capital, in a convertible currency, that was brought into Jordan for the purposes of investment, in accordance with the relevant laws and regulations;</li>\r\n<li>Repatriation of revenues and profits outside of Jordan, in a convertible currency, earned by virtue of the investment; &nbsp;</li>\r\n<li>The liquidation or sale of the whole, or his share of the economic project or undertaking, as well as the ability to act with the proceeds without delay;&nbsp;</li>\r\n<li>The management of the economic project or undertaking in any way he sees fit, through personnel chosen by him; and</li>\r\n<li>Benefitting from the same treatment as a Jordanian investor.</li>\r\n</ol>\r\n<p>Further, any non-Jordanian workers in any economic undertaking shall have the right to remit their wages and compensation outside of Jordan.&nbsp;</p>\r\n<p>In this regard, Article 11 of the Draft Law provides that it shall not be possible to claim ownership of any economic project or undertaking, unless this is through appropriation for public benefit, provided that fair compensation is paid in a convertible currency without delay.</p>\r\n<p><strong>One-Stop Shop Investment Window&nbsp;<br /></strong></p>\r\n<p>In an aim to revise and simplify economic projects licensing procedures, the Draft Law aims to create a one-stop shop for the licensing of economic projects and undertakings in Jordan. All directorates, units or departments that carry out licensing activities in any official public entity shall be moved to one licensing department.&nbsp;</p>\r\n<p>Article 17 of the Draft Law provides that decisions regarding licensing must be issued within a maximum of 15 working days, from the date that all of the legal application requirements are met.&nbsp;</p>\r\n<p>In the case that the license application is rejected, then the applicant must be informed in writing within 3 business days, with attached details regarding any shortcomings in the application. There is also a mechanism in place allowing the applicant to challenge this decision with the Minister of Trade and Industry within 10 days of being informed of the rejection. The applicant shall be informed of the result of this challenge within 30 days, in accordance with Article 18 of the Draft Law.<br /><strong></strong></p>\r\n<p><strong>Conclusion</strong></p>\r\n<p>The Draft Law aims to provide further clarity in the area of local and foreign investment in Jordan, in a difficult economic climate. The Draft Law seeks to reorganize the body of law currently in place, specifically in relation to Development and Free Zones in Jordan. However, overall, in the other areas mentioned in this article, the Draft Law has made additions and administrative improvements, rather than fundamentally changed current laws.&nbsp; &nbsp;</p>'),
	(85201,4644,'_content','field_59b649b5c8b2b'),
	(85202,4644,'lawUpdateArticleMonth','4640'),
	(85203,4644,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(85204,4644,'content_description','The Draft Jordanian Investment Law (the “Draft Law”) aims to attract and encourage both local and foreign investment in Jordan, as well as, reinforce confidence in the investment environment in Jordan for the organization, revitalization and development of the economic environment. '),
	(85205,4644,'_content_description','field_59b641c07f473'),
	(85206,4644,'pageSummary','The Draft Jordanian Investment Law (the “Draft Law”) aims to attract and encourage both local and foreign investment in Jordan, as well as, reinforce confidence in the investment environment in Jordan for the organization, revitalization and development of the economic environment. '),
	(85207,4644,'_pageSummary','field_59e59b307dec8'),
	(85208,4644,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-5/march-4/draft-jordanian-investment-law.html'),
	(85209,4644,'_currentURL','field_59d35123ab1e7'),
	(85210,4644,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Mays Kadhim'),
	(85211,4644,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(85212,4644,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','m.kadhim@tamimi.com'),
	(85213,4644,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(85214,4644,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(85215,4644,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(85216,4644,'lawUpdateArticleNoWriters','1'),
	(85217,4644,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(85218,4644,'_yoast_wpseo_metadesc','The Draft Jordanian Investment Law (the “Draft Law”) aims to attract and encourage both local and foreign investment in Jordan, as well as, reinforce confidence in the investment environment in Jordan for the organization, revitalization and development of the economic environment.'),
	(85219,4645,'content','<p>The judgment below highlights how a mortgage can be enforced by the Execution Court in the event a debtor defaults on paying the mortgage installments.&nbsp; The mortgage deed, in this case, was silent on the issue of obtaining attachments over mortgaged property.</p>\r\n<p><strong>Summary<br /></strong></p>\r\n<p>A Home Finance provider (the creditor- mortgagee) sought an order against a debtor (mortgagor) for an attachment to be levied on property and for the sale of land by public auction in order to collect a debt amounting to AED 1,637,807.22 from the proceeds of the sale.&nbsp; The Home Finance provider had given the debtor a mortgage in the amount of AED 1.6 million to construct a villa on the plot pursuant to a mortgage contract attested by the Land Department.</p>\r\n<p>The debtor defaulted on paying the mortgage installments and as a result, the Home Finance provider filed an application with the Execution judge of the Dubai courts to enforce the mortgage deed.</p>\r\n<p>The Court of Cassation held that the Home Finance provider was entitled to recover its debt from the sale proceeds pursuant to Article 292, 293 of the Civil Procedure Law and Articles 25, 26 of Dubai Law 14 of 2008 concerning mortgages.</p>\r\n<p>It was established that the Home Finance provider could proceed directly to the Execution judge to execute the mortgage deed without going to the courts. The judgment also highlights that pursuant to Article 173 (3) of the Law of Civil Procedures, it is not permissible to contest judgments by the appeal courts at cassation if they concern execution procedures.&nbsp;&nbsp;</p>\r\n<p>Execution procedures are steps taken by the execution judge in execution of judgments and other executory instruments by way of compulsory enforcement.&nbsp; 173(3) also encompasses disputes relating to the procedures falling within the jurisdiction of the execution judge.</p>\r\n<p><strong>Court of First Instance<br /></strong></p>\r\n<p>On 12.10.11, the judge dismissed the Home Finance Provider&rsquo;s application on the basis that the mortgage deed did not expressly state that the creditor-mortgagee had the right to obtain an executive attachment over the mortgaged property and therefore not entitled to request that it be sold by public auction before the end of the mortgage term (06.08.28)<br /><strong><br />Court of Appeal&nbsp;<br /></strong><br />The Home Finance Provider appealed the Court of First Instance judgment [Property Execution] and on 11.10.12, the Court of Appeal accepted the appeal in form and, on the merits, reversed the first instance decision and ordered that an executive attachment be imposed on the mortgaged property (in anticipation of selling it by public auction) and the Land &amp; Property Department be notified accordingly in accordance with its procedures and finally, the Home Finance provider was authorised to collect an amount equivalent to the principal amount of debt from the sale proceeds.<br /><strong><br />Court of Cassation&nbsp;&nbsp;<br /><br /></strong>The debtor/mortgagor appealed before the Court of Cassation on 05.03.12 seeking a reversal of the appealed decision. The Home Finance provider argued that no appeal against the Court of Appeal&rsquo;s decision was possible because it was final, pursuant to Article 173(3) of the Civil Procedure Law.<br /><br />The Home Finance provider&rsquo;s argument was accepted by the Court of Cassation on the basis of Article 173 (3) of the Civil Procedure Law and the last section of Article 17 of Law No. 3 of 1992 on the formation of the Dubai Courts, it reiterated that appeals at cassation are not available for disputes concerning enforcement where a request is made to bar, stay, continue, or invalidate enforcement, as the case may be, whether brought by a party to the enforcement action or otherwise, as long as the dispute concerns enforcement, whatever the amount or nature of the relief sought, be it provisional or substantive (except those actions specifically excluded by law such as an action for recovery of possession) where the final outcome is to allow or disallow enforcement as valid or invalid. This is known as an enforcement action.<br /><br />According to the grounds for relief, the action is a substantive enforcement action by the Home Finance Provider seeking an executive attachment over the property mortgaged in its favour, owned by the debtor-mortgagor, and registered in his name at the Land &amp; Property Department, Dubai and an order that the latter be notified to arrange for the property to be sold by auction in accordance with its applicable procedures, and that the creditor would be entitled to recover its debt from the sale proceeds pursuant to Articles 292, 293 of the Civil Procedure Law and Articles 25, 26 of Dubai Law No. 14 of 2008 concerning mortgages.<br /><br />The Home Finance Provider&rsquo;s requests were granted.&nbsp; The cassation appeal revolved around the issue of the writ of execution and the property in question and as this matter was adjudicated by the Court of Appeal, its decision cannot be appealed to the Court of Cassation. The appeal was dismissed with costs and AED 2,000 as advocate&rsquo;s fees with the deposit forfeited.&nbsp;&nbsp;</p>'),
	(85220,4645,'_content','field_59b649b5c8b2b'),
	(85221,4645,'lawUpdateArticleMonth','4640'),
	(85222,4645,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(85223,4645,'content_description','The judgment below highlights how a mortgage can be enforced by the Execution Court in the event a debtor defaults on paying the mortgage installments.  The mortgage deed, in this case, was silent on the issue of obtaining attachments over mortgaged property.'),
	(85224,4645,'_content_description','field_59b641c07f473'),
	(85225,4645,'pageSummary','The judgment below highlights how a mortgage can be enforced by the Execution Court in the event a debtor defaults on paying the mortgage installments.  The mortgage deed, in this case, was silent on the issue of obtaining attachments over mortgaged property.'),
	(85226,4645,'_pageSummary','field_59e59b307dec8'),
	(85227,4645,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-5/march-4/enforcement-of-a-mortgage.html'),
	(85228,4645,'_currentURL','field_59d35123ab1e7'),
	(85229,4645,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','569'),
	(85230,4645,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(85231,4645,'lawUpdateArticleWriters','1'),
	(85232,4645,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(85233,4645,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Zane Anani'),
	(85234,4645,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(85235,4645,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','z.anani@tamimi.com'),
	(85236,4645,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(85237,4645,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(85238,4645,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(85239,4645,'lawUpdateArticleNoWriters','1'),
	(85240,4645,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(85241,4645,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','410'),
	(85242,4645,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(85243,4645,'lawUpdateArticlePractices','1'),
	(85244,4645,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(85245,4645,'_yoast_wpseo_metadesc','The judgment below highlights how a mortgage can be enforced by the Execution Court in the event a debtor defaults on paying the mortgage installments. The mortgage deed, in this case, was silent on the issue of obtaining attachments over mortgaged property.'),
	(85246,4646,'content','<p>UAE Law no. 10 of 2008 defines Medical Negligence as an &ldquo;error caused by the lack of knowledge of technical matters when such knowledge is presumptive to exist in all those who practice the profession and that such error is due to negligence or substandard conduct (care)&rdquo;. <br /><br />This definition strives to maintain a balance between the protecting patients from the negligence of doctors and providing doctors with the freedom to practice without constant fear of medical malpractice suits which can be damaging to a doctor&rsquo;s reputation, if not career-ending.<br /><br />As set out in the below Dubai Court of Cassation Judgment, this balance is also reflected in the finding that a Doctor&rsquo;s medical responsibility is not to achieve a result, but rather to adhere to a professional standard of care towards a patient.<br /><br />Medical institutions and doctors are also required to carry adequate insurance, allowing doctors to practice without the fear of having to make huge payouts by way of compensation. <br /><br />In order to obtain a judgment against a doctor for medical malpractice/ negligence, three things must be established:<br /><br />1)&nbsp;That a duty of care was owed by the doctor to the patient; and<br />2)&nbsp;That the duty of care was breached due to the fact that the doctor failed to adhere to the correct standard of care; and<br />3)&nbsp;That the patient suffered damages as a result of the breach of the duty of care.<br /><br /><strong>Dubai Court of Cassation Case</strong> <br /><br />This case examined a doctor&rsquo;s duty of care towards his patient.<br /><br />The Claimant/patient was admitted to a hospital (the &ldquo;First Respondent&rdquo;) suffering from varicose veins in his left leg. He was examined by a doctor (the &ldquo;Second Respondent&rdquo;) who determined that he required surgery to remove the varicose veins. During the procedure the Second Respondent committed a medical error and cut a nerve in the patient&rsquo;s leg which was responsible for the movement of the leg. This resulted in the patient suffering from a 20% physical disability in his left leg. The Claimant therefore initiated proceedings before the Dubai Court of First Instance for damages. <br /><br />The Court of First Instance, after reviewing the appointed medical committee&rsquo;s report, awarded the Claimant the amount of AED 800,000. The First and the Second Respondents (the &ldquo;Respondents) subsequently appealed to the Court of Appeal and the award was reduced to AED 200,000. <br /><br />Both the Claimant and the Respondents challenged the Court of Appeal&rsquo;s judgment before the Dubai Court of Cassation. <br /><br />The Respondents&rsquo; arguments before the Court of Cassation were twofold:<br /><br />1-&nbsp;The Court of Appeal had erroneously established that the Second Respondent had committed negligent medical malpractice despite the fact that documents which had been submitted to the court contained a medical report which concluded that the Second Respondent did not breach his duty of care towards the patient; and&nbsp; <br /><br />2-&nbsp;The lower court when determining the sum awarded did not specify how the award was calculated in accordance with the damage allegedly suffered by the Claimant. <br /><strong><br />The Court of Cassation held:<br /></strong><br />1-&nbsp;The Court rejected the Respondents&rsquo; first argument on the basis that a doctor is not required to achieve a result (i.e. curing a patient) but rather has a professional duty to provide patients with competent medical care according to known scientific and technical principles in a manner that achieves the proper care for the patient.</p>\r\n<p>When measuring when the correct level of competent medical care was provided it needed to be established that an average competent doctor with the required scientific knowledge and technical expertise would have acted in the same way, taking into consideration the surrounding circumstances while following professional ethics as well as known scientific principles.</p>\r\n<p>When a doctor fails to provide such a duty of care, he or she is liable for damages suffered by the patient as long as it can be established that the damages were caused by the doctor&rsquo;s breach of his duty of care. Furthermore, the court has the discretion to determine whether the doctor has committed negligence from facts of the case.</p>\r\n<p>Further, the Court held that medical committee&rsquo;s report (upon which the judgments of the lower courts were based) set out that the patient was admitted to the hospital with the full ability to walk. After surgery to remove Varicose Veins; the patient lost the ability to move his left leg as a result of a nerve in his leg being cut during surgery. There was also a failure to take swift remedial measures in respect of this. The report also added that from a medical standpoint, the severing of such a nerve rarely happens in this type of surgery which demonstrates that the doctor had been negligent.</p>\r\n<p>2-&nbsp;The Cassation Court rejected the respondents&rsquo; second argument for the following reasons:<br /><br />Whilst the Court of Cassation recognized that the determination of whether damages had been suffered was ultimately subject to the review of the Court of Cassation, the sum awarded as compensation was to be determined by the court of substance (i.e. the lower courts) and was not subject to review by the Court of Cassation in circumstances where the court of substance had considered all of the elements of the damage and losses suffered by the injured party. <br /><br />The Court of Cassation held that the lower courts when calculating the award had correctly taken into account the following:<br /><br />a)&nbsp;The fact that Material Damage had occurred resulting in the patient suffering a physical disability which required compensating;<br />b)&nbsp;Moral Damages: the patient was a young man in the prime of life who due to the negligence of his doctor lost the ability to walk properly which affected his life. <br /><br />Accordingly, the Court of Cassation upheld the judgment of the Court of Appeal.</p>'),
	(85247,4646,'_content','field_59b649b5c8b2b'),
	(85248,4646,'lawUpdateArticleMonth','4640'),
	(85249,4646,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(85250,4646,'content_description','UAE Law no. 10 of 2008 defines Medical Negligence as an “error caused by the lack of knowledge of technical matters when such knowledge is presumptive to exist in all those who practice the profession and that such error is due to negligence or substandard conduct (care)”.'),
	(85251,4646,'_content_description','field_59b641c07f473'),
	(85252,4646,'pageSummary','UAE Law no. 10 of 2008 defines Medical Negligence as an “error caused by the lack of knowledge of technical matters when such knowledge is presumptive to exist in all those who practice the profession and that such error is due to negligence or substandard conduct (care)”.'),
	(85253,4646,'_pageSummary','field_59e59b307dec8'),
	(85254,4646,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-5/march-4/elements-for-determining-negligence.html'),
	(85255,4646,'_currentURL','field_59d35123ab1e7'),
	(85256,4646,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Taiba Al Saffar'),
	(85257,4646,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(85258,4646,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','t.alsafar@tamimi.com'),
	(85259,4646,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(85260,4646,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(85261,4646,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(85262,4646,'lawUpdateArticleNoWriters_1_lawUpdateAuthorName','Marwa El Mahdy'),
	(85263,4646,'_lawUpdateArticleNoWriters_1_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(85264,4646,'lawUpdateArticleNoWriters_1_lawUpdateAuthorEmail','m.elmahdy@tamimi.com'),
	(85265,4646,'_lawUpdateArticleNoWriters_1_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(85266,4646,'lawUpdateArticleNoWriters_1_lawUpdateAuthorLocation',''),
	(85267,4646,'_lawUpdateArticleNoWriters_1_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(85268,4646,'lawUpdateArticleNoWriters','2'),
	(85269,4646,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(85270,4646,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','410'),
	(85271,4646,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(85272,4646,'lawUpdateArticlePractices','1'),
	(85273,4646,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(85274,4646,'_yoast_wpseo_metadesc','UAE Law no. 10 of 2008 defines Medical Negligence as an “error caused by the lack of knowledge of technical matters when such knowledge is presumptive to exist in all those who practice the profession and that such error is due to negligence or substandard conduct (care)”.'),
	(85275,4647,'content','<strong>Background to the Case</strong>\r\n\r\nThe Claimant/our client, a Swiss watchmaker, is the owner of a trademark which had been registered in the office of origin, Switzerland, with the World Intellectual Property Organisation (WIPO) and also registered internationally.  The Claimant lodged an application to register their trademark in Qatar, which consisted of a semi-figurative trademark featuring the company name and a symbol, with the Ministry of Business and Trade’s Industrial Property Rights Office.  The application was accepted and as part of the examination period was published for opposition purposes in the monthly Official Gazette.\r\n\r\nAn objection to the registered trademark was filed with the Trademark’s Registrar by the Defendant on the grounds that the Claimant’s trademark shared an identical symbol to theirs.  The Registrar issued a decision upholding the objection made by the Defendant and the registration process was halted.\r\n\r\n<strong>Ruling of the Court of First Instance (civil division)\r\n</strong>\r\nThe Claimant contested the decision of the Registrar before the Court of First Instance based on  the provisions of Article 6(5) of the Paris Convention (of which Qatar is a signatory state) and Article 8 of Qatar’s Trademark Law No 9 2002.\r\n\r\nThe Claimant stated their trademark differed from that of the Defendant’s based on the following reasons:\r\n<ul>\r\n 	<li>Pursuant to Article 8 (1) of the Trademark Law No 9 of 2002 certain symbols, including the contested one, are generic symbols which cannot be registered as a trademark;</li>\r\n 	<li>The two trademarks were different both in size and shape; and</li>\r\n 	<li>The two trademarks differ in the overall appearance and are distinct from one another.</li>\r\n</ul>\r\n<strong>The Court of First Instance rejected the claim on the following grounds:\r\n</strong>\r\n<ul>\r\n 	<li>The trademarks were similar in appearance;</li>\r\n 	<li>The symbol in question was identical to that of the Claimant; and</li>\r\n 	<li>The main distinguishing feature of the trademark being the symbol would cause confusion to the consumer as to the source of the trademark.</li>\r\n</ul>\r\nIn reaching its decision to uphold that of the Registrar, the Court also took into account the fact that the Defendant had registered their trademark in Qatar before the Claimant did.\r\n<strong>\r\nJudgment of the Court of Appeal (civil division)</strong>\r\n\r\nThe Claimant/our client appealed against the Judgement before the Court of Appeal based on the aforementioned reasons and argued that the Court of Cassation had previously issued a principle which had stated that in assessing the degree of similarity between two trademarks, the trademark should be examined in its entirety and not solely on a particular feature or aspect.\r\n\r\nThe Court of Appeal overruled the findings of the Court of First Instance and ruled in favour of the Claimant.  In deciding the case, the Court of Appeal applied the balancing test, where it viewed the overall aspects of the trademark and concluded that the trademarks were dissimilar and can be distinguished by the consumer.  They also viewed that the symbol in question was generic and the Defendant could not be afforded exclusivity of its use.  The Court of Appeal ruled that the Claimant be allowed to proceed with the registration of their trademark in Qatar.\r\n<strong>\r\nJudgment of the civil Court of Cassation\r\n</strong>\r\nThe Defendant did not appeal.  However, The Ministry of Business and Trade only appealed against the Judgement before the Court of Cassation based on the following arguments:\r\n<ul>\r\n 	<li>Based on Article 3/3 of the Law no. 7 of 2007 (Settlement of Administrative Disputes) the Administrative Court is alone entitled to look into the administrative disputes relevant to the requests presented by any entities aiming at the cancellation of the final administrative decisions. The controversial decision issued by the Ministry of Business and Trade’s Industrial Property Rights Office, thus the Administrative Division should be competent not the Civil Division, especially that Article 3/3 of the Law 7 of 2007 superseded Article 15/5 of Trade Mark Law no. 9 of 2002 which provides that The decision of the TM Office regarding the opposition shall be subject to appeal to the Civil Court...).</li>\r\n 	<li>The two trademarks were different both in size and shape; and</li>\r\n 	<li>The two trademarks differ in the overall appearance and are distinct from one another.</li>\r\n</ul>\r\n<strong>The Court of Cassation rejected the Ministry’s appeal on the following grounds:\r\n</strong>\r\n<ul>\r\n 	<li>The decision of the Ministry of Business and Trade’s Industrial Property Rights Office is not an administrative decision, because the aforementioned decision was taken regarding a trademark dispute between two private parties, and this dispute related to a private law (i.e. Trademark Law)</li>\r\n 	<li>The trademarks were dissimilar and can be distinguished by the consumer; and that the symbol in question was generic.</li>\r\n</ul>\r\nIn the light of the foregoing, the Court of Cassation upheld the judgment of the Court of Appeal and rejected the Ministry’s appeal.\r\n<strong>\r\nPractice Note:</strong>\r\n\r\nBased on the above, it is crucial for any party wanting to dispute a decision made by the Ministry of Business &amp; Trade to prove his rights on a Trademark, to be aware that the Civil Division is the competent division regarding the Trademark dispute, not the Administrative Division of the Civil Court regarding any controversial decision issued by the Ministry of Business and Trade’s Industrial Property Rights Office.  Therefore, this Judgment openly reserved the jurisdiction solely to the Civil Division Court.'),
	(150272,4647,'core_values',''),
	(150273,4647,'_core_values','field_59b64ab071de4'),
	(150274,4647,'file',''),
	(85276,4647,'_content','field_59b649b5c8b2b'),
	(85277,4647,'lawUpdateArticleMonth','4640'),
	(85278,4647,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(85279,4647,'content_description','Al Tamimi & Company’s Qatar Litigation team successfully won a recent lawsuit (Court of Cassation) brought on behalf of a Swiss watchmaker following a dispute which arose from the trademark registration process where the Swiss watchmaker was prevented from registering their trademark by a rival high end watchmaker for trademark infringement. \r\n'),
	(85280,4647,'_content_description','field_59b641c07f473'),
	(85281,4647,'pageSummary','Al Tamimi &amp; Company’s Qatar Litigation team successfully won a recent lawsuit (Court of Cassation) brought on behalf of a Swiss watchmaker following a dispute which arose from the trademark registration process where the Swiss watchmaker was prevented from registering their trademark by a rival high end watchmaker for trademark infringement.'),
	(85282,4647,'_pageSummary','field_59e59b307dec8'),
	(85283,4647,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-5/march-4/the-competent-courtdivision-regarding-qatar-trademark-disputes.html'),
	(85284,4647,'_currentURL','field_59d35123ab1e7'),
	(150256,4647,'lawUpdateArticleNoWriters',''),
	(150257,4647,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(85287,4647,'lawUpdateArticleWriters','1'),
	(85288,4647,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(85289,4647,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','410'),
	(85290,4647,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(85291,4647,'lawUpdateArticlePractices','2'),
	(85292,4647,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(85293,4647,'_yoast_wpseo_metadesc','Al Tamimi & Company’s Qatar Litigation team successfully won a recent lawsuit (Court of Cassation) brought on behalf of a Swiss watchmaker following a dispute which arose from the trademark registration process where the Swiss watchmaker was prevented from registering their trademark by a rival high end watchmaker for trademark infringement.'),
	(85294,4648,'content','<p>However, pursuant to a recent ruling by the Jordanian Court of Cassation, certain judgments issued by foreign religious courts may now have a greater chance of being enforced provided that certain conditions are met.<br /><br /><strong>Summary of facts:</strong></p>\r\n<ul>\r\n<li>The claimant filed a lawsuit against the defendant requesting the execution of a foreign Judgment in Jordan, obligating the latter to pay 941,904,600 Jordanian Dinars.</li>\r\n<li>The foreign Judgment was rendered by the Jeddah religious courts in the Kingdom of Saudi Arabia.</li>\r\n</ul>\r\n<p>Procedural History:</p>\r\n<ul>\r\n<li>The court of first instance ruled in favor of executing the foreign judgment in Jordan.</li>\r\n<li>The court of appeal ruled against the executing of the foreign judgment in Jordan.</li>\r\n<li>The court of cassation ruled in favor of the court of first instance judgment.</li>\r\n</ul>\r\n<p><strong>The court of cassation<br /></strong><br />A number of points were considered by the Court of Cassation including:<br /><br />-&nbsp;Whether the claimants held a valid power of attorney (it was not executed when the claimants were in Jordan).<br />-&nbsp;Whether there was a violation of article 102 of the Jordanian Constitution of 1952 which provides that:<br /><br />&nbsp;&ldquo;The Civil Courts in the Hashemite Kingdom of Jordan shall have jurisdiction over all persons in all matters, civil and criminal, including cases brought by or against the Government, except those matters in respect of which jurisdiction is vested in Religious or Special Courts in accordance with the provisions of the present Constitution or any other legislation in force&rdquo;<br /><br />-&nbsp;Whether there was a breach of article 25/B of the Riyadh Convention on Judicial Co-operation.<br />-&nbsp;Whether there was a breach of articles 99 and 27 of the Jordanian Constitution.<br /><br /><strong>The Decision</strong><br /><br />After reviewing all the facts provided by both parties to the case, the Court of Cassation ruled in favour of upholding the decision issued by the Court of First Instance in that they ruled in favour of executing the foreign judgment in Jordan.<br /><br />Furthermore, the Court of Cassation&rsquo;s ruling in favour of executing the Saudi judgment in Jordan set a new precedent in that it defied the provision of Article 99 of the Constitution. Article 99 provides that judgments issued by religious courts outside of Jordan are not enforceable in Jordan. However, the Court of Cassation held that the foreign judgment had to be enforced in Jordan as the same was, after being issued by the Religious Saudi Courts in the Kingdom of Saudi Arabia, certified by the Court of Cassation in Saudi Arabia and was awarded a preemptory status.<br /><br />In addition, the Court of Cassation found that the decision had been certified by all required parties and bodies which meant that in accordance with Article 34, in addition to Article 25/A, of the aforementioned Riyadh Agreement, the decision issued by the foreign Court of Cassation could be enforced in Jordan.<br /><br />Furthermore, the Court of Cassation provided in its decision that the courts that are requested to look into the enforceability of foreign judgments are not supposed to look into the merits of the case or alter the basis of its decision. It went on to determine that the tasks of the court were restricted to reviewing the basis of its enforceability in Jordan. Additionally, the Court of Cassation provided that in accordance with the Jordanian Law for the Implementation of Foreign Judgments No. 8 for the year 1952, Jordanian courts may reject the implementation of foreign judgments in Jordan under certain conditions, none of which were applicable to the case at hand.</p>'),
	(56444,3385,'_wp_attached_file','uploads/media-3384.jpg'),
	(56445,3385,'_wp_attachment_metadata','a:5:{s:5:\"width\";i:100;s:6:\"height\";i:133;s:4:\"file\";s:22:\"uploads/media-3384.jpg\";s:5:\"sizes\";a:0:{}s:10:\"image_meta\";a:12:{s:8:\"aperture\";s:1:\"0\";s:6:\"credit\";s:0:\"\";s:6:\"camera\";s:0:\"\";s:7:\"caption\";s:0:\"\";s:17:\"created_timestamp\";s:1:\"0\";s:9:\"copyright\";s:0:\"\";s:12:\"focal_length\";s:1:\"0\";s:3:\"iso\";s:1:\"0\";s:13:\"shutter_speed\";s:1:\"0\";s:5:\"title\";s:0:\"\";s:11:\"orientation\";s:1:\"0\";s:8:\"keywords\";a:0:{}}}'),
	(84845,4625,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84844,4625,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Manal Ben Said'),
	(84843,4625,'_currentURL','field_59d35123ab1e7'),
	(84438,4605,'_content','field_59b649b5c8b2b'),
	(84439,4605,'lawUpdateArticleMonth','4598'),
	(84440,4605,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84441,4605,'content_description','Introduction: Limitation of liability (LOL) clauses are commonly used in construction related contracts in the UAE and indeed in most parts of the world. '),
	(84442,4605,'_content_description','field_59b641c07f473'),
	(84443,4605,'pageSummary','Introduction: Limitation of liability (LOL) clauses are commonly used in construction related contracts in the UAE and indeed in most parts of the world. '),
	(84444,4605,'_pageSummary','field_59e59b307dec8'),
	(84445,4605,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/can-we-really-limit-liability.html'),
	(84446,4605,'_currentURL','field_59d35123ab1e7'),
	(84447,4605,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Faisal Attia'),
	(84448,4605,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84449,4605,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','f.attia@tamimi.com'),
	(84450,4605,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(84451,4605,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(84452,4605,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(84453,4605,'lawUpdateArticleNoWriters','1'),
	(84454,4605,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(84455,4605,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','537'),
	(84456,4605,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84457,4605,'lawUpdateArticlePractices','1'),
	(84458,4605,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84459,4605,'_yoast_wpseo_metadesc','Introduction: Limitation of liability (LOL) clauses are commonly used in construction related contracts in the UAE and indeed in most parts of the world.'),
	(84460,4606,'content','<p><span>In continuation of its objective of improving liquidity in the market and introducing international best business practices in the UAE, the SCA has recently issued four more regulations (&ldquo;Regulations&rdquo;). It is important to note that the Regulations have not been published in the Official Gazette. We would expect publication to take place within the next month. These Regulations, when implemented, would be landmark regulations. The four Regulations are:-</span><br /><br /><span>1.&nbsp;SCA Board Decision No. 48 of 2012 concerning the Regulations as to securities short selling (&ldquo;Short Selling Regulation&rdquo;):</span><br /><br /><span>Selling shares not owned by the seller at the time of sale is an activity that has always been prohibited by the SCA and the SCA has issued several notices to market members emphasizing this prohibition with warnings of severe penalties and cancellation of licenses to any person engaging in such activities.&nbsp; The SCA has now legalized short selling.</span><br /><br /><span>Currently, short selling has only been permitted to enable market makers to conduct their market making activity. Any other case for permitting short selling in the future would require approval by both the UAE exchange and the SCA. Additionally, securities in which short selling shall be permitted will require prior SCA approval. Securities may only be short-sold one month after their listing on any UAE exchange. There are provisions for suspension of short selling in securities.</span><br /><br /><span>Since a broker is obligated to ensure that it does not execute a short selling transaction except after ensuring its client&rsquo;s ability to deliver the concerned securities on the settlement date, a precondition to a short selling transaction may be a stock borrowing transaction by the short seller.&nbsp; The broker would also need to ensure that the price at which securities are short sold is higher than the last executed price. These restrictions would not apply to market makers short selling securities since such market makers would have provided an independent guarantee to the exchange.</span><br /><br /><span>Notwithstanding that the Short Selling Regulations do not obligate a market maker to enter into a stock borrowing transaction as a precursor to a short selling transaction, it may be likely from a legal perspective that a market maker has possession of the securities at the time of placing the short selling orders, since there is a risk that the UAE courts may disregard such a sale based on Shariah principles.</span><br /><br /><span>Failure to settle short sold securities could result in fines imposed on brokers or market makers and in some cases liquidation of bank guarantees provided by them to the exchange.</span><br /><br /><span>Each of the exchanges is expected to issue their internal by-laws that will govern the procedures for short selling.</span><br /><br /><span>2.&nbsp;SCA Board Decision No. 47 of 2012 concerning the Regulations as to lending and borrowing of securities (&ldquo;Securities Lending and Borrowing Regulations&rdquo;):</span><br /><br /><span>The SCA is proposing to provide an internationally accepted market framework whereby investors can borrow and lend securities. The scope of such transactions is essentially to assist market makers and for the purpose of covering a short position in a short sale transaction. Other cases would require SCA approval.</span><br /><br /><span>Such transactions may only be conducted through agents approved for such purpose by the SCA and counterparties to a transaction could either be the clearing house of the exchange or a borrowing/lending agent.</span><br /><br /><span>Approval granted to agents is valid for a year and requires the payment of fees to the SCA. Currently, custodians and brokerage houses licensed by the SCA and banks and investment companies licensed by the UAE Central Bank are eligible to apply and are required to comply with requirements placed by the SCA. SCA would respond to requests within 30 days.</span><br /><br /><span>Securities that are pledged or are under lien or purchased through margin trading or any other case determined by the exchange may not be the subject matter of a stock lending transaction.</span><br /><br /><span>The Securities Lending and Borrowing Regulations provide the minimum criteria to be set out in a stock lending agreement. The security to be provided by the borrower could be:-</span><br /><br /><span>(i)&nbsp;a cash guarantee of at least 105% to be retained by the lender&rsquo;s agent;</span><br /><br /><span>(ii)&nbsp;bank guarantee of at least 105%. If the lender is an individual resident, then such guarantee can only be provided by a local bank; or</span><br /><br /><span>(iii)&nbsp;securities owned by the borrower having a market value of at least 110% to be retained at the clearing house. If the lender is an individual resident then the securities offered as security would need to be UAE listed securities.</span><br /><br /><span>The Securities Lending and Borrowing Regulations place obligations on the agents which shall be supplemented with internal by-laws issued by each exchange and contain oversight and penal provisions. Lenders are entitled to sell the lent securities before redemption.&nbsp; It is important to note that transfer of ownership of securities related to lending and borrowing transactions are permitted to be off-exchange.</span><br /><br /><span>3.&nbsp;SCA Board Decision 46 of 2012 concerning the regulations as to Market Makers (&ldquo;Market Maker Regulations&rdquo;):&nbsp;</span><br /><br /><span>The regulations appear to be similar to those adopted by some stock exchanges in Europe. EU legislation concerning market making sets out a similar mechanism concerning market making or enhancing liquidity in stock listed on several EU exchanges.&nbsp;</span><br /><br /><span>The Market Maker Regulations permits brokerage houses licensed by the SCA and banks and investment companies licensed by the UAE Central Bank or other non financial UAE entities to apply for a license to conduct the activity of providing continuous prices for the purchase and sale of securities to increase their liquidity.&nbsp; A foreign company being similarly regulated in its home country and having been established in this area of practice for not less than five (5) years may also apply and register with a UAE exchange. Licenses shall be for a year and requires the payment of fees to the SCA.</span><br /><br /><span>An important positive development is the introduction of a new security namely, the issuance of warrants. Currently there are no regulations that govern the issuance of such warrants, however, we understand that these regulations are being finalized and should be out for public consultation in a couple of months.</span><br /><br /><span>Internal procedures and controls issued to regulate the market making activity shall be developed by the exchanges to provide for separate trading and settlement mechanisms, guarantees to be submitted to the exchange, obligations of market makers, standards for determination of eligibility of securities for market making, controls for execution of trades and trading commissions, reporting mechanisms. The Market Maker Regulations place continuous obligations on the market maker relating to due diligence, capital adequacy, reporting and record keeping requirements.&nbsp;</span><br /><br /><span>The market maker license is an important license since the SCA has granted exemptions to market makers from compliance with various requirements such as specific Articles of SCA&rsquo;s Disclosure Regulations. Market makers are permitted to engage in short selling of securities and in securities lending and borrowing transactions. They are permitted to issue warrants and if the issuer of warrants is a market maker then they are exempted from the requirement of having a minimum prescribed number of warrant holders. Securities subject to market making transactions may be permitted to be transferred off-exchange.</span><br /><br /><span>The Market Maker Regulations also contain oversight and penal provisions.</span><br /><br /><span>4.&nbsp;SCA Board Decision No. 49 of 2012 concerning the Regulations as to liquidity provision (&ldquo;Liquidity Provision Regulations&rdquo;):</span><br /><br /><span>The Liquidity Provision Regulations are supportive to the Market Making Regulations, whereby issuers of securities listed on UAE markets can directly engage market makers to enhance liquidity of the issuer\'s shares.</span><br /><br /><span>The requirement to have the Liquidity Provision Agreement approved by the Market seems overly burdensome and might result in over-regulation/over-intervention of the contractual freedom between liquidity providers and issuers. A notification that the criteria set out in the Liquidity Provision Regulations and as prescribed by the exchanges should have been sufficient compliance.</span><br /><br /><span>The liquidity provision ability of the liquidity provider is capped at 5% of the issuer&rsquo;s security. Additionally a liquidity provider is not permitted to be market maker for the same security. Exemptions available to market makers are also not granted to liquidity providers although they are required to comply with the same obligations placed on market makers.</span><br /><br /><span>It is not common practice in various markets that the agreement is publically disclosed.&nbsp; This proposed public disclosure of the amount of capital that would be allocated by the issuer to the liquidity provider under the Liquidity Provision Agreement is likely to affect the ability of the issuer to expeditiously inject additional capital for market making, should the publicly disclosed capital be utilized up.</span><br /><br /><span>The Liquidity Provision Regulations also contain oversight and penal provisions.</span></p>'),
	(84461,4606,'_content','field_59b649b5c8b2b'),
	(84462,4606,'lawUpdateArticleMonth','4598'),
	(84463,4606,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84464,4606,'content_description','The Securities and Commodities Authority (“SCA”) issued new fund regulations (which came into effect on August 26, 2012) and pursuant to which the SCA has taken over the regulation of domestic and foreign funds.'),
	(84465,4606,'_content_description','field_59b641c07f473'),
	(84466,4606,'pageSummary','The Securities and Commodities Authority (“SCA”) issued new fund regulations (which came into effect on August 26, 2012) and pursuant to which the SCA has taken over the regulation of domestic and foreign funds.'),
	(84467,4606,'_pageSummary','field_59e59b307dec8'),
	(84468,4606,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/new-sca-securities-regulations.html'),
	(84469,4606,'_currentURL','field_59d35123ab1e7'),
	(84470,4606,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','838'),
	(84471,4606,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(84472,4606,'lawUpdateArticleWriters','1'),
	(84473,4606,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(84474,4606,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','411'),
	(84475,4606,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84476,4606,'lawUpdateArticlePractices','1'),
	(84477,4606,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84478,4606,'_yoast_wpseo_metadesc','The Securities and Commodities Authority (“SCA”) issued new fund regulations (which came into effect on August 26, 2012) and pursuant to which the SCA has taken over the regulation of domestic and foreign funds.'),
	(84479,4607,'content','<p>Generally speaking, these standard contracts have been prepared in the UK, Europe, or the United States having regard to local laws applicable to the foreign corporation in its home country.&nbsp; The \"Governing Law\" clause tends to be towards the back of the contract, and the parties may come to consider this towards the end of the negotiations.&nbsp; There may be a tendency on the part of the foreign corporation, in the interests of closing the deal, to agree with the request of the local customer that the contract be governed by UAE law (with UAE courts having jurisdiction).&nbsp; That could be an entirely reasonable commercial approach for the foreign corporation to take.&nbsp; What can be of concern is when the foreign corporation takes the view that, if there is a dispute under the contract at a later time, this choice of UAE law and UAE courts is unlikely to make much of a difference to the foreign corporation\'s position.&nbsp; That, quite simply, is not the case.<br /><br />We do not have the space here to provide a detailed comparison of UAE law with the laws of other key \"technology-originating countries\" such as the US or the UK (although we are asked to provide such advices on a case-by-case basis).&nbsp; For the purpose of this article we wanted to highlight some key issues in the context of technology contracts, which may come as a surprise to lawyers and clients more familiar with the laws of their home countries.<br /><br /><strong>Liquidated damages</strong>&nbsp;<br /><br />Liquidated damages clauses are widely used in technology contracts.&nbsp; Article 390 of the UAE Civil Code (translated) states that: &ldquo;(1) The contracting parties may fix the amount of compensation in advance by making a provision therefore in the contract or in a subsequent agreement, subject to the provisions of the law. (2) The judge may in all cases, upon the application of either of the parties, vary such agreement so as to make the compensation equal to the loss, and any agreement to the contrary shall be void.&rdquo;&nbsp; This gives the Court the ultimate right (upon the application of one of the parties) to examine the level of pre-agreed, fixed compensation and increase or decrease the amount to reflect the actual loss suffered by a party.&nbsp; Liquidated damages are deemed to be ancillary contractual obligations, in the sense that they will not apply unless a primary obligation has been established in the first place.&nbsp; In other words, liquidated damages are not, per se, a cause of action for a claim for damages.&nbsp; Rather, they can only be invoked for establishing the amount of damages claimed.&nbsp; Recent cases have shown that something referred to as &ldquo;a penalty&rdquo;, being a more strict imposition of an amount regardless of whether a loss has been incurred, may not be upheld by a court, whereas a liquidated damages clause intended to reasonably quantify the loss likely suffered is more likely to be upheld.<br /><br /><strong>Interest on claims</strong><br /><br />Vendors often include interest clauses for late payments in supply contracts (although sometimes the interest may be referred to as an \"administrative fee\" or something similar).&nbsp; If the amount claimed was quantified at the time the claim was filed, then the court will grant to the claimant, in the money judgment, interest as from the time of filing the claim &ndash; or the date of judgment, it varies &ndash; until final payment.&nbsp; If the debt is confirmed by a contract, the court may even grant interest on the debt from the time the claimed amount became due until final payment.&nbsp; Under the UAE Commercial Code, if the subject matter of the commercial obligation is a sum of money of ascertained amount at the time the obligation arises, and the debtor delays in paying it, he will then be obliged to pay the creditor interest at the rate agreed in the contract, provided that it does not exceed 12% per annum.&nbsp; If there is no agreement in the contract for the payment of interest, then the judicial practice in the emirate of Dubai is that interest will be calculated at the rate of 9% per annum, with effect from the date the debt fell due for payment.&nbsp;<br /><br /><strong>Indemnities</strong><br /><br />There are no UAE law prohibitions on contracts containing indemnities in respect of any matters, either in respect of commercial matters generally or specifically in respect of intellectual property issues (the latter common in technology supply contracts).&nbsp; The UAE courts will generally require solid evidence to support the sums claimed under an indemnity.&nbsp; There are certain articles in the UAE Commercial Transactions Law which limit the amount of any indemnity in certain specific situations, but these are not relevant for present purposes.&nbsp; Article 290 of the UAE Civil Code states that it shall be permissible for the judge to reduce the level of indemnity or not to enforce an indemnity at all if the person suffering harm participated by his own act in bringing about or aggravating the harm.&nbsp; In all cases the indemnity shall be assessed according to the amount of harm suffered by the victim, together with loss of profit, provided that that is a natural result of the harmful act.&nbsp; Article 293 of the UAE Civil Code states that the right to indemnity for harm shall include moral harm, and an infringement of the liberty, dignity, honor, reputation, social standing or financial credit of another shall be regarded as being moral harm.&nbsp; The right to receive indemnification for moral harm may not be transferred to a third party unless the amount of it has been fixed by agreement or by a final judicial order.&nbsp; Further article 294 allows that the indemnity be made payable by installments or by way of a regular income.</p>\r\n<p><strong><br />Limit of liability for breach</strong><br /><br />It is said that, in general, the UAE courts will uphold limitation of liability clauses, unless there has been fraud or gross negligence, pursuant to Article 383 of the Civil Code.&nbsp; However, the concept of liability in this context must be appreciated.&nbsp; This is liability for failure to comply with a particular obligation, not financial liability (which is dealt with separately &ndash; see further below).&nbsp; The relevant article states (translated): &ldquo;If that which is required of an obligor is the preservation of a thing, or the management thereof or the exercise of care in the performance of his obligation, he shall have discharged that obligation if, in the performance thereof, he exercises all such care as the ordinary man would exercise, notwithstanding that the intended object is not achieved, unless there is an agreement or provision of law to the contrary.&nbsp; In all cases, the obligor shall remain liable for any fraud or gross error on his part.&rdquo;&nbsp; The article actually proposes a &ldquo;reasonable efforts&rdquo; level when assessing compliance but leaves this subject to agreement between the parties.&nbsp; With respect to total exemptions of liability, Article 296 of the Civil Code provides that &ldquo;Any condition purporting to provide exemption from responsibility for a harmful act shall be void.&rdquo;&nbsp; This is intended to deal with a prior stipulation of non-liability in respect of an unlawful act done by one person causing harm to another.&nbsp; As regards financial liability, Article 390 of the Civil Code provides (translated): &ldquo;The contracting parties may fix the amount of compensation in advance by making a provision therefore in the contract or in a subsequent agreement, subject to the provisions of the law.&nbsp; The judge may in all cases, upon the application of either of the parties, vary such agreement so as to make the compensation equal to the harm, and any agreement to the contrary shall be void.&rdquo;&nbsp;<br /><br /><br /><strong>Self-help means are valuable</strong><br /><br />We generally recommend to clients that any time spent in a technology contract negotiation on means of self-help, which could avoid the need to litigate disputes at a later point, is time well-spent.&nbsp; It is preferable not to have key issues such as those above before a Court.&nbsp; Thus it is our recommendation that if a technology vendor is considering adopting UAE law for a contract with a local customer, it should also consider building into the contract self-help means which they might not typically use in other countries, or for which they may not always negotiate as rigorously.&nbsp; For instance:</p>\r\n<ul>\r\n<li>Payment milestones linked to time milestones, or at least deliverables which the vendor can control.</li>\r\n<li>Deemed acceptance upon a particular period of time expiring after testing, regardless of use or payment.</li>\r\n<li>It is an obligation of the customer to execute and deliver an acceptance certificate.</li>\r\n<li>Letters of credit for milestone payments which are to be made down the track.</li>\r\n<li>Avoid set off clauses including in relation to SLC&rsquo;s.</li>\r\n<li>Right to suspend service upon breach of threatened breach by customer.</li>\r\n<li>Vendor has ultimate responsibility for determining whether change control takes the project outside of the original scope.</li>\r\n<li>Maintenance starts from acceptance, and payment of maintenance is another deemed acceptance event.</li>\r\n</ul>'),
	(84480,4607,'_content','field_59b649b5c8b2b'),
	(84481,4607,'lawUpdateArticleMonth','4598'),
	(84482,4607,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84483,4607,'content_description','From time to time we act for foreign corporations who are looking to supply technology solutions to customers the UAE and who wish to do so using their \"standard\" technology supply contracts.'),
	(84484,4607,'_content_description','field_59b641c07f473'),
	(84485,4607,'pageSummary','From time to time we act for foreign corporations who are looking to supply technology solutions to customers the UAE and who wish to do so using their \"standard\" technology supply contracts.'),
	(84486,4607,'_pageSummary','field_59e59b307dec8'),
	(84487,4607,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/technology-contracts-exercise-care-in-choosing-a-governing-law.html'),
	(84488,4607,'_currentURL','field_59d35123ab1e7'),
	(84489,4607,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','David Yates'),
	(84490,4607,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84491,4607,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','d.yates@tamimi.com'),
	(84492,4607,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(84493,4607,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(84494,4607,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(84495,4607,'lawUpdateArticleNoWriters','1'),
	(84496,4607,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(84497,4607,'_yoast_wpseo_metadesc','From time to time we act for foreign corporations who are looking to supply technology solutions to customers the UAE and who wish to do so using their \"standard\" technology supply contracts.'),
	(84498,4608,'content','<p><span>In some cases, and especially with goods in transit, administrative complaints are not accommodated and hence the right holders&rsquo; option is to seek a court order. The common way to stop containers by way of a court order is to seek a preventive seizure decision from the court circuit allocated to address expedited requests.&nbsp;&nbsp;</span><br /><br /><span>This is an ex parte procedure which is subject to a financial security to be provided by applicant seeking the attachment order. Such security, which is determined by the Judge, would be kept with the court and be used for compensating the owner of the goods seized incase the owner is awarded damages as a result of this seizure.&nbsp; But when it comes to counterfeit goods, it is usually difficult to determine the financial security, because either the value of goods are difficult to determine, whether due to the counterfeit goods stuffed into container are mixed with genuine goods or with unrelated goods,&nbsp; or as in other cases, description of the goods on the bills of lading do not match the actual goods being shipped to avoid scrutiny by the customs authorities or to evade higher excise duties imposed to certain category of goods.&nbsp; Even in the event the court has determined a fixed amount as a financial security, this amount may remain on hold for several years particularly if the owner of the goods files a civil claim against the applicant on the basis of a wrongful infringement complaint.&nbsp; All these reasons have caused a trademark owner to rarely resort to expedited court order to stop and seize containers.</span><br /><br /><span>In a recent case, we had to resort to the court to stop a container in respect of goods arriving to the UAE port, the goods in transit.&nbsp; In order for the court to grant an expedited order to seize goods coming in transit, the court determined a substantially high financial security to be placed with the court before granting the preventive seizure. At this point, we amended our petition to the judge requesting a detailed report disclosing the types of goods and quantities subject of the container as a legal exercise is necessary to allow us to determine their estimated value of the goods in order to formally request the court to place an attachment order against each goods.&nbsp; Essentially this amended petition, served these same objectives as an attachment order against the container, in that it forced the customs authorities to seize the container and prevent it from being discharged, cleared or re-exported.&nbsp;</span><br /><br /><span>The order was obtained successfully from the Dubai Courts and enforced against a container for goods in transit, allowing both the trademark owner and the court to be able to receive a full report of the suspected shipment and determine whether to proceed in taking legal action to enforce trademark rights.</span></p>'),
	(84499,4608,'_content','field_59b649b5c8b2b'),
	(84500,4608,'lawUpdateArticleMonth','4598'),
	(84501,4608,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84502,4608,'content_description','In the UAE, counterfeit goods at the Customs are stopped by an administrative complaint directly with the Customs Department. '),
	(84503,4608,'_content_description','field_59b641c07f473'),
	(84504,4608,'pageSummary','In the UAE, counterfeit goods at the Customs are stopped by an administrative complaint directly with the Customs Department. '),
	(84505,4608,'_pageSummary','field_59e59b307dec8'),
	(84506,4608,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/new-approach-to-seize-containers-through-court-orders.html'),
	(84507,4608,'_currentURL','field_59d35123ab1e7'),
	(84508,4608,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','897'),
	(84509,4608,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(84510,4608,'lawUpdateArticleWriters','1'),
	(84511,4608,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(84512,4608,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','634'),
	(84513,4608,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84514,4608,'lawUpdateArticlePractices','1'),
	(84515,4608,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84516,4608,'_yoast_wpseo_metadesc','In the UAE, counterfeit goods at the Customs are stopped by an administrative complaint directly with the Customs Department.'),
	(84517,4609,'content','<p>The tenth edition of the Nice Classification was entered into force on January 1, 2012.&nbsp; The previous one was the ninth edition of the Nice Classification and had been in force since January 1, 2007.<br /><br />The number of classes in the 10th edition, as well as the class heading for each class, remains unchanged from the ninth edition. However, various goods have been moved from one class to another.&nbsp; For example, \'swimming belts\', \'swimming jackets\' and \'water wings\' have been moved from Class 9 to Class 28, \'soldering apparatus\', \'electric door openers\' and \'vending machines\' have been moved from Class 9 to Class 7 and &lsquo;entertainment and gaming devices&rsquo; are now classified uniformly in class 28.&nbsp; The gaming devices that are equipped with an external display screen or monitor were classified into Class 9 and those with built-in screen were classified in class 28 previously.&nbsp;<br /><br />The adoption of the 10th edition does not affect trademarks already filed/registered in Lebanon. Upon next renewal, the goods / classes affected by the change will be re-classified adequately.<br /><br />In the Middle East region, not all countries have adopted 10th edition of the Nice Classification, meaning that the same product or service may fall in different classes from country to country depends on which edition of the Nice Classification the country follows.&nbsp; As a result, it is important to bear in mind which edition of the Nice Classification applies when conducting clearance searches and filing trademark applications in a given country to ensure that applications are filed in the correct class.<br /><br />The table below classifies the countries in the ME region according to their adoption of the Nice Classification:<br /><br /></p>\r\n<table border=\"0\">\r\n<tbody>\r\n<tr>\r\n<td>Algeria, Bahrain, Cyprus, Egypt,<br />Jordan, Morocco, Syria, Tunisia and UAE,&nbsp;<br /><br /></td>\r\n<td><strong>10th</strong>&nbsp;Edition of the Nice Classification</td>\r\n</tr>\r\n<tr>\r\n<td>Iran, Oman and Saudi Arabia</td>\r\n<td><strong>9th</strong>&nbsp;Edition of the Nice Classification</td>\r\n</tr>\r\n<tr>\r\n<td>Gaza, Kuwait, Libya, Sudan, West Bank and Yemen</td>\r\n<td><strong>8th</strong>&nbsp;Edition of the Nice Classification</td>\r\n</tr>\r\n<tr>\r\n<td>Iraq and Qatar</td>\r\n<td><strong>7th</strong>&nbsp;Edition (with Iraq following a local sub-classification)</td>\r\n</tr>\r\n</tbody>\r\n</table>\r\n<p><br /><strong><br />Background:<br /></strong><br />The Nice Classification consists of a classification of goods and services for the purposes of registering trademarks and service marks. It is based on a multilateral treaty administered by World Intellectual Property Organization (WIPO). This treaty is called the Nice Agreement&nbsp; concerning the International Classification of Goods and Services for the Purpose of the Registration of Marks, which was concluded in 1957. This Classification is commonly referred to as the Nice Classification. The Nice Agreement is open to States party to the Paris Convention for the Protection of Industrial Property.<br /><br />The trademark offices of the contracting States of the Nice Agreement are required to include in the official documents and publications the numbers of the classes of goods and/or services.&nbsp; Use of the Nice Classification by national offices has the advantage of filing applications with reference to a single classification system. The preparation of applications is thereby greatly simplified, as the goods and services to which a given mark applies will be classified in the same way in all countries that have adopted it, although the differences between each edition of the Classification (as discussed above) raises some complications.<br /><br />The Nice Classification comprises the class headings accompanied by explanatory notes and an alphabetical list of goods and services, with the class in which each product or service is placed. The class headings describe in very broad terms the nature of the goods or services contained in each of the 34 classes of goods and 11 classes of services.&nbsp; In order to keep the Nice Classification up to date, it is continuously revised and a new edition is published every five years, although from this year onwards the review and issuing new editions with minor changes shall occur every year with substantial review and changes will continue to occur every five years. The revision is carried out by a Committee of Experts set under the Nice Agreement. All states party to the Agreement are members of the Committee of Experts.<br /><br />Although only 83 States are party to the Nice Agreement, the trademark offices of at least 150 States, as well as the International Bureau of WIPO, the African Intellectual Property Organization (OAPI), the African Regional Intellectual Property Organization (ARIPO), the Benelux Office for Intellectual Property (BOIP) and the Office for Harmonization in the Internal Market (Trade Marks and Designs) (OHIM) of the European Communities, actually use the Nice Classification.</p>'),
	(84518,4609,'_content','field_59b649b5c8b2b'),
	(84519,4609,'lawUpdateArticleMonth','4598'),
	(84520,4609,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84521,4609,'content_description','Lebanon has decided to adopt the Tenth Edition of the International Classification of Goods and Services for the purposes of the registration of Trademark under the Nice Agreement (Nice Classification).'),
	(84522,4609,'_content_description','field_59b641c07f473'),
	(84523,4609,'pageSummary','Lebanon has decided to adopt the Tenth Edition of the International Classification of Goods and Services for the purposes of the registration of Trademark under the Nice Agreement (Nice Classification).'),
	(84524,4609,'_pageSummary','field_59e59b307dec8'),
	(84525,4609,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/lebanon-adopted-10th-edition-of-the-nice-classification.html'),
	(84526,4609,'_currentURL','field_59d35123ab1e7'),
	(84527,4609,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','884'),
	(84528,4609,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(84529,4609,'lawUpdateArticleWriters','1'),
	(84530,4609,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(84531,4609,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','634'),
	(84532,4609,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84533,4609,'lawUpdateArticlePractices','1'),
	(84534,4609,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84535,4609,'_yoast_wpseo_metadesc','Lebanon has decided to adopt the Tenth Edition of the International Classification of Goods and Services for the purposes of the registration of Trademark under the Nice Agreement (Nice Classification).'),
	(84536,4610,'content','<p><span>Perhaps the most obvious criterion, but one which is often overlooked, is the requirement that parties who wish to arbitrate their disputes must have a valid arbitration agreement.&nbsp;</span><br /><br /><span>The UAE Civil Code (see Article 203(1)) allows parties to insert an arbitration clause in the main agreement / contract (arbitration clause), or to enter into a subsequent agreement to arbitrate. Other important requirements are that the arbitration agreement must be in writing and signed by a person capable of binding the party in question to arbitration.</span><br /><br /><span>Of course, as with any commercial transaction, the thought that the relationship may deteriorate to the point where a dispute may arise is often not within the parties&rsquo; contemplation at the time of contract formation. The result of this can be the drafting of an arbitration clause which is invalid or impractical (i.e. pathological).</span><br /><br /><span>This article does not intend to cover the main ingredients of an arbitration clause or how to successfully draft one. It does, however, intend to cover the likely outcome when one party makes an assertion that either the main contract or the arbitration agreement therein is invalid. Such assertions are generally made with a view to claiming that an arbitrator does not have jurisdiction to determine the dispute which has arisen between the parties. The jurisdiction of the tribunal is, of course, absolutely fundamental to the issue of whether the arbitrators have the power to determine the dispute. Awards which are issued in the absence of jurisdiction lack legitimacy. A lack of jurisdiction presents one of the very few available grounds upon which a party can seek to have an award set aside in the competent court. Issues of jurisdiction are generally decided in the early phase of the proceedings, because before deciding on the substantive issues in dispute, a tribunal must satisfy itself that it has jurisdiction. It is, however, sometimes the case that a decision on jurisdiction will be indicated with the final award.</span><br /><br /><strong>Separability &amp; Competence-Competence<br /><br /></strong><span>The doctrines of separability and competence-competence have developed to reinforce and strengthen the jurisdiction of a tribunal. Both concepts are recognised in the UAE.</span><br /><br /><span>A distinction must be made between whether the issue at hand relates to the validity of the main contract or the validity of the arbitration agreement within that main contract, or both.</span><br /><br /><span>A determination as to the validity of the main contract (which contains an arbitration clause) is usually within the jurisdiction of an arbitral tribunal. This is because of the principle of separability. The essence of this principle, which is embodied in the rules of many arbitral institutions, including those of the DIAC and DIFC-LCIA, is that regardless of the validity of the main contract, including whether the main agreement has been terminated or was void from its very beginning, the arbitration clause within that main agreement is to be treated independently.</span><br /><br /><span>For example, Article 23.1 of the DIFC-LCIA Arbitration Centre Rules provides as follows:</span><br /><br /><span>The Arbitral Tribunal shall have the power to rule on its own jurisdiction, including any objection to the initial or continuing existence, validity or effectiveness of the Arbitration Agreement. For that purpose, an arbitration clause which forms or was intended to form part of another agreement shall be treated as an arbitration agreement independent of that other agreement. A decision by the Arbitral Tribunal that such other agreement is non-existent, invalid or ineffective shall not entail ipso jure the non-existence, invalidity or ineffectiveness of the arbitration clause.</span><br /><br /><strong>Similarly, Articles 6.1 and 6.2 of the DIAC Rules provide:<br /><br />6.1&nbsp;</strong><span>Unless otherwise agreed by the parties, an Arbitration Agreement which forms or was intended to form part of another agreement shall not be regarded as invalid, non-existence or ineffective because that other agreement is invalid, or did not come into existence or has become ineffective, and the Arbitration Agreement shall for that purpose be treated as a distinct agreement.</span><br /><br /><strong>6.2</strong><span>&nbsp;If any party raises one or more pleas concerning the existence, validity, scope or applicability of the arbitration agreement, then the Executive Committee may decide, without prejudice to the admissibility or merits of the plea or pleas, that the arbitration shall proceed if it is prima facie satisfied that an arbitration agreement may exist under the Rules. In such a case, any decision as to the jurisdiction of the Tribunal shall be taken by the Tribunal itself.</span><br /><br /><strong>The effect of the above is perhaps best demonstrated by an example:<br /><br /></strong><span>Party A and Party B enter into a main contract, in which they decide via an arbitration clause to resolve certain disputes arising out of or in connection with the main contract by way of arbitration. This arbitration clause is valid under UAE Law. Party A terminates the agreement for breach of contract by Party B. There is, however, a dispute between Party A and Party B over the quantum of damages owed by Party B to Party A for Party B&rsquo;s breach of contract. Notwithstanding the fact that the agreement has been terminated, the arbitration clause survives and the dispute over damages owed must be resolved by arbitration in accordance with the clause. Put simply, under the principle of separability the arbitration clause survives termination and provides the parameters by which disputes are to be resolved.</span><br /><br /><span>The legal doctrine of competence-competence assists by overcoming the curiosity which results from decisions of an arbitrator on his or her own jurisdiction. Under this theory, issues as to the validity of an arbitration agreement can be determined by a Tribunal. A quick example of this is as follows: Party A and Party B have an arbitration clause in a main contract. Party A thinks the clause is valid and commences proceedings against Party B, who thinks the clause is invalid. Party B launches a jurisdictional challenge on this basis, and the Tribunal rules accordingly. The end result could be that the Tribunal determines they do not have jurisdiction. The immediately obvious question then becomes, of course, the basis upon which an arbitral tribunal could have been empowered by the parties to determine its own jurisdiction in circumstances where the tribunal lacks jurisdiction? The doctrine of competence-competence, which is sometimes referred to as a legal fiction, has developed and found its place in most modern arbitration rules and laws to overcome this issue and also to avoid the parties having to involve the competent court at an early stage at potentially great expense.</span><br /><br /><span>It is important to note the difference between competence-competence and separability. The former allows the Tribunal to determine its jurisdiction. The latter has an impact on the outcome of that determination. Without separability, a tribunal employing competence-competence to determine its own jurisdiction may be required to deny jurisdiction of the substantive merits, because the arbitration clause could potentially be affected by the invalidity of the main contract.</span><br /><br /><strong>Partial Challenges<br /><br /></strong><span>Finally, arbitrators are often faced with a partial challenge to their jurisdiction. This may arise in a dispute over termination of the main contract where a party may be making a number of different claims for relief. Often, arbitration clauses contain pre-conditions before being able to arbitrate, such as the initial referral of a dispute to the Engineer for determination (as is often the case in FIDIC type contracts), or notification in writing to an opponent of the existence of a dispute. Pre-conditions to arbitration have been recognized and upheld by the UAE Courts.</span><br /><br /><span>In the above case, it often transpires that the party commencing arbitration proceedings has adhered to the pre-conditions to arbitration in the case of 6 out of 10 claims referred to arbitration. It may, therefore, be open to the responding party to argue that the arbitral tribunal has no jurisdiction to hear the remaining 4 claims, because the pre-conditions to arbitration were not satisfied. It is open to the arbitrators to rule on their own jurisdiction in such circumstances &ndash; i.e. to determine for themselves whether the pre-conditions have been satisfied, and, if not, whether the failure to satisfy them impacts adversely on their jurisdiction to determine the dispute relating to those claims.</span><br /><br /><strong>Role of the Courts in Jurisdiction<br /><br /></strong><span>Decisions of Tribunal&rsquo;s relating to jurisdiction are open to review by the competent court. In this respect, it is important to distinguish a decision on jurisdiction from a decision on the substantive merits &ndash; the latter form of decision is not open to review by the courts (save for very limited public policy grounds).&nbsp; If a decision on jurisdiction is reached in the preliminary stages of proceedings, it may be challenged in the competent court by one of the parties. As a general premise, this challenge should not serve to restrain the continuance of the arbitration proceedings. This general premise, which reflects international best practice, can be found in Article 8(2) of the UNCITRAL Model Law:</span><br /><br /><span>Where [a court action has been brought regarding a tribunal&rsquo;s jurisdiction], arbitral proceedings may nevertheless be commenced or continued, and an award may be made, while the issue is pending before the court.</span><br /><br /><span>Parties often seek to challenge a decision on jurisdiction in the competent court as a matter of tactics, perhaps in an attempt to delay or disrupt the arbitration proceedings. Arbitrators are not, however, obliged to stay the arbitration proceedings in such circumstances.</span></p>'),
	(84537,4610,'_content','field_59b649b5c8b2b'),
	(84538,4610,'lawUpdateArticleMonth','4598'),
	(84539,4610,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84540,4610,'content_description','In the UAE, arbitration is regarded as an exceptional and special dispute forum through which parties agree to resolve their disputes.'),
	(84541,4610,'_content_description','field_59b641c07f473'),
	(84542,4610,'pageSummary','In the UAE, arbitration is regarded as an exceptional and special dispute forum through which parties agree to resolve their disputes.'),
	(84543,4610,'_pageSummary','field_59e59b307dec8'),
	(84544,4610,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/doctrines-in-support-of-jurisdiction-an-overview.html'),
	(84545,4610,'_currentURL','field_59d35123ab1e7'),
	(84546,4610,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Claire Clutterham'),
	(84547,4610,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84548,4610,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','c.clutterham@tamimi.com'),
	(84549,4610,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(84550,4610,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(84551,4610,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(84552,4610,'lawUpdateArticleNoWriters','1'),
	(84553,4610,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(84554,4610,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','410'),
	(84555,4610,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84556,4610,'lawUpdateArticlePractices','1'),
	(84557,4610,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84558,4610,'_yoast_wpseo_metadesc','In the UAE, arbitration is regarded as an exceptional and special dispute forum through which parties agree to resolve their disputes.'),
	(84559,4611,'content','<p><span>In the absence of an express choice of the DIFC Courts&rsquo; jurisdiction, Article 5A(1) of the Judicial Authority Law sets out the following five jurisdictional gateways which confer exclusive jurisdiction on the DIFC Courts to hear and determine:</span><br /><br /><span>(a)&nbsp;civil or commercial claims and actions to which the DIFC or any DIFC Body, DIFC Establishment or Licensed DIFC Establishment is a party;</span><br /><br /><span>(b)&nbsp;civil or commercial claims and actions arising out of or relating to a contract or promised contract, whether partly or wholly concluded, finalized or performed within the DIFC or that will be performed or is supposed to be performed within the DIFC pursuant to express or implied terms stipulated in the contract;</span><br /><br /><span>(c)&nbsp;civil or commercial claims and actions arising out of or relating to any incident or transaction which has been wholly or partly performed within the DIFC and is related to DIFC activities;</span><br /><br /><span>(d)&nbsp;appeals against decisions or procedures made by DIFC Bodies where DIFC Laws and DIFC Regulations permit such appeals; and</span><br /><br /><span>(e)&nbsp;any claim or action over which the DIFC Courts have jurisdiction in accordance with DIFC Laws and DIFC Regulations.</span><br /><br /><span>Contracting parties falling within one or more of the jurisdictional gateways cited above may however wish to opt out of the jurisdiction of the DIFC Courts in favour of the local (non-DIFC) Dubai Courts, which they are entitled to do pursuant to Article 13(1) of DIFC Law No. 10 of 2005 as amended (the Law relating to the application of DIFC Laws).&nbsp; Article 13(1) provides that a &ldquo;submission to the courts of a jurisdiction in a contract shall be effective&rdquo;.&nbsp; Such parties must exercise particular care when drafting a suitable jurisdiction clause giving effect to their intention to opt out in favour of the local (non-DIFC) Dubai Courts.&nbsp; This is because the DIFC Courts have determined that they will ordinarily exercise jurisdiction over contracts that fall within the jurisdictional gateways but contain jurisdiction clauses that are vague to the extent that they do not clearly identify which of the courts of Dubai the parties agree shall have jurisdiction to hear disputes arising under or in relation to their contract.&nbsp;</span><br /><br /><span>In such cases the DIFC Courts will examine whether the background circumstances of a contract lead to the conclusion that the parties intended to submit to the DIFC Courts&rsquo; jurisdiction.&nbsp; Factors relevant to such a judicial conclusion include having contracting parties: (a) entering into their contract within the DIFC and subjecting it to DIFC Law; (b) located in the DIFC; (c) providing services under their contract from the DIFC; and (d) with an English-language contract and related documentation.&nbsp;</span><br /><br /><span>These factors were expressly identified in Injazat Capital Limited and Injazat Technology Fund B.S.C. v Denton Wilde Sapte &amp; Co. (CFI 019/2010) earlier this year.&nbsp; In its judgment the DIFC Court determined that a reference to the &ldquo;exclusive jurisdiction of the Dubai courts&rdquo; in the terms of engagement of a DIFC-based law firm gave the DIFC Courts jurisdiction on the grounds that the DIFC Courts are also courts of Dubai.&nbsp; The Defendant law firm had argued that the phrase &ldquo;exclusive jurisdiction of the Dubai courts&rdquo; was a valid opt out of the DIFC Courts&rsquo; jurisdiction exclusively in favour of the local (non-DIFC) Dubai Courts.&nbsp;</span><br /><br /><span>In Injazat, the DIFC Court acknowledged that a distinction can be drawn between the Dubai Courts as established under Dubai Law No. 3 of 1992 and the DIFC Courts established under the Judicial Authority Law.&nbsp; However, the DIFC Courts looked to what the parties had intended by their reference to the &ldquo;Dubai courts&rdquo; and decided that the burden was on the DIFC-based law firm to establish that its terms constituted an agreement to opt out of the DIFC Courts&rsquo; jurisdiction.&nbsp; As the law firm is a DIFC entity it did not meet this burden.</span><br /><br /><span>This issue only arises where at least one of the contracting parties is a DIFC entity or one or more of the other jurisdictional gateways conferring exclusive jurisdiction on the DIFC Courts is engaged and the disagreement is whether the applicable jurisdiction clause can be taken to constitute an &ldquo;opt out&rdquo; of the DIFC Courts&rsquo; jurisdiction, thereby conferring jurisdiction on the local (non-DIFC) Dubai Courts.&nbsp;</span><br /><br /><span>Where none of the jurisdictional gateways conferring exclusive jurisdiction on the DIFC Courts are engaged and the parties have not expressly opted into the jurisdiction of the DIFC Courts, the usual jurisdiction provisions in a contract should suffice.&nbsp; However, in order to eliminate any remaining risk of being involuntarily drawn into the net of the DIFC Courts, a jurisdiction clause should still make it clear that a reference to the &ldquo;Dubai Courts&rdquo; is to the local (non-DIFC) Dubai Courts and not to the DIFC Courts.&nbsp; Therefore, where a party or transaction with any link to the DIFC intends to contract out of the DIFC Courts&rsquo; jurisdiction and refer disputes to the local (non-DIFC) Dubai Courts, the jurisdiction clause should make it clear that all disputes are to be referred to the Dubai Courts as established under Dubai Law No. 3 of 1992.</span></p>'),
	(84560,4611,'_content','field_59b649b5c8b2b'),
	(84561,4611,'lawUpdateArticleMonth','4598'),
	(84562,4611,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84563,4611,'content_description','As is now widely known by lawyers and the business community in Dubai and beyond, Article 5(A)(2) of Dubai Law No.12 of 2004 as amended (the Judicial Authority Law) permits contracting parties to expressly agree to have any disputes arising between them resolved by the DIFC Courts, even if they have no other link to the DIFC.'),
	(84564,4611,'_content_description','field_59b641c07f473'),
	(84565,4611,'pageSummary','As is now widely known by lawyers and the business community in Dubai and beyond, Article 5(A)(2) of Dubai Law No.12 of 2004 as amended (the Judicial Authority Law) permits contracting parties to expressly agree to have any disputes arising between them resolved by the DIFC Courts, even if they have no other link to the DIFC.'),
	(84566,4611,'_pageSummary','field_59e59b307dec8'),
	(84567,4611,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/opting-out-of-the-exclusive-jurisdiction-of-the-difc-courts.html'),
	(84568,4611,'_currentURL','field_59d35123ab1e7'),
	(84569,4611,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','933'),
	(84570,4611,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(84571,4611,'lawUpdateArticleWriters','1'),
	(84572,4611,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(84573,4611,'_yoast_wpseo_metadesc','As is now widely known by lawyers and the business community in Dubai and beyond, Article 5(A)(2) of Dubai Law No.12 of 2004 as amended (the Judicial Authority Law) permits contracting parties to expressly agree to have any disputes arising between them resolved by the DIFC Courts, even if they have no other link to the DIFC.'),
	(84574,4612,'content','<p><span>In order to encourage constructive dialogue amongst parties and to encourage the use of conciliation to resolve disputes that may arise in respect of projects in Qatar, the Qatar International Center for Conciliation and Arbitration (QICCA) adopted a new set of Conciliation Rules in May 2012 (the &ldquo;QICCA Conciliation Rules&rdquo;), which are modelled on the UNCITRAL Conciliation Rules. In the wake of this welcome development, the Qatar International Court and Dispute Resolution Centre (QICDRC) has also prepared its own draft conciliation rules, which are expected to come into force in the near future. At contract drafting stage, parties to international contracts may now elect for the QICCA Rules, or those of the QICDRC (once adopted), as the procedural rules governing disputes arising under those contracts as an alternative to the more commonly used international institutional rules (such as the ICC Rules).&nbsp;</span><br /><br /><strong>The Conciliation Process under the QICCA<br /><br /></strong><span>In order for a dispute to be settled under the QICCA Conciliation Rules, the parties in a contractual relationship must agree that the dispute between them will be settled, in the first instance, by means of conciliation pursuant to the QICCA Conciliation Rules. In order to initiate the conciliation process under the QICCA Conciliation Rules, a party must file a conciliation request, setting out a pr&eacute;cis of the dispute, with the QICCA, and pay the required fee. The QICCA will then, within seven days, notify the other named party of the filing. The conciliation process does not officially commence until the other party expresses in writing its agreement to participate in the process. Unless otherwise specified in the Notice of Conciliation, the respondent is afforded two weeks from the date the QICCA sends the Notice of same to reply; otherwise the conciliation will not proceed. The QICCA Conciliation Rules do not stipulate as to the details to be included in the Notice of Conciliation, other than the required summary of the dispute. However, it is to be assumed such Notice ought to include the names and contact details of other parties, and the details relating to the method to be used to select a Conciliator, where same is not specified in the dispute resolution clause in the contract.</span><br /><br /><span>Under the QICCA Rules, the process shall be conducted by one mutually agreed-upon Conciliator, unless the otherwise stipulated by the parties in their contract. However, where the parties have agreed to appoint two Conciliators, each party is permitted to nominate one of its choosing. Where three Conciliators are to be appointed, the parties shall attempt to reach agreement with regard to the third. The parties may seek the assistance of the QICCA with respect to the designation of the Conciliators. In all cases, when individuals are nominated or appointed to work as Conciliators, the QICCA shall take into consideration the requirement for the Conciliators to remain neutral and independent in the performance of their duties. To that end, Conciliators must, within one week of their appointment, disclose any circumstances that may give rise to justifiable doubt in relation to their neutrality or independence. Furthermore, appointment of a Conciliator shall not be considered complete until the Conciliator accepts the nomination.</span><br /><br /><span>The Conciliator must ensure that the parties are treated fairly and equally and that they have been provided with adequate opportunity to present their case. The parties shall undertake to cooperate with the Conciliator in good faith and to comply with the Conciliator&rsquo;s requests to attend meetings and to provide evidence. Absent any agreement between the parties to the contrary, communications with the parties may be oral or in writing and the location of any meetings is to be determined by the Conciliator after having consulted the parties. The Conciliator is obliged to use their best endeavours to bring the parties to settlement in the time frame available, and in any event within three months, unless the parties agree to extend the process. The Conciliator shall abide by the parties&rsquo; instructions throughout the Conciliation in relation to what information, if any, is to be treated as confidential. The conciliation process terminates once the parties reach and sign a settlement agreement (discussed further below), or where the Conciliator informs the QICCA in writing (after consulting the parties) that the conciliation process has reached a deadlock, or upon notification by any of the parties to the QICCA confirming that such party no longer wishes to participate in the process.</span><br /><br /><strong>The Settlement Agreement<br /><br /></strong><span>When the parties to conciliation reach an agreement in relation to settlement of their dispute, a Settlement Agreement shall be drafted by the Conciliator and circulated to the parties for their signatures. The parties may wish to, and be given, an opportunity to comment on the draft Agreement and the Conciliator may reformulate same accordingly. The final Agreement, once signed by both parties, shall be considered binding and enforceable upon them.</span><br /><br /><span>The status of Settlement Agreements internationally, and particularly with regard to enforcement, is the subject of some debate. In some jurisdictions, Settlement Agreements may be enforced in the same manner as any other contract; in others, such agreements will only acquire the power to bind the parties where the dispute resolution clause which provided for the parties to enter into conciliation also stipulated that those parties may have recourse to arbitration should they fail to reach agreement at conciliation, in which case the Settlement Agreement may be given the force of an arbitral award.</span><br /><br /><span>Notwithstanding the fact that the QICCA Conciliation Rules, as well as their equivalent alternatives, provide for such agreements to be binding and enforceable, any party to a Settlement Agreement may decide, after signing a Settlement Agreement, not to abide by it for any reason it may consider valid. It is arguable that such a scenario would return the parties, who had initially selected conciliation in order to avoid having recourse to arbitration or to judicial intervention, back to their original positions. In such circumstances, would the party in default be in breach of a contractual obligation and, if so, would the other party seek a court order for specific execution?</span><br /><br /><span>In the Qatari context, parties entering into a Settlement Agreement should have regard to the provisions of Qatar&rsquo;s Civil Code relating to &lsquo;compromises&rsquo;, enshrined at Articles 573 to 581, inclusive thereof. Pursuant to the aforementioned Articles, the parties must have proper capacity to dispose of or vary their rights under the contract and the Settlement Agreement must only affect the rights of the contracting parties; the settlement terms must be in writing; and the Settlement Agreement must clearly delineate between the rights being disposed of or varied, and those which are excluded from its scope. It would be prudent to include a severability clause in the Settlement Agreement, in order to preclude the application of Article 581 of the Qatari Civil Code, which operates to nullify a &lsquo;compromise&rsquo; agreement where any part of it is determined to be void or is annulled.</span><br /><br /><strong>Conclusion<br /><br /></strong><span>As Qatar works to achieve the objectives set out in Qatar National Vision 2030, and particularly to build the infrastructure required to facilitate the FIFA World Cup 2022, the domestic construction and engineering industries are experiencing unprecedented growth. Our experience in practice informs us that many of the contracts relating to the largest projects currently underway or about to be commenced in Qatar stipulate Qatari law as the governing law. In light of the foregoing, developments such as the QICCA&rsquo;s adoption of new Conciliation Rules are to be welcomed, bolstering as they do the machinery available to parties contracting in this jurisdiction for the resolution of contractual disputes.</span></p>'),
	(84575,4612,'_content','field_59b649b5c8b2b'),
	(84576,4612,'lawUpdateArticleMonth','4598'),
	(84577,4612,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84578,4612,'content_description','Parties to major international contracts, particularly within the construction industry, are increasingly opting to utilise conciliation in the hope of achieving early settlement of disputes arising from such contracts, prior to resorting to the lengthier and more costly arbitration procedure.'),
	(84579,4612,'_content_description','field_59b641c07f473'),
	(84580,4612,'pageSummary','Parties to major international contracts, particularly within the construction industry, are increasingly opting to utilise conciliation in the hope of achieving early settlement of disputes arising from such contracts, prior to resorting to the lengthier and more costly arbitration procedure.'),
	(84581,4612,'_pageSummary','field_59e59b307dec8'),
	(84582,4612,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/new-conciliation-rules-promulgated-in-qatar.html'),
	(84583,4612,'_currentURL','field_59d35123ab1e7'),
	(84584,4612,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Seem Maleh'),
	(84585,4612,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84586,4612,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','s.maleh@tamimi.com'),
	(84587,4612,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(84588,4612,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(84589,4612,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(84590,4612,'lawUpdateArticleNoWriters','1'),
	(84591,4612,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(84592,4612,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','410'),
	(84593,4612,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84594,4612,'lawUpdateArticlePractices','1'),
	(84595,4612,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84596,4612,'_yoast_wpseo_metadesc','Parties to major international contracts, particularly within the construction industry, are increasingly opting to utilise conciliation in the hope of achieving early settlement of disputes arising from such contracts, prior to resorting to the lengthier and more costly arbitration procedure.'),
	(84597,4613,'content','<p>Indeed, it has always been a sign of prestige and significant social status for a person to be chosen to mediate in order to resolve disputes. Additionally, Islamic teachings have traditionally prescribed mediation in order to resolve disputes in society. However, this cultural preference has not until recently been buttressed by robust structural frameworks.&nbsp; As such it would typically be undertaken on an ad hoc basis.&nbsp;&nbsp;&nbsp;&nbsp;<br /><br />As far as legislation is concerned, Jordan has previously enacted the Mediation in Resolving Civil Dispute Act 2006 in order to formalize the process of mediation. However, before discussing this act one needs to briefly introduce the Jordanian judicial system. This provides a bird eye&rsquo;s view of the matrix in which this Act operates. It is important to note that Jordan is still experimenting with its new mediation Act. There is therefore little empirical evidence that addresses the impact of this Mediation Act 2006 on the Jordanian judicial process.&nbsp;<br /><br />The Mediation Act 2006 states that a &ldquo;Judicial Management Centre&rdquo; shall be established at the Court of First Instance, known as the &ldquo;Mediation Management Centre&rdquo;.&nbsp; This is comprised of judges from the Court of First Instance and the Magistrate Court. These are known as &ldquo;Mediation Judges&rdquo;, and supported by an administrative team. One must also clarify that when parties to a dispute come to register their cases at the Court of First Instance and/or Magistrate Courts situated at the Palace of Justice in Amman, the Registrar initially asks the parties if they want the case to be considered by the Mediation Management Centre &ndash; which is attached to the Palace of Justice.&nbsp;<br /><br />The Chairman of the Judicial Council has the authority to designate what is known as &ldquo;Special Mediators&rdquo; &ndash; selected from retired judges, lawyers, professionals, etc.&nbsp; However, it is not yet clear why the law has designated the category of &ldquo;Special Mediators&rdquo;, as the parties themselves can appoint their own private mediators. The Mediation Act 2006 states that the Case Management Judge or the Judge of the Magistrate Court, after meeting with the parties in the dispute or their legal representatives, may refer the dispute, upon the request of the parties or after their approval, to the Mediation Judge or to a Special Mediator to resolve the dispute amicably.&nbsp; In all cases, the judge shall take into consideration, as much as possible, the parties\' agreement while naming the mediator.&nbsp; However, the role of the direct involvement of the parties of appointing private mediators is not overruled completely by the Mediation Act 2006. In this respect, the parties may appoint private mediators upon the approval of the Case Management Judge or the Magistrate Judge.&nbsp; From a procedural viewpoint the Mediation Act 2006 makes a distinction between the requirements when submitting the file to the Mediation Judge and the Special Mediators.<br /><br />The mediation judge reserves the right to ask the parties to submit a brief memorandum of their claims or defenses. When submitting to the latter, parties need to submit such briefs within a period not exceeding 15 days as of the date of the referral. In this respect, Art.(4) of the Mediation Act 2006 states that:&nbsp;<br /><br />\"Parties to the dispute need to attend mediation sessions or their legal representatives, particularly if they were juridical persons.&nbsp; As far as the mediator is concerned, it is up to him/her to determine the date of each hearing and notify the parties in dispute or their representatives of dates and locations.&nbsp; The mediator shall meet with the parties in and their representatives and discuss with them the subject matter of the dispute including their requests and defenses.&nbsp; For this purpose, the mediator may give his/her opinion, evaluate the evidences, and present the legal grounds, precedents and other procedures, which will facilitate the mediation process.&nbsp; As far as time constraints are concerned, the mediator shall complete the mediation process within a period not exceeding three months as of the date of referring the dispute to him\".<br /><br />If the mediator reached a settlement, totally or partially, he/she shall submit to the Case Management Judge or to the Magistrate Judge a report of such enclosed with the settlement agreement signed by both parties in the dispute to be ratified. This agreement shall be considered, after ratification, as final.&nbsp; However, if the mediator did not reach a settlement, he/she shall submit a report to the Case Management Judge or to the Magistrate Judge, indicating that the parties did not reach a settlement &ndash;provided that he/she clarifies in this report the scope of their compliance and their representatives in attending the mediation hearings.&nbsp;&nbsp;<br />If the mediation was not successful due to the absence of one of the parties or their representatives, the Case Management Judge or the Magistrate Judge may impose a fine on that party or their representative.&nbsp; However, upon the conclusion of mediation, the mediator needs to return to each party the memorandums and documents submitted, without retaining any copies thereof, subject to the legal liability.&nbsp; The mediation, which shall be confidential, once ratified by the parties, shall be considered final.&nbsp; Additionally, subject to nullity, even the Mediation Judge would not be able to review the decision.<br /><br />As for the characteristics of the Jordanian System of Mediation, please note that:</p>\r\n<ol>\r\n<li>The Jordanian system of mediation is largely court-based. When registering their cases at the Palace of Justice in Amman, the Court&rsquo;s Registrar will recommend referring disputes to the Mediation Management Centre.</li>\r\n<li>The Jordanian system of court-based mediation is still experimental. The Mediation Management Centre is attached only to the Palace of Justice in Amman and not spread throughout the country. The legal community is still positive about the role of mediation in Jordan and is highly complementary that Jordan is the first Arab country to enact a Mediation Act.&nbsp;</li>\r\n<li>Jordan accepts private mediation, and allows the parties to choose their own mediators. However, as seen above under the Mediation Act 2006, such type of mediation often lack some of the enforcement mechanisms accorded to court-based mediation.</li>\r\n<li>Jordanian mediation needs to be confidential. Mediators owe a duty of confidentiality to the parties and may not in general circumstance divulge their proceeding to unauthorized persons or public bodies.&nbsp;</li>\r\n<li>Court-based mediation in Jordan has a time constraint of three months to conclude within this time. This is seen as a step forward in order to cut costs and ensure that the process of mediation is timely and efficient.</li>\r\n<li>Although mediation in Jordan is a voluntary exercise, once it is court-based certain enforcement mechanisms are employed to ensure that the process is taken seriously. For example, parties to the dispute will be fined if they (or their legal representatives, if they are juridical persons) fail to attend mediation cessions.</li>\r\n<li>Once approved by the parties, court-based mediation outcomes in Jordan are final and cannot be abrogated. However, this is not the case when mediation is not court-based.&nbsp; If the parties do not agree to the decision of a private mediator, then they can bring the case to the courts. This is seen by some judges in Jordan as duplicating the process, and often requiring further regulation.&nbsp;<br />Jordan&rsquo;s experience with ADRs is still relatively new. However, despite this, Jordan has recently made commendable strides towards institutionalizing this process, and is increasing its attention to mediation.</li>\r\n</ol>'),
	(84598,4613,'_content','field_59b649b5c8b2b'),
	(84599,4613,'lawUpdateArticleMonth','4598'),
	(84600,4613,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84601,4613,'content_description','Mediation as a social phenomenon is a highly entrenched practice in Jordanian society. This stems from Jordan’s strong tribal roots which place high importance on the role of tribal leaders in mediating disputes.'),
	(84602,4613,'_content_description','field_59b641c07f473'),
	(84603,4613,'pageSummary','Mediation as a social phenomenon is a highly entrenched practice in Jordanian society. This stems from Jordan’s strong tribal roots which place high importance on the role of tribal leaders in mediating disputes.'),
	(84604,4613,'_pageSummary','field_59e59b307dec8'),
	(84605,4613,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/mediation-in-jordan.html'),
	(84606,4613,'_currentURL','field_59d35123ab1e7'),
	(84607,4613,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Alaa Al Bataineh'),
	(84608,4613,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84609,4613,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','a.albataineh@tamimi.com'),
	(84610,4613,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(84611,4613,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(84612,4613,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(84613,4613,'lawUpdateArticleNoWriters','1'),
	(84614,4613,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(84615,4613,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','410'),
	(84616,4613,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84617,4613,'lawUpdateArticlePractices','1'),
	(84618,4613,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84619,4613,'_yoast_wpseo_metadesc','Mediation as a social phenomenon is a highly entrenched practice in Jordanian society. This stems from Jordan’s strong tribal roots which place high importance on the role of tribal leaders in mediating disputes.'),
	(84620,4614,'content','<p>The contract between the parties contained an arbitration clause. Accordingly, the Claimant requested the court to appoint an arbitrator. The dispute between the parties related to the Defendant&rsquo;s unilateral termination of usufruct contracts between the parties. The Claimant, which considered the Defendant&rsquo;s termination to be unlawful, also desired that the arbitrator assesses the quantum of damages suffered by it by virtue of the purported unlawful termination.<br /><br /><strong>Facts of the Case<br /></strong><br />The Claimant was the owner of a Hotel, and had entered into four usufruct contracts with the Defendant with respect to that Hotel. The Claimant argued that it had fulfilled all its contractual obligations, but that the Defendant had taken possession over three out of the four outlets and closed them down. It was the Claimant&rsquo;s case that this was done without any legal basis or justification. Accordingly, on 7 September 2007 the Claimant sent the Defendant a letter of termination of the contracts and requesting the hand over of the outlets.<br /><br /><strong>Procedural History<br /><br /></strong>On 24 October 2007, the Court of First Instance referred the case to the Judicial Department of the Emirate of Abu Dhabi to appoint a sole arbitrator to arbitrate the dispute between the parties, based on the request of the Defendant.<br /><br /><strong>The Court also held:</strong></p>\r\n<ul>\r\n<li>That the arbitrator should deposit the Award and the appendices with the Court within 15 days from the date of issuance.</li>\r\n<li>That within 15 days of the arbitrator depositing the Award, a hearing session to authenticate this award would be set.</li>\r\n</ul>\r\n<p>The Defendant appealed this decision to the Court of Appeals and the Court of Cassation but both appeals were dismissed. On 28 January 2009 the arbitrator issued the award, and on 8 April 2009 the Court of First Instance authenticated the award. The Defendant then lodged an appeal with the Court of Appeal.<br /><br />The Court of Appeal upheld the lower&rsquo;s court decision. Consequently, the Defendant appealed to the Court of Cassation.<br /><br /><strong>Court of Cassation<br /><br /></strong>The Defendant argued that the Court of Appeal had erred in its decision to uphold the decision of the Court of First Instance. The basis for the Defendant&rsquo;s appeal was that the Award was null and void. The grounds for this argument were as follows:<br /><br />a)&nbsp;The authentication of the arbitral award should not be filed after the issuance of the final decision on 24 October 2007 that ended the dispute by appointing an arbitrator as it is not admissible to accept the interlocutory application that was submitted by the Claimant requesting the court to authenticate the arbitral award after the Court issued its final decision;<br /><br />b)&nbsp;The procedure for authenticating the Award as imposed by the Court had not been requested by the parties.<br /><br />c)&nbsp;That the Claimant should have had to initiate its own independent proceedings to demand that the Court authenticate the arbitral award.</p>\r\n<p>d)&nbsp;That the Court lacked the jurisdiction to oversee the case as the Tenancy Dispute Resolution Committee (TDRC), as per law No 20 of 2006 (as amended by Law no. 6 of 2009 for the Emirates of Abu Dhabi) was the appropriate legal entity for the resolution of the dispute. The Defendant argued that this was the case notwithstanding the presence of an arbitration clause.</p>\r\n<p>e)&nbsp;Finally, the Defendant argued that the arbitration award was void due to the invalidity of the arbitration clause in the contracts as the Claimant&rsquo;s representatives were not authorized in their Power of Attorney to sign the arbitration clause on behalf of the Claimant.<br /><br />In relation to the first point, the Court of Cassation relied on Article 213 of the UAE Civil Procedure Law in holding that arbitration can be conducted either through the Court (Articles 213(1) and 213(2)) or through an independent institution (Article 213(3)).<br /><br />The Court of Cassation stated that if parties participating in an institutional arbitration wanted to enforce or set aside the arbitral award, they should file a claim in the relevant Court according to article 42 of the Civil Procedure Law. However, the Court of Cassation held that the arbitration proceedings in this case had been conducted through the Court. The Claimant&rsquo;s plea to set aside the Award was therefore rejected because of Article 213(1) of the UAE Civil Procedure Law, which permits a party to enforce the award without the need to file a new case with the court.<br /><br />The Court rejected the Claimant&rsquo;s plea that the procedure for authenticating the Award as imposed by the Court had not been requested by the parties.&nbsp; In this regard, the Court relied on subsections 1 &amp; 2 of article 213,&nbsp; and accordingly the court decided that the parties can authenticate the arbitral award as stated in subsections 1 of this article without the need to file a new case with the court.<br /><br />The Court of Cassation held that the TDRC was the legal entity that is entitled to oversee disputes emanating from the tenant-landlord relationship. Moreover, the Court held that the mandatory provisions of Article 2 Law no.20 of 2006 as amended by Law no. 6 of 2009 for the Emirates of Abu Dhabi prohibit parties &ldquo;to agree to arbitrate any dispute arising out of the tenancy agreement&rdquo;.<br /><br />However, the Court noted that Article 2 of the same law excluded from its provision leases for hotels and building for tourism purposes, including furnished apartments. The Court found that the effect of Article 2 was such that the TDRC did not have jurisdiction over cases related to leases for hotels and building for tourism purposes, including furnished apartments. The Court reasoned that since contracts falling under Article 2 were not covered by TDRC, parties to these types of contracts should be granted a limited time within which to agree to arbitrate their tenant landlord disputes. In this case, the Court ruled that as the subject property was a hotel for tourism purposes the TDRC did not have jurisdiction.<br /><br />The Court of Cassation also rejected the Claimant&rsquo;s capacity argument. The Court held that pursuant to Article 203(4), only those who have capacity/competence to participate in dispute resolution proceedings can agree on arbitration. The Court clarified that this authority could be expressed or implied.<br /><br />Such authority would be considered express when it is conveyed verbally or in writing, and implicit when inferred from the circumstance, such as speech and conduct. The Court further held that the agreement to arbitrate can be incorporated as a clause in the contract between parties or as a separate independent agreement in the course of a dispute between both parties. However, this is not to be confused with the doctrine of separability which prescribes that an arbitration clause in a contract is to be treated as separate from that main contract. The Court found that in this case, all contracts concluded between the parties were signed by the representatives of the Claimant and sealed with its company stamp. The Court also found although the representatives who signed the agreements containing the arbitration clause did not have express authority to do so,&nbsp; there was communication regarding arbitration between these representatives and the duly authorized persons within the company. These communications, according to the Court, were strong evidence of an implied authority to enter into arbitration. Additionally, the Defendant did not dispute the authority of these representatives at any earlier stage.&nbsp;<br /><br />The result of the case was that the Court of Cassation rejected the Claimant&rsquo;s pleas. The award was held to be valid and enforceable.</p>'),
	(84621,4614,'_content','field_59b649b5c8b2b'),
	(84622,4614,'lawUpdateArticleMonth','4598'),
	(84623,4614,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84624,4614,'content_description','Claim: A commercial action was filed by a local company (“the Claimant”) before the Abu Dhabi Court against a Hotel operating company in the UAE (“the Defendant”). '),
	(84625,4614,'_content_description','field_59b641c07f473'),
	(84626,4614,'pageSummary','Claim: A commercial action was filed by a local company (“the Claimant”) before the Abu Dhabi Court against a Hotel operating company in the UAE (“the Defendant”). '),
	(84627,4614,'_pageSummary','field_59e59b307dec8'),
	(84628,4614,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/the-uae-courts-approach-with-respect-to-upholding-arbitration-awards-1.html'),
	(84629,4614,'_currentURL','field_59d35123ab1e7'),
	(84630,4614,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','929'),
	(84631,4614,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(84632,4614,'lawUpdateArticleWriters','1'),
	(84633,4614,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(84634,4614,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','410'),
	(84635,4614,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84636,4614,'lawUpdateArticlePractices','1'),
	(84637,4614,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84638,4614,'_yoast_wpseo_metadesc','Claim: A commercial action was filed by a local company (“the Claimant”) before the Abu Dhabi Court against a Hotel operating company in the UAE (“the Defendant”).'),
	(84639,4615,'content','<p><span>The Claimant requested an order that the Respondent pay the amount of AED1, 253,528 along with interest in addition to the value of the final certified payment certificate.</span><br /><br /><span>In the course of the pleadings, the Respondent amended the relief sought by requesting that the Court appoint an arbitrator to settle the dispute between the parties. Connected with this plea was a request that the action filed by the Claimant be dismissed on the basis that the Dubai Court had no jurisdiction to hear the dispute because the performance of the construction contract had occurred in the Emirate of Sharjah.</span><br /><br /><span>Appeals may not be filed against judgments issued pursuant to Article 204(1) of the UAE Civil Procedure Code which deal with the appointment or replacement of an arbitrator.</span><br /><br /><strong>Procedural History:</strong><br /><br /><span>On 28 December 2006 the Court of First Instance ordered the appointment of an accounting expert to act as an arbitrator, charged with resolving a dispute which had arisen between the parties. The Respondent appealed this judgment to the Court of Appeal, the court rejected the appeal on the basis of Article 204(2) of the UAE Civil Procedure Code. Consequently the respondent appealed this decision to the Court of Cassation. The Claimant therefore filed a memorandum in defense.&nbsp;</span><br /><br /><span>Respondent argued that the Court of Appeal erred in its reasoning.&nbsp; By this the Respondent was referring to its pleas before the Dubai Court of First Instance. The relevant pleas were:</span><br /><span>&nbsp;</span><br /><span>a)&nbsp;that Court lacked the jurisdiction to determine the Claimant&rsquo;s request because the construction contract had been performed in Sharjah;</span><br /><br /><span>b)&nbsp;that the appointment of the arbitrator was incorrect and should be revoked.</span><br /><br /><span>The Respondent further argued that the Court of Appeal had determined the inadmissibility of its appeal without having properly examined the arguments put forward in support. Further, the Respondent argued that this was because, at least on its interpretation of the Court of Appeal&rsquo;s reasoning, those arguments were not admissible by virtue of Article 204(2) of the UAE Civil Procedure Code. The Respondent took the view that its arguments were essential arguments which ought to have been properly addressed. The Respondent&rsquo;s position was that the judgment issued by the Court of Appeal was therefore defective.&nbsp;</span><br /><br /><strong>Court of Cassation held:<br /><br /></strong><span>The Court of Cassation held that the Respondent&rsquo;s argument was groundless. The Court of Cassation held that it had been consistently established that orders appointing arbitrators cannot be appealed. The Court of Cassation acknowledged that this was an exception to the general rule that decisions of the Court are capable of appeal.</span><br /><br /><span>The Court of Cassation further re-iterated that the principle of the &ldquo;unchallengeable&rdquo; judgment does not extend to other subject matters such as pleas regarding lack of jurisdiction or, importantly, judgments rejecting requests to appoint an arbitrator, or, finally, judgments determining other preliminary questions upon which the adjudication of the request to appoint or replace an arbitrator is dependant: judgments falling within these categories are subject to appeal.&nbsp;However, judgments appointing arbitrators are not.</span><br /><br /><span>It was noted by the Court of Cassation that the Respondent, in the course of defending the action initially filed by the Claimant, had in fact requested the appointment of an arbitrator to resolve the dispute which had arisen in respect of outstanding payments.&nbsp;&nbsp;</span><br /><br /><span>What the legislator meant by the concept of the &ldquo;unchallengeable judgment&rdquo; in Article 204(2) of the UAE Civil Procedure Code is that orders of the Court appointing arbitrators cannot be appealed. This is an exception to the general rule which permits the appeal of judgments by methods permitted by law. Appeals may not be filed against judgments issued pursuant to Article 204(1) of the UAE Civil Procedure Code and which deal with the appointment or replacement of an arbitrator. The principle of the &ldquo;unchallengeable&rdquo; judgment does not extend to other subject matter such as pleas regarding lack of jurisdiction or, importantly, judgments rejecting requests to appoint an arbitrator, or, finally, judgments determining other preliminary questions upon which the adjudication of the request to appoint or replace an arbitrator is dependant: judgments falling within these categories are capable of appeal.&nbsp;</span><br /><br /><span>The Court of Cassation, in dismissing the Companies&rsquo; appeal, emphasized that decisions to appoint or replace arbitrators made pursuant to Article 204(1) of the UAE Civil Procedure Code enjoyed the protection of the principle of the &ldquo;unchallengeable judgment&rdquo; contained in Article 204(2).</span></p>'),
	(84640,4615,'_content','field_59b649b5c8b2b'),
	(84641,4615,'lawUpdateArticleMonth','4598'),
	(84642,4615,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84643,4615,'content_description','Summary of facts: The Claimant filed an action before the Dubai Court of First Instance against two Companies (collectively known as “the Respondent”).'),
	(84644,4615,'_content_description','field_59b641c07f473'),
	(84645,4615,'pageSummary','Summary of facts: The Claimant filed an action before the Dubai Court of First Instance against two Companies (collectively known as “the Respondent”).'),
	(84646,4615,'_pageSummary','field_59e59b307dec8'),
	(84647,4615,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/dubai-challenging-the-appointment-of-an-arbitrator.html'),
	(84648,4615,'_currentURL','field_59d35123ab1e7'),
	(84649,4615,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','929'),
	(84650,4615,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(84651,4615,'lawUpdateArticleWriters','1'),
	(84652,4615,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(84653,4615,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Marwa El Mahdy'),
	(84654,4615,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84655,4615,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','m.elmahdy@tamimi.com'),
	(84656,4615,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(84657,4615,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(84658,4615,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(84659,4615,'lawUpdateArticleNoWriters','1'),
	(84660,4615,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(84661,4615,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','410'),
	(84662,4615,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84663,4615,'lawUpdateArticlePractices','1'),
	(84664,4615,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84665,4615,'_yoast_wpseo_metadesc','Summary of facts: The Claimant filed an action before the Dubai Court of First Instance against two Companies (collectively known as “the Respondent”).'),
	(84666,4616,'content','<p>&nbsp;Our team comprises dispute resolution lawyers based in Dubai, Abu Dhabi,  Sharjah, Qatar, Saudi Arabia, Jordan, Kuwait and Iraq with experience resolving  disputes in the local courts of each of the countries in which we operate, as  well as the Dubai International Financial Centre Court that is second to none.&nbsp;  Many of the senior individuals within the team are recognized as leading  practitioners in their field. Whatever problems our clients face, wherever they  occur in the Middle East and beyond, we are strategically placed to  assist.<br /><br />Led by Hassan Arab who is one of the leading and most respected  dispute resolution practitioners in the region, our team of highly qualified and  experienced practitioners from the Middle East, Europe, Australia, Africa and  North America brings a breadth and depth of legal expertise and experience that  is unequalled in the UAE and Gulf.&nbsp; Our lawyers include a team of UAE nationals  with rights of audience to appear before all Courts of law in the UAE. Not only  are our litigators licensed to appear before the local UAE Courts, we are also  honoured to have on our staff a retired senior judge who has served an  impressive thirty years behind the bench. We take pride that several of our  lawyers are recognized arbitrators who have acted as sole arbitrators in several  complex matters.<br /><br />In addition to the UAE litigation practice, Al Tamimi  has one of the largest and leading the Dubai International Financial Centre  (&ldquo;DIFC&rdquo;) Courts&rsquo; practice groups in the UAE led by Rita Jaballah.&nbsp; Al Tamimi was  actively involved in the establishment of the DIFC Courts and we have been  involved with the DIFC Courts&rsquo; Users&rsquo; Committee and DIFC Court Rules  Sub-Committee. We have a number of solicitors and barristers qualified in other  jurisdictions registered to appear before the DIFC Courts. To date we have been  involved in some of the leading DIFC Court of First Instance and the DIFC Court  of Appeal cases to come before the DIFC Courts.&nbsp;<br /><br />The teams&rsquo; success is  recognised by the leading legal directories with Chambers stating that our  lawyers &lsquo;excel at local law litigation&rsquo; and have commented that, &lsquo;the sheer  breath of the firms presence around the world ensures that clients can always  find informed advise on local disputes&rsquo;<br />Our clients rely on our global  perspective and our in-depth knowledge and understanding of local and regional  laws.&nbsp; We advise and represent clients involved in local, DIFC, regional and  international commercial disputes.&nbsp; Our familiarity with federal and local  government, federal and local laws, the laws and regulations of the Free Zones,  and with the many Courts and tribunals operating across the UAE and the Middle  East, enables our clients to conduct their affairs with increased certainty and  efficiency.&nbsp; <br /><br /><strong>OUR SERVICES AT A GLANCE&nbsp; INCLUDE:</strong></p>\r\n<ul>\r\n<li>Domestic and Regional Commercial, Banking and Finance, Intellectual  Property, Property, Construction and Employment Disputes and Litigation  (including all disputes filed before specialist tribunals such as the Rent  Committee and Specialist Judicial Committees</li>\r\n<li>Multijurisdictional Litigation</li>\r\n<li>Mediation and other forms of alternative dispute resolution</li>\r\n<li>Enforcement of foreign judgments and arbitral awards</li>\r\n<li>White collar crime and all forms of criminal prosecution and  defence</li>\r\n</ul>\r\n<p>What distinguishes Al Tamimi &amp; Company&rsquo;s Dispute Resolution practice from  others, though, is that, as part of the local community, we understand the local  culture. Emphasis on local knowledge and abilities has been and will continue to  be a key characteristic of the practice. Having international skills and talent  while remaining a local firm is one of the pillars of our  success.<br /><br /><strong>Key Contacts:<br /><br />Hassan Arab</strong><br />Deputy  Managing Partner<br />Regional Head of Litigation<br /><a href=\"mailto:h.arab@tamimi.com\">h.arab@tamimi.com</a><br /><strong><br /><br />Hussain  Eisa Al Shiri</strong><br />partner<br />Head of UAE Litigation<br /><a href=\"mailto:h.shiri@tamimi.com\">h.shiri@tamimi.com<br /></a><strong><br /><br />Ahmed  Allouz</strong><br />partner<br />Head of Dubai Litigation<br /><a href=\"mailto:a.allouz@tamimi.com\">a.allouz@tamimi.com</a></p>\r\n<p><strong><br />Rita Jaballah</strong><br />partner <br />Head of DIFC  Litigation<br /><a href=\"mailto:r.jaballah@tamimi.com\">r.jaballah@tamimi.com</a></p>\r\n<p><strong><br />Mohammed Al Marzouqi</strong><br />partner <br />Head of Litigation,  Abu Dhabi<br /><a href=\"mailto:z.oghil@tamimi.com\">m.almarzouqi@tamimi.com</a><br /><br /><strong><br />Zafar  Sheikh Oghli</strong><br />partner <br />Head of Sharjah office <br /><a href=\"mailto:z.oghil@tamimi.com\">z.oghil@tamimi.com</a><br /><br /><br /><strong>ARBITRATION<br /></strong><br />The  Arbitration team consists of international lawyers with considerable experience  of arbitrating disputes in a variety of regions and industries. The team is led  by Essam Al Tamimi who is a distinguished and highly respected practitioner and  speaker on both the local and international arbitration scene.&nbsp;The firm&rsquo;s  practitioners include lawyers from the UK, Australia, United States and India,  and they regularly write, consult and lecture on arbitration around the  world.</p>\r\n<p>The Firm&rsquo;s arbitration expertise extends to all types of disputes and  industries,  including:<br /><br />-&nbsp;Trade<br /><br />-&nbsp;Banking<br /><br />-&nbsp;Finance<br /><br />-&nbsp;Commodities<br /><br />-&nbsp;Corporate  and commercial problems<br /><br />-&nbsp;Agency disputes<br /><br />-&nbsp;Joint venture disputes  and company/corporate related issues<br /><br />-&nbsp;Shareholder  disputes<br /><br />-&nbsp;Fraud aspects arising out of international  trade<br /><br />-&nbsp;Bilateral investment treaty claims and matters arising out of  international treaties generally<br /><br />-&nbsp;Disputes relating to sale of goods and  commodities<br /><br />-&nbsp;Performance bonds, guarantees, letters of indemnity,  banking collateral agreements<br /><br />-&nbsp;Disputes regarding the sale, purchase and  construction of property and infrastructure<br /><br />-&nbsp;Insurance, re-insurance and  mutual assurance issues.</p>\r\n<p>The team regularly advises on the enforcement of domestic and foreign awards  in the Middle East, and provides expert witness evidence in arbitration  proceedings in various jurisdictions on a range of issues under UAE law.  <br /><br />The team also handles arbitrations conducted in Arabic, and works very  closely with other departments such as Construction, IP, Transport &amp;  Shipping and the Property Department to prevent and resolve our clients&rsquo;  problems.<br /><br />Our Arbitration lawyers have extensive experience in all types  of arbitration work including ICSID and UNCITRAL arbitrations and arbitrations  before the following:</p>\r\n<ul>\r\n<li>The Dubai International Arbitration Centre (DIAC)</li>\r\n<li>The DIFC &ndash; LCIA Arbitration Centre</li>\r\n<li>Abu Dhabi Commercial Conciliation &amp; Arbitration Centre (ADCCAC)</li>\r\n<li>GCC Commercial Arbitration Centre, Manama, Bahrain</li>\r\n<li>The International Court of Arbitration (ICC)</li>\r\n<li>The London Court of International Arbitration (LCIA)</li>\r\n<li>London Maritime Arbitrators Association, London Metal Exchange, the Refined  Sugar Association, Grain &amp; Feed Trade Association, Federation of Oils Seeds  and Fats Association, Coffee Trade Federation, Cocoa Association</li>\r\n<li>Kuala Lumpur Regional Centre for Arbitration</li>\r\n<li>Ad hoc arbitration tribunals in the UAE, Geneva, Stockholm and  Moscow</li>\r\n</ul>\r\n<p><br />Another key attraction Al Tamimi offers is that it is a one-stop shop  which covers every aspect of a commercial dispute, since it offers expertise in  mediation, conciliation, arbitration, and litigation, and can take a case from  the preliminary advisory stage all the way through to enforcement. Many firms  have to outsource their local court work to independent UAE law firms at great  expense and inconvenience to their clients, but that is not the case with Al  Tamimi &amp; Company. The Arbitration and Litigation teams work alongside each  other on a day-to-day basis to provide comprehensive and effective support to  our clients.<br /><br />The Arbitration and Litigation teams enjoy a varied and  interesting practice that deals with a wide range of problems.&nbsp; We believe it is  a real privilege for us to learn about our clients&rsquo; business and assist them in  any way possible. Although every problem is uniquely different, we believe there  is always a commercially pragmatic and effective solution, and we make sure we  attempt to find it for the benefit of those instructing us.<br /><br /><strong>Key  contact:</strong></p>\r\n<p><strong>Paul Turner</strong><br />Regional head of  Arbitration<br />p.turner@tamimi.com</p>'),
	(84667,4616,'_content','field_59b649b5c8b2b'),
	(84668,4616,'lawUpdateArticleMonth','4598'),
	(84669,4616,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84670,4616,'content_description','Litigation : Al Tamimi & Company boasts the largest, strongest and broadest dispute resolution practice in the Middle East. '),
	(84671,4616,'_content_description','field_59b641c07f473'),
	(84672,4616,'pageSummary','Litigation : Al Tamimi & Company boasts the largest, strongest and broadest dispute resolution practice in the Middle East. '),
	(84673,4616,'_pageSummary','field_59e59b307dec8'),
	(84674,4616,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/dispute-resolution-in-al-tamimi-company.html'),
	(84675,4616,'_currentURL','field_59d35123ab1e7'),
	(84676,4616,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','410'),
	(84677,4616,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84678,4616,'lawUpdateArticlePractices','1'),
	(84679,4616,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84680,4616,'_yoast_wpseo_metadesc','Litigation : Al Tamimi & Company boasts the largest, strongest and broadest dispute resolution practice in the Middle East.'),
	(84681,4617,'content','October 2013\r\n\r\n<hr />\r\n\r\nThe principle allows for the reduction of the agreed upon obligations of a party to a contract if that party’s performance was affected by an unforeseen public circumstances and justice warrants such a reduction by the judge. For this principle to be applicable, certain restrictions laid down by the legislator must be proven by the aggravated party whose contractual performance was rendered onerous by the unforeseen emergency. This principle is different than force majeure in that the latter renders the contractual performance impossible and thus the contractual obligations affected by it are cancelled.\r\n\r\nIn a recent case the Dubai Court of Cassation looked at the argument as to whether the Financial Crisis was sufficient cause to invoke the principle of exceptional circumstances as per Article 249 of the UAE Civil Code.\r\n\r\n<strong>Facts:</strong>\r\n\r\nA real estate developer entered into a sale agreement to sell a floor in one of its projects to an investment company. Later on, the parties agreed to terminate the agreement by virtue of a settlement agreement whereby the real estate developer took back the previously sold floor from the investment company for the amount of AED 25,300,176. However, the Claimant failed to pay the amount of AED 11,440,000 from the agreed upon settlement sum.\r\n\r\nThe investment company (the “Claimant”) filed an action before Dubai Court of First Instance against the real estate developer (the “Respondent”) requesting payment of the due amount plus 5% interest calculated from the date of each unsettled installment. The Respondent filed a counterclaim and requested the Court to abrogate the second agreement on grounds of Article 583 of the UAE Civil Code, and to reduce the due amount to a reasonable limit on grounds of exceptional circumstances as defined in Article 294 of the UAE Civil Code due to the occurrence of the global financial crisis.\r\n\r\n<strong>Procedural History:</strong>\r\n\r\nThe First Instance Court appointed an expert to look at Respondent’s performance of its contractual obligations. After submitting his report, the Court rendered its judgment as to the principal claim and ordered the Respondent to pay the amount of AED 11, 440,000 and 5% interest from the date of filing the claim until full payment and dismissed the counter claim.\r\n\r\nBoth the Claimant and the Respondent appealed the judgment to the Court of Appeals. The Court dismissed the Respondent’s appeal and increased the interest to 9% in response to the Claimant’s appeal and further upheld the lower court’s judgment as to all other aspects. Consequently, the Respondent filed an appeal before the Court of Cassation requesting to overturn the lower court’s judgment.\r\n\r\n<strong>The Court of Cassation:</strong>\r\n\r\nThe Respondent argued that the lower court erred in its application of the law when it relied in its judgment on the expert’s report and disregarded the Respondent’s argument as to its right for application of the principle of unforeseen circumstances stipulated under Article 249 of the UAE Federal Civil Transactions Law. While the Respondent would have performed its contractual obligations in usual circumstances, the occurrence of the Global Financial Crisis as an unforeseen public circumstance rendered performance of its obligations onerous and unreasonably excessive threatening it with vast losses due to the collapse of the real estate market. The collapse of the real estate market caused the deterioration of the Respondent’s financial status. Furthermore, it placed the Respondent’s business in daunting circumstances which led to financial distress and which requires reducing its contractual obligation to a reasonable level in accordance with the aforementioned article.\r\n\r\nThe Court of Cassation stated that it is well established that the basic rule in contracts is that it is not open to either of the two parties to a contract to unilaterally abrogate or vary from it nor is it permissible for the judge to do so. However, the legislator, in response to a pressing need necessitated by justice, laid down an exception, namely the exception of unforeseen circumstances as defined in Article 249 of the UAE Civil Code. The legislator has provided for material restrictions that must be present for the judge to be able to apply the aforementioned article, namely:\r\n<ol>\r\n 	<li>there must be an unforeseen event that rarely occurs and could not be predicated by the normal person;</li>\r\n 	<li>the unforeseen event is public and not only affecting the debtor or a limited scale of people;</li>\r\n 	<li>the event was not foreseen when the parties concluded their agreement and the criteria is the usual person measure;</li>\r\n 	<li>the debtor was unable to avoid the consequences resulted from the unforeseen event by exercising a reasonable effort;</li>\r\n 	<li>the unforeseen event occurred following concluding the agreement and prior to executing it;</li>\r\n 	<li>the unforeseen event rendered the performance of the obligation onerous threatening with unreasonable loss for the aggravated party; and</li>\r\n 	<li>in order to apply the principal of exceptional circumstances and to reduce the onerous obligation, the legislator used the term “if justice so required” which implies the necessitating of applying an objective judgment, and the judge has the discretion in characterizing the case facts and its evidence accordingly.</li>\r\n</ol>\r\nThe Court further stated that the Global Financial Crisis and its consequential influences on the countries can not be deemed as an exceptional unforeseen disaster or emergency that calls for application of Article 249 of the UAE Civil Code. The Court reasoned that financial unfavorable events occur frequently and could be anticipated in general. Moreover, the Respondent did not dispute the amount owed; they simply wanted it to be reduced based on the Financial Crisis. Therefore, the Respondent’s request to reduce its obligation set forth in the settlement agreement on grounds of Article 249 is groundless, and thus, the Court upheld the lower court’s judgment and dismissed the case.\r\n\r\n<strong>Practice Note: </strong>\r\n\r\nIt is important to distinguish between the principle of exceptional circumstances as defined in Article 249 and the principle of force majeure as defined in Article 273 of the Civil Code in that the former if applicable requires the judge to reduce the onerous performance while the latter ceases the performance and terminates the contractual obligation. Further as illustrated by this case, the Court’s are reluctant to apply the principle of exceptional circumstances in events that occur frequently or that can be generally predicted. While the recent impact of the Financial Crisis cannot be denied, due to the volatile nature of the financial markets the Court was unconvinced that it was truly unforeseen.'),
	(183910,4617,'core_values',''),
	(183911,4617,'_core_values','field_59b64ab071de4'),
	(183912,4617,'file',''),
	(183913,4617,'_file','field_59b64c10f6600'),
	(84682,4617,'_content','field_59b649b5c8b2b'),
	(84683,4617,'lawUpdateArticleMonth','4780'),
	(84684,4617,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84685,4617,'content_description','In binding contracts, the general principal is that unilateral modification of contractual terms is not permitted. However, the UAE legislator, for requirements necessitated by justice, has made an exception in Article 249 of the UAE Civil Code, namely the principle of exceptional circumstances.'),
	(84686,4617,'_content_description','field_59b641c07f473'),
	(84687,4617,'pageSummary','In binding contracts, the general principal is that unilateral modification of contractual terms is not permitted. However, the UAE legislator, for requirements necessitated by justice, has made an exception in Article 249 of the UAE Civil Code, namely the principle of exceptional circumstances.'),
	(84688,4617,'_pageSummary','field_59e59b307dec8'),
	(84689,4617,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-6/november-3/dubai-the-global-financial-crisis-and-the-principle-of-exceptional-circumstances.html'),
	(84690,4617,'_currentURL','field_59d35123ab1e7'),
	(84691,4617,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','812'),
	(84692,4617,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(84693,4617,'lawUpdateArticleWriters','1'),
	(84694,4617,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(84695,4617,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Marwa El Mahdy'),
	(84696,4617,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84697,4617,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','m.elmahdy@tamimi.com'),
	(84698,4617,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(84699,4617,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(84700,4617,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(84701,4617,'lawUpdateArticleNoWriters','1'),
	(84702,4617,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(84703,4617,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','410'),
	(84704,4617,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84705,4617,'lawUpdateArticlePractices','1'),
	(84706,4617,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84707,4617,'_yoast_wpseo_metadesc','In binding contracts, the general principal is that unilateral modification of contractual terms is not permitted. However, the UAE legislator, for requirements necessitated by justice, has made an exception in Article 249 of the UAE Civil Code, namely the principle of exceptional circumstances.'),
	(84708,4549,'_edit_lock','1536151047:5'),
	(84709,4619,'_wp_attached_file','uploads2/media-4618.jpg'),
	(84710,4619,'_wp_attachment_metadata','a:5:{s:5:\"width\";i:100;s:6:\"height\";i:133;s:4:\"file\";s:23:\"uploads2/media-4618.jpg\";s:5:\"sizes\";a:0:{}s:10:\"image_meta\";a:12:{s:8:\"aperture\";s:1:\"0\";s:6:\"credit\";s:0:\"\";s:6:\"camera\";s:0:\"\";s:7:\"caption\";s:0:\"\";s:17:\"created_timestamp\";s:1:\"0\";s:9:\"copyright\";s:0:\"\";s:12:\"focal_length\";s:1:\"0\";s:3:\"iso\";s:1:\"0\";s:13:\"shutter_speed\";s:1:\"0\";s:5:\"title\";s:0:\"\";s:11:\"orientation\";s:1:\"0\";s:8:\"keywords\";a:0:{}}}'),
	(84711,4618,'lawUpdateImageURL','5902'),
	(84712,4618,'_lawUpdateImageURL','field_59c8deca117cd'),
	(84713,4618,'lawUpdateDesc',''),
	(84714,4618,'_lawUpdateDesc','field_59da24cd91f17'),
	(84715,4618,'lawUpdateYear','2013'),
	(84716,4618,'_lawUpdateYear','field_59da245091f13'),
	(84717,4618,'pageSummary',''),
	(84718,4618,'_pageSummary','field_59e59b307dec8'),
	(84719,4618,'lawUpdateStartMonth','December'),
	(84720,4618,'_lawUpdateStartMonth','field_59da247791f14'),
	(84721,4618,'currentURL','http://localhost:8888/tamimi/en/section/law-update/section-5/january-2'),
	(84722,4618,'_currentURL','field_59d35123ab1e7'),
	(84723,4620,'content','<p>While franchise agreements are obvious examples of commercial agreement underpinned by trademark licenses, various other commercial agreements also contain or may contain detailed provisions related to the use of trademarks, including for example agency-, distribution- and in certain circumstances manufacturing agreements.&nbsp;</p>\r\n<p>Adequately dealing with the rights associated with the use of trademarks in commercial agreements is critical to the owners of these valuable intellectual property rights, while it is equally critical to licensees who may be investing significantly in ventures where the rights associated with the use of the licensed trademarks are not fully appreciated. &nbsp;</p>\r\n<p>This article will look into some considerations related to trademark licensing in the UAE under Federal Law No. 37 of 1992 Concerning Trademarks (the &ldquo;Law&rdquo;). &nbsp;</p>\r\n<p>Exclusive, non-exclusive and sole licenses</p>\r\n<p>Articles 30 to 34 of the Law deals specifically with the licensing of trademarks providing that the proprietor of a trademark may, &ldquo;by a written and notarized contract&rdquo;, license one or more persons to use such mark for all, or some, of the products or services for which the trademark is registered. &nbsp;</p>\r\n<p>The Law accordingly confirms that a trademark owner is at liberty to choose to grant an exclusive or non-exclusive license in the UAE.&nbsp; An exclusive license means only the particular licensee can use the trademark, while no further licenses to other parties would be possible in respect of the same territory and goods or services. &nbsp; A non-exclusive license refers to a license by which the licensor may allow more than one party to use the same trademark in the same territory and in respect of the same goods or services. &nbsp;</p>\r\n<p>Importantly, the Law also confirms that it is possible for the owner of a trademark to license different licensees to use the same trademark in respect of different goods or services. It may accordingly be possible for a licensor to grant for example an exclusive license to use a trademark in respect of jewelry (included in class 14 of the trademark classification system) to one licensee, while also granting an exclusive license to another licensee to use the same trademark in respect of watches (also included in the mentioned class 14).&nbsp; In each case however, it will be critical to clearly define the scope of the relevant license with respect to the specific goods it is limited to.</p>\r\n<p>Article 30 of the Law provides that &ldquo;&hellip; the trademark owner may use [the trademark] by himself unless agreed otherwise&rdquo;.&nbsp; As a result of this provision in the Law it is accordingly very important for especially licensees to ensure that license agreements governed by the laws of the UAE specifically deal with the rights of the owner of the licensed trademark.&nbsp; Whether the terms &ldquo;exclusive license&rdquo; or even &ldquo;sole license&rdquo; are used, a best practice is not to leave the rights of the trademark licensor open to interpretation and to rather specifically set out the actual rights of, or limitation of the rights of, the trademark owner in the agreement.</p>\r\n<p>Recordal of licenses - is it mandatory?</p>\r\n<p>When it comes to the recordal of trademark licenses, a number of questions are generally raised by clients such as whether the recordal of a license with the trademarks registry is mandatory, the effect of non-recordal of a license and whether the licensee would be able to take legal action against infringers. &nbsp;</p>\r\n<p>According to the Law, a trademark license shall be recorded in the Register, and a license shall have no effect against third parties unless it has been recorded.&nbsp; The Law accordingly clearly requires the recordal of a trademark license with the trademarks registry although non-recordal should not have any effect on the contractual rights and obligations created between the licensor and the licensee.</p>\r\n<p>In addition to the above it is worth mentioning that according to Article 20 of the Law, the proprietor of a trademark may apply for the cancellation of its trademark registration from the trademarks Register.&nbsp; However, if the proprietor has granted a third party, by way of a recorded license agreement, a license to use the trademark, the said mark may not be removed from the Register without the licensee&rsquo;s written approval.&nbsp; In order to benefit from this provision of the Law, it is accordingly necessary to ensure that the licence is in fact recorded with the trademarks registry.</p>\r\n<p>Enforcing a licensed trademark&nbsp;</p>\r\n<p>With regard to the question whether a trademark licensee is entitled to take legal action in its own name in the UAE to enforce the trademark licensed to it, the Law provides that it is the proprietor of the trademark that is entitled to initiate legal action against trademark infringers.&nbsp; A trademark licensee is accordingly not authorised by the Law to initiate legal action in its own name against trademark infringers on the basis of a license - whether recorded or not &ndash; irrespective of any such right being granted in a license agreement. &nbsp; &nbsp;</p>\r\n<p>The Law does provide however, that any person who suffers damages as a result of the infringement of a trademark can initiate a civil action claiming damages from the infringer.&nbsp; However, it must be taken into consideration that the legal status of a licensee will only be recognized upon the recordal of the license with the trademark registry and the non-recordal of a trade mark license may accordingly also have an adverse effect on the ability of a licensee to seek compensation in civil proceedings based on the provisions of the Law.</p>\r\n<p>Conclusion</p>\r\n<p>Based on the above discussion, the only conclusion that can be reached is it is advisable and beneficial for both trademark licensors and the licensees to record trademark licenses with the trademark registry. &nbsp;</p>\r\n<p>For any assistance with respect to trademark licensing or the recordal of trademark license agreements with the trademark registry, please contact the authors of this article.</p>'),
	(84724,4620,'_content','field_59b649b5c8b2b'),
	(84725,4620,'lawUpdateArticleMonth','4618'),
	(84726,4620,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84727,4620,'content_description','The licensing of trademarks is an essential component of various commercial agreements facilitating business operations in the UAE. '),
	(84728,4620,'_content_description','field_59b641c07f473'),
	(84729,4620,'pageSummary','The licensing of trademarks is an essential component of various commercial agreements facilitating business operations in the UAE. '),
	(84730,4620,'_pageSummary','field_59e59b307dec8'),
	(84731,4620,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-5/january-2/considerations-in-trademark-licensing-in-the-uae.html'),
	(84732,4620,'_currentURL','field_59d35123ab1e7'),
	(84733,4620,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','884'),
	(84734,4620,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(84735,4620,'lawUpdateArticleWriters','1'),
	(84736,4620,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(84737,4620,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Waldo Steyn'),
	(84738,4620,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84739,4620,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','w.steyn@tamimi.com'),
	(84740,4620,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(84741,4620,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(84742,4620,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(84743,4620,'lawUpdateArticleNoWriters','1'),
	(84744,4620,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(84745,4620,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','634'),
	(84746,4620,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84747,4620,'lawUpdateArticlePractices','1'),
	(84748,4620,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84749,4620,'_yoast_wpseo_metadesc','The licensing of trademarks is an essential component of various commercial agreements facilitating business operations in the UAE.'),
	(84750,4621,'content','<p>Chapter 9 of the Capital Markets Law governs the placement memorandum of securities issued by companies.&nbsp;Pursuant to Article 370 of the CMA Bylaws, no person may offer  securities for public offering or private placement unless a placement  memorandum is submitted in accordance with the data and procedures set  forth in the CMA Bylaws and as approved by the CMA.&nbsp; Therefore, the CMA  will request the submission for review of a private placement memorandum  (the &ldquo;PPM&rdquo;), which must contain the following:</p>\r\n<ul>\r\n<li>Name, address of the head office, date and place of incorporation of the issuing entity.</li>\r\n<li>Name and address of the subscription agent if the issuing entity is not the subscription agent.</li>\r\n<li>Names and positions of the board members of the issuing entity.</li>\r\n<li>Subscription period.</li>\r\n<li>Statement that the placement memorandum was prepared in accordance  with Law No. 7 and the CMA Bylaws and, was approved by the CMA.</li>\r\n<li>Statement that the CMA shall not be a party in any case related to  the damages resulting from any placement memorandum registered by the  CMA.</li>\r\n<li>If the placement memorandum contains a statement by an expert or  statement based upon an opinion prepared by an expert, the placement  memorandum shall refer to the fact that the expert has given its  approval, that such approval was submitted to the CMA and that the  expert did not withdraw this approval before submission of the  memorandum for registration with the CMA.</li>\r\n<li>The memorandum shall clearly include the following notice: \"about  the contents of this document, we advise you to consult a legally  authorized advisor, and specialized in providing advice about purchase  of shares and other securities before making the placement decision.\"</li>\r\n<li>Names, addresses and positions of the individuals in charge of placement memorandum.</li>\r\n<li>Declaration from the board of the issuing entity or board of the  subscription agent that they shall be responsible for any inaccurate  information which could be included within the placement memorandum and  that they declare, according to the best of their knowledge and belief,  that the information in the placement memorandum was prepared in  accordance with true facts and that the placement memorandum did not  overlook any information which could affect the content thereof.</li>\r\n<li>Number of securities offered and the category they belong to.</li>\r\n<li>Statement of the rights related to the securities in the detail provided for below in numbers 27-29.</li>\r\n<li>Statement of profit distribution related to the issuing entity  within the preceding five years, including the value of distributions  and forms thereof.</li>\r\n<li>Procedures for exercising the rights of priority related to  securities and indication of any restrictions on whether the securities  offered are convertible into other forms of securities.</li>\r\n<li>Statement of whether or not the securities offered are listed in the  Kuwait Stock Exchange (the &ldquo;KSE&rdquo;) and any reasons for the rejection of  the listing application shall be mentioned.</li>\r\n<li>Giving a brief description of any future arrangements for trading securities offered.</li>\r\n<li>Objective of issuing securities.</li>\r\n<li>Authority for issuing and offering securities.</li>\r\n<li>Total revenue expected from the offering and the net revenues expected after deducting expenses.</li>\r\n<li>Details for using issuance revenues, specifically indicating the area of their use.</li>\r\n<li>Capital expense, reduction of debt, acquisition, operating capital or any other uses.</li>\r\n<li>Names of any persons in charge of covering the offering in case there are unsubscribed securities.</li>\r\n<li>Value of the offering expenses or estimated value thereof and, the party in charge of its payment.</li>\r\n<li>Procedures of refunding money to subscribers if their applications  are totally or partially rejected and an indication of the time schedule  for the same.</li>\r\n<li>Name and address of the transfer or registration agent, if any.</li>\r\n<li>Period of time for delivering securities after allocation. (Please note that the below</li>\r\n<li>27 &ndash; 29 are rights associated with shares as referenced above in 12)</li>\r\n</ul>\r\n<p>If the securities are shares, the rights related to them shall be as follows:</p>\r\n<ol>\r\n<li><span>Price of offering securities or method of determining the price and time schedule for the same</span></li>\r\n<li>Voting</li>\r\n<li>Short-term profit rate of the share</li>\r\n<li>Revenue of capital when liquidating the issuing entity</li>\r\n<li>Redemption of value and summary of all the approvals necessary about the difference in any of the rights</li>\r\n<li>Method of subscription in unsubscribed shares</li>\r\n</ol> \r\n<ul>\r\n<li>If the securities are bonds or deeds, the rights related to them shall be as follows:</li>\r\n</ul>\r\n<ol>\r\n<li><span>Payable revenue</span></li>\r\n<li>Date of payment</li>\r\n<li>Date of payment of the original amount</li>\r\n</ol> \r\n<ul>\r\n<li>If the securities are convertible:</li>\r\n</ul>\r\n<ol>\r\n<li>Conditions and maturity dates for holder of convertible securities to obtain</li>\r\n</ol> \r\n<ul>\r\n<li>the promised securities.</li>\r\n<li>Procedures for exercising the rights of the promised securities.</li>\r\n<li>Any information related to the promised securities according to what is</li>\r\n<li>required in 27 and 28 above.</li>\r\n<li>Legal form of the issuing entity, the legislation under which it was incorporated and the legislation it is operating under.</li>\r\n<li>Summary of the provisions provided for by the articles of  association or the regulations of the issuing entity in respect of  determining its objectives.</li>\r\n<li>Volume of permitted and paid-up capital and the number of shares distributed over each of them.</li>\r\n<li>Number and details of any securities issued by the issuing entity,  whether listed or unlisted in the KSE, along with indication of the  conditions and procedures for their conversion and the number of  promised shares after conversion.</li>\r\n<li>Number and details of any securities listed or not listed in the KSE  that are issued by the issuing entity but do not represent the shares  of capital.</li>\r\n<li>If the issuing entity is a member in a group, a brief description  shall be submitted for the group and the position of the issuing entity  therein.</li>\r\n<li>Any information about persons directly or indirectly exercising control over the issuing entity.</li>\r\n<li>Indicating the name of shareholders holding more than 5 % of the  securities which have the right to vote in the capital of the issuing  entity and the percentage of holding for each thereof.</li>\r\n<li>Audited financial statements approved by the general assembly of the  issuing entity for the three years preceding the date of subscription.</li>\r\n<li>Statement submitted by the board members of the issuing entity  proving the commitment of the issuing entity to prepare the said  financial statements in accordance with the Law of Commercial Companies  and acceptance of responsibility therefore.</li>\r\n<li>If a period elapses exceeding nine months as of the date of the  preparation of the last auditors\' report, a new report of the auditors  shall be submitted for the said period and shall include the status of  work progress, the status of profits and losses with the issuing entity,  an indication of its approval to publish such report in the placement  memorandum and that it assumes full liability therefore.</li>\r\n<li>Brief description of the present or suggested contracts of the board  members with the issuing entity or any of the affiliated companies.</li>\r\n<li>Disclosure of the contracts wherein any of the board members of the  issuing entity have a valid interest during the issuance of placement  memorandum.</li>\r\n<li>Total financial and &ldquo;in kind&rdquo; benefits granted to the board members  of the issuing entity during the previous financial year for the date of  issuing the placement memorandum plus the estimated value of such  benefits to be issued to board members of the financial year of  subscription.</li>\r\n<li>Number and percentage of shares held by each board member of the  issuing entity out of its capital and indication of the type of such  shares, if any.</li>\r\n<li>Resumes of each of the present or suggested board members of the  issuing entity and nature of any family relationships among such board  members.</li>\r\n<li>Disclosure of any other administrative position held by any board member or suggested board member.</li>\r\n<li>Description of the main businesses of the issuing entity and any exceptional factors influencing the businesses thereof.</li>\r\n<li>Statement about the reliance of the issuing entity on any specific  clients or suppliers; on any patent rights, other intellectual property  rights, licenses; or on any special contracts&nbsp; gaining an overriding  importance in the business of the issuing entity.</li>\r\n<li>Statement of the factors the issuing entity considers as risks affecting any investor in this offering.</li>\r\n<li>Information relating to current investments, if any.</li>\r\n<li>Information related to any judicial procedures, arbitration  proceedings, whether effective or pending, being prepared therefore,  taken by or against the issuing entity or any member in the group of the  issuing entity which has or might have a great influence upon the  financial position of the issuing entity.</li>\r\n<li>Main information for all the main contracts and parties thereof,  whether related to the issuing entity or companies affiliated thereto,  within two years as of the date of issuing the placement memorandum and  such contracts shall not include contracts that are standard in carrying  on the business thereof.</li>\r\n</ul>\r\n<p>In conclusion, the Capital Markets Law sets forth the requirements  for obtaining approval from the CMA for a PPM. However, please note that  the CMA may require other conditions and requirements given the  relatively recent implementation of the CMA and its procedures.</p>');

INSERT INTO `tm_postmeta` (`meta_id`, `post_id`, `meta_key`, `meta_value`)
VALUES
	(84751,4621,'_content','field_59b649b5c8b2b'),
	(84752,4621,'lawUpdateArticleMonth','4618'),
	(84753,4621,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84754,4621,'content_description','In February 2010, the Kuwait government passed new laws and regulations related to the activities of securities in Kuwait, namely Law No. 7 of 2010 (the “Law No. 7”) and Executive Bylaws for Law No. 7 of 2010 Concerning Establishment of the Capital Markets Authority and Organization of Securities Activity (the “CMA Bylaws”), (collectively the “Capital Markets Law”). The Capital Markets Authority (“CMA”) is currently the regulatory authority primarily responsible for regulating the marketing, offer and sale of securities in Kuwait. '),
	(84755,4621,'_content_description','field_59b641c07f473'),
	(84756,4621,'pageSummary','In February 2010, the Kuwait government passed new laws and regulations related to the activities of securities in Kuwait, namely Law No. 7 of 2010 (the “Law No. 7”) and Executive Bylaws for Law No. 7 of 2010 Concerning Establishment of the Capital Markets Authority and Organization of Securities Activity (the “CMA Bylaws”), (collectively the “Capital Markets Law”). The Capital Markets Authority (“CMA”) is currently the regulatory authority primarily responsible for regulating the marketing, offer and sale of securities in Kuwait. '),
	(84757,4621,'_pageSummary','field_59e59b307dec8'),
	(84758,4621,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-5/january-2/kuwait-requirements-for-obtaining-approval-of-a-private-placement-memorandum-from-the-capital-market.html'),
	(84759,4621,'_currentURL','field_59d35123ab1e7'),
	(84760,4621,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Fatema Fathnezhad'),
	(84761,4621,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84762,4621,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','f.fathnezhad@tamimi.com'),
	(84763,4621,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(84764,4621,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(84765,4621,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(84766,4621,'lawUpdateArticleNoWriters','1'),
	(84767,4621,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(84768,4621,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','411'),
	(84769,4621,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84770,4621,'lawUpdateArticlePractices','1'),
	(84771,4621,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84772,4621,'_yoast_wpseo_metadesc','In February 2010, the Kuwait government passed new laws and regulations related to the activities of securities in Kuwait, namely Law No. 7 of 2010 (the “Law No. 7”) and Executive Bylaws for Law No. 7 of 2010 Concerning Establishment of the Capital Markets Authority and Organization of Securities Activity (the “CMA Bylaws”), (collectively the “Capital Markets Law”). The Capital Markets Authority (“CMA”) is currently the regulatory authority primarily responsible for regulating the marketing, offer and sale of securities in Kuwait.'),
	(84773,4622,'content','<p>It further expands the definition of conduct violating the privacy of others by criminalizing eavesdropping, transmitting and disclosing communications (including audio and visual material); taking photographs of others and copying, saving or publishing them; and publishing news, comments, statements and information even if they are authentic.</p>\r\n<p>The New Cyber Crime Law, most notably, creates additional categories  of offenses addressing the increase in the incidence of cyber crime in  the United Arab Emirates (&ldquo;UAE&rdquo;). Highlighted below are the most notable  provisions of the New Cyber Crime Law.<br /><br /><strong>1. Access to an electronic site<br /><br /></strong>Federal  Law No. 2 of 2006 previously provided that anyone who commits a willful  act by illegally accessing an electronic site will be punished by  imprisonment and/or a fine. Article 2 of the New Cyber Crime Law removes  the intent requirement and prohibits any person from accessing an  electronic site illegally, without permission, or by exceeding the  limits of said permission, and provides for an express fine of not less  than AED 100 and not exceeding AED 300. It provides an express penalty  of imprisonment for a period of at least six months and/or a fine of not  less than AED 150,000 and not more than AED 750,000 for changing,  copying, deleting, disclosing and publishing any data or information  obtained by entering an electronic site illegally and without  permission. To the extent such data or information is personal; the New  Cyber Crime Law increases the penalty to imprisonment for a period not  less than one year and/or a fine of not less than AED 250,000 and not  exceeding AED 1,000,000.<br /><br />Article 4 of the New Cyber Crime Law  further states that any person who enters without permission any  electronic site for the purpose of obtaining government data or  confidential information of a financial trade or economic establishment  shall be punished by temporary imprisonment and/or a fine of not less  than AED 250,000 and not exceeding AED 1,500,000. There is an increase  in penalty if such data is changed, copied, deleted, disclosed, or  published which includes a fine of not less than AED 250,000 and not  exceeding AED 1,500,000 and/or imprisonment for a period not less than  five years.<br /><br /><strong>2. Medical related data<br /><br /></strong>Article  7 of the New Cyber Crime Law now expands the definition of conduct in  respect of medical data and information by stating that any person, who  obtains, amends, damages or discloses information obtained online,  related to medical records, examinations, diagnoses, treatment or care,  without permission, shall be punished by temporary imprisonment.<br /><br /><strong>3. Electronic card and bank account numbers; confidential codes; forgery<br /><br /></strong>Article  12 expands the categories of private information and punishes any  person who unlawfully accesses credit card numbers, electronic card  numbers, bank account statements and details of electronic payment  methods by imprisonment and/or a fine. It punishes the intent to use and  the use of such information to obtain funds belonging to third parties  by imprisonment of not less than six months and/or a fine not less than  AED 200,000 and not exceeding AED 1,000,000.<br /><br />Article 14 of the  New Cyber Crime Law also prohibits a person from obtaining without  permission a confidential number, code or password used to access any  electronic site without permission by providing for imprisonment and/or a  fine not less than AED 200,000 and not exceeding AED 500,000<br /><br />Article  13 further prohibits the forgery, imitation and copying of a credit  card, debit card, and any other electronic payment method and punishes  persons from using and knowingly accepting such credit cards, debit  cards, and/or other electronic payment methods with imprisonment and/or a  fine of not less than AED 500,000 and not exceeding AED 2,000,000.<br /><br /><strong>4. Electronic communication<br /><br /></strong>Protecting  the privacy and integrity of electronic communications, Article 10  prohibits the disruption of electronic communication by spamming  electronic mail. Article 15 of the New Cyber Crime Law also provides  that it is an offence for persons to intentionally and without  permission capture and/or intercept communications online. The offence  is punishable by a fine not less than AED 150,000 and not exceeding AED  500,000. Further, a person who discloses information obtained in this  manner may be punished by imprisonment for a period not exceeding one  year.<br /><br /><strong>5. Gambling activities and materials that prejudice public morals<br /><br /></strong>Article  17 of the New Cyber Crime Law now punishes anyone who produces,  transmits, publishes and exploits through an electronic site gambling  and/or pornographic material or any other material that may prejudice  public morals. Any person, who establishes, operates or supervises an  electronic site and/or transmits, sends or publishes through an  electronic site; gambling and/or pornographic materials shall be  punished by imprisonment and a fine of not less than AED 250,000 and not  exceeding AED 500,000. Further, if the subject of the pornographic  content is a juvenile not exceeding eighteen years, or if the content  was designed to tempt juveniles, the offender shall be punished by  imprisonment for a period not less than one year and a fine not less  than AED 500,000 and not exceeding AED 150,000.<br /><br />Under Article 19,  any person who incites or tempts another to commit prostitution using  an electronic site shall also be punished by imprisonment and a fine of  not less than AED 250,000 and not exceeding AED 1,000,000. The  punishment is increased for a period of not less than five year and a  fine not exceeding AED 1,000,000 if the victim is a juvenile.<br /><br /><strong>6. Defamation<br /><br /></strong>Under  Article 20, any person who insults others or has attributed to another  an incident that may make him subject to punishment or contempt by  others by using an electronic site shall be punished by imprisonment or a  fine of not less than AED 250,000 and not exceeding AED 500,000. Insult  or slander against public employees is considered an aggravating  circumstance of the crime.<br /><br /><strong>7. Contempt of religion<br /><br /></strong>Article  35 stipulates penalties of imprisonment and a fine of not less than AED  250,000 and not more than AED 1,000,000 for any person using electronic  sites to display contempt for any holy symbols, characters, figures and  rituals of Islam including the Divinity (Allah, God) and the Prophets  andfor any other faiths or religions or any of their symbols,  characters, figures and rituals.<br /><br /><strong>8. Human trafficking<br /><br /></strong>Article  23 of the New Cyber Crime Law prohibits any person from establishing,  operating or supervising an electronic site for the purpose of organ or  human trafficking and punishes the same by temporary imprisonment and a  fine of not less than AED 500,000 and not exceeding AED 1,000,000. This  is an increase from the penalty stipulated in the 2006 Cyber Crime Law,  which previously criminalized human trafficking, by temporary  detainment.<br /><br /><strong>9. Sedition, sectarianism and harming national unity<br /><br /></strong>Article  24 stipulates punishments for any person creating or running an  electronic site to publish, online or through any information technology  means, any programs or ideas which would promote disorder, hate, racism  or sectarianism and damage the national unity, social peace, public  order and pubic decency.<br /><br /><strong>10. Weapon&rsquo;s trade and terrorist activities<br /><br /></strong>Articles  25 stipulate punishment for persons who operate an electronic site for  the purpose of promoting or trading weapons, ammunitions or explosives.  Article 26 provides that it is an offence to establish, operate or  supervise an electronic site, or publish information online for a  terrorist group or any illegal group, association, organization, or  body.&nbsp;<br /><br /><strong>11. Collecting donations without a license<br /><br /></strong>Article  27 prohibits any person from creating or running an electronic site to  raise donations without obtaining a license from the competent  authority.<br /><br /><strong>12. State security<br /><br /></strong>Article 29  of the New Cyber Crime Law also stipulates penalties of imprisonment and  a fine not exceeding AED 1,000,000 for any person who may create or run  an electronic site or any information technology means, to deride or to  damage the reputation or the stature of the state or any of its  institutions, its President, the Vice President, any of the Rulers of  the emirates, their Crown Princes, the Deputy Rulers, the national flag,  the national anthem, the emblem of the state or any of its symbols.<br /><br />Article  28 prohibits any person from publishing any information, news,  caricatures or any other kind of pictures that would pose threats to the  security of the state and to its highest interests or violate its  public order.<br /><br />Article 30 punishes any person from creating or  running an electronic site for the purpose of engaging in the overthrow  of the system of government of the state or to seize it, or to seek to  disrupt or obstruct the Constitution or the effective laws of the state,  or to oppose the basic principles which constitute the foundations of  the system of government of the state.<br /><br /><strong>13. Promoting demonstrations without a license<br /><br /></strong>Article  32 of the New Cyber Crime Law stipulates punishment for persons who  operate or supervise an electronic site for the purpose of planning,  organizing, planning, promoting or calling demonstrations or protests  and the like without a license from the competent authority. Offenders  shall be punished by imprisonment or a fine of not less than AED 500,000  and not exceeding AED 1,000,000.<br /><br /><strong>14. Trade of antiquities without a right<br /><br /></strong>Article  33 stipulates penalties of imprisonment and a fine of not less than AED  500,000 and not more than AED 1,000,000 on any person using electronic  to engage in the unauthorized trade of antiquities and works of art.  Further, Article 34 stipulates penalties of imprisonment and a fine of  not less than AED 250,000 and not exceeding AED 1,000,000 on any person  using an electronic site to engage in the unauthorized use of, or  provide unauthorized facilities to others to use communication services  or audio and video channels.<br /><br /><strong>15. Communication services online<br /><br /></strong>Article  34 provides that it is an offence for any person to benefit or  unlawfully facilitate for others the use of communication services or  audio or visual transmission channels that are online. This provision  does not sanction the &ldquo;use&rdquo; of communications services or audio or  visual transmission channels that are online. In other words, the  provision sets a penalty for unlawfully accessing / obtaining  communications services on behalf of oneself or a third person online.  Article 34 imposes a fine ranging between AED 250,000 and AED 1,000,000  and/or imprisonment for a period not less than one year on any person  who benefits or unlawfully facilitates for others the use of  communication services or audio or visual transmission channels that are  online.<br /><br />The official translation from the Ministry of Justice  states that whoever uses communication services, audio or video  broadcasting channels without legal right, or facilitates such use by  others online shall be punished by imprisonment for at least one year  and/or a fine of not less than AED 250,000 and not exceeding AED  1,000,000.<br /><br /><strong>16. Narcotics and money laundering<br /><br /></strong>The  New Cyber Crime Law prohibits any person from establishing, operating  or supervising an electronic site or publishing information online for  the promotion of narcotics and psychotropic drugs. It stipulates a  penalty of temporary imprisonment and a fine of not less than AED  500,000 and not more than AED 1,000,000 which is an increase from the  penalty stipulated in the Cyber Crime Law which criminalized the same by  temporary detainment.<br /><br />Article 37 also stipulates penalties of  imprisonment and a fine of not less than AED 500,000 and not exceeding  AED 2,000,000 for any person using electronic sites to transfer or  deposit illegal funds with the intention to hide or camouflage their  source, or, for that matter, to hide or camouflage the facts about  illegal funds, their source, movement, ownership and the rights attached  to them as well as to acquire, own or use illegal funds despite  knowledge by the involved person of the illegal status of their sources.</p>'),
	(84774,4622,'_content','field_59b649b5c8b2b'),
	(84775,4622,'lawUpdateArticleMonth','4618'),
	(84776,4622,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84777,4622,'content_description','Last month the President His Highness Shaikh Khalifa Bin Zayed Al Nahyan issued Federal Law No. 5 of 2012 (“New Cyber Crime Law\") a comprehensive piece of legislation on combating cyber crimes. The New Cyber Crime Law protects the privacy of information published online including data, information, credit card numbers, bank account statements and details of electronic payment methods.'),
	(84778,4622,'_content_description','field_59b641c07f473'),
	(84779,4622,'pageSummary','Last month the President His Highness Shaikh Khalifa Bin Zayed Al Nahyan issued Federal Law No. 5 of 2012 (“New Cyber Crime Law\") a comprehensive piece of legislation on combating cyber crimes. The New Cyber Crime Law protects the privacy of information published online including data, information, credit card numbers, bank account statements and details of electronic payment methods.'),
	(84780,4622,'_pageSummary','field_59e59b307dec8'),
	(84781,4622,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-5/january-2/new-law-combating-information-technology-crimes.html'),
	(84782,4622,'_currentURL','field_59d35123ab1e7'),
	(84783,4622,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','918'),
	(84784,4622,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(84785,4622,'lawUpdateArticleWriters','1'),
	(84786,4622,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(84787,4622,'_yoast_wpseo_metadesc','Last month the President His Highness Shaikh Khalifa Bin Zayed Al Nahyan issued Federal Law No. 5 of 2012 (“New Cyber Crime Law\") a comprehensive piece of legislation on combating cyber crimes. The New Cyber Crime Law protects the privacy of information published online including data, information, credit card numbers, bank account statements and details of electronic payment methods.'),
	(84788,4623,'content','<p>With the EUR1.47 billion fine issued by the European Commission and  considering the lack of a consolidated competition law in the UAE,  businesses here may have been excused for being tempted to focus only on  their competitive activities related to operations in Europe. However,  with the publication on 23 October 2012 of UAE Federal Law No. 4 of 2012  Concerning Regulation of Competition (the &ldquo;Law&rdquo;) all businesses with  operations in the UAE or supplying goods and services to the UAE market  will have to ensure that they focus on and comply with the provisions of  this new law.<br /><br />On 23 February 2013 the Law will come into force  in the UAE regulating specifically competition in the form of  restrictive agreements, the abuse of dominant position and economic  concentration.&nbsp; With significant new penalties now being imposed for the  contravention of the Law, it must be a priority for businesses  operating in the UAE to consider the compliance of their local, and  wider, operations with this new legislative framework.<br /><br />This article is an introduction to the new Law and aims to provide a general overview of the Law only.&nbsp;<br /><br /><strong>Objectives of the Law<br /><br /></strong>A  very interesting and unorthodox legislative style from the UAE  legislator was to introduce an opening provision clarifying the policy  behind the Law. No doubt this approach will help the Courts, Competition  Regulation Committee and practitioners to place the provisions of the  law into perspective.<br /><br />The objectives of the new law are set forth in Article 2 as being twofold:</p>\r\n<ol>\r\n<li>Providing a stimulating environment for establishments in order to  enhance efficiency, competitiveness and the interest of consumers and to  achieve sustainable development in the UAE; and</li>\r\n<li>Keeping a competitive market governed by the market mechanisms in  accordance with the economic freedom principle through banning  restrictive agreements, business and actions that lead to the abuse of a  dominant position, controlling the operations of economic concentration  and avoiding all that may prejudice, limit or prevent competition.</li>\r\n</ol>\r\n<p><strong>Structure of the Law</strong></p>\r\n<p>The Law is arranged into a number of chapters, which include definitions and the objectives of the Law, as well as:</p>\r\n<ul>\r\n<li>Application of the Law (dealing with some exclusions);</li>\r\n<li>Anti-Competitive Practices;<br />o&nbsp;Restrictive Agreements; and&nbsp;<br />o&nbsp;Abuse of Dominant Position;</li>\r\n<li>Economic Concentration;</li>\r\n<li>Penalties;</li>\r\n<li>Competition Regulation Committee; and</li>\r\n<li>Responsibilities of the Ministry of Economy.</li>\r\n</ul>\r\n<p><strong>&ldquo;New&rdquo; Concepts</strong></p>\r\n<p>It will be noted from the stated objectives of the Law that the Law  introduces two important new concepts to the regulation of competition  in the UAE in the form of the terms &rdquo;Dominant Position &rdquo;and &ldquo;Economic  Concentration&rdquo;.&nbsp; These terms are defined as follows:<br /><br />Dominant  Position:&nbsp;The position that enables any establishment, by itself or in  participation with some other establishments, from dominating or  affecting the relevant market.<br /><br />Economic Concentration:&nbsp; &nbsp;Any  behavior from which a total or partial alienation (merger or  acquisition) of a property or usufruct of the properties, rights,  stocks, shares or liabilities of an establishment to another  establishment shall result and that may enable one establishment or a  consortium of establishments from controlling, directly or indirectly,  another establishment or a consortium of other establishments.<br /><br /><strong>Application of the Law<br /><br /></strong>The  Law provides that the provisions of the Law shall be enforced on all  businesses in relation to their economic activities in the UAE. The Law  further applies to the exploitation of intellectual property rights  whether in the UAE and abroad. Interestingly, the Law may also be  enforced against economic activities outside of the country that impact  competition in the UAE.<br /><br />As a result of the scope of the  application of the Law, individuals, corporates and syndicates will have  to consider their activities carefully whether in respect of  franchising rights, intellectual property licensing, mergers and  acquisitions or other commercial activities to ensure proper compliance  with the Law, and to consider how their business practices in other  jurisdictions may impact competition in the UAE in light of this new  Law.<br /><br />The Law provides for specific exclusions in respect of  regulated sectors that have specific competition rules including  Telecoms, Financial and Transport sectors.<br /><br /><strong>Anti-Competitive Practices &ndash; Restrictive Agreements<br /><br /></strong>The  restrictive agreements which are considered prohibited are mentioned as  a non-exclusive list of examples, and include agreements that have the  objective or effect of:</p>\r\n<ul>\r\n<li>Price Fixing;</li>\r\n<li>Determining conditions for sale or supply of services;</li>\r\n<li>Colluding in bids, practices and supplying offers;</li>\r\n<li>Market Sharing/Division and allocation; and</li>\r\n<li>Limiting the free flow of goods/ services to lead trade therein subject to artificial prices.</li>\r\n</ul>\r\n<p>The provisions of the Law related to restrictive agreements  accordingly appear to restate at least some existing provisions  contained in the Executive Regulations to the Consumer Protection Law  with more detail and with significantly more severe penalties.<br /><br /><strong>Anti-Competitive Practices &ndash; Abuse of Dominant Position<br /><br /></strong>The  Law introduces the &ldquo;dominant position&rdquo; concept into the regulation of  competition in the UAE.&nbsp; Article 6 of the Law provides that a business  with a dominant position in a market sector, or in a main and effective  part thereof, shall be prohibited from performing actions that lead to  the abuse of such position in order to prejudice, limit or prevent  competition.&nbsp; The Law lists a number of non-exclusive actions that are  prohibited, including those with the following objectives:</p>\r\n<ul>\r\n<li>Imposing the prices or conditions of reselling of commodities or services directly or indirectly.</li>\r\n<li>Selling a commodity or performing a service with a price less than  the actual cost thereof with the aim of hindering competitive  establishments from entering the relevant market, excluding them from  such market or causing them losses that prevent them from continuing  their activities.</li>\r\n<li>Discriminating with no justification among clients in identical  contracts in relation to the prices of commodities and services or the  conditions of buying and selling contracts.</li>\r\n<li>Obliging a client not to deal with a competitive establishment.</li>\r\n<li>The total or partial rejection to deal in accordance with the usual commercial conditions.</li>\r\n<li>Unjustified abstinence from dealing in commodities and services  through buying or selling or limiting or hindering such dealing that may  lead into imposing an unreal price thereof.</li>\r\n<li>Suspending the concluding of a buying or selling contract on the  condition of accepting obligations concerning other commodities or  services unrelated to the original contract.</li>\r\n<li>Purposively publish incorrect information about the commodities or its prices.</li>\r\n<li>Decrease or increase the available supply of the commodity so as to create an artificial scarcity or abundance of the commodity.</li>\r\n</ul>\r\n<p>The threshold for what percentage of a market share shall be deemed  to establish a Dominant Position shall be determined by Cabinet  decision.<br /><br />It is of interest to note that both restrictive  agreements and instances of the abuse of a dominant position can be  exempted from prohibition subject to approval of the Minister of Economy  and provided the agreement or activity will actually result in  enhancing economic development and competitiveness in the market.<br /><br /><strong>Economic Concentration</strong></p>\r\n<p>Articles 9 to 11 of the Law deal with economic concentration, the  threshold for which is also to be determined by Cabinet decision. The  Law requires a 30 day advance application to be filed with the Ministry  for approving an acquisition or merger transaction, providing as  follows:.</p>\r\n<ul>\r\n<li>The Ministry of Economy may approve an economic concentration  transaction if it would not have a negative impact on competition, or if  it would have a positive economic impact that outweighs any negative  impact on competition.</li>\r\n</ul>\r\n<p><strong>Penalties and Court Proceedings</strong></p>\r\n<p>The new Law provides for harsh penalties that are unprecedented in  UAE legislation which range from AED500,000 up to AED5 million. The  penalties may also be imposed based on the percentage of annual sales in  the cases of non compliant economic concentration transactions.<br /><br />Furthermore,  upon conviction, the court may order a business to be closed for a  period of no less than three months and no more than six months.<br /><br />All  competition court cases have been granted the advantage of expedited  cases and the Law allows for interim relief and temporary injunctions  pending final court judgment.<br /><br />With respect to criminal  proceedings, the Law stipulates that the Minister&rsquo;s approval is required  for initiating any criminal prosecution of acts contrary to the Law.  The Law also authorizes the Minister of Economy to reconcile any  contravention of the Law before a criminal case is transferred to the  Criminal Court in return for a settlement amount equivalent to no less  than double the minimum fine.&nbsp;<br /><br />It is important to note that the  Law specifically provides that no penalty issued against a party will  prejudice the right of an aggrieved party to seek compensation from that  offending party for damages resulting from its unlawful actions.&nbsp; The  financial risk to businesses contravening the Law is accordingly not  limited to the penalties provided for, but extends to possible civil  claims for damages.<br /><br /><strong>Competition Regulation Committee and the Ministry of Economy<br /><br /></strong>The  Law provides that a Competition Regulation Committee shall be  established and shall be chaired by the Under Secretary of the Ministry  of Economy.&nbsp; This would probably be a factor that may impact the  application of the Law in a smooth and timely manner. It is no secret  that Government committees struggle to convene when their composition is  made up of very busy public sector officials and prominent businessmen.  In most cases, the Committee Chair is engaged in multiple committees  and attending to various matters, all of which are important, which  renders the possibility to convene hostage to the work load of the  chairperson.<br /><br /><strong>Gaps<br /><br /></strong>The Law has not  provided a clear exemption or a specific treatment to family businesses.  Obviously a family business acquisition of another business in the same  group which may raise dominant position concerns may still qualify and  enjoy exemptions to be approved by the Minister. However the importance  of family businesses to the economy makes it worthy to address  separately provisions regulating this valuable constituent of UAE  businesses.<br /><br />Transactions occurring in the stock market demand  speed which would also require specific treatment and not subject to the  timelines requiring compliance in respect of economic concentration  transactions.<br /><br />Regional arrangements with competition regulatory  bodies would seem to be a sensible approach for corporations having to  comply with rules in a neighboring state. If the plan is to accomplish  harmony between GCC states, regulating competition should no doubt also  be at the top of the list of matters for harmonization of laws and  practices.<br /><br /><strong>Conclusion<br /><br /></strong>The enactment of  UAE Federal Law No. 4 of 2012 Concerning Regulation of Competition is an  important step in the evolution of competition law in the UAE.&nbsp; The  Executive Regulations to the Law and the thresholds determining market  power will add the necessary details to this Law.&nbsp;</p>\r\n<p>At this time, it is critical for businesses with operations in the  UAE or supplying goods and services in the UAE to ensure that their  operations (in the UAE and beyond its borders) comply with the new Law,  prior to it coming into force in February 2013.<br /><br />if you would like  further information or have any questions regarding this new law,  please contact Omar Obeidat, Partner &amp; Head of IP (<a href=\"mailto:o.obeidat@tamimi.com\">o.obeidat@tamimi.com</a>) or Marcus Wallman, Partner and Head of Commercial Advisory (<a href=\"mailto:m.wallman@tamimi.com\">m.wallman@tamimi.com</a>).</p>'),
	(84789,4623,'_content','field_59b649b5c8b2b'),
	(84790,4623,'lawUpdateArticleMonth','4618'),
	(84791,4623,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84792,4623,'content_description','On 5 December 2012 the European Commission imposed the biggest antitrust penalty in its history - EUR1.47 billion (USD1.92 billion) - against six firms for running two cartels for nearly a decade. '),
	(84793,4623,'_content_description','field_59b641c07f473'),
	(84794,4623,'pageSummary','On 5 December 2012 the European Commission imposed the biggest antitrust penalty in its history - EUR1.47 billion (USD1.92 billion) - against six firms for running two cartels for nearly a decade. '),
	(84795,4623,'_pageSummary','field_59e59b307dec8'),
	(84796,4623,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-5/january-2/new-competition-law-in-the-uae.html'),
	(84797,4623,'_currentURL','field_59d35123ab1e7'),
	(84798,4623,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Waldo Steyn'),
	(84799,4623,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84800,4623,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','w.steyn@tamimi.com'),
	(84801,4623,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(84802,4623,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(84803,4623,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(84804,4623,'lawUpdateArticleNoWriters','1'),
	(84805,4623,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(84806,4623,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','634'),
	(84807,4623,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(84808,4623,'lawUpdateArticlePractices','1'),
	(84809,4623,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(84810,4623,'_yoast_wpseo_metadesc','On 5 December 2012 the European Commission imposed the biggest antitrust penalty in its history - EUR1.47 billion (USD1.92 billion) - against six firms for running two cartels for nearly a decade.'),
	(84811,4624,'content','<p>Other names used for similar or related concepts are &ldquo;Residences&rdquo; and &ldquo;Branded Apartments&rdquo;.&nbsp;Generally the concept of MSA, Residences or Branded Apartments will contain the following features:</p>\r\n<ol>\r\n<li>The Building will be of a higher quality.</li>\r\n<li>Commonly the MSA, Residences or Branded Apartments may sit along side a singly owned Hotel development.</li>\r\n<li>The offer of the Units by Owners for short term accommodation services is often a feature.</li>\r\n<li>In all cases, the development is branded and both Owners resident in  the development and any tenants or guests will be entitled to benefit  from a range of services provided by the Hotel Operator or arranged by  the Owners Association. A list of such Ameliorated Services is set down  in Part C &ndash; Commercial and Practical Considerations in Structuring MSA  schemes (&ldquo;Ameliorated Services&rdquo;).</li>\r\n</ol>\r\n<p>In this article we explore the legal backdrop to the concept of MSA.  It should be noted that this article does not purport to comment on the  licensing requirements of the Dubai Economic Department or Dubai Tourism  Commerce and Marketing<br /><br />The simple description above of a MSA  scheme belies what is in fact a relatively complex legal and commercial  arrangement with many potential variations possible.<br /><br />We consider in more detail below, the nature of MSA schemes under the following topics:</p>\r\n<p>A.&nbsp;The Legal Entities involved in providing MSA.</p>\r\n<p>B.&nbsp;The Relevant Legal Documentation.</p>\r\n<p>C.&nbsp;Commercial and Practical Considerations in Structuring MSA Schemes.</p>\r\n<p>D.&nbsp;Regulatory and other Issues Arising.<br /><br /><strong>A)&nbsp;The Legal Entities involved in providing MSA</strong></p>\r\n<p>In theoretical terms, once the development is complete the management  of the &ldquo;Common Areas&rdquo; and general administration of the development  should pass to the Owners Association formed pursuant to Law No 27 of  2007 on Ownership of Jointly Owned Properties in the Emirate of Dubai  (&ldquo;JOP Law&rdquo;) and regulated pursuant to RERA&rsquo;s &ldquo;Directions&rdquo; to the JOP  Law.<br /><br />The investors become the Owners of the Units. By virtue of  their ownership, Owners are members of the Owners Association, are  entitled to vote at meetings of the General Assembly and be elected as  Board members of the Owners Association.<br /><br />If therefore the  developer wants to ensure that there is the ability for a Hotel Operator  to operate from the development, this will have to be procured by a  contract with the Owners Association.<br /><br />The Owners of the Units  will also need to enter into their own private arrangement with the  Hotel Operator for the rental of their Unit, should they wish to use the  Rental Pool.</p>\r\n<p><strong>B)&nbsp;The Legal Documentation</strong></p>\r\n<p>The principal document relevant to the creation of a MSA scheme is  the Sale and Purchase Agreement (&ldquo;SPA&rdquo;), between the developer and  investors. Ideally, the SPA should fully disclose or make sufficient  reference to the documents set out and discussed below:</p>\r\n<ol>\r\n<li>The constitutional document pursuant to the JOP Laws and Directions  is known as the Jointly Owned Property Declaration. This document needs  to set out clearly the role of Hold Co (discussed below) and the Hotel  Operator.</li>\r\n<li>The Hotel Operator will need to have the right to provide the  Ameliorated Services, as well as operate the Rental Pool and provide  various other branding and consulting services. In addition, the Owners  Association may need to be compelled to provide certain Ameliorated  Services. These aspects are normally dealt with in a framework agreement  which, for the purposes of this Article, we will call the &ldquo;MSA  Framework Agreement&rdquo;. This MSA Framework Agreement is not to be confused  with (though may incorporate features of) an association manager&rsquo;s  agreement or facilities management agreements (see the table in Part C  which sets out the various services).</li>\r\n<li>Hotel Operators are normally appointed pursuant to separate  operational and technical services agreements between the Hotel Owner  and the Hotel Operator.</li>\r\n<li>If the MSA development sits alongside part of a Hotel development,  the developer may wish to ensure that the Owner of the Hotel has the  right to also remove the Hotel Operator from the development comprising  the Branded Apartments.</li>\r\n<li>Therefore, the developer would need to ensure that the Hotel  Operator did not have the MSA Framework Agreement directly with the  Owners Association. Accordingly, the developer should set up a holding  company (&ldquo;Hold Co&rdquo;) to enter into the MSA Framework Agreement and then  create a separate operational and technical services agreements (on a  back to back basis) with the Hotel Operator (&ldquo;Operator Agreements&rdquo;) in  relation to the Branded Apartments.</li>\r\n<li>Without the use of Hold Co, the Owners Association would have a  contract directly with the Hotel Operator complicating the ability of  the Hotel Owner to remove the Hotel Operator from the Branded Residences  or the ability to assign the rights under the MSA Framework Agreement  to any purchaser of the Hotel.</li>\r\n<li>Unit Owners have jurisdiction over their Units and accordingly it is  for them to enter into any arrangement with the Hotel Operator for the  management of their Units. As the Hotel Operator will require rental  stock to operate, a Rental Pool Agreement needs to be appended to the  SPA, with the relevant investor&rsquo;s agreement to enter into this. As for  the MSA Framework Agreement referred to above, it may be more  appropriate that the Rental Pool Agreement be between Hold Co and the  investors, though operationally the Hotel Operator would be appointed  (pursuant to the Operator Agreements) as Hold Co&rsquo;s agent to enter into  the Rental Pool Agreements and operate the Rental Pool.</li>\r\n</ol>\r\n<p>The Rental Pool Agreement will generally entitle the Hotel Operator  or Hold Co (as the case may be) to manage the Unit for a fee. The  obligations on the Hotel Operator or Hold Co would generally include;  arranging tenants and occupiers, maintaining the Unit, paying all  outgoings in relation to the Unit and paying the balance of the revenues  to the Unit Owner.<br /><br />Whilst it may be possible to design the MSA  scheme independently of the Hotel Operator and endeavour to incorporate  the necessary flexibility to adapt to the requirements of any Hotel  Operator, generally such schemes are designed in tandem with the Hotel  Operator at the conceptual and design phases of the development.<br /><br />The  developer / Hold Co and the Hotel Operator would also enter into the  Operating Agreements relating to the Hotel and/or MSAs. It is important  in doing this that any commercial considerations in such documents are  also carried down through the documents referred to in 1 to 6 above in  so far as they relate to or in any way impact on the legal entities  referred to.</p>\r\n<p><strong>C) Commercial and Practical Considerations in establishing a MSA scheme</strong></p>\r\n<p>Considerable effort and consideration needs to be put into MSA  schemes to ensure that they meet the expectations of investors and the  Hotel Operator without conflict, and with clarity on the structuring. It  is important to remember that not all of the investors may want their  Units to form part of the Rental Pool, and some investors may want to  actually reside in the development.<br /><br />For resident Owners, they may  not want many of the services that the Hotel Operator provides as  mandatory and for which they have to pay for. They may nonetheless be  happy to pay for some services on a &ldquo;User Pays&rdquo; basis.<br /><br />For other  investors, there can be the inclination to see any Ameliorated Services  as being the obligation of the Hotel Operator (as they are operating a  business from the Common Areas of the development and profit from same),  and therefore the costs should be met out of the Hotel revenues.  Accordingly the exact service, cost and revenue matrix needs to be  developed and investors made aware of same.<br /><br />We consider, in  simple terms, the services to be offered in relation to a development  comprising MSA fall into the categories set down in the table below.</p>\r\n<table border=\"1\" cellspacing=\"0\" cellpadding=\"2\" align=\"center\">\r\n<tbody>\r\n<tr>\r\n<td align=\"center\" valign=\"top\">\r\n<h6><strong>Association Management&nbsp;</strong><strong>Services (a service to the&nbsp;</strong><strong>Owners Association (&ldquo;OA&rdquo;)).</strong></h6>\r\n</td>\r\n<td align=\"center\" valign=\"top\">\r\n<h6><strong>Contracted Services (facilities&nbsp;</strong><strong>management) provided in relation to Common Areas.</strong></h6>\r\n</td>\r\n<td align=\"center\" valign=\"top\">\r\n<h6><strong>Ameliorated Services (a la&nbsp;</strong><strong>carte and other similar&nbsp;</strong><strong>hotel type services)</strong></h6>\r\n</td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\">\r\n<ul>\r\n<li>Working with OA Board to develop strategies for management of common areas;</li>\r\n</ul>\r\n<ul>\r\n<li>Preparing annual budgets;</li>\r\n</ul>\r\n<ul>\r\n<li>Negotiating supply contracts; &nbsp;</li>\r\n</ul>\r\n<ul>\r\n<li>Supervising contractors;</li>\r\n</ul>\r\n<ul>\r\n<li>Attending to day-to-day operational matters and correspondence;</li>\r\n</ul>\r\n<ul>\r\n<li>Implementing decisions of OA and Board;</li>\r\n</ul>\r\n<ul>\r\n<li>Keeping books and records as required by law;</li>\r\n</ul>\r\n<ul>\r\n<li>Supervising defect repairs and warranty claims;</li>\r\n</ul>\r\n<ul>\r\n<li>Coordinating insurances and insurance claims;</li>\r\n</ul>\r\n<ul>\r\n<li>Issuing service charge notices and collecting payments;</li>\r\n</ul>\r\n<ul>\r\n<li>Facilitate submission of technical, financial and management reports to&nbsp; Board and OA;</li>\r\n</ul>\r\n<ul>\r\n<li>Dealing with complaints from Owners;</li>\r\n</ul>\r\n<ul>\r\n<li>Coordinating and attending Board and General Assembly meetings,&nbsp;&nbsp; sending notices of meetings and maintaining minutes;</li>\r\n</ul>\r\n<ul>\r\n<li>Follow up on legal matters on behalf of OA;</li>\r\n</ul>\r\n<ul>\r\n<li>Representing OA with governmental and quasi- governmental entities.</li>\r\n</ul>\r\n</td>\r\n<td valign=\"top\">\r\n<ul>\r\n<li>HVAC plant and equipment;</li>\r\n</ul>\r\n<ul>\r\n<li>Electrical Systems;</li>\r\n</ul>\r\n<ul>\r\n<li>Plumbing Systems</li>\r\n</ul>\r\n<ul>\r\n<li>Minor Civil Works;</li>\r\n</ul>\r\n<ul>\r\n<li>Uninterrupted Power Supply;</li>\r\n</ul>\r\n<ul>\r\n<li>Pressurization systems;</li>\r\n</ul>\r\n<ul>\r\n<li>General Building Supervision;</li>\r\n</ul>\r\n<ul>\r\n<li>Maintenance of swimming pool;</li>\r\n</ul>\r\n<ul>\r\n<li>Water tank maintenance and cleaning;</li>\r\n</ul>\r\n<ul>\r\n<li>Lifts and Elevators;</li>\r\n</ul>\r\n<ul>\r\n<li>Cleaning;</li>\r\n</ul>\r\n<ul>\r\n<li>Security Services;</li>\r\n</ul>\r\n<ul>\r\n<li>Pest control services;</li>\r\n</ul>\r\n<ul>\r\n<li>Gardening;</li>\r\n</ul>\r\n<ul>\r\n<li>Painting and decorating of Common Areas;</li>\r\n</ul>\r\n<ul>\r\n<li>Repairs and maintenance of Common Areas;</li>\r\n</ul>\r\n<ul>\r\n<li>Audit;</li>\r\n</ul>\r\n<ul>\r\n<li>Valuations;</li>\r\n</ul>\r\n<ul>\r\n<li>Architectural and engineering consulting;</li>\r\n</ul>\r\n<ul>\r\n<li>Reserve Fund Studies;</li>\r\n</ul>\r\n<ul>\r\n<li>Legal Services;</li>\r\n</ul>\r\n<ul>\r\n<li>Design assistance.</li>\r\n</ul>\r\n</td>\r\n<td valign=\"top\">\r\n<ul>\r\n<li>The Rental Pool including a booking service and property management services;</li>\r\n</ul>\r\n<ul>\r\n<li>Housekeeping and cleaning services;</li>\r\n</ul>\r\n<ul>\r\n<li>Arranging linen services;</li>\r\n</ul>\r\n<ul>\r\n<li>Additional security control;</li>\r\n</ul>\r\n<ul>\r\n<li>Childcare services;</li>\r\n</ul>\r\n<ul>\r\n<li>Property maintenance services and repairs;</li>\r\n</ul>\r\n<ul>\r\n<li>A mini bar service;</li>\r\n</ul>\r\n<ul>\r\n<li>A food and beverage service;</li>\r\n</ul>\r\n<ul>\r\n<li>The use of specialist Club facilities</li>\r\n</ul>\r\n<ul>\r\n<li>A valet service;</li>\r\n</ul>\r\n<ul>\r\n<li>Porterage services;</li>\r\n</ul>\r\n<ul>\r\n<li>Bellboys;</li>\r\n</ul>\r\n<ul>\r\n<li>Full time reception;</li>\r\n</ul>\r\n<ul>\r\n<li>Full time caretaker;</li>\r\n</ul>\r\n<ul>\r\n<li>Services including towels, chairs, umbrellas and related services and equipment.</li>\r\n</ul>\r\n</td>\r\n</tr>\r\n</tbody>\r\n</table>\r\n<p><br />Note: services specifically related to Units in the Rental Pool  are excluded from consideration in the table as any costs associated  with such Units would be for the Owner of that Unit under the Rental  Pool Agreement. If the costs of providing services in relation to such  Units formed part of the budget for the Owners Association this would  severely prejudice those Owners who chose not to put their Units into  the Rental Pool. It is the case however, that services in relation to  the Units are covered in the Rental Pool Agreement, it being a private  arrangement between the Unit Owner and Hold Co/the Hotel Operator and  the costs of the same are deducted from the revenues obtained from  letting out the Unit.<br /><br />The Association Management Services are  clearly a cost of the Owners Association and would be budgeted for and  paid for by Owners through their payment of Service Charges. Likewise  the Contracted Services would ordinarily be contracted for by the Owners  Association in the same fashion.<br /><br />The controversial category  (should we take the view of the cost conscious resident Owner) will be  the Ameliorated Services. Some of these may be able to be provided on a  &ldquo;User Pays&rdquo; basis, such as the putting of a Unit into the Rental Pool or  Unit maintenance services. If this is the case those &ldquo;User Pays&rdquo;  services would ordinarily be removed from the Owners Association budget.  Some Ameliorated Services may however be less easily categorized as  &ldquo;User Pays&rdquo;. Take for example &ldquo;Reception&rdquo; services and &ldquo;Bell Boy&rdquo;  services which may be used by all Owners and occupiers and not just  guests to the Rental Pool. In such cases it needs to be clear whether  the Hotel meets the costs of the same or the services are procured by  the Owners Association and paid by Owners through their payment of  Service Charges.<br /><br />Another potentially problematic aspect of MSA,  is that the Hotel Operator may also want to control the nature of the  services offered to the Owners Association by service providers and  choose service providers to ensure that it can meet its Brand Standards.  Sometimes the Hotel Operator may want to provide services itself and in  such circumstances there may need to be a process to benchmark and  apportion costs.<br /><br />Careful consideration from both a legal and  commercial perspective needs to be given to the issues raised in this  Part C and it is suggested that appropriate disclosure of the  arrangements may reduce the potential for disputes with Owners or the  Owners Association at a later date.<br /><br /></p>\r\n<p><strong>D)&nbsp;Regulatory and other Issues Arising</strong></p>\r\n<p>Readers may appreciate that a MSA scheme is a more complicated  ownership arrangement than simply owning an apartment in a building  which is nonetheless regulated pursuant to the JOP Laws and Directions.<br /><br />It  should be emphasized furthermore that if developers could bind the  Owners Association to long term contracts this could seriously undermine  the freehold nature of the investment.<br /><br />MSA arrangements are not  surprisingly therefore regulated in the Directions. In particular the  following provisions of the Directions may apply should RERA determine:</p>\r\n<ol>\r\n<li>Restrictions on the length of all Supply Agreements (of which the  MSA Framework Agreement would be one) with the Owners Association to no  more than 3 years.</li>\r\n<li>Article 17 of the Direction for General Regulation ensuring that the  content of all Supply Agreements are fair, clear and have appropriate  mechanisms ensuring quality.</li>\r\n<li>Article 34 of the Direction for General Regulation which may  restrict the ability of the Developer to enter into Supply Agreements on  behalf of the Owners Association.</li>\r\n</ol>\r\n<p><strong>In addition it is likely that RERA may require:</strong></p>\r\n<ol>\r\n<li>An Association Manager, registered with the Dubai Economic  Department and RERA, to be appointed to perform the various statutory  association management services set down in the Direction for  Association Constitution and as summarised above in Part C.</li>\r\n<li>The Management Agreement be registered with RERA in accordance with Article 17(1)(d) of the Direction for General Regulation.</li>\r\n</ol>\r\n<p>It is probable that RERA may exercise its discretion as above, having  regard to the fairness of the scheme overall on Owners. In addition it  is very likely that RERA may also consider, in exercising its  discretion, the extent to which the developer has complied with the  disclosure regime set down in the Direction for General Regulation and  therefore the extent to which the investor appreciated the nature of the  scheme into which he was investing.&nbsp;<br /><br />The above represents an  overview of a managed and serviced apartment scheme in the context of  Dubai regulation to date. As mentioned this Article does not deal with  licensing considerations.</p>'),
	(84812,4624,'_content','field_59b649b5c8b2b'),
	(84813,4624,'lawUpdateArticleMonth','4618'),
	(84814,4624,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84815,4624,'content_description','The term “managed and serviced apartments” (“MSA”) is generally given to apartments sold to investors where the investors may also agree to put these apartments (“Units”) into a “Rental Pool” operated by a Hotel Operator (as well as receive a range of ameliorated services at the development, similar to the offerings of a Hotel). '),
	(84816,4624,'_content_description','field_59b641c07f473'),
	(84817,4624,'pageSummary','The term “managed and serviced apartments” (“MSA”) is generally given to apartments sold to investors where the investors may also agree to put these apartments (“Units”) into a “Rental Pool” operated by a Hotel Operator (as well as receive a range of ameliorated services at the development, similar to the offerings of a Hotel). '),
	(84818,4624,'_pageSummary','field_59e59b307dec8'),
	(84819,4624,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-5/january-2/managed-and-serviced-apartments-in-dubai-considerations-from-a-jointly-owned-property-strata-and-hot.html'),
	(84820,4624,'_currentURL','field_59d35123ab1e7'),
	(84821,4624,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','860'),
	(84822,4624,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(84823,4624,'lawUpdateArticleWriters','1'),
	(84824,4624,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(84825,4624,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Katrine Kofoed'),
	(84826,4624,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(84827,4624,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','k.kofoed@tamimi.com'),
	(84828,4624,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(84829,4624,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(84830,4624,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(84831,4624,'lawUpdateArticleNoWriters','1'),
	(84832,4624,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(84833,4624,'_yoast_wpseo_metadesc','The term “managed and serviced apartments” (“MSA”) is generally given to apartments sold to investors where the investors may also agree to put these apartments (“Units”) into a “Rental Pool” operated by a Hotel Operator (as well as receive a range of ameliorated services at the development, similar to the offerings of a Hotel).'),
	(84834,4625,'content','<p>UAE Federal Law No. 37 of 1992 Concerning Trademarks provides in Article 2 that:<br /><br /><em>&ldquo;A  trademark is anything which takes a distinctive form whether names,  words, signatures, letters, figures, drawings, symbols, titles, tax  stamps,</em>&nbsp;<em>seals, pictures, inscriptions, advertisements or packs or any other mark or a combination thereof&hellip;.&rdquo;</em><br /><br />It  will be noted that the definition of a trademark requires a mark to  &ldquo;take a distinctive form&rdquo; and single colours as such cannot be  considered to be inherently distinctive. Despite this requirement of  distinctiveness and the absence in the definition of specifically  dealing with single colours (or even a combination of colours), the  definition of a trademark has proven to be sufficiently wide to allow  for the interpretation that a single colour can in fact function as a  trademark in the UAE.&nbsp; This was confirmed by the registration in the UAE  back in April 2007 of a single colour trademark for a shade of orange  in respect of a particular rice product.&nbsp;<br /><br />As single colour  trademarks are considered less conventional and are not commonly applied  for or as a rule accepted for registration, ongoing developments in  respect of single colour trademarks in jurisdictions outside of the UAE  remains of interest to trademark practitioners and owners in the UAE as  it provides some guidance on the kind of considerations that may be  relevant in applying for and objecting to single colour trademark  applications here in the UAE.<br /><br />In this article the recent judgment  in the UK case involving Cadbury&rsquo;s application for the registration of a  shade of purple is reviewed as the logic applied by the court (rather  than the legal principles) could be of assistance in local matters.<br /><br /><strong>Background of the UK case<br /><br /></strong>In  2004, Cadbury applied to register the Cadbury shade of purple  (identified on the Pantone colour chart as Pantone 2685C) as a trademark  in the UK in respect of the following goods:<br /><br />\"chocolate in bar  form, chocolate confectionery, chocolate assortments, cocoa-based  beverages, preparations for cocoa-based beverages, chocolate based  beverages, preparations for chocolate based beverages, chocolate  cakes\".&nbsp;<br /><br />The application was rejected by the UK Trademark  Registry on the ground that it was \"devoid of distinctive character\" &ndash;  i.e. that is the mark is incapable of serving the function of a  trademark and identifying the origin of the goods to which it was  applied.<br /><br />Cadbury filed evidence that the colour purple mark had  &ldquo;acquired distinctiveness through use&rdquo;, showing that the mark had been  used so extensively that consumers had come to recognise it as  identifying Cadbury&rsquo;s goods alone. In particular it was submitted that  Cadbury had been using its colour purple trademark since 1914.<br /><br />The  UK Trademark Registry accepted the evidence and the application for  registration of the mark for the majority of goods applied for. The  examiner found that there was no inherent distinctive character in the  colour purple mark, but there was a significant body of evidence  suggesting that the mark had in fact acquired distinctiveness.<br /><br />Although  the application for the colour purple mark was accepted by the UK  Trademark Registry, it was opposed by another confectionery producer as  it also used a shade of purple in respect of one of its own brand of  chocolate products.&nbsp;<br /><br /><strong>The objection to the colour purple trademark</strong><br /><br />On  appeal to the High Court of the UK, the UK Trademark Registry&rsquo;s  findings on the acquired distinctiveness of the colour purple trademark  were not placed in dispute. Instead the appeal was based on the  contention that the colour purple trademark did not meet the definition  of a sign as the mark had no distinctive character (this kind of  argument may also be of particular relevance here in the UAE where the  Law does not deal with the concept of &ldquo;acquired distinctiveness&rdquo;).<br /><br />The  question of single colour trademarks has been the subject of several  European Court of Justice (ECJ) decisions. The ECJ case of Libertel  Groep BV v Benelux-Merkenbureau was the first case to expressly  acknowledge that a colour could be registered as a trademark provided  that the colour is described and accompanied with a Pantone reference.  Such a reference allows the mark to be identified clearly which is a  requirement of a sign capable of graphic representation and therefore  registration. In addition however, it is required also that a Court must  consider the context of the particular case in order to make a  determination on the registration of a single colour trademark.<br /><br />In  the appeal, the appellant cited a later ECJ case (following the  Libertel case) involving Dyson Limited and the Registrar of Trademarks  which held that the abstract concept of a transparent bin for a vacuum  cleaner was not capable of registration as a trademark. The appellant  argued that the logic applied in the Dyson case should be extended to  abstract colours so as to prevent an unfair competitive advantage being  obtained by possible registrants.<br /><br />In the appeal the Judge  considered the decisions of the ECJ and decided the case in favour of  Cadbury.&nbsp; The opposition to the application of the colour purple mark  although unsuccessful overall, did result in the trademark registration  being limited to the following goods: \"chocolate in bar and tablet form;  chocolate for eating; drinking chocolate; preparations for making  drinking chocolate\".&nbsp; The reason for this was that the evidence in this  case showed that other manufacturers also used a purple colour in  respect of cakes and chocolate assortments, while Cadbury itself used  colours other than its particular shade of purple in respect of its own  chocolate assortments.&nbsp;<br /><br /><strong>Important limitations<br /><br /></strong>This  case shows that the UK courts will limit a monopoly granted in respect  of a particular colour in order to ensure that the monopoly only extend  to the genuine and proven interests of an applicant.&nbsp; The protection  granted to Cadbury is not for a shade of purple generally, but for the  very particular and objectively identifiable shade of purple it uses  (Pantone 2685C).&nbsp; Cadbury\'s trademark will accordingly only be infringed  if a shade of purple so similar to the colour identified as Pantone  2685C is used, as to be indistinguishable.<br /><br />Further, protection  for the Cadbury&rsquo;s purple trademark was rejected in respect of many of  the goods included in the original trademark application.&nbsp; This included  goods such as chocolate assortments and cakes, even though Cadbury  submitted evidence proving the use of its specific colour purple in  respect of such goods.&nbsp; The conclusion that can be reached in this  regard is that courts in the UK at least will take a very conservative  approach in granting exclusivity in respect of single colour trademarks  requiring use of the relevant colour mark over a significant period of  time, a very strong association between the relevant trademark owner and  the goods bearing the single colour mark, and the use of the single  colour in relation to particular products being close to exclusive.&nbsp;<br /><br /><strong>What does this case mean for trademark protection in the UAE?<br /><br /></strong>Although  the decision in the Cadbury matter took place in the UK under UK laws  and in consideration of ECJ judgments, there is a possibility that both  the trademarks registry in the UAE and the local courts would follow a  similarly conservative approach in granting a possible monopoly on the  use of a single colour as a trademark.&nbsp; Further, the logic applied in  this case in dealing with the question of distinctiveness and the kind  of evidence required to support a conclusion that a single colour can  function as a distinctive trademark, should be of assistance to the  trademarks registry, the UAE courts and accordingly interested  applicants (and opponents) in dealing with applications for single  colour trademarks in the UAE.<br /><br />In practice, it would accordingly  be advisable for parties seeking protection for single colour trademarks  in the UAE to (i) clearly define the relevant colour in a way that is  objectively determinable; (ii) to consistently use the relevant colour  in practice; (iii) to prevent the use of shades of the relevant colour  by others (to the extent this may be possible) in respect of the same  category of goods / services; and (iv) to keep good record of the  development of the particular shade of the colour (if developed  specifically), packaging, marketing and advertising materials as  evidence .<br /><br /><strong>Conclusion<br /><br /></strong>It is important to  bear in mind that Cadbury&rsquo;s use of its shade of purple started back in  1914 which was an important fact considered by the court in this matter.  As Cadbury had almost a century of use of its colour purple to rely on,  the ownership of single colour trademarks &ndash; also here in the UAE - is  likely to continue to be an exception rather than the rule.</p>'),
	(84835,4625,'_content','field_59b649b5c8b2b'),
	(84836,4625,'lawUpdateArticleMonth','4618'),
	(84837,4625,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84838,4625,'content_description',''),
	(84839,4625,'_content_description','field_59b641c07f473'),
	(84840,4625,'pageSummary',''),
	(84841,4625,'_pageSummary','field_59e59b307dec8'),
	(84842,4625,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-5/january-2/cadbury-retains-hold-over-its-trademark-for-a-shade-of-purple-1.html'),
	(56689,3407,'_wp_attached_file','uploads/media-3406.jpg'),
	(56690,3407,'_wp_attachment_metadata','a:5:{s:5:\"width\";i:100;s:6:\"height\";i:133;s:4:\"file\";s:22:\"uploads/media-3406.jpg\";s:5:\"sizes\";a:0:{}s:10:\"image_meta\";a:12:{s:8:\"aperture\";s:1:\"0\";s:6:\"credit\";s:0:\"\";s:6:\"camera\";s:0:\"\";s:7:\"caption\";s:0:\"\";s:17:\"created_timestamp\";s:1:\"0\";s:9:\"copyright\";s:0:\"\";s:12:\"focal_length\";s:1:\"0\";s:3:\"iso\";s:1:\"0\";s:13:\"shutter_speed\";s:1:\"0\";s:5:\"title\";s:0:\"\";s:11:\"orientation\";s:1:\"0\";s:8:\"keywords\";a:0:{}}}'),
	(84195,4591,'content_description','End of service gratuity (“ESG”) is a topic that is currently stirring much debate.  In particular, it was recently reported that after conducting a study into the ESG system, the World Bank recommended the establishment of a pension fund for expatriate employees to replace or supplement ESGs. '),
	(84193,4591,'lawUpdateArticleMonth','4574'),
	(84194,4591,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(84192,4591,'_content','field_59b649b5c8b2b'),
	(98413,5346,'_content','field_59b649b5c8b2b'),
	(98414,5346,'lawUpdateArticleMonth','5326'),
	(98415,5346,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98416,5346,'content_description','2015 was a challenging year for the Middle East and North Africa (“MENA”) hospitality industry, with some countries’ performance being impacted by currency fluctuations and other macroeconomic and geopolitical factors.\r\n'),
	(98417,5346,'_content_description','field_59b641c07f473'),
	(98418,5346,'pageSummary','2015 was a challenging year for the Middle East and North Africa (“MENA”) hospitality industry, with some countries’ performance being impacted by currency fluctuations and other macroeconomic and geopolitical factors.'),
	(98419,5346,'_pageSummary','field_59e59b307dec8'),
	(98420,5346,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/hotel-brands-coping-with-online-marketing-an-operators-perspective.html'),
	(98421,5346,'_currentURL','field_59d35123ab1e7'),
	(98422,5346,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','897'),
	(98423,5346,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98424,5346,'lawUpdateArticleWriters','1'),
	(98425,5346,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98426,5346,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Mai Marshad'),
	(98427,5346,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(98428,5346,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','m.marshad@tamimi.com'),
	(98429,5346,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(98430,5346,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(98431,5346,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(98432,5346,'lawUpdateArticleNoWriters','1'),
	(98433,5346,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(98434,5346,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','634'),
	(98435,5346,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(98436,5346,'lawUpdateArticlePractices','1'),
	(98437,5346,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(98438,5346,'_yoast_wpseo_metadesc','2015 was a challenging year for the Middle East and North Africa (“MENA”) hospitality industry, with some countries’ performance being impacted by currency fluctuations and other macroeconomic and geopolitical factors.'),
	(98439,5347,'content','March 2016\r\n\r\n<hr />\r\n\r\nMany of these hotels are operated by companies based in a single jurisdiction, but have global brand names well-known to consumers as a result of globalization and increased tourism and travelling. Unfortunately many operators neglect to register their trademarks nationally or internationally, and in many cases have failed to enforce their trademarks outside of their core geographic market. Recently, there is an increasing trend of businesses venturing into the hospitality industry, and consequently, trademark disputes have increased as a result of their geographic expansion. For example, a notable lawsuit occurred between the infamous “The Plaza Hotel” in New York and the “Union Plaza,” also known as “Plaza Hotel and Casino” in Las Vegas. Although many hotels are established in one location, their brand name precedes them, and is therefore known all over the world. As a result, consumer confusion is extremely likely when one travels from New York to Las Vegas and sees THE PLAZA mark. A logical association is made between the two businesses, as the brand is notorious and the name is seemingly the same.\r\n\r\nInternational trademark disputes in the hospitality industry create tension between two important legal trademark principles: the territoriality principle and the ‘famous trademark’ doctrine. According to the territoriality principle, trademark rights are determined on a jurisdictional (i.e. country-by-country) basis; whereas the ‘famous trademark’ doctrine (or ‘well-known’ trademark doctrine) is the general exception to the territoriality principle, and refers to the idea that a trademark can be given protection in a jurisdiction due to how famous it is, even though it is not registered or used in the jurisdiction.\r\n\r\nArticle 6(3) of the Paris Convention highlights the territoriality principle, providing that a “mark duly registered in a country of the [Paris] Union shall be regarded as independent of marks registered in other countries of the Union, including the country of origin.” However, Article 6bis of the Paris Convention lays out the well-known trademark exception, stating, “The countries of the Union undertake [...] to refuse or to cancel the registration, and to prohibit the use, of a trademark which constitutes a reproduction, an imitation, or a translation, liable to create confusion, of a mark considered [...] to be well known in that country as being already the mark of a person entitled to the benefits of this Convention and used for identical or similar goods.” This exception is further expanded to apply to service marks, which would include hospitality industry services, in Article 16(1) of the Agreement on Trade Related Aspects of Intellectual Property Rights. According to these agreements, actual use of a trademark in a foreign country is not essential to establish the mark is well-known. Therefore, reverting back to the earlier example, THE PLAZA is a well-known mark in Dubai, even though the only branch is in New York; this may be a result of media attention or movie settings, but irrespective of why, THE PLAZA is a well-known mark worldwide.\r\n\r\nInternational hospitality disputes are not new, but they are becoming increasingly frequent and complex, with the results being uncertain. In a recent case handled by Al Tamimi &amp; Company, a very famous and well-known hotel in India sought to sue two different Indian restaurants by the same name, one being located in Kuwait and an unrelated, separate one being located in the UAE. The hotel sought to sue the restaurants on the grounds of trademark infringement, among other claims. The UAE Trademarks Office analyzed the trademark owner’s multiple trademark registrations, evidence of fame (including the international and national awards won by the hotel and the Indian celebrities that visited it) and found that the UAE based restaurant was infringing on a well-known mark. In Kuwait, however, the results were not as easily obtained. The matter in Kuwait was assigned to be assessed by an Intellectual Property Expert and is currently pending a decision\r\n\r\nConflicting results are often due to the fact that there is no set criteria for a mark to be labelled as “well-known” or “famous;” moreover, it is often difficult to ascertain that a mark is well-known when the examiner may have never heard of the mark in the particular jurisdiction. For this reason, the examiners in the UAE reviewed an array of evidence relating to the hotel’s brand, consumer recognition, advertisements, media attention, and more to assess whether the mark was famous.\r\n\r\nThese types of disputes are continually on the rise, and the increase is likely to be noticeable in Dubai, as hundreds of restaurants and hotels will open between now and the 2020 Expo. It is important for brands in the hospitality industry to protect their marks and maintain the ability to geographically expand. First and foremost, the company must assess and identify which countries it may reasonably expect to expand into, and for those countries, the company should attempt to register their trademarks. In the countries where registration is sought, it is important to note the requirements to maintain registration. For example, advertising of the hospitality services (or some type of marketing) under the mark to travellers to the hotel, may be sufficient to obtain and maintain registrations, even though the hotel or company does not actually provide hospitality services in the country in question.\r\n\r\nIn countries of interest where the company was not able to successfully register or foresees that the hotel may face trademark issues after assessing the results of a trademark search, the hotel or company should maintain records to establish that it is a well-known or famous mark. As in the previously mentioned case with the Indian hotel and the Indian restaurant by the same name in the UAE, the hotel relied on publications and media that arguably reached consumers in the country. Other possible forms of evidence include accounting records demonstrating advertising or marketing expenses in the country, customer lists identifying guests from the country who have visited the hotel, and internet logs identifying visits to the company’s website from users in the country. It should be noted that often proving that a mark is well-known or famous requires evidence spanning several years.\r\n\r\nIt is not only important for businesses in the hospitality industry to act pre-emptively, such as the actions suggested above, but it is also important for these businesses to take action and enforce against possible infringements in countries of interest. This is important to ensure that the company can expand in the future and avoid litigation against an established entity in the country of interest. With a rapidly growing economy, and with the 2020 Expo just around the corner, it is imperative for brand names in the hospitality industry to protect their marks in the UAE and neighbouring region.\r\n\r\n&nbsp;'),
	(163451,5347,'core_values',''),
	(163452,5347,'_core_values','field_59b64ab071de4'),
	(163453,5347,'file',''),
	(163454,5347,'_file','field_59b64c10f6600'),
	(163455,5347,'orderValue4','4'),
	(163456,5347,'_orderValue4','field_59d2096a8ff34'),
	(163457,5347,'related_pages_header',''),
	(98394,5345,'_content','field_59b649b5c8b2b'),
	(98395,5345,'lawUpdateArticleMonth','5326'),
	(98396,5345,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98397,5345,'content_description','In a hospitality project which involves funding from one or several financial institutions, it will often be a requirement that the lender group, or their representative, enters into a direct agreement with the hotel operator and the hotel owner. '),
	(98398,5345,'_content_description','field_59b641c07f473'),
	(98399,5345,'pageSummary','In a hospitality project which involves funding from one or several financial institutions, it will often be a requirement that the lender group, or their representative, enters into a direct agreement with the hotel operator and the hotel owner.'),
	(98400,5345,'_pageSummary','field_59e59b307dec8'),
	(98401,5345,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/direct-agreements-in-hotel-financings-key-considerations.html'),
	(98402,5345,'_currentURL','field_59d35123ab1e7'),
	(204153,5345,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(204152,5345,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Renata Rai'),
	(98405,5345,'lawUpdateArticleWriters',''),
	(98406,5345,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98407,5345,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','411'),
	(98408,5345,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(98409,5345,'lawUpdateArticlePractices','1'),
	(98410,5345,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(98411,5345,'_yoast_wpseo_metadesc','In a hospitality project which involves funding from one or several financial institutions, it will often be a requirement that the lender group, or their representative, enters into a direct agreement with the hotel operator and the hotel owner.'),
	(98412,5346,'content','March 2016\r\n\r\n<hr />\r\n\r\nThe MENA region is one of the most rapidly developing hospitality markets with a continuous influx of international hotel brands. A 2015 study conducted by Knight Frank found that international operators are responsible for operating approximately 61% of the total hotel supply in the region, whilst international brands operate 24% of the existing supply in relation to serviced apartments. A study conducted by the Dubai Department of Tourism and Commerce Marketing predicts that by the end of 2016 Dubai is expected to see a tremendous rise in new hotels including Renaissance Dubai Downtown, The Westin Dubai, and W Hotel Palm Jumeirah, bringing total rooms to 110,000 and by 2020 to 150,000. As new hotels continue to open, one of the greatest challenges facing hotels today is competition. As customers now have greater choice, the intense competitive market has forced hotel brands to focus on providing memorable experiences to their guests rather than selling a service. As such, a dedicated focus on customer loyalty and brand name is prerequisite for the survival of hotels today.\r\n\r\nA hotel trademark acts as an essential identifier. A hotel’s trademark is associated with a hotel’s image, reputation, design, cleanliness, hospitality, demographics and underlying value or quality of a hotel. Such association ultimately leads to an identity of a hotel and is often perceived as the personality of an intangible entity: the Brand.\r\n\r\n<strong>Hotel Rooms: a commodity or a quality service?</strong>\r\n\r\nThe industry has witnessed the rise of new online service providers such as Airbnb, Expedia, Hotel Search and Booking.com. Airbnb alone has served over 30 million guests since 2008. Nevertheless, Airbnb appears to be less damaging to hotels than Uber may have been to pre-existing licensed taxis. This is partly due to the fact that before the internet the market for renting a room (in the commodity sense of a service) was not limited to hotels (renting rooms in the quality sense of a service). Airbnb has however been a platform to combine and grow this market. The brand operating the hotel is the main reason why hotels will continue to grow, as they offer assurance and predictable consistency in quality service, amenities and facilities.\r\n\r\n<strong>Rise of Mobile Apps</strong>\r\n\r\nMobile apps and specialized accommodation websites have allowed customers more freedom to choose the best value options for their preference, opening the path to healthy and fair competition after it was restricted to tourist agencies (who would often use restricted lists). Guests are presented with cheaper accommodation and flexibility in relation to checking in and checking out. However, many of the mobile apps themselves face fierce competition from new comers year on year, and so these platforms always need to improve and invest into research and development to keep their apps and sites friendly and attractable to consumers, and allow the hotel brands excellent exposure with minimal expenditure.\r\n\r\n<strong>But is it all good? </strong>\r\n\r\nNot quite. As with anything in the cyber world, the forums, apps, and sites related to hotels allow for ratings, reviews and commenting by consumers and users on their experience or opinion to be shown adjacent to the hotel brands. Regardless of how objective or truthful, the reviews reflect opinions of users not that of the internet based company. This may be at times damaging to the brand if the reviews posted next to the name of a certain hotel have rated the brand unfairly below what it represents. The integrity of a trademark may be held hostage to exaggeration or non credible opinions. It would nonetheless be fair to argue that however opinionated users may be, the overwhelming sensible reviews would balance against those that draw an untrue picture. Furthermore, and as a result of the tremendous exposure offered by the online world, those less fortunate brands and hotel brand owners who previously could not afford advertisement are now on par with the 5*+ hotels in terms of exposure. This is obviously good for these brand owners yet narrows the gap previously enjoyed by the richer hotels.\r\n\r\n<strong>What does this mean to Hotel Brand owners?</strong>\r\n\r\nThe internet has shifted the advertisement of a trademark and its use from printed media to online. This means that whereas printed media was under control of and instructed by hotel brand owners, the online use is controlled by third parties. The responsibility lies with the hotel brand owners to monitor proper online use of their trademarks in a manner consistent with its branding guidelines. Hotel brand owners also need to secure registration of their trademark and defend the integrity of the brand by taking action against any social media accounts, professional forum accounts, mobile apps or hotel related sites that misappropriate their trademark. This may mean putting in place mechanisms to monitor against misuse, infringements, cyber-squatting, and misappropriation of the brand.\r\n\r\n&nbsp;'),
	(163481,5346,'core_values',''),
	(163482,5346,'_core_values','field_59b64ab071de4'),
	(163483,5346,'file',''),
	(163484,5346,'_file','field_59b64c10f6600'),
	(163485,5346,'orderValue4','4'),
	(163486,5346,'_orderValue4','field_59d2096a8ff34'),
	(163487,5346,'related_pages_header',''),
	(163488,5346,'_related_pages_header','field_59b6441e3cc94'),
	(98375,5344,'_content','field_59b649b5c8b2b'),
	(98376,5344,'lawUpdateArticleMonth','5326'),
	(98377,5344,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98378,5344,'content_description','The renovation of a hotel can have many traps for both Contractors and Developers.  If these issues are not properly allowed for, you can lose your reputation and be embroiled in a dispute for years!!  '),
	(98379,5344,'_content_description','field_59b641c07f473'),
	(98380,5344,'pageSummary','The renovation of a hotel can have many traps for both Contractors and Developers. If these issues are not properly allowed for, you can lose your reputation and be embroiled in a dispute for years!!'),
	(98381,5344,'_pageSummary','field_59e59b307dec8'),
	(98382,5344,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/hotel-renovations-what-could-possibly-go-wrong.html'),
	(98383,5344,'_currentURL','field_59d35123ab1e7'),
	(204159,5344,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(204158,5344,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Scott Lambert'),
	(98386,5344,'lawUpdateArticleWriters',''),
	(98387,5344,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98388,5344,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','537'),
	(98389,5344,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(98390,5344,'lawUpdateArticlePractices','1'),
	(98391,5344,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(98392,5344,'_yoast_wpseo_metadesc','The renovation of a hotel can have many traps for both Contractors and Developers. If these issues are not properly allowed for, you can lose your reputation and be embroiled in a dispute for years!!'),
	(98393,5345,'content','March 2016\r\n\r\n<hr />\r\n\r\nThe purpose of this agreement is to clearly set out the relationship between these three stakeholders and how the financing agreements between the financiers and the hotel owner and hotel management agreements between the hotel owner and the hotel operator will fit together. This requirement often emanates from both the hotel operator and the financiers as it is in their common interest to reach a clear agreed position.\r\n\r\nThere will often be some conflicting provisions between the hotel management agreement and the financing agreements and part of the job of the direct agreement is to iron out any such conflicts. Although united by the common purpose of operating the hotel efficiently, the three key stakeholders tend to have differing priorities. The priorities of the operator would be to protect (i) its right to operate the hotel for the anticipated term, (ii) its autonomy as regards operational matters, (iii) its revenue and (iv) its brand and intellectual property. The owner will want the hotel to be a success and will want to support the operator and financiers in reaching agreement, as this will be critical to the success of the project. The financiers usually understand the position of the operator and the owner, but have their own requirements as regards the extent of security and operational control required in respect of the particular project. Notwithstanding the potential for conflict between these stakeholders, there is one key factor which unites them and that is the desire for the hotel project to be completed and for the hotel to operate smoothly and profitably.\r\n\r\nIn this article we will comment upon four key areas which are significant for the stakeholders to consider, which are usually covered in a direct agreement. These are:\r\n<ul>\r\n 	<li>bank accounts;</li>\r\n 	<li>non disturbance of the operator;</li>\r\n 	<li>insurance requirements and application of insurance proceeds; and</li>\r\n 	<li>termination.</li>\r\n</ul>\r\n<strong>Bank accounts</strong>\r\n\r\nHotel projects usually involve a number of bank accounts, with payments moving between them as agreed under the hotel management agreement and facility agreement. The typical structure is that hotel revenue is paid into the hotel operating account and applied towards hotel operating costs. Any profit is subject to various deductions, such as management fees payable to the operator and/or a contribution towards a maintenance and repair fund, after which the remaining balance is paid to the owner, as the owner’s return.\r\n\r\nIn some cases, the financing agreements and the hotel management agreement are not implemented at the same time, so the parties need to review the existing contractual framework as regards bank accounts, payments and cashflows and then amend that framework as necessary to reflect how these matters will operate in practice.\r\n\r\nFrom the operator’s perspective, the priority is to ensure that they have control over, and access to, the hotel operating revenues and an ability to carry out their role as hotel manager, which will usually include managing the income and operating costs of the hotel, for the duration of the term of the hotel management agreement. The operator will be less concerned with the owner’s return.\r\n\r\nBy contrast, the owner’s priority will be to ensure that the operator is able to operate the hotel efficiently and that there are no unnecessary hurdles to payment to the owner (or its nominated account) of the owner’s return.\r\n\r\nThe financiers will want to have as much visibility as possible over the hotel operations and cashflow and will often want to see all hotel project accounts held with one of the financiers. The financiers would usually appreciate that the operator needs a high level of autonomy in terms of operating income and expenses and may allow this, provided that they have visibility over operations and control as regards the accounts, other than the accounts required for operating the hotel.\r\n\r\nIn some hotel projects, the direct agreement will provide that there should be a hotel operating budget prepared periodically and agreed between the parties and allowing for matters within the budget to be automatically permitted, whereas deviations require special approval. Whether this is required or advisable will depend on a case by case assessment of the project. Where the budget formulation and approval process is contemplated, the timelines to agree the budget and a fallback position to resolve any disagreement, for example by referring the matter to an expert, are advisable.\r\n\r\nRelated to accounts are the financiers’ right to set off amounts due to them from the owner against credit balances on accounts in the name of the owner. This is relevant because in many cases, certain operating accounts will be held in the name of the owner, but would be under the sole control of the operator. For this reason, some operators require that the “operating” accounts (ie which relate strictly to hotel revenue and expenses and other deductions under the hotel management) are kept outside the security structure and the only obligation on the operator is to pay the owner’s return to such account as is required by the financiers. Alternatively, where the accounts must be held with one of the financiers, the operator may require that the financiers’ right of set off cannot be exercised against the operating accounts. This is because the operator will have committed to running the hotel, including dealing with many third parties, in reliance upon amounts in those accounts and the operator would not want to be left in a position where the funds on which it relied have been unilaterally withdrawn by the financiers.\r\n\r\n<strong>Non disturbance of the operator</strong>\r\n\r\nAs noted above, the stakeholders usually agree that they will all be best served by a well run hotel, operated by the operator with minimal interference from the owner or financiers. The operator is, after all, the best placed stakeholder to make the relevant operational decisions and would usually have been selected based on its track record and experience. In light of this, the operator will seek assurances from the financiers that the operator will be left to run the hotel operations in accordance with the hotel management agreement and, to the extent possible, the hotel management agreement will be respected by the financiers and their representatives, delegates and successors. In the UAE, this latter point requires careful consideration because of the lack of self help enforcement remedies under UAE law. In most cases, the financiers will see the land on which the hotel is based as their core collateral and will take a mortgage over that site. If there were an event of default under the finance agreements and the financiers were to enforce their security, this mortgage would be executed through the relevant execution court, culminating in an auction of the property. Currently, contracts such as hotel management agreements will not automatically follow the land to the ultimate buyer, binding that buyer to comply with their terms. As such, the type of non disturbance clause seen in the UAE may be lighter in this respect than the equivalent clause in some other jurisdictions.\r\n\r\n<strong>Insurance requirements and application of proceeds</strong>\r\n\r\nIn most transactions, the operator will have insurance requirements placed on the owner under the hotel management agreement, sometimes with the operator arranging the necessary insurances at the owner’s cost. Similarly, the financing agreements will include insurance obligations on the owner and also provisions setting out the way in which insurance proceeds are to be applied (such as to replace or repair a damaged asset or in certain circumstances to mandatorily prepay the financing). Any mismatch in these requirements needs to be carefully considered and the documents drafted, or amended if they are already in place, to reflect the commercial agreement between the stakeholders on these matters. Of particular importance are the obligation to apply proceeds paid on total loss of the property itself to reduce the financing amount (on the basis that the main asset has been destroyed) and the ability of the operator to have visibility and comfort as regards application of certain operations related insurance proceeds. For example third party liability insurance should be applied to pay the injured third party and insurance proceeds paid in respect of a damaged lift ought to be applied to repair the lift. There is no ‘one size fits all’ approach to these matters, as they will depend on the insurance policies in question and the provisions of the hotel management agreement and financing agreement. They are, however, important to understand and agree at an early stage in negotiations.\r\n\r\n<strong>Termination</strong>\r\n\r\nAnother area which unites the stakeholders is the desire to agree the manner in which the hotel management agreement may be terminated. The financiers want to have visibility on the occurrence of any potential termination event under the management agreement, usually with a right (but not an obligation) to remedy the underlying breach. This is because, in some cases, the financiers would want to protect the hotel management agreement and the services provided thereunder, even if this is at their cost for a certain period. This would usually be because either the owner is not in a position to remedy the breach, or requires financier assistance to do so and the financiers feel their overall position is best served through continuation of the hotel management agreement. From the operator’s perspective, agreeing to such a termination process is beneficial, in the sense that a breach could be remedied not only by the owner, but (at the financiers’ option) by the financiers as well. The downside from the operator’s perspective is that the financiers’ requirements may extend the timeframe and process to terminate, when compared with the operator’s rights under the hotel management agreement.\r\n\r\nOn the flip side, the financiers would usually agree to notify the operator of the occurrence of an event of default or enforcement event under the financing agreements. This would simply put the operator on notice as regards the owner’s position, allowing the operator to begin contingency planning. This notification would not usually give the operator any new rights, so this is more an information sharing obligation to reflect the good faith of the parties.\r\n\r\n<strong>Concluding remarks </strong>\r\n\r\nAs can be seen from the above, the interplay between operator, owner and financiers can be very varied and depends on the operational arrangements in place in respect of the hotel project in question. The one key theme in hotel financings is that clarity in requirements and expectations of these stakeholders is vital in helping them to quickly and efficiently find contractual solutions to manage the relationship between them, while allowing the hotel to operate smoothly.\r\n\r\nShould you have any queries concerning direct agreements or hotel financings, please feel free to contact the author of this article or any other member of the Banking &amp; Finance team at Al Tamimi &amp; Company.'),
	(163513,5345,'core_values',''),
	(163514,5345,'_core_values','field_59b64ab071de4'),
	(163515,5345,'file',''),
	(163516,5345,'_file','field_59b64c10f6600'),
	(98347,5342,'_content_description','field_59b641c07f473'),
	(98348,5342,'pageSummary','Hotels contain many vast and diverse departments, such as housekeeping, marketing, reservations and food outlets.'),
	(98349,5342,'_pageSummary','field_59e59b307dec8'),
	(98350,5342,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/can-i-get-a-witness-standard-terms-for-agreement-with-live-performers-at-a-hotel-venue-in-the-uae.html'),
	(98351,5342,'_currentURL','field_59d35123ab1e7'),
	(98352,5342,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','845'),
	(98353,5342,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98354,5342,'lawUpdateArticleWriters','1'),
	(98355,5342,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98356,5342,'_yoast_wpseo_metadesc','Hotels contain many vast and diverse departments, such as housekeeping, marketing, reservations and food outlets.'),
	(98357,5343,'content','March 2016\r\n\r\n<hr />\r\n\r\nUnusual working arrangements are not as common in the UAE as elsewhere. However, in some sectors, such arrangements are more usual simply because of issues particular to that sector. In the hotel sector, businesses which use the separate owner/operator model have little choice but to utilise secondments for a variety of reasons which will be considered below. This article explores the practical issues surrounding secondments used by hotels in the UAE together with the associated benefits of utilising that approach.\r\n\r\n<strong>Background</strong>\r\n\r\nIn order to work in the UAE, all employees must have a residence visa (with the exception of UAE and other GCC nationals) and a work permit. As a result of UAE immigration laws, an employee may only lawfully work in the UAE for the employer listed on the employee’s visa and work permit and only from the employer’s registered premises. Furthermore, an employee may not lawfully work for more than one employer simultaneously except in very limited circumstances.\r\n\r\nWhere an employee is found to be carrying out work for an organisation other than their employer without the approval of the applicable authorities, fines of up to AED 51,000 (USD 14,000) per employee in breach may be issued by the General Directorate of Residency and Foreigners Affairs up to a maximum of AED 5 million (USD 1.4 million). Such fines may be issued against both the employer and any entity which allows employees who are not sponsored by it to carry out work.\r\n\r\nAs set out above, all employees in the UAE must carry out work for their sponsor and at their sponsor’s registered place of business only. In the hotel industry, this inevitably results in the hotel owner employing all hotel staff, including senior management, as it is the hotel owner that holds the hotel licence and provides the licensed place of business at which the staff will be employed. This arrangement creates a scenario where the legal responsibility for the staff remains with the owner, whilst the selection, hiring, management and direction of the staff is undertaken by the hotel operator – although, practically, through the hotel executive personnel such as the general manager, head of HR, etc.  These executives will also be employees of the owner. As a result, the issue of liability for the conduct of the hotel staff, including the executive personnel, can become blurred, and may, in the event of breach of the operator’s obligations to the owner under the hotel management agreement (“HMA”), create an obstacle to successfully proving breach by the operator, where the event giving rise to the breach has been undertaken by a member of the hotel staff. To address this, secondment of executive staff is commonly used to provide for the continued employment of hotel executive personnel (general manager, financial controller and, in some cases, department heads) by the hotel operator, with a secondment to the hotel owner for the purposes of sponsorship and visa only.\r\n\r\n<strong>Secondments in practice</strong>\r\n\r\nIn recognition of the fact that some roles or business dynamics require a degree of flexibility in relation to working arrangements, it is possible in some circumstances for employees to obtain consent to carry out work for another employer or from another location than set out in the employee’s residence visa and work permit.\r\n\r\nMore usually, a secondment will be used for commercial considerations (as identified above) or because the ultimate employer (in this case, the operator) does not have a presence in the UAE or is otherwise unable to obtain residence visas or work permits for employees. Where this is the case, the owner will sponsor the employee but an employment relationship will remain in place between the employee and the operator.\r\n\r\n<strong>Documenting arrangements</strong>\r\n\r\nWhere key employees are concerned, it is very common for the employees to continue to be employed directly by the operator (often via its parent company abroad) whilst also entering into a direct employment relationship with the owner (which will ultimately be responsible for obtaining a residence visa for the employee) which naturally results in a number of issues. Perhaps the most important consideration for all parties is whether the employment with the operator will continue throughout any secondment arrangement. In most cases, employment will continue not least to ensure that the owner is best placed to prove any breach of contract by the operator. This potentially results in the employee being able to assert employment rights against both the owner and the operator. One possible way to resolve this difficulty is to suspend the employment terms with the operator whilst employment with the owner is ongoing.\r\n\r\nOnce a decision has been made in relation to employment of key staff with the operator, the primary concern between the parties would generally be how to document the arrangement, with the most commonly used arrangement being:\r\n\r\n1.  HMA\r\n\r\nThis would generally set out the commercial arrangements between the parties. Ideally, the owner would negotiate the terms of the HMA such that the operator retains responsibility for a number of specific key personnel. On occasion, and again depending on the negotiations between the parties, the HMA may contain a right of veto in favour of the owner which enables the owner to have some involvement in the identity of key personnel.\r\n\r\n2.  Employment contract between the operator and the employee\r\n\r\nIn order to preserve the relationship between the operator and employee during the secondment, and assuming that the parties would like this to be the case, the employee would ordinarily remain employed by the operator.\r\n\r\n3. Secondment agreement between the owner and operator\r\n\r\nIdeally, the agreement would detail, amongst other things, the mechanism for the secondment and management of the employees by the owner. This would include any amounts payable to the employee, responsibility for disciplinary matters, which party can approve leave etc. The most common approach would be for the operator to retain control of the employee with the owner effectively acting as the operator’s proxy, carrying out instructions issued by the operator (where necessary). In some cases, the parties do not enter into such an agreement.\r\n\r\n4.   Agreement or letter between the operator and the employee\r\n\r\nWhere a secondment arrangement will be in place, the operator would generally communicate the proposed secondment to the employee in writing. The document would set out that the employment relationship between the parties will continue (if that is intended to be the case) and would identify which provisions of the employment contract will continue during the secondment and which would not. The agreement would also provide details and conditions in respect of the employment. By way of example, the agreement would identify the proposed country and location of work, reporting lines and other matters which are likely to change during the secondment period.\r\n\r\n5.  Employment contract between the owner and the employee\r\n\r\nBroadly, in order to obtain a residence visa and work permit for an individual in the UAE, it is necessary to file a standard form contract with the relevant free zone authority or the Ministry of Labour (with some exceptions). Certain hotels are exempt from the remit of the Ministry of Labour and therefore a standard employment contract is not a pre-condition of the visa process for those exempted entities. However, it would be usual for individuals to be provided with an employment contract from the owner. Despite that, the contractual documentation between the owner and the employee will generally be kept to a minimum in order to avoid repeating the content of the contract between the operator and employee or, potentially, creating conflict between those terms.\r\n\r\n<strong>Considerations</strong>\r\n\r\nThere are many considerations for all parties involved in a secondment arrangement and most will be particular to the circumstances. However, there are a number of points which should be considered throughout the process in all cases and particularly whilst drafting the required documents. Examples of points to consider are set out below:\r\n<ul>\r\n 	<li>How long will the secondment arrangement be in effect?</li>\r\n 	<li>Which party will be responsible for the employee, both day to day and in respect of material matters?</li>\r\n 	<li>Can any of the parties bring the arrangement to an immediate end and, if so, how will doing so impact upon the overarching employment relationship?</li>\r\n 	<li>What arrangements will be put into place during the secondment to ensure that the parties communicate effectively? Will there be regular updates issued by the owner?</li>\r\n</ul>\r\nThe considerations set out above are of particular importance in respect of key employees who may well have worked with an operator for many years and who intend to remain employees of the operator for the foreseeable future.\r\n\r\nMoreover, in addition to the pure employment considerations which all parties should be mindful of, it is of particular importance for the owner to consider the question of liability in the event of any major difficulties arising from the HMA. In the event of a breach of the terms of the HMA by the operator, the owner may well be in a stronger position to successfully prove the operator’s breach, if the owner has ensured a direct link between the operator and the hotel key personnel, by utilising a well structured secondment arrangement.'),
	(163598,5343,'core_values',''),
	(163599,5343,'_core_values','field_59b64ab071de4'),
	(163600,5343,'file',''),
	(163601,5343,'_file','field_59b64c10f6600'),
	(163602,5343,'orderValue4','4'),
	(163603,5343,'_orderValue4','field_59d2096a8ff34'),
	(163604,5343,'related_pages_header',''),
	(163605,5343,'_related_pages_header','field_59b6441e3cc94'),
	(163606,5343,'related_pages',''),
	(163607,5343,'_related_pages','field_59b6434af4880'),
	(163608,5343,'relatedArticles',''),
	(163609,5343,'_relatedArticles','field_59d349d04107c'),
	(163610,5343,'_yoast_wpseo_content_score','30'),
	(163611,5342,'_edit_last','1'),
	(163612,5342,'lawUpdateArticlePractices',''),
	(163613,5342,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(163614,5342,'lawUpdateArticleSectors',''),
	(163615,5342,'_lawUpdateArticleSectors','field_59ec462a1e203'),
	(98358,5343,'_content','field_59b649b5c8b2b'),
	(98359,5343,'lawUpdateArticleMonth','5326'),
	(98360,5343,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98361,5343,'content_description','It is becoming increasingly common for employers in a number of labour markets worldwide to utilise atypical working arrangements. '),
	(98362,5343,'_content_description','field_59b641c07f473'),
	(98363,5343,'pageSummary','It is becoming increasingly common for employers in a number of labour markets worldwide to utilise atypical working arrangements.'),
	(98364,5343,'_pageSummary','field_59e59b307dec8'),
	(98365,5343,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/secondments-in-the-uae-hotel-industry.html'),
	(98366,5343,'_currentURL','field_59d35123ab1e7'),
	(98367,5343,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','917'),
	(98368,5343,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98369,5343,'lawUpdateArticleWriters_1_lawUpdateArticleWriter','891'),
	(98370,5343,'_lawUpdateArticleWriters_1_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98371,5343,'lawUpdateArticleWriters','2'),
	(98372,5343,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98373,5343,'_yoast_wpseo_metadesc','It is becoming increasingly common for employers in a number of labour markets worldwide to utilise atypical working arrangements.'),
	(98374,5344,'content','March 2016\r\n\r\n<hr />\r\n\r\nA dream renovation could turn to disaster very easily for any Developer or Contractor. Careful thought and drafting is needed to avoid being caught by common pitfalls.\r\n\r\n<strong>Scenario 1 </strong>\r\n\r\nA luxury hotel wants to have the foyer and restaurant areas refurbished during its off season.  These areas include a shopping arcade which is part of the complex but adjacent to the actual hotel.  Work is delayed and falls well behind the programme.  The Developer is faced with the prospect of the work having to be done over the peak tourist season which may affect hotel bookings and shop turnover.  The Contractor is engaged under a construct only FIDIC Red Book 1999.\r\n\r\nIf work is delayed from the off season to the peak season the hotel operator will claim against the Developer as will the lessees of the shops, which could be very expensive.  If the construction contract is based on FIDIC and is not amended the Developer could not accelerate the Contractor’s work to avoid work in peak season or manage this issue by suspending certain work at certain times (noisy or dusty work).\r\n\r\nThe construction contract should also ensure that any protocol for work to be a carried out which has been agreed with the operator is imposed on the contractor and that the Contractor does not cause the Developer to breach any lease.  It may also be the case that agreements for cooling or other services will be impacted and need to be managed under the construction contract. Importantly the agreed damages for late completion should reflect the potential claims or exclude from the rate claims from tenants and the operator.\r\n\r\n<strong>Scenario 2 </strong>\r\n\r\nA Contractor is working on a hotel redevelopment.  The hotel is operating and there are separate specialised contractors who are doing the entry areas.  The foyer art work will be completed earier than the entire project as the hotel is to partly open.  The foyer art is fragile and may be damaged by too much vibration.  During construction the specialised contractors cause delays due to unloading materials and taking longer than scheduled to complete their work.  The contract as in scenario 1 is engaged under a construct only FIDIC Red Book 1999.\r\n\r\nThe Contractor should look to have amendments to the contract to ensure that it is not responsible for the other contractors working on a shared site and that if the other contractors cause delay then it is not the Contractor’s responsibility. The Contractor should also ensure that it is clear that it will get additional costs it incurs should this happen.  It is preferable if there is an agreed protocol for who controls the loading docks and what access and egress is given as well as clarifying who is responsible for safety on shared areas.    The limitation of liability clause will need careful review and the Contractor should make sure that any particular conditions do not delete the ‘no liability for consequential loss’ provision, which may expose the Contractor to significant loss should the Contractor disrupt the hotel’s business.\r\n\r\nAs a Developer you would want to ensure that the Contractor is liable for, and is to coordinate work so as to not cause, damage the artwork. The contract will need to manage the early completion of part of the work and the monitoring of vibrations while work continues. Maybe there should be clear rules to protect hotel guests and to not disturb functions, venues and guests sleeping.\r\n\r\nWhile these scenarios are brief, these types of scenarios are almost always encountered in any hotel renovation project.  The scenarios highlight dangers for both the Developer and the Contractor.\r\n\r\nDevelopers should:\r\n<ul>\r\n 	<li>Ensure the contract makes provision for the interaction between the ongoing hotel and retail operations and the works, particularly where there is work which will cause noise or dust;</li>\r\n 	<li>Select a Contractor who is familiar with operating in a Brownfield (as against a Greenfield) environment, and preferably with experience with hotels and their requirements;</li>\r\n 	<li>Check the program to have a sequence that minimises the impact on the hotel operational areas;</li>\r\n 	<li>Allow for the ability to have no work times, either due to peak seasons or to times of day, and agree the effects that may have on the contract price, if any;</li>\r\n 	<li>Make sure that the terms of the hotel management agreement are not broken or that any redevelopment agreement reached with the hotel operator is reflected in the risks passed through to the Contractor;</li>\r\n 	<li>Have measurable means to assess if noise or vibration is excessive through the installation of meters or requiring the Contractor to install and monitor such meters;</li>\r\n 	<li>Manage the protection of existing structures and infrastructure and ensure that any agreed work methods are included or observed, particularly where there are any sensitive areas.</li>\r\n</ul>\r\nContractors should:\r\n<ul>\r\n 	<li>Ensure that they have an agreed means of access and egress as well as places for the storage of materials;</li>\r\n 	<li>Become familiar with the hotel management team to work out when work can be done and when it cannot be done;</li>\r\n 	<li>Set out in the contract the agreed terms for when the Contractor is entitled to claim for additional costs due to disruption or delay to accommodate the hotel operations;</li>\r\n 	<li>Ensure their insurance  cover is adequate for the risks of working in this operating environment;</li>\r\n 	<li>Limit their liability generally and seek to remove liability for consequential loss as claims by third parties (such as the hotel operator or tenants) may be significant</li>\r\n</ul>\r\nAll hotel renovation or addition projects will contain unique risks.  These risks should be considered and the agreement on how they are to be managed should be properly documented in the construction contract.  It is simply too risky to your business as a Developer or a Contractor to use a standard form and ignore these risks.'),
	(163564,5344,'core_values',''),
	(163565,5344,'_core_values','field_59b64ab071de4'),
	(98346,5342,'content_description','Hotels contain many vast and diverse departments, such as housekeeping, marketing, reservations and food outlets. '),
	(98345,5342,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98343,5342,'_content','field_59b649b5c8b2b'),
	(98344,5342,'lawUpdateArticleMonth','5326'),
	(98342,5342,'content','March 2016\r\n\r\n<hr />\r\n\r\nIn this region, one of the bigger revenue generators for hotel operators is the bar or club. In the competitive entertainment industry, bars and clubs are increasingly hiring musical acts – singers, bands and DJs – to generate interest and gain an audience. But many hotel venues are doing this on an ad hoc basis, using emails and calls to confirm and not having a set of standard terms that they present to entertainers that are performing in the venue. As with every aspect of your business, having and using a standard form contract for venue entertainment ensures that everyone understands the business side of the deal. There are no unexpected surprises for either party.\r\n\r\nThe basics are easy – the performer will perform on a certain date, at a certain time, for an agreed upon length of time, possibly alongside another act, and some money will be paid. Here are some other key terms that you might consider for inclusion in an entertainers’ contract\r\n\r\n<strong>Cancellation by the venue</strong>\r\n\r\nCancellation terms can vary enormously from venue to venue - they depend on issues such as lead times for marketing or cancellation terms agreed with other suppliers (such as a company that might be supplying the sound system). Any venue will usually have a set cancellation time and this should not vary from act to act. Performers are used to seeing a sliding scale for cancellation – in other words, the venue won’t have to pay them if it cancels the event before a certain date (say, 28 days before the event) but after that it will have to pay a certain percentage, generally sliding up to 100% for a cancellation that takes place very close to the date of the event. Venues can expect some negotiation on this point from ‘name’ performers – some will expect to be paid 100% anytime within, say, 60 days of the event. Many performers will not be willing to commit to an event if they are not offered such terms – if the venue cancels the event, they will not be able to replace that lost revenue readily and so they expect to be compensated.\r\n\r\n<strong>Cancellation by the performer</strong>\r\n\r\nObviously, a venue will not wish to pay a percentage of the fee to a performer that cancels their performance. Indeed, performers should only be able to cancel in limited circumstances - on evidence of illness for example. It is simply not possible to run a venue when it is possible that a performer that might not turn up.\r\n\r\n<strong>Standards for the performance</strong>\r\n\r\nThe UAE has strict rules about the content of performances and the performer must be made aware of those. This can readily be done contractually. For example if the performer includes any action, word or material in the performance that is, for example, lewd in nature or refers to drugs or drunkenness then the venue might have a contractual right to retain a percentage of the fee. Similarly noise levels can be set contractually – but ensure that it is clear to all parties where the noise measurement will be taken. Noise levels are significantly different at the front door than they are next to the speakers.\r\n\r\n<strong>Fees </strong>\r\n\r\nDeals vary from venue to venue but many venues in this region operate with a revenue share deal. This may mean that the performer takes the door money and perhaps a share of the bar takings once a certain minimum is reached. These terms need to be extremely clear to all parties – money is the root of most arguments and if the performer does not understand the terms, then you can expect that argument to begin.\r\n\r\nName performers will usually require a flat fee to appear and may also demand a percentage of their performance fee up front, before they perform. Very well known acts will often demand the whole fee before they perform.\r\n\r\nIf there is a revenue share deal, then the venue must be clear in setting contractual controls about the venue’s maximum capacity. It is very tempting for a performer to take in an extra 25 people if they are getting the money from each person. A fine however, if levied by the authorities, will be addressed to the venue. In that regard, the agreement can require that fines be repaid if they are caused by the actions of the performer – whether for overcrowding or excessive noise or for conduct whilst on stage.\r\n\r\n<strong>Extras</strong>\r\n\r\nPerformers will assume that certain things will be provided by the venue at no cost – water, parking, electricity. Some performers expect a little more – soft cotton towels, champagne, M&amp;Ms with the blue ones removed. Generally however these long and detailed riders will only be requested by name performers. For standard performers, it is important to be clear about what will be supplied. This extends to sound and lighting equipment as well as extras. The venue may already contain sound and lighting equipment but some performers might augment that equipment with their own gear. The agreement should be clear about who is supplying which part and, importantly, who is responsible for looking after each part. Performers using the venues equipment may wish to know who will be operating it. The performer will want to know that the operator is professional and properly trained as neither the performer nor the audience will tolerate incompetence in sound or lighting at any event.\r\n\r\nPromotional tickets and the management of the guest list can regularly lead to disagreement – usually antagonizing the party that is getting the ticket money. If your venue capacity is not large, then a guest list with 50 ‘friends’ is going to take away from your potential revenue. Similarly, if the performer is taking the ticket money, they may be upset if the venue provides 20 free passes to a local radio station.\r\n\r\n<strong>Force Majeure</strong>\r\n\r\nIn most regions, this clause has limited application to the live performance industry but in this region it can be extremely important. Public mourning periods are always unexpected and, without a clear force majeure clause (and perhaps an appropriate insurance policy as well) a venue can be liable for a large percentage of the performers fees if they have to cancel an event at the last minute. Outdoor venues are more susceptible – there may be issues with weather and again, this should be properly covered under a force majeure clause.\r\n\r\n<strong>Marketing</strong>\r\n\r\nThis vital part of event planning needs to be clearly allocated to the relevant party well before the event takes place. The venue should expect the performer to, at the very least, promote the event to their Facebook page, Twitter following and email database. However, the performer may expect the venue to provide more traditional media advertising such as radio spots and magazine listings. A poorly attended event usually leads to fingers being pointed in relation to poor (or poorly targeted) marketing. Addressing this in the agreement will avoid such a situation.\r\n\r\nLarger events may benefit from the inclusion of a specific capped amount that the venue will spend in advertising. The performer does need to know that there is not an endless marketing budget but will also be more comfortable knowing that there is at least some budget allocation for this important item.\r\n\r\n<strong>Non compete</strong>\r\n\r\nSome venues want to retain a performer for longer than one night – they may seek to create a regular event around that performer. If this is the case then the venue must consider a clause that prohibits the performer from taking that same performance or event name and putting it on elsewhere. If you do this, the performer can reasonably ask for a commitment to the event – 6 months perhaps. This is also a case where the marketing must be clearly set out so that the venue, the performer and the event all get the best opportunity to be successful.\r\n\r\n<strong>Merchandise </strong>\r\n\r\nLive performers often want to sell merchandise (such as t-shirts and CDs) at their events. It provides them with extra income and promotion. Venues do sometimes take a small commission on these sales, although this is rare in this region. It is important that the agreement is clear about the location and size of the merchandising stand as well as indicating who is responsible for staffing the stand and securing the goods that are displayed on the stand.\r\n\r\nRecording the performance.\r\n\r\nSome performers will want to be able to record the performance at the event and this should clearly be at their cost and risk. If the venue wishes to create images of the performance for promotion of the venue, it will need the specific permission of the performer within the agreement. It is likely that the performer will want to restrict the way that the venue uses the images – perhaps only for the promotion of the venue and maybe for a limited number of months. If the venue is creating live footage of a performance, it needs to address the complex issue of underlying music rights that will arise when it records and subsequently uses that footage.\r\n\r\n<strong>Conclusion</strong>\r\n\r\nIt is possible that an exchange of emails will suffice when a venue takes on a performer but this is not always prudent. Experience has shown that a simple pro-forma contract will stop miscommunication, avoid heated arguments after the event and ensure that the public does not view the event, however large or small, as having been poorly executed. It is a reliable way to ensure that events in hotel venues operate smoothly and, more importantly, return a profit.'),
	(163632,5342,'core_values',''),
	(163633,5342,'_core_values','field_59b64ab071de4'),
	(163634,5342,'file',''),
	(163635,5342,'_file','field_59b64c10f6600'),
	(163636,5342,'orderValue4','4'),
	(163637,5342,'_orderValue4','field_59d2096a8ff34'),
	(163638,5342,'related_pages_header',''),
	(163639,5342,'_related_pages_header','field_59b6441e3cc94'),
	(163640,5342,'related_pages',''),
	(163641,5342,'_related_pages','field_59b6434af4880'),
	(163642,5342,'relatedArticles',''),
	(163643,5342,'_relatedArticles','field_59d349d04107c'),
	(163644,5342,'_yoast_wpseo_content_score','30'),
	(163645,5341,'_edit_last','1'),
	(163646,5341,'lawUpdateArticlePractices',''),
	(163647,5341,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(163648,5341,'lawUpdateArticleSectors',''),
	(163649,5341,'_lawUpdateArticleSectors','field_59ec462a1e203'),
	(98341,5341,'_yoast_wpseo_metadesc','Al Tamimi & Company examines the options available to an Owner to terminate the HMA prematurely, where the HMA is governed by UAE law.'),
	(98340,5341,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(98339,5341,'lawUpdateArticleNoWriters','1'),
	(98336,5341,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(98337,5341,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(98338,5341,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(98320,5341,'_content','field_59b649b5c8b2b'),
	(98321,5341,'lawUpdateArticleMonth','5326'),
	(98322,5341,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98323,5341,'content_description','The standard terms and conditions of a hotel management agreement (“HMA”) usually provide the hotel owner (“Owner”) with very limited possibilities to terminate, while the hotel operator (“Operator”), on the other hand, has a wider entitlement to do so, sometimes even for defaults which may not be considered material.'),
	(98324,5341,'_content_description','field_59b641c07f473'),
	(98325,5341,'pageSummary','The standard terms and conditions of a hotel management agreement (“HMA”) usually provide the hotel owner (“Owner”) with very limited possibilities to terminate, while the hotel operator (“Operator”), on the other hand, has a wider entitlement to do so, sometimes even for defaults which may not be considered material.'),
	(98326,5341,'_pageSummary','field_59e59b307dec8'),
	(98327,5341,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/when-can-a-hotel-owner-terminate-the-hotel-management-agreement-a-uae-law-perspective.html'),
	(98328,5341,'_currentURL','field_59d35123ab1e7'),
	(98329,5341,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','890'),
	(98330,5341,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98331,5341,'lawUpdateArticleWriters','1'),
	(98332,5341,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98333,5341,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Lada Shelkovnikova'),
	(98334,5341,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(98319,5341,'content','March 2016\r\n\r\n<hr />\r\n\r\nIn order to ensure that whatever is provided in the HMA as a ground for unilateral termination by the Owner is enforceable under UAE law, thorough consideration should be given at the outset of negotiations of the HMA.\r\n\r\nThis article examines the options available to an Owner to terminate the HMA prematurely, where the HMA is governed by UAE law.\r\n\r\n<strong>Unilateral termination in the event of Operator breach </strong>\r\n\r\nOnce the Owner signs the HMA with the Operator it should take into account that, generally, proving an Operator’s breach of its contractual obligations will in practice be extremely difficult. One of the main reasons for this is due to the fact that the Operator’s management and operation of the hotel is undertaken through the Hotel personnel who, in the UAE, are employees of the Owner. Therefore, omissions on the part of Hotel staff, from a legal perspective, may be held as omissions of the Owner’s employees and not the Operator (unless it can be proven that the Operator was aware of such omissions and didn’t prevent them when it had the possibility to do so). This scenario may be altered in favour of an Owner should the Owner and Operator agree that the key personnel of the Hotel (i.e. the general manager, financial controller, head of marketing etc.) will be employed by the Operator and seconded to the Owner. This may, in certain circumstances, assist the Owner’s proof of a breach by the Operator’s (rather than the Owner’s) staff under the HMA. Therefore, it is preferable for an Owner to require such arrangements at the outset of negotiation of the HMA.\r\n\r\nAssuming that the Operator’s breach of the HMA can be proven by the Owner, the Owner can terminate the HMA in compliance with the UAE Civil Code by way of the parties’ mutual consent, by operation of law and by way of a court order. In order to avoid lengthy litigation/arbitration proceedings to secure a court order, the Owner may wish to rely on Article 271 of UAE Civil Code, which provides for a special method of termination:\r\n\r\n“It shall be permissible to agree that a contract shall be regarded as being cancelled spontaneously [automatically] without the need for a judicial order upon non-performance of the obligations arising thereout, and such agreement shall not dispense with notice unless the contracting parties have expressly agreed that it should be dispensed with.”\r\n\r\nThis Article permits that the wording of a termination clause in the HMA can prevail over (i) the need for a court order and (ii) the need for notice to be given to terminate. The position of the Dubai courts in previous rulings has confirmed that where the parties have expressly agreed in the contract to vest either party with a right to terminate the contract upon the breach of the other party, such provision is enforceable provided that the contract clearly states that such right can be exercised without the need for a court order (e.g. Court of Cassation judgment No. 266/2005). The Owner will however need to ensure at the outset of negotiation of the HMA that supporting language to this effect is included in the HMA.\r\n\r\nOn the other hand, the Owner should be mindful that there should be enough evidence of the Operator’s breach to substantiate the termination. Otherwise, if the Operator disputes the termination of the HMA by the Owner in court or arbitration and succeeds in showing that the termination was wrongful, the Operator will be entitled to claim damages from the Owner for breach of contract.\r\n\r\n<strong>Unilateral termination for convenience (no default on the part of the Operator)</strong>\r\n\r\nAs was mentioned above, the general rule under the UAE Civil Code provides that if there is no mutual consent between the parties to terminate a contract, neither party can unilaterally terminate it in the absence of a default allowing such termination.\r\n\r\nBut does UAE law allow the parties to agree that one party can terminate unilaterally for convenience (i.e. that the Owner can terminate even if there is no default on the part of the Operator)?\r\n\r\nYes, if the parties have agreed in the HMA that it can be unilaterally terminated (in the absence of either party’s default) by the Owner without the need for a court order, this will be upheld pursuant to the UAE Civil Code (Article 218) and court practice. However, an Operator will usually not agree to grant an Owner such a right in the HMA without a term that compensation (liquidated damages) be paid by the Owner to the Operator in the event such right is exercised. The Operator would require that the amount of such compensation be included in the HMA.\r\n\r\nWith respect to the amount of any such compensation, the right of the parties to agree in advance is generally provided for in Article 390 of the UAE Civil Code. The UAE courts have traditionally been of the opinion that liquidated damages cannot be awarded upon termination of a contract due to the fact that the agreement on liquidated damages within the contract is an ancillary (supporting) obligation, and therefore, does not exist in isolation of the primary obligation. As a result, until recently UAE courts have consistently applied the rule that where the primary obligation is terminated, the liquidated damages clause shall be disregarded as well. However, this position was recently changed by a ruling of Abu Dhabi Court of Cassation (Commercial Appeal No. 790-2013, dated 22. October 2014):\r\n\r\n“A penalty clause, being liquidated damages, is ancillary to a principal obligation. When the principal obligation is extinguished by the termination of the contract, the ancillary obligation is likewise extinguished and deprived of its effect. Thus, any tenable action for termination cannot be brought in contract and must be brought in tort in accordance with the general rules given that the penalty clause relates to the obligations imposed in contract upon its parties and calls for a penalty in the event of breach while the contract is still in force. <strong><em>However, if the penalty clause is independent and unrelated to any of the obligations, the extinguishment of the contract would have no effect on the existence of the penalty clause insofar as it gives rise to a separate agreement between the parties, notwithstanding its inclusion in the contract itself.”</em></strong>\r\n\r\nHowever, there is no such case law yet established in other Emirates, which means that should the Operator challenge the validity of the provision in the HMA on the pre-agreed amount of liquidated damages, there is a potential risk that the court (of an Emirate other than Abu Dhabi) or arbitral tribunal may interpret the nature of the liquidated damages differently, i.e. by considering that the liquidated damages clause has been terminated simultaneously with the termination of the HMA. Should this be the case, the court would then be entitled to assess the damages in accordance with the general rules for damage assessment, and not the pre-agreed amount of liquidated damages. In this case, both parties bear the risk of such assessment being unpredictable. However, the good news for an Owner is that in this case, the burden of proof with respect to the amount of incurred damages would be on the Operator.\r\n\r\nThe parties should also appreciate that the amount of compensation (liquidated damages), despite being specified in the HMA, may be varied by the court even if it finds that it survives the termination of the main agreement. On the application of either party the court has the discretion under Article 390(2) of the UAE Civil Code to vary the agreement as to the amount of compensation to be awarded, so as to make the compensation equal to the loss and any agreement of the parties to the contrary in the HMA in such circumstances, would be null and void. This practically means that either party could claim for an increase or decrease of the pre-agreed amount of compensation, however, the party bringing such a claim will have the burden of proof in court to override the pre-agreed amount of liquidated damages under the HMA.\r\n\r\nTherefore, should an Owner wish to negotiate termination for convenience in the HMA, the Owner should be mindful that Operators are usually reluctant to agree and so it should be raised at the outset of negotiations. Such a right to terminate is particularly important for an Owner where the nature of the performance test in the HMA will severely restrict the Owner’s other rights of termination.\r\n\r\n<strong>Unilateral termination in case of failure of performance test </strong>\r\n\r\nA common contractual ground for termination by the Owner is where the Operator fails the performance test.  For the majority of HMAs, the ability to terminate for failure of the performance test will effectively be the only way for an Owner to terminate the HMA without risk of payment of liquidated damages to the Operator. Therefore, the importance of the structuring of the performance test cannot be overestimated.\r\n\r\nHowever, the mere existence of a performance test in the HMA is not a guarantee of protection for the Owner, and so the negotiation of a fair, effective and representative performance test in the HMA should be a key issue for an Owner at the outset of negotiation of the HMA. There are numerous options for structuring a performance test, and these will to a large extent depend on various circumstances and scenarios of the project and both the Owner’s and the Operator’s positions in negotiation. Where an effective performance test is not possible, then an Owner may wish to focus on a right of unilateral termination for convenience instead, with payment of compensation to the Operator.\r\n\r\n<strong>Conclusion </strong>\r\n\r\nWhilst the Owner will hope never to have to terminate the Operator before the end of the contract term, it is important that the Owner negotiates contractual rights of termination to ensure that the Owner has the right to efficiently replace the Operator. It is essential that proper wording is used and that specialist legal advice is sought prior to the HMA being signed.'),
	(163664,5341,'core_values',''),
	(163665,5341,'_core_values','field_59b64ab071de4'),
	(163666,5341,'file',''),
	(163667,5341,'_file','field_59b64c10f6600'),
	(163668,5341,'orderValue4','4'),
	(163669,5341,'_orderValue4','field_59d2096a8ff34'),
	(163670,5341,'related_pages_header',''),
	(163671,5341,'_related_pages_header','field_59b6441e3cc94'),
	(163672,5341,'related_pages',''),
	(163673,5341,'_related_pages','field_59b6434af4880'),
	(163674,5341,'relatedArticles',''),
	(163675,5341,'_relatedArticles','field_59d349d04107c'),
	(163676,5341,'_yoast_wpseo_content_score','30'),
	(163677,5340,'_edit_last','1'),
	(163678,5340,'lawUpdateArticlePractices',''),
	(163679,5340,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(98301,5340,'_content','field_59b649b5c8b2b'),
	(98302,5340,'lawUpdateArticleMonth','5326'),
	(98303,5340,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98304,5340,'content_description','Major mergers and acquisitions often take place during periods of market slowdown, where the purchase price for the assets in question, be it shares, real estate or an operational business, is favourable and acquisition opportunities are more diverse. '),
	(98305,5340,'_content_description','field_59b641c07f473'),
	(98306,5340,'pageSummary','Major mergers and acquisitions often take place during periods of market slowdown, where the purchase price for the assets in question, be it shares, real estate or an operational business, is favourable and acquisition opportunities are more diverse.'),
	(98307,5340,'_pageSummary','field_59e59b307dec8'),
	(98308,5340,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/market-slowdown-time-for-hotel-acquisitions.html'),
	(98309,5340,'_currentURL','field_59d35123ab1e7'),
	(98310,5340,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Lada Shelkovnikova'),
	(98311,5340,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(98284,5339,'_content','field_59b649b5c8b2b'),
	(98285,5339,'lawUpdateArticleMonth','5326'),
	(98286,5339,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98287,5339,'content_description','The continued growth in the tourism sector of Dubai, coupled with an increase in the level of sophistication of tourists in general, is encouraging investors to diversify their product offering by increasingly tapping into the market of holiday homes and hotel apartments. '),
	(98288,5339,'_content_description','field_59b641c07f473'),
	(98289,5339,'pageSummary','The continued growth in the tourism sector of Dubai, coupled with an increase in the level of sophistication of tourists in general, is encouraging investors to diversify their product offering by increasingly tapping into the market of holiday homes and hotel apartments.'),
	(98290,5339,'_pageSummary','field_59e59b307dec8'),
	(98291,5339,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/holiday-homes-and-hotel-apartments-in-dubai-a-comparative-study.html'),
	(98292,5339,'_currentURL','field_59d35123ab1e7'),
	(98293,5339,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','872'),
	(98294,5339,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98295,5339,'lawUpdateArticleWriters_1_lawUpdateArticleWriter','842'),
	(98296,5339,'_lawUpdateArticleWriters_1_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98297,5339,'lawUpdateArticleWriters','2'),
	(98298,5339,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98299,5339,'_yoast_wpseo_metadesc','Al Tamimi & Company compares both concepts under the lens of Dubai law to highlight the differences and provide the reader with a better understanding in regard to the licensing and other regulatory requirements for each concept.'),
	(98300,5340,'content','March 2016\r\n\r\n<hr />\r\n\r\nFrom a potential buyer’s perspective, any slowdown of the market in general, and for the hospitality market in particular, presents a positive opportunity.\r\n\r\nBy way of example, the last 18 months have seen a particularly active time in Dubai for hotel acquisitions. The hotel industry particularly within the Emirate has matured, stabilised and become internationally established. For any investor considering a hotel purchase, this article sets out the recommended steps to be taken (and risks to avoid) from a legal perspective.\r\n\r\n<strong>Legal Due Diligence</strong>\r\n\r\nShould an investor underestimate the importance of legal due diligence, focussing only on financial analysis, the repercussions may be grave.\r\n\r\nThe scope of the legal due diligence is important, in order to reveal not only existing and potential legal risks, but also any risks related to:\r\n<ul>\r\n 	<li>seller’s title to the Hotel and underlying land, history of previous ownership and transfers, existing encumbrances and third party rights (including mortgages), compliance with master developer rules and regulations (including full payment of purchase price and community services charges), permitted zoning/use and any other restrictions or information that may impact the intended development of the land;</li>\r\n 	<li>the selling (and any holding) company’s corporate and trading history, history of previous share transfers, shareholders, existing encumbrances over shares and confirmation on the company’s current good standing, existing or threatened litigation or disputes;</li>\r\n 	<li>history of labour relations with hotel staff including compliance with labour contracts during employment and dismissal of Hotel employees, and compliance with employment laws, including trade union requirements if applicable,</li>\r\n 	<li>history of contractual relations with the hotel operator (if any), other third parties, and lenders (including the status of loan repayments under an existing mortgage, if any), to verify the status of any outstanding payments and other types of contractual breach that may lead to liability, and</li>\r\n 	<li>history of compliance of the hotel’s operation with local laws, including licensing requirements, environmental laws, health and safety, sanitary requirements etc.</li>\r\n</ul>\r\nIt is important to ensure that the investor is clear on his potential exposure due to any risks, (and in this respect, the effect of any statute of limitations under local law on historical issues), the extent of which will depend on the structure of the deal (either share transfer or asset transfer).\r\n\r\nWhere any risks are revealed in the course of legal due diligence, the investor, together with the seller, if possible, should assess whether such risks can be mitigated or eliminated by the seller prior to closure of the transaction. If the latter is possible, such actions should constitute conditions precedent to closing. Alternatively, the investor should consider the seller providing an indemnity (and the seller’s financial strength should the indemnity be called upon), against any claims, damage, loss, cost or expense that may be incurred by the investor in the future, if same relates to the period of time preceding closure of the transaction. In certain cases, however, the revealed risks may be incurable and so significant that they would need to be reflected in the acquisition price, or may prevent the transaction from proceeding.\r\n\r\n<strong>Analysis of the Hotel Management Agreement </strong>\r\n\r\nAs part of the legal due diligence it is highly important for an investor to assess the hotel owner’s rights and obligations pursuant to the hotel management agreement (“HMA”) under which the Hotel is managed by an operator (“Operator”), since in the vast majority of cases the investor is obliged to assume all the current owner’s rights and obligations under the HMA as an incoming hotel owner. Therefore, the investor should analyse whether the HMA provides for at least basic protections to the owner, for example annual budget approval rights; supervision of expenditure of funds and obligations to provide additional working capital; monthly and annual reporting by the Operator; owner’s control/approval rights over capital expenditure and spending of funds from the FF&amp;E Reserve; and the possibility to trigger the performance test or terminate the HMA without cause.\r\n\r\nIn case the HMA does not provide for such protections, the investor should thoroughly consider whether the transaction should be consummated, since in most cases, the existence of the HMA will prevent the investor from acquiring the hotel with vacant possession and, thus, should either take the Hotel with all obligations and commitments of the owner to the Operator, or leave the deal if he is unable to get comfortable with these.\r\n\r\n<strong>Obtaining the Operator’s approval</strong>\r\n\r\nThe procedure for a hotel sale is heavily regulated in most HMAs. As such, the Operator usually has a right of first refusal with respect to any sale of the hotel, which right should be strictly respected by the seller and the investor, to prevent any breach of the HMA and the threat of litigation or arbitration in the future. Unless there are no restrictions regarding sale of the hotel in the HMA, then usually, the seller should disclose to the Operator the investor’s offer and the identity of the investor before any binding sale and purchase agreement is signed between the parties.\r\n\r\nUnder most HMAs, the Operator usually has a particular timeframe to either exercise its right of first refusal or alternatively approve the investor and assignment of the HMA thereto. In this respect, it is important to analyse whether the HMA provides for a clear approval procedure and criteria allowing the Operator to reject and prevent a sale. If there is no such mechanism, the buyer should assume the associated risks since if the Operator is entitled to reject the investor for no objective reason predetermined in the HMA, the investor’s time and money invested into all preparatory arrangements up to that point (including broker’s, appraisal, legal, consultancy and accountant’s fees for legal and financial due diligence etc) may be wasted.\r\n\r\n<strong>Termination of HMA on sale </strong>\r\n\r\nIf the HMA provides for the possibility for the seller to terminate the HMA on sale by paying the Operator an amount of liquidated damages, the investor should carefully consider whether or not it wishes to require such vacant possession and if it does, which party will ultimately pay the liquidated damages amount (or in which proportion will it be shared by the investor and the seller). The investor may wish to terminate the HMA and obtain vacant possession for several reasons - for hotel performance issues, or due to a requirement for a strategic change in the hotel’s positioning (e.g. change of segment from midscale to upscale or vice versa, if feasibility studies have demonstrated that a different brand or operator may be preferable than in existence), or where the investor has a strategic relationship with another operator.\r\n\r\nThe investor should, however, keep in mind that payment of liquidated damages to the Operator would not be the only price for termination of the HMA, since all OS&amp;E and FF&amp;E, which associate the hotel with such brand and/Operator, will have to be removed from the hotel, together with a change of branding, and potential refurbishment/renovation of the Hotel to comply with the new operator’s brand standards.\r\n\r\nIf the investor decides to require vacant possession, payment of liquidated damages and termination of the HMA should be a condition precedent to closing the hotel acquisition to ensure that the Operator will not have any claims against the investor in respect of the period of time preceding the closing of the transaction.\r\n\r\n<strong>Transaction structuring </strong>\r\n\r\nThere are various options for structuring the acquisition of a hotel, the most common of which are:\r\n<ul>\r\n 	<li>asset deal, i.e. by way of acquisition of the hotel building and underlying land by way of a real estate purchase;</li>\r\n 	<li>share deal, i.e. by way of acquisition of the shares of the company (or parent company), which owns (or otherwise has occupational rights to) the hotel and the underlying land;</li>\r\n 	<li>a combination of the above, i.e. incorporation of a newly established company (special purpose vehicle), to which the seller transfers the hotel building and land, and then sells the shares in such newly established company to the investor.</li>\r\n</ul>\r\nEach option of structuring has it own advantages and disadvantages, and must be considered on a case by case basis. In case of a share acquisition, the investor is exposed to the risks related to the selling company’s corporate history and previous trading activity (including previous credit history etc) and liabilities. However at the same time, a share acquisition may be more efficient, since all personnel, permits and licenses necessary for the hotel operation, contractual arrangements with suppliers, etc are already in place in the target company’s name and no additional actions or formalities are generally required by the investor (unless there is a change of control provision in any contract, which entitles the other party to terminate the agreement with the seller).\r\n\r\nVice versa, if the Hotel is sold by way of an asset acquisition, the investor is, on the one hand protected in terms of historical risks and liabilities of the seller’s business activity and trading history, but on the other hand, all personnel, licenses and permits, and third party contracts will need to be assigned or re-executed in the name of the investor.\r\n\r\nConsidering the pros and cons of each option, based on the information obtained through the legal due diligence process, the investor’s legal advisors should advise whether it is preferable to proceed with a share or asset transaction or a combination of both through incorporation of a new company to accommodate the transaction, and which particular conditions precedent/subsequent, if any, should be provided for in the sales documentation to ensure the maximum protection of the investor.\r\n\r\n<strong>Acquisition of a distressed asset </strong>\r\n\r\nWhere the investor is considering the purchase of a distressed asset, which involves liability and outstanding payments owed to the Operator, then the investor should undertake legal and financial due diligence with respect to the existence of any breach of the following owner’s obligations under the HMA:\r\n<ul>\r\n 	<li>provision of additional working capital upon the Operator’s request (where the revenue generated by the Hotel is insufficient to cover the operating and /or non-operating expenses of the Hotel);</li>\r\n 	<li>payment of Operator’s fees and other charges due to the Operator under the HMA and ancillary hotel agreements;</li>\r\n 	<li>payment of FF&amp;E reserve contributions;</li>\r\n 	<li>non-interference with the management of the Hotel by the Operator;</li>\r\n 	<li>undertaking capital works to the hotel as required pursuant to the annual budget or upon the Operator’s request (as may be stipulated in the HMA);</li>\r\n 	<li>payment of property insurance premiums etc.</li>\r\n</ul>\r\nIn order to reveal all owner defaults under the HMA, the investor should engage the Operator and, additionally, a mediator specialized in hospitality industry and hotel operation matters, in order to agree on an action plan for settlement of existing claims by the Operator, and remedy of owner’s defaults.\r\n\r\nSuch an action plan, once developed and approved by the investor and the Operator, should be signed between the two simultaneously with signing the sale and purchase agreement with respect to the Hotel. Otherwise, if such homework is not undertaken by the investor prior to the Hotel acquisition, the investor will be exposed to the risk of the Operator’s historic claims against the previous owner and possible termination of the HMA in addition. This is due to the fact that assignment of the HMA requires that the investor assumes all rights and obligations and liability of the Hotel owner under the HMA. Furthermore, the HMA will usually provide that a party’s failure to complain of any breach or default committed by the other party, irrespective of how long such failure continues, does not constitute a waiver of the non-defaulting party to seek remedies available to it under the HMA and applicable law. This means that the Operator would be entitled to pursue claims against the investor (as the new owner) with respect to events of default that occurred prior to its acquisition of the Hotel. In this respect, any limitation period should be taken into account, the length of which will depend upon the law chosen by the parties to govern the HMA.\r\n\r\nIn view of the above exposure, it is highly important for an investor to be aware of all historical events of default and potential claims against the existing owner, and to settle the issues with the Operator, with the assistance of a hospitality mediator if appropriate, prior to signing the sale and purchase agreement with the seller.'),
	(163698,5340,'core_values',''),
	(163699,5340,'_core_values','field_59b64ab071de4'),
	(163700,5340,'file',''),
	(163701,5340,'_file','field_59b64c10f6600'),
	(163702,5340,'orderValue4','4'),
	(163703,5340,'_orderValue4','field_59d2096a8ff34'),
	(163704,5340,'related_pages_header',''),
	(98267,5338,'_pageSummary','field_59e59b307dec8'),
	(98268,5338,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/merger-boom-in-the-hotel-industry-impact-on-hotel-owners.html'),
	(98269,5338,'_currentURL','field_59d35123ab1e7'),
	(98270,5338,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','931'),
	(98271,5338,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98272,5338,'lawUpdateArticleWriters','1'),
	(98273,5338,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98274,5338,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Lada Shelkovnikova'),
	(98275,5338,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(98276,5338,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','l.shelkovnikova@tamimi.com'),
	(98277,5338,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(98278,5338,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(98279,5338,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(98280,5338,'lawUpdateArticleNoWriters','1'),
	(98281,5338,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(98282,5338,'_yoast_wpseo_metadesc','Al Tamimi & Company explores possible scenarios of how mergers of large hotel companies may impact hotel owners, in respect of hotels both in operation and under development.'),
	(98283,5339,'content','March 2016\r\n\r\n<hr />\r\n\r\nIn this article, we will compare both concepts under the lens of Dubai law to highlight the differences, and provide the reader with a better understanding in regard to the licensing and other regulatory requirements for each concept.\r\n\r\nDecree No. 41 of 2013 ‘Regulating the Activity of Leasing out Holiday Homes in the Emirate of Dubai’ provides a definition for the term ‘holiday homes’. Holiday homes are furnished real property units leased out by a licence holder regularly and on an ongoing basis for the purpose of further subletting them to guests. These guests are natural persons who intend on using the holiday homes for overnight accommodation.\r\n\r\nHotel apartments are also furnished real property units. However, and unlike holiday homes, hotel apartments are located within a hotel facility and as such they benefit from hotel-like amenities (e.g. bar, spa, gym, etc.). Such hotel apartments may be leased for relatively longer periods in return for a monthly or annual rent.\r\n\r\nBelow is a comparison table highlighting the major licensing and regulatory requirements governing each concept.\r\n<table class=\"MsoTableGrid\" border=\"1\" cellspacing=\"0\" cellpadding=\"0\">\r\n<tbody>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"></td>\r\n<td valign=\"top\" width=\"243\"><address class=\"MsoNormal\"><strong>Holiday Homes</strong></address></td>\r\n<td valign=\"top\" width=\"120\"><address class=\"MsoNormal\"><strong>Hotel Apartments</strong></address></td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>Main regulation </strong></address></td>\r\n<td valign=\"top\" width=\"243\"><address class=\"MsoNormal\">Decree No. 41 of 2013 ‘Regulating the Activity of Leasing out Holiday Homes in the Emirate of Dubai’.</address>&nbsp;</td>\r\n<td valign=\"top\" width=\"120\"><address class=\"MsoNormal\">By-law No. 1 of 1998 ‘Concerning Licensing and Classification of Hotels, Guest Houses and Furnished Apartments’.</address></td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>Main licensing and regulatory bodies </strong></address></td>\r\n<td valign=\"top\" width=\"243\">\r\n<ul>\r\n 	<li><address>Department of Economic Development (‘DED’)</address></li>\r\n 	<li><address>Department of Tourism and Commerce Marketing (‘DTCM’)</address></li>\r\n 	<li><address>DED</address>\r\n<ul>\r\n 	<li><address>DTCM</address></li>\r\n</ul>\r\n</li>\r\n</ul>\r\n</td>\r\n<td valign=\"top\" width=\"120\"></td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>Licence holder </strong></address></td>\r\n<td valign=\"top\" width=\"243\"><address class=\"MsoNormal\">Must be a company incorporated at the DED and approved by the DTCM.</address></td>\r\n<td valign=\"top\" width=\"120\"><address class=\"MsoNormal\">Must be a company incorporated at the DED and approved by the DTCM.</address></td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>Status of licence holder vis-à-vis the units </strong></address></td>\r\n<td valign=\"top\" width=\"243\"><address class=\"MsoNormal\">The licence holder should be the manager of the units. The units can be located in different locations, owned by different owners and each unit must be separately classified as a holiday home under the Decree.</address></td>\r\n<td valign=\"top\" width=\"120\"><address class=\"MsoNormal\">In order to obtain a hotel apartment licence, the licence holder should be the owner (or leaseholder) of the building in which the hotel apartments are located.</address></td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>Unit </strong></address><address class=\"MsoNormal\"><strong>requirements</strong></address></td>\r\n<td valign=\"top\" width=\"243\"><address class=\"MsoNormal\">A minimum of 20 units (villas or apartments (or a combination of them) is required.</address></td>\r\n<td valign=\"top\" width=\"120\"><address class=\"MsoNormal\">The apartments must all be located in one building and classified as hotel apartments in accordance with the classification requirements of the DTCM.</address></td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>Classification of the units</strong></address></td>\r\n<td valign=\"top\" width=\"243\"><address class=\"MsoNormal\">Units are classified as either ‘Holiday Homes – Standard’ or ‘Holiday Homes – Deluxe’. There are differing standards attached to each classification.</address>&nbsp;</td>\r\n<td valign=\"top\" width=\"120\"><address class=\"MsoNormal\">The hotel apartments are classified as ‘Standard’, ‘Deluxe’ or ‘Superior’, depending on the quality and facilities of the building housing the hotel apartments, and the services to be provided, if any.</address></td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>Commencement of operation prior to classification  </strong></address></td>\r\n<td valign=\"top\" width=\"243\"><address class=\"MsoNormal\">The licence holder is allowed to commence its operation prior to the classification of the holiday homes.</address></td>\r\n<td valign=\"top\" width=\"120\"><address class=\"MsoNormal\">Classification of the hotel apartments is subject to the classification of the entire building in which the hotel apartments are located and therefore the licence holder cannot commence its operations prior to such classification.</address></td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>Services that may be provided by the licence holder</strong></address></td>\r\n<td valign=\"top\" width=\"243\"><address class=\"MsoNormal\">Services provided by the licence holder are generally limited to rental of the units to the guests, and provision of a contact telephone number for the guest in the event of any emergency, problem or breakdown of amenities within the unit.</address>&nbsp;\r\n\r\n<address class=\"MsoNormal\">The holiday home operator will usually outsource facilities management to a third party facilities management company.</address>&nbsp;\r\n\r\n<address class=\"MsoNormal\">The licence holder cannot provide services relating to facilities that are not included in the room. Therefore, any facilities that may be operated from a building in which holiday homes are located, would need to be separately licensed in respect of the activity being carried out, and operated under that licence.</address></td>\r\n<td valign=\"top\" width=\"120\"><address class=\"MsoNormal\">In general, a hotel apartment is a ‘hotel establishment’ offering guests a complete self-contained sole occupancy unit consisting of studios and units with one or more bedrooms, with at least a living room, a kitchen with cooking facilities and a dining area.</address><address class=\"MsoNormal\">The hotel apartment may benefit from hotel-like amenities such as bar and lounge, staff, hotel operator service, reception, guest relations, concierge/tourist information, restaurant and room service.</address>&nbsp;</td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>Status of the licence holder vis-à-vis staff providing the services</strong></address></td>\r\n<td valign=\"top\" width=\"243\"><address class=\"MsoNormal\">The company will hold the licence and be the employer of the staff providing the holiday home rental services.</address></td>\r\n<td valign=\"top\" width=\"120\"><address class=\"MsoNormal\">The company will hold the licence and be the employer of the staff providing the services to the hotel apartments.</address></td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>Licensed activity</strong></address></td>\r\n<td valign=\"top\" width=\"243\"><address class=\"MsoNormal\">The licensed activity of the company as defined by the DED/DTCM, is as follows:</address>\r\n<ul>\r\n 	<li><address>Vacation Homes Rental</address></li>\r\n 	<li><address>Activity Code: 551010<strong> </strong></address></li>\r\n 	<li><address>Activity Group:Time sharing</address></li>\r\n 	<li><address>Licence Type: Tourism<strong> </strong></address></li>\r\n 	<li><address>Activity Description:Includes offering owned or rented furnished accommodation for renting to vacationers on a daily, weekly, monthly or annual basis. It requires rental of the unit as a whole, and not partially as rooms or beds.</address></li>\r\n</ul>\r\n</td>\r\n<td valign=\"top\" width=\"120\"><address class=\"MsoNormal\">The licensed activity of the company as defined by the DED/DTCM, is as follows:</address>\r\n<ul>\r\n 	<li><address>Hotel Apartments Rental</address></li>\r\n 	<li><address>Activity Code: 701006</address></li>\r\n 	<li><address>Activity Group: Tourism Activities</address></li>\r\n 	<li><address>Licence Type: Tourism</address></li>\r\n 	<li><address>Activity Description: Includes firms which furnish residential apartments with all requisites and means necessary for residential purposes. Such apartments are leased for relatively long periods in return for monthly or annual rent.</address></li>\r\n</ul>\r\n</td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address><strong>Dubai tourism taxes and fees</strong> <strong> </strong></address></td>\r\n<td valign=\"top\" width=\"243\"><address class=\"MsoNormal\">The DTCM will impose a 10% Municipality Fee on all bookings once licensed operators are registered. Licensed operators will also be required to collect the new Dubai Tourism Dirham Fee of 10 AED for standard holiday homes and 15 AED for deluxe holiday homes per booked room night, additional to the Municipality Fee.</address>&nbsp;</td>\r\n<td valign=\"top\" width=\"120\"><address class=\"MsoNormal\">The DTCM will impose a 10% Municipality Fee on all bookings once licensed operators are registered. Licensed operators will also be required to collect the new Dubai Tourism Dirham Fee of 10 AED for standard hotel apartments, 15 AED for deluxe hotel apartment and AED 20 for luxury hotel apartments per booked room night, additional to the Municipality Fee.</address></td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>Operation after licensing </strong></address></td>\r\n<td valign=\"top\" width=\"243\">The licence holder will enter into management agreements to manage holiday home units, by opening a portal account at the DTCM whereby the units will be registered and a reception/registration system for check-in and check-out will be implemented, together with calculation of the Dubai Tourism Dirham Fee to be collected from guests. The company will have to secure at least 20 units in order to apply for and obtain individual classification permits for each unit, (which cost approximately 750 AED per room).   The company shall provide DTCM with an undertaking from the classified unit owner that the owner has entered into a management agreement with the company together with the owner’s passport copy and the unit title deed.   Once the unit is registered and the permit fees are paid, the permit for the unit will be issued.</td>\r\n<td valign=\"top\" width=\"120\">Once classification is issued and the licence is obtained, the licence holder is expected to commence operation and receive guests in the hotel apartments.</td>\r\n</tr>\r\n<tr>\r\n<td valign=\"top\" width=\"100\"><address class=\"MsoNormal\"><strong>General requirements</strong></address><address class=\"MsoNormal\"><strong> </strong></address></td>\r\n<td valign=\"top\" width=\"243\">\r\n<ul>\r\n 	<li>Holiday home rentals will be allowed on a daily, weekly and monthly basis.</li>\r\n 	<li>Licensees will not be allowed to rent partial properties, i.e. split a property into separate rooms or beds.</li>\r\n 	<li>Hotel apartments building shall provide all facilities, including, reception, room service, laundry, restaurants and bar, etc.</li>\r\n</ul>\r\n</td>\r\n<td valign=\"top\" width=\"120\"></td>\r\n</tr>\r\n</tbody>\r\n</table>\r\n&nbsp;\r\n\r\nIn addition, both types of units are subject to the below regulatory requirements:\r\n<ul>\r\n 	<li>The licence holder will have to demonstrate experience in the hospitality sector.</li>\r\n 	<li>The DTCM will register, monitor and inspect holiday homes and hotel apartments to comply with set standards.</li>\r\n 	<li>Unlicensed operators will be fined and immediately closed down.</li>\r\n 	<li>Each licensed property will have to display an official certificate of registration by the DTCM within the property.</li>\r\n 	<li>Licensed properties will have to be properly and regularly maintained.</li>\r\n 	<li>Electricity and water must be provided to customers at no additional charge.</li>\r\n 	<li>Licensees will be required to participate in the electronic program of guest registration for hotel and tourism establishments.</li>\r\n 	<li>Licensees must provide data and statistics to the DTCM.</li>\r\n 	<li>Licensees will not be allowed to act as an intermediary, or middle man, between unlicensed operators and their customers.</li>\r\n 	<li>Licensees must collect taxes and fees as set out by the Dubai Municipality and the DTCM for each confirmed booking.</li>\r\n 	<li>Licensees will require insurance to the required specification of the DTCM for the duration of the licence term.</li>\r\n 	<li>The DTCM will have powers to warn, suspend apply fines and cancel the licence of any operator that is in violation of their rules.</li>\r\n</ul>\r\n&nbsp;\r\n\r\n<strong>Conclusion</strong>\r\n\r\nHoliday homes and hotel apartments are two concepts that are fundamentally different from each other and are designed to achieve diverging results. Most of all, each concept is governed by a different set of licensing and regulatory requirements which needs to be clearly understood by investors as a precondition to determining whether to venture in one concept or the other.'),
	(163732,5339,'core_values',''),
	(163733,5339,'_core_values','field_59b64ab071de4'),
	(163734,5339,'file',''),
	(163735,5339,'_file','field_59b64c10f6600'),
	(163736,5339,'orderValue4','4'),
	(163737,5339,'_orderValue4','field_59d2096a8ff34'),
	(163738,5339,'related_pages_header',''),
	(163739,5339,'_related_pages_header','field_59b6441e3cc94'),
	(98265,5338,'_content_description','field_59b641c07f473'),
	(98266,5338,'pageSummary','2015 was marked with the announcement of some unprecedented large-scale mergers and acquisitions of hotel operator companies.'),
	(98264,5338,'content_description','2015 was marked with the announcement of some unprecedented large-scale mergers and acquisitions of hotel operator companies. '),
	(98263,5338,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98262,5338,'lawUpdateArticleMonth','5326'),
	(98261,5338,'_content','field_59b649b5c8b2b'),
	(98246,5337,'_content','field_59b649b5c8b2b'),
	(98247,5337,'lawUpdateArticleMonth','5326'),
	(98248,5337,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98249,5337,'content_description','In late 2015, His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President, Prime Minister and Ruler of Dubai, issued Cabinet Resolution (31) of 2015 the Executive Regulations of Federal Law No (8) of 2014 concerning the Security of Sports Facilities and Events that provides guidance around the scope of new legal obligations affecting those involved in the organisation and hosting of sports events. '),
	(98250,5337,'_content_description','field_59b641c07f473'),
	(98251,5337,'pageSummary','In late 2015, His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President, Prime Minister and Ruler of Dubai, issued Cabinet Resolution (31) of 2015 the Executive Regulations of Federal Law No (8) of 2014 concerning the Security of Sports Facilities and Events that provides guidance around the scope of new legal obligations affecting those involved in the organisation and hosting of sports events.'),
	(98252,5337,'_pageSummary','field_59e59b307dec8'),
	(98253,5337,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/new-sports-law-ensures-the-uae-remains-a-global-leader.html'),
	(98254,5337,'_currentURL','field_59d35123ab1e7'),
	(98255,5337,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','927'),
	(98256,5337,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98257,5337,'lawUpdateArticleWriters','1'),
	(98258,5337,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98259,5337,'_yoast_wpseo_metadesc','Cabinet Resolution (31) of 2015 the Executive Regulations of Federal Law No (8) of 2014 issued concerning the Security of Sports Facilities and Events that provides guidance around the scope of new legal obligations affecting those involved in the organisation and hosting of sports events.'),
	(98260,5338,'content','March 2016\r\n\r\n<hr />\r\n\r\nAccording to the predictions of hospitality experts, other hotel chains may be contemplating the same over the next few years in order to equal the capabilities of the larger players and better compete in the market.\r\n\r\nWhilst the consolidation of some of the biggest hospitality companies is exciting news, this may not necessarily be good news for hotel owners. Whilst there has been discussion in the industry press with respect to the impact of the mergers on the companies involved and on consumers, the potential impact on hotel owners have been mainly left unaddressed and we now offer our thoughts.\r\n\r\nThis article further explores possible scenarios of how mergers of large hotel companies may impact hotel owners, in respect of hotels both in operation and under development.\r\n\r\n<strong>Change or repositioning of a Brand</strong>\r\n\r\nFollowing a merger, the portfolio of brands of the newly merged company may be extensive, with potential overlap or duplication of brands within the same segment. As a result, the company may need to consider repositioning, rebranding, or retiring one or more of the brand. This will be the case particularly if it is considered that due to similarities between certain brands, some of them are no longer viable or may create competition with other brands now comprised in the same portfolio, or which may be simply too expensive to maintain as part of the enlarged portfolio.\r\n\r\nAny such changes to the brand will impact a hotel owner whose hotel bears such brand, and we therefore need to consider how this is regulated in a hotel management agreement (“HMA”).\r\n\r\nIt is usually the case that standard provisions of the operators’ HMAs do not provide any protection for an owner in respect of future repositioning or change of a brand. The result of this is that, unless there has been specific negotiation in the HMA to provide an owner with flexibility and options where the brand of its hotel is repositioned or changed, the hotel owner may find that its hotel must carry a different brand name from that originally contracted for in the HMA. The imposition of this on an owner may not necessarily be well received, particularly if the new branding results in a substantial change of the brand concept, standards, and positioning (which may impact the hotel’s market segment and financial performance). A change and/or repositioning of the brand may also bring opportunities to expand into a new market segment, or to achieve greater flexibility to increase revenue, however, any such change is likely to require significant expenditure from the owner to adapt its hotel in line with the new branding requirements, which may negatively impact the owner’s return in the short term.\r\n\r\nIn respect of hotels already under operation pursuant to an HMA which does not provide sufficient protections for an owner, the changes required resulting from the brand repositioning will ultimately need to be implemented in the hotel. However, for new hotel projects whose HMA is still under discussion, it may be possible to negotiate a certain level of flexibility and protection for the owner.\r\n\r\nAnother issue for owners to consider is the exclusivity arrangement under the existing HMA, since usually exclusivity arrangements are structured to give protection only to the brand of hotel. Therefore, where there is a future change of the brand name of that hotel, the exclusivity protection under the HMA may no longer exist which could leave an owner exposed to unexpected competition should the operator take over management of other hotels now bearing the same brand as the owner’s hotel and which are located in close proximity. In this respect, achieving as much protection as possible of an owner’s interests, during negotiation of the HMA is essential.\r\n\r\n<strong>Unification of Brand Standards </strong>\r\n\r\nAnother consequence of a merger of hotel operators will be the potential unification of brand standards, including IT standards. Such unification will apply to all hotels within the portfolio of the merged companies, regardless of whether any particular hotel brand is repositioned, changed or retired, following the merger.\r\n\r\nEventually, every hotel owner will be required to comply with the unified brand standards, and the key questions for an owner in this respect would be “when” “how” and “at what cost”?\r\n\r\nIt is often the case that the standard terms of an operator’s HMA will not provide any protection to an owner in the event of changes to brand standards, and the owner will ordinarily be required to adhere to the implementation of such changes. As a result, unless an owner has specifically negotiated certain provisions in respect of implementation of brand standard changes to provide some comfort and protection for the owner, the owner will be exposed to the mandatory implementation of all changes, regardless of the amount of additional expenditure required to fund such changes. If there is insufficient revenue generated by the hotel to fund the implementation of changes (which might especially be the case if the changes take place during the initial operational years when the hotel business is still achieving stabilisation), the owner may have to seek debt financing.\r\n\r\nAlthough operators will usually provide a phasing-in period for implementation of changes to brand standards (particularly where the costs of same must be funded by the owner’s own capital), unless flexibility is agreed in the HMA to protect the owner’s position the period of time for implementation can be defined by the operator at its own discretion. This can give rise to a conflict between operator’s interest in benefiting and regularising the brand, and the financial performance of the hotel and the owner’s additional expenditure requirements.\r\n\r\nTherefore, for developers of new hotel projects, it is essential to seek protection and flexibility in the HMA, in case of a change of the brand standards in the future, particularly as the bottom line is that all hotels of the brand will have to comply with the changes, and non-compliance would not only put the owner in breach of its obligations under the HMA, but may result in an outdated hotel which is not able to compete at the level of other hotels of the same brand.  A balance is achievable and an owner should look to minimise, so far as possible, the impact of its implementation of brand standard changes, through agreeing in the HMA a suitable grace period to implement the changes, with the aim that the costs of change be covered from profit generated by the hotel business rather than from the owner’s equity.\r\n\r\n<strong>Change to centralised operator services and loyalty programs</strong>\r\n\r\nIn most cases, the mandatory centralised services that will be provided by an operator is not exhaustively set out in an HMA, with the result that amendment of mandatory services may be made at the operator’s discretion. Additionally, the charges for centralised services as set out in an HMA (including reservation fees and guest loyalty program costs) will not be fixed for the duration of the term of the HMA, and will be subject to change to reflect increases in the cost of providing such services.\r\n\r\nTherefore, hotel owners are under an obligation to allow the hotel to participate in such centralised services and loyalty programs, regardless of changes to the services or the cost of same.\r\n\r\nHowever, an upside of a merger between hotel operators will be the benefit gained through increased economies of scale and buying power of an enlarged operating company, and therefore hotel owners should benefit from reservation systems now having a wider reach, a merged database of customers loyal to the brand, and greater bargaining strength over third party suppliers and service providers to procure more favourable terms and conditions (including pricing).\r\n\r\n<strong>What to expect next?</strong>\r\n\r\nGiven the current and envisaged consolidation of operators and brand portfolios within the hotel industry, developers and owners may encounter less flexibility from an operator on certain provisions of the HMA in its negotiations. This arises as a result of the need to achieve unification and consistency across the operator’s business and brand portfolio, leaving less possibility for variation to its terms and conditions.  There will always be exceptions for “anchor” hotel developers, where the property in question will provide an operator with a strategic point of entry or a portfolio of hotels in a region or country having little or no existing brand representation, especially if the region in question is a new and/or emerging market for the hotel operator, but these remain relatively rare opportunities.\r\n\r\nIt will be interesting to see whether the approach of hotel developers and owners changes going forwards, given the anticipated large-scale mergers and consolidation of the market, particularly in already well established locations where competition between brands is high. It may be that owners will seek a unique differentiation for their future hotels, and as a result, may consider the smaller players in the market, subject to whether this suits the project and its anticipated market. As a result, smaller hotel operator companies may be provided with an opportunity to deal with owners who are now looking for flexibility and a strategic partnership, and who may have overlooked such operators previously. However, even then, hotel owners should keep in mind that consolidation of operators within the market remains a constant option, and therefore, protection for an owner against such future consolidation should be always sought during negotiation of the HMA, in order to achieve a balance of interest between the operator and owner.'),
	(163764,5338,'core_values',''),
	(163765,5338,'_core_values','field_59b64ab071de4'),
	(163766,5338,'file',''),
	(163767,5338,'_file','field_59b64c10f6600'),
	(163768,5338,'orderValue4','4'),
	(98227,5336,'_content','field_59b649b5c8b2b'),
	(98228,5336,'lawUpdateArticleMonth','5326'),
	(98229,5336,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98230,5336,'content_description','Family businesses play a key role in elevating the economies of the countries they operate in. In the GCC, the private sector is dominated by family owned businesses, which make up more than 75% of the GCC private sector companies. \r\n'),
	(98231,5336,'_content_description','field_59b641c07f473'),
	(98232,5336,'pageSummary','Family businesses play a key role in elevating the economies of the countries they operate in. In the GCC, the private sector is dominated by family owned businesses, which make up more than 75% of the GCC private sector companies.'),
	(98233,5336,'_pageSummary','field_59e59b307dec8'),
	(98234,5336,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/governance-a-necessity-for-the-family-in-business.html'),
	(98235,5336,'_currentURL','field_59d35123ab1e7'),
	(98236,5336,'lawUpdateArticleNoWriters_0_lawUpdateAuthorName','Bashayer Al Obeidli'),
	(98237,5336,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorName','field_59e59ad5d15dd'),
	(98238,5336,'lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','b.alobeidli@tamimi.com'),
	(98239,5336,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorEmail','field_59e59afcd15de'),
	(98240,5336,'lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation',''),
	(98241,5336,'_lawUpdateArticleNoWriters_0_lawUpdateAuthorLocation','field_59e59b05d15df'),
	(98242,5336,'lawUpdateArticleNoWriters','1'),
	(98243,5336,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(98244,5336,'_yoast_wpseo_metadesc','Family businesses play a key role in elevating the economies of the countries they operate in. In the GCC, the private sector is dominated by family owned businesses, which make up more than 75% of the GCC private sector companies.'),
	(98245,5337,'content','March 2016\r\n\r\n<hr />\r\n\r\nThe Resolution is now the primary vehicle through which the Ministry of Interior will oversee elements of safety and security at sports events in the UAE, leveraging the police, civil defence and other relevant authorities as necessary.\r\n\r\nMake no mistake, this is a cornerstone law for the local sports industry, so it is critical that people and companies operating within it – including event organisers, authorised private security firms, sporting regulatory bodies, fans, teams and other participants – fully understand their obligations to avoid falling foul of the law, which at its most punitive can carry serious criminal charges.\r\n\r\nWhile the headline-grabbing element of the law relates to unruly fan behaviour, it actually has a wide-ranging impact; from the planning, coordination and safety behind event organisation, through to on-pitch, court or track conduct, as well as in the stands.\r\n\r\nClearly, we have not yet had much time to see the new law in action, so there remains some guesswork around how the rules will actually be enforced. However, knowing what those rules actually are – and ensuring you operate within them – is the best way to be confident of your legal position should an incident arise.\r\n\r\nSo, what are the critical details behind the new rules? Despite the breadth of the law, its various touchpoints can loosely be grouped under three target areas in terms of application: addressing safety and security at sporting events through (i) Facility/Venue and Organiser practices, (ii) Fan Conduct and (ii) Anti-Corruption.\r\n\r\n<strong>Sports Facilities &amp; Organisers</strong>\r\n\r\nThe bulk of the law relates to this area, with organisers and venue managers subject to specific new compliance requirements and oversight, aimed at ensuring the UAE is aligned with or setting global best practice.\r\n\r\nMost notably, all sporting events should have a flexible administrative and organisational guide, including necessary measures relevant to the nature and scope of the event, as well as specifics on the venue. This guide is subject to approval by a designated police contact.\r\n\r\nFor a number of sophisticated event organisers, designing, submitting, and ultimately implementing their event management plans, in accordance with their approved guide, will essentially cement and perhaps reformulate some elements of best practices they have previously established. This could mean substantial change for some. However, they will also need to take additional steps to comply with specific protocols under the new law.\r\n\r\nThese requirements are welcome, such as the need for a designated and qualified Event Security Officer to coordinate with a Police Observer. And the use of the latest technology in communications and crowd management, effectively mandating a blend common sense with modern capabilities, to increase safety and security as appropriate for modern day sporting entertainment.\r\n\r\nFacilities, venues and event organisers can be subject to fines of up to AED 500,000 for non-compliance with these rules.\r\n\r\n<strong>Fan Conduct</strong>\r\n\r\nSports fans face tougher fines for criminal actions conducted at events or venues. The law does not replace the existing Penal Code in such circumstances but it does complement it. This means that committing any Penal Code offence at a sporting event will now be considered an aggravating factor, so would be likely to attract greater punishment than if it had been committed elsewhere.\r\n\r\nThere will also now be formalised crowd restrictions on entering the field of play, bringing prohibited or dangerous materials into a venue, taking to or acquiring weapons inside a venue, violent conduct, throwing materials, insulting or racially abusing or gesturing other people, disregarding facility rules, and using a venue for political purposes.\r\n\r\nThere are numerous other restrictions but generally speaking the changes bring the UAE legally into line with global best practice when it comes to the conduct of fans. Breaking the law can now have dramatic consequences. Depending on the severity of the crime, it can result in imprisonment of three months and fines up to AED 30,000.\r\n\r\n<strong>Anti-Corruption </strong>\r\n\r\nGiven what is unfolding in global sport at present – with the likes of FIFA, the IAAF and various other recognised international sporting bodies facing intense scrutiny around their actions – this aspect of the UAE law is not only timely but in some ways pioneering. In essence, it removes a significant chunk of self-regulation from sporting bodies and brings it under federal law.\r\n\r\nCheating, fraud or corruption in gaining rights to host a sporting event can now be punishable by a fine of up to AED 1 million, plus liability for certain costs. We should keep a keen eye on the interpretation and scope of enforcement of this particular provision, to see if its application could be used more broadly to address some the issues surrounding match-fixing and cheating that we know have plagued international sports in recent times.\r\n\r\nWith this in mind, UAE could be taking a welcome and a significantly pro-active position to protect the integrity of its sporting events. The law could provide a platform for broader tackling of corruption in sports to be specifically identified and punishable through a sports-specific statute, in addition to the measures within the UAE Penal Code already applicable to such conduct.\r\n\r\nOf course, the full implementation and impact of these new rules is yet to be seen. But, they are potentially far reaching in their scope. However, they should be welcomed in terms of trying to ensure that the UAE, which already hosts some of the world’s most popular sporting events and may have aspirations to host the Olympics, remains at the forefront of the global sporting events sector. Nonetheless, new rules need to be properly understood for companies and individuals to act within their boundaries. Getting this right will take time and significant effort but guarantee the law is a success in practice and not just on paper.\r\n\r\nA version of this article first appeared in the GulfNews on 18 February 2016.\r\n\r\n&nbsp;'),
	(163798,5337,'core_values',''),
	(163799,5337,'_core_values','field_59b64ab071de4'),
	(163800,5337,'file',''),
	(163801,5337,'_file','field_59b64c10f6600'),
	(163802,5337,'orderValue4','4'),
	(163803,5337,'_orderValue4','field_59d2096a8ff34'),
	(163804,5337,'related_pages_header',''),
	(163805,5337,'_related_pages_header','field_59b6441e3cc94'),
	(163806,5337,'related_pages',''),
	(163807,5337,'_related_pages','field_59b6434af4880'),
	(163808,5337,'relatedArticles',''),
	(163809,5337,'_relatedArticles','field_59d349d04107c'),
	(163810,5337,'_yoast_wpseo_content_score','30'),
	(163811,5336,'_edit_last','1'),
	(163812,5336,'lawUpdateArticlePractices',''),
	(163813,5336,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(98226,5336,'content','March 2016\r\n\r\n<hr />\r\n\r\nIn order to ensure stability, one must take a long term view. The key to having a stable family-owned business is to ensure that it is managed in a way that allows it to grow, prosper and avoid paralysis. Attaining this objective is no easy road and this is where the value of governance comes into play.\r\n\r\nGovernance is an essential process through which family businesses can set and implement rules governing and regulating different aspects of the business. It is a practice that covers a wide scope that could range from regulating the employment of family members to the setup of board committees to developing a balanced and coherent investment strategy. Governance should ensure the attainment of the overall vision and objectives of both the family and the business and set the necessary implementation strategies, allowing the family business to succeed without fracturing family harmony. Governance is an ongoing journey which moves with the business and adapts to its needs.\r\n\r\n<strong>The Necessity</strong>\r\n\r\nFor family businesses specifically, good governance should not be viewed as optional, but essential. Governance can deliver the necessary solutions for the challenges all family businesses encounter and facilitate amicable resolution of issues all family businesses face. Such challenges can differ depending on the stage the family business has reached and the generation currently in charge.\r\n\r\nFor example, family businesses controlled by the founder generation often struggle with letting go and entrusting the next generation with responsibility and control. In contrast, family businesses where the business has already been passed to the new generation may find it difficult to cope with the differences of mindset, the involvement in the business and the need to work with other stakeholders, as some stakeholders may want growth while others may want a cash out.\r\n\r\n<strong>Why is governance an absolute necessity in the case of family businesses? </strong>\r\n\r\n<em>Particularity </em>\r\n\r\nIn family businesses, two essential elements should always be given due consideration, i.e. the family element and the business element. Balancing these two key elements forms the ideal road to success and continuity of family businesses. While applying governance to family businesses is more complicated than applying it to ordinary companies, governance is even more necessary in family businesses whose survival depends on the satisfaction of entirely different needs.\r\n\r\nThe law disregards this particularity, but tools are available for family businesses that recognize the importance of governance and wish to put it to good use. The implementation of governance is not only beneficial to the business, but it can also assist in regulating and defusing family issues and can ensure that family issues do not overwhelm the business. In the real world, striking this desired balance can be challenging. Factors such as emotional baggage, family ties and family traditions often get in the way. Good governance helps families build a stable base of consensus and can result in more transparent, clear and stable family affairs, promoting family unity and harmony and also attributing to the business’s growth.\r\n\r\n<em>Growth in Numbers</em>\r\n\r\nIn addition to the growth of business operations, the rapid growth in the number of shareholders in family businesses through generational change in the GCC region also attributes to the need for governance in these businesses. Large families are part of the culture in the GCC and the simple entrepreneur can have dozens of children and grandchildren, all of whom will grow up to be stakeholders. Managing this growth through governance by adopting an appropriate structure with distinct ownership and clearly defined roles can promote stability and can induce more positive growth.\r\n\r\n<em>Transition</em>\r\n\r\nIn family businesses, transition of the founder out of the business due to health or morality is often a sensitive topic and a tricky phase which requires delicate planning to avoid conflict and potentially grave consequences. Setting a succession plan as a part of governance is often the key to a smooth transition of its business and its very survival.\r\n\r\n<strong>What are the risks that a family business may face without governance?</strong>\r\n\r\nLoss of opportunity\r\n\r\nWhilst not having a sound governance system in place does not necessarily mean the demise of the business in the short future or a loss of its profits, it can result in a continuous chain of losses of opportunity. Family business that put in place a governance strategy have better coordination and are likely to achieve and prosper even more. With no clear governance “lowest common denominator” decision making prevails as every stakeholder has a veto power, usually not the best way for the business to move forward.\r\n\r\nUpsurge of Conflicts\r\n\r\nConflict in the case of family businesses can often be emotional and dramatic. The absence of governance can lead to the lack of healthy communication between family members and can result in the upsurge of such conflicts. Families need a framework to decide issues which must be resolved. Also, to the family unity and the success of the business, setting a conflict resolution mechanism can contain, speed and simplify the process of resolving any disagreement.\r\n\r\nDamaging Nepotism\r\n\r\nWhilst family succession has many positives and is the arm of most families, this is not to be confused with damaging nepotism i.e. the promotion of family members into roles they are not capable of performing, or to which they are manifestly unsuited. The absence of governance allows damaging nepotism. Putting in place a clear set of rules that regulates key elements such as the employment, development of family members, assessment and training of family and non-family employees in a fair and transparent way can help in avoiding damaging nepotism and can contain, save and preserve the business.\r\n\r\nEffective implementation\r\n\r\nA coherent governance system can assist families in facing challenges. Merely having a set of listed structures and policies in place does not necessarily amount to a good governance practice, as reaching a positive impact through governance requires governance to be “lived and breathed” everyday. Belief in the family values, respect and proper integration are essential pillars to good governance. An important element which can make or break the process of implementation is careful analysis of whether the adopted governance strategy is really fit for this particular family or its business. Each family business should look at its own needs and objectives and, based on this consideration, choose workable governance bodies, policies and procedures.\r\n\r\n<strong>Conclusion</strong>\r\n\r\nGovernance in family businesses is not just a trendy buzzword, it is a pressing issue for many GCC companies to which attention is long overdue. Governance is necessary because although family businesses are special, business is still business at the end of the day; and generational transition in business often creates threats to the business and family harmony. Only the planning and practice of good governance will effectively defuse these threats.'),
	(163832,5336,'core_values',''),
	(163833,5336,'_core_values','field_59b64ab071de4'),
	(163834,5336,'file',''),
	(98191,5334,'_content','field_59b649b5c8b2b'),
	(98192,5334,'lawUpdateArticleMonth','5326'),
	(98193,5334,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98194,5334,'content_description','Concerns around the flammability of external aluminium cladding used to cover the exteriors of many Dubai high-rise buildings have been around for several years now.  '),
	(98195,5334,'_content_description','field_59b641c07f473'),
	(98196,5334,'pageSummary','Concerns around the flammability of external aluminium cladding used to cover the exteriors of many Dubai high-rise buildings have been around for several years now.'),
	(98197,5334,'_pageSummary','field_59e59b307dec8'),
	(98198,5334,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/uae-insurance-law-update-insurance-implications-of-building-fires-in-dubai.html'),
	(98199,5334,'_currentURL','field_59d35123ab1e7'),
	(98200,5334,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','863'),
	(98201,5334,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98202,5334,'lawUpdateArticleWriters','1'),
	(98203,5334,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98204,5334,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','632'),
	(98205,5334,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(98206,5334,'lawUpdateArticlePractices','1'),
	(98207,5334,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(98208,5334,'_yoast_wpseo_metadesc','Concerns around the flammability of external aluminium cladding used to cover the exteriors of many Dubai high-rise buildings have been around for several years now.'),
	(98209,5335,'content','March 2016\r\n\r\n<hr />\r\n\r\nIn Dubai and Abu Dhabi, the respective Department of Economic Development (“DED”) requires entities planning sales promotions to first obtain a permit. If a promotion were to specifically target any of the other emirates, then it would be appropriate to considering seeking permits in such emirates.\r\n\r\nThe process for obtaining a sales promotion permit from the DED is straight-forward, and can usually be completed within a week or so. Information on the proposed promotion, such as its general nature, the nature, quantity and value of any prizes, and the period over which the promotion will be run, need to be submitted to the DED along with a copy of the organiser’s trade licence and premises lease, an application form for the permit, and the official fee.\r\n\r\nOfficial fees are relatively modest and can vary depending on aspects such as the duration of the promotion, the value of any prizes and the extent of any advertising.\r\n\r\nPrizes that are products such as tobacco, alcoholic beverages or pharmaceuticals, are not permitted. Cash prizes are generally not permitted, although they may be permissible in circumstances where cash is a key aspect of the organiser’s core business, such as a money exchange. There are no prescribed requirements with regard to any ‘skill’ element. Raffle-type prize draws, where participants simply purchase tickets, are generally not permitted. For competitions involving prize draws, it is necessary to have an official from the DED in attendance at the prize draw to act as an official witness.\r\n\r\nRunning a sales promotion without a permit can attract a penalty. The penalty can vary depending on whether the sales promotion is one for which a permit, if sought, would have been issued. If an unauthorised sales promotion were to come to the attention of the DED, then the types of penalties that could be expected would (at the time this article went to print) range from around AED 2,000 (about USD 540) to AED 25,000 (about USD 6,800) for a first offence, and higher in subsequent instances. Generally, if the subject matter of the competition is not something that the DED would have approved, then higher penalties are likely to apply.\r\n\r\nThere is only a limited likelihood of the DED taking issue with an on-line promotion not specifically targeting participants in the UAE. If the DED did become concerned by the absence of a permit for such a promotion, then the most likely outcome would be for it to liaise with the local telecommunications regulator to have access to the offending site blocked.\r\n\r\nAdditionally, it is worth noting that there are two ‘formal’ sale seasons in Dubai. The Dubai Shopping Festival is an annual retail event and generally spans the month of January. Although not mandatory to offer sales promotions during the Dubai Shopping Festival, many retail stores choose to do so during this time. Sales promotions conducted during the Dubai Shopping Festival are regulated by the Department of Tourism and Commerce Marketing, which issues permits for sales promotions conducted during the Dubai Shopping Festival. The Dubai Summer Surprises is a separate retail event, similar to the Dubai Shopping Festival, but conducted for a period of around 30 days sometime between June and September. Again, it is not mandatory to offer sales promotions during Dubai Summer Surprises, although it is common to do so. Permits for sales promotions conducted during the Dubai Summer Surprises are also issued by Department of Tourism and Commerce Marketing. The specific rules and regulations in respect of each specific sales season are issued prior to the relevant retail event. These generally track the DED’s rules in respect of sales promotions.\r\n\r\nIf a sales promotion is going to be limited to a specific free zone, then consideration should also be given to whether any free zone-specific rules apply. The DEDs do not generally have authority to control activities in the many free zones located in the UAE.\r\n\r\nAny businesses planning to run a sales promotion in the UAE, in the nature of those outlined above, should consider the regulatory regime relating to such promotions and seek to obtain the requisite permit. The nature of this jurisdiction is such that it is often necessary to liaise directly with the relevant authorities in order to better understand the way in which laws and regulations are likely to be applied in practice.\r\n\r\nAl Tamimi &amp; Company’s Technology, Media &amp; Telecommunications team regularly advises on advertising and marketing related legal issues, including considerations relating to promotions, including sweepstakes and on-line promotions. For further information, please contact Nick O’Connell – n.oconnell@tamimi.com or Sana Saleem – s.saleem@tamimi.comCompetitions, Promotions'),
	(163866,5335,'core_values',''),
	(163867,5335,'_core_values','field_59b64ab071de4'),
	(98210,5335,'_content','field_59b649b5c8b2b'),
	(98211,5335,'lawUpdateArticleMonth','5326'),
	(98212,5335,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98213,5335,'content_description','In the UAE, sales promotions, including sales as well as competitions and prize draws (prize campaigns, sweepstakes, raffles, and instant prizes, etc.), are regulated on an emirate-by-emirate level in each of the seven emirates that make up the UAE.'),
	(98214,5335,'_content_description','field_59b641c07f473'),
	(98215,5335,'pageSummary','In the UAE, sales promotions, including sales as well as competitions and prize draws (prize campaigns, sweepstakes, raffles, and instant prizes, etc.), are regulated on an emirate-by-emirate level in each of the seven emirates that make up the UAE.'),
	(98216,5335,'_pageSummary','field_59e59b307dec8'),
	(98217,5335,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/competitions-promotions-prize-draws-sweepstakes-raffles-and-instant-prizes-sales-promotions-in-the-u.html'),
	(98218,5335,'_currentURL','field_59d35123ab1e7'),
	(98219,5335,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','893'),
	(98220,5335,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98172,5333,'_content','field_59b649b5c8b2b'),
	(98173,5333,'lawUpdateArticleMonth','5326'),
	(98174,5333,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98175,5333,'content_description','The GCC regional plans for rail, taken together and viewed in the context of their respective timetables, are of an entirely different order of magnitude to any major infrastructure project that has been achieved in any other comparable region. For both freight and passenger rail, this is new territory. \r\n'),
	(98176,5333,'_content_description','field_59b641c07f473'),
	(98177,5333,'pageSummary','The GCC regional plans for rail, taken together and viewed in the context of their respective timetables, are of an entirely different order of magnitude to any major infrastructure project that has been achieved in any other comparable region. For both freight and passenger rail, this is new territory.'),
	(98178,5333,'_pageSummary','field_59e59b307dec8'),
	(98179,5333,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/gcc-rail-infrastructure-projects-the-challenges-and-the-benefits.html'),
	(98180,5333,'_currentURL','field_59d35123ab1e7'),
	(98181,5333,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','777'),
	(98182,5333,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98183,5333,'lawUpdateArticleWriters','1'),
	(98184,5333,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98185,5333,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','537'),
	(98186,5333,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(98187,5333,'lawUpdateArticlePractices','1'),
	(98188,5333,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(98189,5333,'_yoast_wpseo_metadesc','Al Tamimi & Company examines why rail is critical to the future success of the GCC as its members seek to learn from the experience of other jurisdictions in developing their rail programmes.'),
	(98190,5334,'content','March 2016\r\n\r\n<hr />\r\n\r\nThose concerns first surfaced in the wake of the Tamweel Tower fire in Jumeirah Lake Towers in November 2012.\r\n\r\nThe insurance implications of buildings covered with potentially flammable aluminum cladding are enormous. The cost of insuring such buildings is sure to increase significantly, if it has not done so already.  In some cases, it may be difficult to insure such buildings at all.\r\n\r\nFor the owners, owners’ associations and tenants of such buildings, the question of whether they are insured in the event of fire is understandably of prime significance. Yet the responsibilities of owners, developers, owners’ associations and tenants to take out insurance and their rights and obligations towards each other as well as to third parties with respect to the parts of the building over which they have this responsibility are often poorly understood.\r\n\r\n<strong>Third Party Liability of Property Developers and Owners’ Associations</strong>\r\n\r\nAs a general rule, property developers and owners’ associations remain responsible for all areas of a property over which they maintain control.  Where those areas cause harm to third parties, the property developer or the owner’s association may be liable to the injured party due to their perceived ability to eliminate or minimise the risk of harm.\r\n\r\nTo protect themselves against incurring a legal liability to third parties in those circumstances, the property developer or owner’s association can take out public liability insurance.  This form of insurance will cover the property developer or the owner’s association for liability to pay damages or compensation to persons who have suffered loss as a result of a harm flowing from the acts or omissions of the property developer or the owner’s association.\r\n\r\nHowever, because public liability insurance only covers an insured person for a legal liability to pay damages or compensation to a third party for loss, this form of insurance will usually not cover an insured person unless:\r\n<ul>\r\n 	<li>the liability is the result of a judicial finding or of an arbitral award; or</li>\r\n 	<li>the insured person would have had the liability under the general law rather than under a private agreement or contract.</li>\r\n</ul>\r\nFor a property developer or an owner’s association to incur a liability covered by this form of insurance, they will usually need to be found to be legally at fault.  In the UAE, the hurdle for the finding of legal fault is, compared to western countries, somewhat higher.  The test for causation in particular is considerably more demanding.  For that reason, a third party that has suffered harm as a result of an act or omission of a property developer or an owner’s association cannot be assured of recovery from them.\r\n\r\n<strong>Insurance for Owners and Tenants</strong>\r\n\r\nOwners and tenants of rented properties should always take out insurance covering their respective interests in the property.  The usual form of insurance for this is home and contents insurance.   This form of insurance will typically cover:\r\n<ul>\r\n 	<li>the policyholder’s property and their belongings in the property against accidental damage by risks like fire or flood and against  theft by burglary;</li>\r\n 	<li>the policyholder against liability to third parties, up to a monetary limit set out in the policy, for loss caused by or arising from the policyholder’s own fault;</li>\r\n 	<li>the policyholder for any loss of rent where the policyholder’s property is leased and the loss of rent is due to an insured event.</li>\r\n</ul>\r\nBecause home and contents insurance only provides cover against accidental loss or damage, this form of insurance will usually not cover the policyholder against loss or damage arising from pre-existing defects in the property.  An example of a pre-existing defect in a property would be where the property’s foundations were insufficiently firm and the property sustained structural damage as a result of subsidence.\r\n\r\nWhere the policyholder’s property and/or contents are damaged as a result of fire, the policy should cover the resulting damage even if the property consists of materials that do not comply with building safety standards or are later found to have caused or contributed to the fire.\r\n\r\n<strong>Owners in Jointly Owned Properties</strong>\r\n\r\nIn the case of owners and tenants of jointly owned properties in high-rise apartments in Dubai, the insurance that covers the building and the common areas usually remains in the name of the developer.  Legislation exists in Dubai governing jointly owned property but the authorities are yet to grant licenses to owners’ associations which gives them full legal capacity. For that reason, the responsibility for insuring the common areas of most apartment buildings in Dubai continues to lie with the original developer.   However, this can create problems in the event that the property becomes damaged and the owners suffer loss.\r\n\r\nIn the case of the Tamweel Tower fire, the fact that the property had to be insured by the original developer rather than in the name of the owners’ association meant that the owners’ association was not a party to the contract of insurance and the owners individually did not have standing to recover under the policy.   This contributed to delays in arranging for the building to be reinstated and consequential costs to the owners, much of which will not be recoverable under the insurance that existed over the building.\r\n\r\n<strong>Owners, Owners’ Associations and Developers Claiming Against Builders and Architects  </strong>\r\n\r\nPerhaps the most complex area for all property stakeholders involves cases where rights are sought to be pressed against builders and designers of a residential building for defects.\r\n\r\nArchitects and builders are usually required to take out insurance as part of their obligations under the original contract with the property developer.  The UAE Civil Code (Federal Law No. 15 of 1985) imposes strict liability on architects or engineers for defects that affect, or threaten to affect, the structural integrity of a building that they have designed.  This potential liability applies for 10 years and it cannot be contracted out of.  While there is insurance in the market designed to cover architects and engineers for this kind of liability, there are numerous cases where architects and engineers either fail to take out this insurance or take it out for an insufficient duration.\r\n\r\nA construction contract will also usually require an architect or engineer to take out professional indemnity insurance.  This insurance is designed to cover an architect or engineer for negligent acts or omissions that:\r\n<ul>\r\n 	<li>arise from the discharge of the architect’s or the engineer’s job in designing the building; and</li>\r\n 	<li>cause loss to persons for whom the architect or engineer has a duty of care.</li>\r\n</ul>\r\nThis duty could extend to the owners of apartments in a high-rise building designed by an architect or engineer but that will not always be the case.\r\n\r\nThis form of insurance also has other limitations. First, it will only respond where the architect or engineer has, or would have if sued, a legal liability to make good the act or omission causative of the loss.  Second, the extent to which UAE law provides a remedy for losses flowing from a building or design defect is very limited.  Losses that are considered too remote or that are purely economic (like a property’s diminution in value as a result of a building or design defect) are often not compensable, even though they may have caused real and quantifiable financial loss to the owner of the apartment concerned.  Third, apart from cases based on decennial liability, the availability of a legal remedy for losses caused by building defects is dependent on the finding of legal fault.  This requirement can be quite challenging in the UAE as it requires a clear departure by the architect or engineer from accepted professional standards as well as the materialization of actual physical damage.\r\n\r\nThis means that the prospect of apartment owners successfully recovering against architects or engineers for defects will be very difficult in the absence of actual physical damage.  The same applies for apartment owners seeking to recover against a property developer or an owners’ association.\r\n\r\n<strong>Conclusion </strong>\r\n\r\nSeveral building fires in Dubai have shone a light on the potential fire hazard posed by certain forms of aluminium cladding used to cover the exteriors of many high-rise buildings in the Emirate.\r\n\r\nThe insurance covering most jointly owned high-rise properties remains in the name of the original property developer rather than in the name of an owners’ association.  This is likely to remain the case until such time as owners’ associations are vested with full legal capacity on behalf of the property owners.  This circumstance has the potential to complicate the recovery of insurance proceeds and the repair of the property in the event of significant accidental damage. In addition, the Jointly Owned Property Law (Law No. 27 of 2007 ‘Concerning Jointly Owned Property in the Emirate of Dubai’) and its Directions do not require or permit owners’ associations to take out loss of rent or contents insurance on behalf of their owners and many owners do not take out such insurance. This means that, should a fire occur which damages an owner’s apartment and forces an owner out of the building, the owner will not have any clear right to recover under the insurance policy over the building.\r\n\r\nIdeally, the steps required to make owners’ associations the effective legal entities of the owners in jointly owned buildings ought to be effected as soon as possible.  Once that occurs, insurance policies covering jointly owned buildings that remain in the names of the original property developers can be assigned to the relevant owners’ association.\r\n\r\nIn the meantime, owners in jointly owned buildings would be well advised to consult with the property developers of their building and understand the nature of the insurance arrangements in place.  If the policies do not cover some of the risks that an owner of an apartment may wish to insure (for example, contents insurance or loss of rent), then the owner should contact the developer or the manager of the owners’ association and endeavour to have the policy extended to cover them.  Better yet, individual owners should take out those forms of insurance in their own name.\r\n\r\n&nbsp;'),
	(163898,5334,'core_values',''),
	(163899,5334,'_core_values','field_59b64ab071de4'),
	(163900,5334,'file',''),
	(163901,5334,'_file','field_59b64c10f6600'),
	(163902,5334,'orderValue4','4'),
	(163903,5334,'_orderValue4','field_59d2096a8ff34'),
	(163904,5334,'related_pages_header',''),
	(163905,5334,'_related_pages_header','field_59b6441e3cc94'),
	(163906,5334,'related_pages',''),
	(163907,5334,'_related_pages','field_59b6434af4880'),
	(163908,5334,'relatedArticles',''),
	(163909,5334,'_relatedArticles','field_59d349d04107c'),
	(163910,5334,'_yoast_wpseo_content_score','30'),
	(163911,5333,'_edit_last','1'),
	(163912,5333,'lawUpdateArticleSectors',''),
	(163913,5333,'_lawUpdateArticleSectors','field_59ec462a1e203'),
	(163914,5333,'lawUpdateArticleNoWriters',''),
	(163915,5333,'_lawUpdateArticleNoWriters','field_59e59aaed15dc'),
	(163916,5333,'orderValue1','1'),
	(163917,5333,'_orderValue1','field_59d0c6e5175b5'),
	(163918,5333,'stats_list',''),
	(163919,5333,'_stats_list','field_59b6372466bcc'),
	(163920,5333,'orderValue2','2'),
	(98157,5332,'_content','field_59b649b5c8b2b'),
	(98158,5332,'lawUpdateArticleMonth','5326'),
	(98159,5332,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98160,5332,'content_description','Just over a year on from arguably the most far-reaching liquidation seen in the maritime world and there is still no end in sight.  \r\n'),
	(98161,5332,'_content_description','field_59b641c07f473'),
	(98162,5332,'pageSummary','Just over a year on from arguably the most far-reaching liquidation seen in the maritime world and there is still no end in sight.'),
	(98163,5332,'_pageSummary','field_59e59b307dec8'),
	(98164,5332,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/lessons-learnt-from-the-owbunker-saga-a-uae-perspective.html'),
	(98165,5332,'_currentURL','field_59d35123ab1e7'),
	(98166,5332,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','806'),
	(98167,5332,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98168,5332,'lawUpdateArticleWriters','1'),
	(98169,5332,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98170,5332,'_yoast_wpseo_metadesc','Just over a year on from arguably the most far-reaching liquidation seen in the maritime world and there is still no end in sight. Al Tamimi & Company considers the case itself, how courts around the world have construed the O.W.Bunker contractual framework differently'),
	(98171,5333,'content','March 2016\r\n\r\n<hr />\r\n\r\nIn the current climate it is difficult to avoid concerns about the economics behind the plans. For instance, in the UAE it has been announced that the development of phase 2 of the rail network connecting Abu Dhabi, Dubai and onwards to Oman has been suspended. The knock-on effect as regards Oman is yet to unfold but there may also be a domino effect across the region. However, other projects remain on track and indeed have set records – the Doha metro (now 77% complete in terms of its tunnelling works) had 21 boring machines in operation at one stage.\r\n\r\nThis article examines why rail is critical to the future success of the GCC as its members seek to learn from the experience of other jurisdictions in developing their rail programmes.\r\n\r\n<strong>Railways as Public Goods</strong>\r\n\r\nThe default position for most rail networks is one of public subsidy. Even where attempts have been made to impose some form of competition in the hope of making systems relatively more self-financing (perennially seeking the ultimate goal of a cost reflective tariff, through disaggregating the state utility and carving up the network into a whole new business ecology of track owning companies, track operating companies, passenger rail franchise holders, rolling stock lease companies and the like), the story of subsidy remains key.\r\n\r\nThe issue of subsidy has to be recognized.  Railways are what economists call “public goods”. There is usually a consensus that the public want and need them. In Europe (and elsewhere) that is certainly the case. There is a deep culture of passenger rail in European countries.  Public transport is a factor in everyday life and plays a vital economic role well in excess of any subsidy from which the system benefits. So, to a great extent, the subsidy directly applied to the network has an amplifying but indirect effect throughout the economy.\r\n\r\nLooking further afield, it is arguable that the history of the United States (or at least the massive expansion into the west of the continent) is inextricably bound-up with the expansion of the railway network there, and although the Americans fell out of love with rail during the last century, there is now a marked renaissance in train projects in that part of the world (with all of the attendant benefits in the supply chain). India has a huge network and arguably a strong railway culture, as does China, which has embraced the opportunity of high-speed rail. Compare those cultures with the GCC region where there is (with the exceptions of the historic but now largely defunct Hijaz Railway and the Riyadh-Dammam passenger route) no widespread tradition of rail and many factors which, at first blush, appear to militate against it.\r\n\r\nAs engines of growth and regeneration there are few infrastructure initiatives which have the same impact as a railway network, and they often have other important benefits, including environmental factors such as improved air quality – a particular concern for residents in many GCC cities. Jobs are also important. According to the Oman Daily Observer (27 July 2015), Oman Rail is to employ 40,000 workers on the first phase of the national railway network. Up to 15,000 of those workers could be Omanis. It is envisaged that the railway will create high in-country value (ICV) for Omani nationals through different construction operations related to the rail project. Typical measures creating ICV include the procurement of Omani products and services from Omani subcontractors, the creation of partnerships with Omani subcontractors, and the training and development of an Omani workforce.\r\n\r\nIn Saudi Arabia, education has been put front and centre of the rail programme. The Saudi Railway Polytechnic is one key element in that transformation. Working in partnership with Saudi Railways Company, international education provider TQ Pearson operates the new institution (which commenced training in April 2014). If this kind of approach is replicated across the GCC then it will provide tangible long-term benefits for the region as a whole.\r\n\r\n<strong>Other Benefits</strong>\r\n\r\nAside from the transport benefits of the railways themselves, the scale of property development around new stations and the scope for investment should not be underestimated. A recent example of these benefits can be found in Birmingham, England, where the dilapidated and dark New Street Station (a hub of the UK rail network) has been redeveloped with a massive 435,000 sq ft shopping complex (named ‘Grand Central’) incorporating anchor tenant John Lewis. Contracts have now been exchanged on a 150 year head-lease of the shopping centre for a reported GBP 335 million (PropertyWeek, 22 January 2016) with property company Hammerson in advanced discussions to bring a 50/50 joint venture partner on board for the future ownership of Grand Central.\r\n\r\nRailway stations therefore result in property and retail development opportunities too. Those developments will, in their turn, create more new jobs and growth in the economy. They also allow people more flexibility as to where they live and where they work, delivering net gains in higher paid jobs and leveraging lower housing, education and employment costs.\r\n\r\nIn the GCC region we can look forward to equivalent schemes based around iconic stations such as award winning architect Zaha Hadid’s adventurous design for the King Abdullah Financial District metro station and the Olaya Street blue and green line metro interchange designed by Gerber Architekten in Riyadh. Dubai is also to benefit from a significant extension of its metro in advance of Expo 2020.\r\n\r\nAll of the above will require, among other things, financing and funding arrangements for the construction works; a complex web of EPC contracts (and efficient disputes resolution regimes; franchise concessions in respect of the lines themselves (and their subsequent renewal); rolling stock finance and lease agreements (which will have to dovetail with franchise procurement exercises); economic and safety regulation for the railway network; ticketing regimes integrating peak/off peak; zonal and bus connections; as well as leases for units in associated shopping malls. This all constitutes real economic benefits of the schemes. Because these schemes are in essence brand new businesses. The opportunity for supply chain and logistics providers is also significant, and it will be interesting to see whether and to what extent coordinated responses and approaches develop in this regard across the region.\r\n\r\n<strong>Inter-City Travel</strong>\r\n\r\nAside from the urban metro projects there are also ambitious plans in the GCC region for inter-city travel. The Haramain high-speed line linking Jeddah with the holy cities will add speed and comfort to pligrims’ Hajj experience (the terminal station in Jeddah being similar to the large stations found in Europe, such as Birmingham New Street).\r\n\r\nOn the freight side, the advent of the Saudi land bridge, linking the Gulf with the Red Sea and the North-South line will (it is hoped) ease the passage of freight across the Kingdom, and provide a high quality alternative to traditional road freight. These are globally significant railway projects. They will change the culture of the region and offer a legacy of first-rate employment opportunities for locals and also monumental property development opportunities.\r\n\r\n<strong>Integrated Systems</strong>\r\n\r\nAll of the schemes mentioned above are part of an integrated transport system where connections are relatively easy and the spread of the network takes people where they want to go quickly and cheaply relative to the alternative of driving or flying. There are certainly environmental benefits. But these benefits can only ever be realized if the network is sufficiently wide to optimize people’s choices. That network connectivity also enables genuine measures in traffic calming to be taken (for example, it is doubtful whether London’s congestion charging scheme would have been feasible without its public transport offering a viable alternative). A key element of rail projects is their inter-connectivity with other transport services, such as airports, ports and other local transport services including buses and taxis. This is especially important in the GCC where walking in the heat of summer for even a short period can be difficult.\r\n\r\n<strong>Towards a Culture of Rail</strong>\r\n\r\nOnce the railways have been completed, the real challenge will start – that of developing a culture of rail. Without embracing that cultural change many of the transformational benefits described above risk being lost or dissipated. The GCC has the political will to achieve a real change in how transportation is viewed. In a period of sustained economic turbulence, even if some of the projects stall, there appears to be enough viable projects to ensure that this transformation in the region is secure, and will consolidate and even accelerate once the global and regional economic climates become more stable.'),
	(163930,5333,'core_values',''),
	(163931,5333,'_core_values','field_59b64ab071de4'),
	(163932,5333,'file',''),
	(163933,5333,'_file','field_59b64c10f6600'),
	(163934,5333,'orderValue4','4'),
	(163935,5333,'_orderValue4','field_59d2096a8ff34'),
	(163936,5333,'related_pages_header',''),
	(163937,5333,'_related_pages_header','field_59b6441e3cc94'),
	(163938,5333,'related_pages',''),
	(163939,5333,'_related_pages','field_59b6434af4880'),
	(163940,5333,'relatedArticles',''),
	(163941,5333,'_relatedArticles','field_59d349d04107c'),
	(163942,5333,'_yoast_wpseo_content_score','30'),
	(163943,5332,'_edit_last','1'),
	(98138,5331,'_content','field_59b649b5c8b2b'),
	(98139,5331,'lawUpdateArticleMonth','5326'),
	(98140,5331,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98141,5331,'content_description','A slowdown in an economy is commonly followed by a tightening of liquidity and an increase in credit losses in the banking market. '),
	(98142,5331,'_content_description','field_59b641c07f473'),
	(98143,5331,'pageSummary','A slowdown in an economy is commonly followed by a tightening of liquidity and an increase in credit losses in the banking market.'),
	(98144,5331,'_pageSummary','field_59e59b307dec8'),
	(98145,5331,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/security-enforcement-in-dubai.html'),
	(98146,5331,'_currentURL','field_59d35123ab1e7'),
	(98147,5331,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','814'),
	(98148,5331,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98149,5331,'lawUpdateArticleWriters','1'),
	(98150,5331,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98151,5331,'lawUpdateArticlePractices_0_lawUpdateArticlePractice','411'),
	(98152,5331,'_lawUpdateArticlePractices_0_lawUpdateArticlePractice','field_59dc79c8e10ce'),
	(98153,5331,'lawUpdateArticlePractices','1'),
	(98154,5331,'_lawUpdateArticlePractices','field_59dc7918de021'),
	(98155,5331,'_yoast_wpseo_metadesc','A slowdown in an economy is commonly followed by a tightening of liquidity and an increase in credit losses in the banking market.'),
	(98156,5332,'content','March 2016\r\n\r\n<hr />\r\n\r\nThis article considers the case itself, how courts around the world have construed the O.W.Bunker contractual framework differently, the issues caused by this varying judicial interpretation and some of the potential legal solutions suggested in the market to avoid the double payment conundrum in the future.  This article considers matters from a UAE perspective but in order to do so it is necessary to review the approach of the courts on an international basis.\r\n\r\n<strong>The double payment demands</strong>\r\n\r\nOW Bunker &amp; Trading A/S and OW Supply &amp; Trading A/S and its subsidiaries (“OWB”) went into liquidation in November 2014.  As a result, physical suppliers (“PS”) across numerous jurisdictions moved quickly to demand payment directly from shipowner debtors for supply of fuel to their vessels and relied upon numerous causes of action to bring their respective claims.   Ship arrests soon followed when immediate payment was not forthcoming.\r\n\r\nIn parallel the OWB entities in liquidation were not slow to issue payment demands on behalf of the OWB estate, pursuant to the terms of the respective sale contracts.  It soon emerged that OWB  had concluded, one year prior to its collapse, a revolving borrowing base credit facility for a sum of USD 700m from various lenders represented by ING Bank N.V (“ING”) as the security agent. ING purported to have a valid security agreement over the trade receivables due to OWB from the shipowners and accordingly pursued shipowner debtors, often arresting their ships to recover the same debts demanded by PS.\r\n\r\nFor shipowner debtors, the dilemma as to which party to pay for the fuel supply remains.  Most shipowners are willing to settle the dues but, understandably, do not want to pay for the same bunkers twice. As will be noted, the respective courts have sought to deal with this issue through various different applications of legal theory.\r\n\r\n<strong>How have the courts ruled across the world?</strong>\r\n\r\n<em>England </em>\r\n\r\nThe shipowners in (The Res Cogitans) [2015] EWHC 2022 (Comm) argued that the OWB sale contract with the shipowner purported to be a contract for the sale of goods falling under the Sales of Goods Act 1979 (“SOGA”).  In order for a claimant to bring an action for the contract price under SOGA, title in the goods must have passed to the buyer for money consideration.  The owners argued that title could not have passed from OWB to the shipowner for two reasons; firstly the PS still had property over the fuel by way of a retention of title clause and, secondly, because the fuel was mostly consumed prior to payment at the expiration of the 30 day credit period, at which point title in the goods would ordinarily pass.  Since the goods were consumed during the 30 day credit period, there was, owners argued, nothing to pass title in at the expiration of the credit period.\r\n\r\nThe Court of Appeal took the view that the bunker supply contract between OWB and the shipowner was a ‘hybrid’ contract comprising, firstly, a license to consume the bunkers immediately upon delivery without title having to pass, and secondly, a sale contract pertaining to the unconsumed bunkers on board when payment fell due at the expiration of the credit period. With regard to the license, the Court concluded that OWB’s ability to pass title to the owners was irrelevant and that OWB’s claim was a straight debt claim.  However, the agreement to sell the unconsumed fuel at a later time would require the title to pass to the buyers upon payment and so the SOGA would apply to this element of the contract.\r\n\r\nIn our view, the Court of Appeal’s application of legal theory represents quite a divergence from the contractual intentions of the parties.  No doubt those working in the bunkering community would not describe their trade activities as the sale and purchase of licenses to consume fuel immediately and agreements to sell the remaining unconsumed fuel after the credit period expiration.  It appears to be quite a creative decision in this respect and the Supreme Court may yet constue the contractual framework differently when the resultant appeal is heard.\r\n\r\nPending the outcome of the appeal ship ownerscan, reasonably conclude that the SOGA cannot be relied upon to avoid payment to OWB and OWB are deemed entitled to full payment.  However, the decision does not prevent ships from being arrested in different jurisdictions and so the double payment conundrum persists.\r\n\r\n<em>Singapore</em>\r\n\r\nIn Singapore, a consolidated interpleader application was filed by thirteen owners and charterers in Precious Shipping Public Co Ltd v OW Bunker Far East (Singapore) [2015] SGHC 187.  Interpleader relief is designed for situations whereby a third party debtor wishes to pay a debt but is subject to two or more competing claims over the same debt.  The competing claims must be adverse to one another and the court’s decision should extinguish the non-legitimate claim(s) to provide legal certainty on liability.  The third party debtor, as applicant, will pay the debt amount into the court in order that the court may determine entitlement to it.\r\n\r\nIn order for the Singapore High Court to make an order for interpleader relief, the applicant must first adduce evidence that there is prima facie evidence of competing claims.   After assessing the PS’s claims in bailment, retention of title, unjust enrichment, unlawful conversion of property and the option to exercise maritime liens in other jurisdictions, the court held that the PS had no case that could be defined as an adverse competing claim and that the PS was simply seeking to circumvent the insolvency procedure. To rule that the PS had a valid claim would, according to the court, be “unfair” and “unjust”.  Therefore, the interpleader application was dismissed and no order was made.\r\n\r\nThe Singapore Courts appear to have upheld the contractual intentions of the parties in this case by recognising the PS’s potential claim, but limiting it to a liquidation claim against the OWB estate.  Again, the double payment conundrum remains live because vessels who might pay OWB in Singapore may still be arrested by PS in other jurisdictions for the same sum.\r\n\r\n<em>Canada - Canpotex Shipping Services Limited v. Marine Petrobulk Ltd., [2015] FC 1108</em>\r\n\r\nConversely, in September 2015, further to USD 600,000 being deposited by the charterer into court for interpleader relief, the Canadian Federal Court found that the PS was entitled to full payment and that OWB had no claim against the shipowner. Central to the decision was the finding that the PS General Terms and Conditions (“GTCs”) bound both OWB and a charterer by virtue of the valid incorporation of the PS’s GTCs into OWB’s GTCs.  The PS’s GTCs provided for a right of arrest against the shipowner directly in the event of non-payment and had the effect of making the shipowner and OWB jointly and severally liable for the fuel.   The PS’s GTCs were also governed by Canadian law and Canadian law is unequivocal that intermediaries cannot claim against vessels where the intermediary has not paid the supplier for services delivered to the vessel.  Upon OWB’s failure to pay for the fuel, the valid incorporation of the PS’s GTCs into the contract between the shipowner and OWB had the effect of creating a direct contractual right of action against the shipowner by the PS.  Upon payment by the charterer of the contract price, the charterer was released from any further obligation to pay OWB because OWB was held to have breached its contractual obligation to pay for the fuel.\r\n\r\nThe Court’s ruling in this case is refreshingly practical and probably best reflects the contractual and commercial intentions of the parties. However, it is acknowledged that the case is limited because we do not know how the courts would rule if the PS’s GTCs were not incorporated into OWB’s GTCs.\r\n\r\n<em>United Arab Emirates</em>\r\n\r\nUnlike the common law jurisdictions mentioned above, the UAE adopts a civil law legal system.  Under the civil law, the bunker delivery receipt (“BDR”) has historically been recognised as a valid and binding contract on the shipowner in its own right, premised on Articles 135, 137(2) and 154 of the Commercial Maritime Code (Federal Law No. 26/1981 hereinafter the “CMC”) which makes shipowners liable for contracts concluded by the Master on behalf of the vessel.   For many years we have observed courts across the entire Gulf region rule in favour of the PS pursuant to the BDR and there is no reason to anticipate change because the courts in the Gulf, being paper-based, have always viewed the stamping of a BDR as proof of offer and acceptance in the formation of a contract.\r\n\r\nAfter the collapse of OWB, many PS in the Gulf sought to recover unpaid supply dues from shipowners on the premise that the BDR constituted a contract under UAE law.  This was contested by shipowners, OWB and ING because the notion of the BDR is derived from court trends, custom and practice, coupled with an interpretation of provisions of the CMC. We doubt whether the OWB branch in Dubai really was aware during day-to-day practice that a contract arose through stamping and signing of the BDR and it is difficult to measure how many PS were aware of this either.\r\n\r\nAt the end of 2015, the Khorfakkan Court of Appeal affirmed this interpretation of the law by giving credence to a PS claim under the BDR, deeming it to be a valid contract evidenced by the vessel seal and Master’s signature. The Fujairah Court of First Instance recently ruled in a similar manner. Notably in the Khorfakkan case, ING’s claim under the security instrument was rejected by virtue of OWB’s inability to demonstrate its claim over the trade receivables in the first place.  OWB failed at the first hurdle.  However, this decision is subject to appeal to the Court of Cassation and can merely be considered as guidance, not precedent.\r\n\r\nIn our view, the UAE Court’s application of legal theory is, probably, the most divergent from the actual contractual intentions of the parties involved.  The intentions of the parties to establish a third contract between the shipowner and PS by way of BDR is tenuous at best, at least from the shipowners’ perspective.  It is most likely the shipowner believed he was contacting with OWB only.\r\n\r\nOne key issue is that OWB conducted business as full traders and invoiced for the principal sum plus their profit element.  Had they invoiced for a brokerage or agency fee representing their actual mark-up only, then the community could probably have avoided this whole saga.\r\n\r\nLastly, it is noteworthy that most of the claims seen by the court follow from PS arrests whereby the principal sum only was claimed.  In these instances, for the reasons mentioned above, we believe the PS will usually succeed.  However, this does not mean OWB’s claim falls away, it simply means they will be able to claim, independently, for their mark-up only.   Had OWB brought the claims in the first place, perhaps the court would have ordered that the shipowner debtors make split payments accordingly.\r\n\r\n<em>Interpleader relief in the UAE</em>\r\n\r\nThere is no legal provision under UAE law for interpleader relief actions, as seen in Singapore and the Canadian cases above.  This means that shipowners who wish to pay their bunker invoices still have no way to pre-empt arrests and there have been few alternative solutions suggested.\r\n\r\nAlthough it is not possible for the shipowner to avoid arrest in the UAE, the shipowner who has had its vessel arrested can reduce legal expenses by joining the intermediary or PS to the proceedings.  At this stage, the shipowner can request the court to receive the debt amount into court and for the court to decide whether the intermediary or the PS is entitled to it.  The shipowner can then, in practice, reduce its involvement in the case by not attending hearings or making any submissions.  Whilst not an interpleader action, it is perhaps the next best way to compel the intermediary and the PS to litigate and resolve the competing claim.\r\n\r\n<strong>Is it ‘business as usual’ for the UAE bunkering community?</strong>\r\n\r\nYet again, we have observed that no company is too big to fail and the vulnerabilities hidden in long-standing industry practices can be exposed by the failing of one link in the contractual chain.  The market has offered up some potential solutions as outlined below.\r\n\r\nThe OWB saga emphasised the risks involved when ordering bunkers through intermediaries.  Loss prevention circulars have emerged from Protection &amp; Indemnity clubs recommending that shipowners deal directly with PS, thus eradicating any risk of double payment demands.  We consider it likely that shipowners with wider geographical trading limits may be slow to implement such changes because intermediaries often have access to markets that shipowners do not.\r\n\r\nAnother proposal is that shipowners should contract to split payments between the intermediary and PS and only to pay the mark-up and principal sum to the parties respectively.  It would follow that if the shipowner cannot make payment for bunkers, or the intermediary goes into liquidation, the intermediary can only sue in contract for the profit element and not the full sum thus avoiding any risk of paying the principal sum twice.  However, we believe this suggested solution only works legally and does not offer a commercial solution because the intermediary is unlikely to disclose its mark-up and agreeing to such a contractual arrangement would leave it at risk of being cut out of future transactions.\r\n\r\nFinally, one last proposal that has been mooted involves amending the payment provisions in the contracts requiring the intermediary to pay the PS, or the preceding intermediary, before payment becomes due from the shipowner.  In essence, the effect would be to provide the shipowner, as end buyer, the longest credit period and would ensure double payment demands would be avoided.  If there is a longer sale chain then transacting parties would contract on back-to-back terms.  As above, whilst this offers a workable legal solution, we do not consider that it is a commercial one.  The proposal involves the shifting of risk of non-payment away from the PS to the intermediary in the instance that the shipowner defaults on payment.  We do not envisage intermediaries accepting this transfer of risk.\r\n\r\nIn our view, intermediaries and PS could better align themselves in contract on their debt recovery strategies.  For example, parties could agree from the outset that in the event of non-payment, the PS will refrain from pursuing the debtor if the intermediary pursues the recovery on behalf of both entities, sharing the cost of such recovery with the PS.   This would avoid double payment demands upon the shipowner, would facilitate faster recovery and not disrupt the status quo.\r\n\r\nTo conclude, whilst there are some legal solutions on the table, few are commercially viable.\r\n\r\n<strong>Considerations for all</strong>\r\n\r\nThe OWB saga continues and the courts have grappled with the application of legal theory to a a complex commercial structure in courts around the world.  The decisions in England, Singapore, Canada and the UAE are indicative of the courts’ collective failure to produce a globally uniform solution to a global bankruptcy.  This failure is reflective of the intricate differences between the facts in each case and the legal theory applied in each jurisdiction.\r\n\r\nWhat is clear, is that a one-size-fits-all solution is unlikely to be forthcoming and by the nature of the international business of shipowners, their ships are likely to remain at risk of arrest and double payment demands for some time.\r\n\r\nSolutions have been proposed to improve industry practice in order to avoid a similar OWB situation from occurring again, however we have demonstrated how such suggested changes may be commercially inconvenient and improbable.   If intermediaries and PS could better align themselves in their approach to debt recovery then this would certainly represent progress.'),
	(163964,5332,'core_values',''),
	(163965,5332,'_core_values','field_59b64ab071de4'),
	(163966,5332,'file',''),
	(163967,5332,'_file','field_59b64c10f6600'),
	(163968,5332,'orderValue4','4'),
	(163969,5332,'_orderValue4','field_59d2096a8ff34'),
	(163970,5332,'related_pages_header',''),
	(163971,5332,'_related_pages_header','field_59b6441e3cc94'),
	(163972,5332,'related_pages',''),
	(163973,5332,'_related_pages','field_59b6434af4880'),
	(98121,5330,'_content','field_59b649b5c8b2b'),
	(98122,5330,'lawUpdateArticleMonth','5326'),
	(98123,5330,'_lawUpdateArticleMonth','field_59da2a396b063'),
	(98124,5330,'content_description','The FIDIC 1999 (Red Book) at clause 8.7 provides that in the event completion is delayed the contractor shall pay the employer delay damages equal to a pre-agreed amount specified in the contract as a compensation for the delay (the ‘Delay Damages’).'),
	(98125,5330,'_content_description','field_59b641c07f473'),
	(98126,5330,'pageSummary','The FIDIC 1999 (Red Book) at clause 8.7 provides that in the event completion is delayed the contractor shall pay the employer delay damages equal to a pre-agreed amount specified in the contract as a compensation for the delay (the ‘Delay Damages’).'),
	(98127,5330,'_pageSummary','field_59e59b307dec8'),
	(98128,5330,'currentURL','http://localhost:8888/tamimi/en/magazine/law-update/section-14/march-9/abu-dhabi-judgment-on-delay-damages-highlights-importance-of-when-contract-is-terminated.html'),
	(98129,5330,'_currentURL','field_59d35123ab1e7'),
	(98130,5330,'lawUpdateArticleWriters_0_lawUpdateArticleWriter','530'),
	(98131,5330,'_lawUpdateArticleWriters_0_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98132,5330,'lawUpdateArticleWriters_1_lawUpdateArticleWriter','501'),
	(98133,5330,'_lawUpdateArticleWriters_1_lawUpdateArticleWriter','field_59da2ac06b065'),
	(98134,5330,'lawUpdateArticleWriters','2'),
	(98135,5330,'_lawUpdateArticleWriters','field_59da2a866b064'),
	(98136,5330,'_yoast_wpseo_metadesc','The FIDIC 1999 (Red Book) at clause 8.7 provides that in the event completion is delayed the contractor shall pay the employer delay damages equal to a pre-agreed amount specified in the contract as a compensation for the delay (the ‘Delay Damages’).'),
	(98137,5331,'content','March 2016\r\n\r\n<hr />\r\n\r\nRecent reports from publicly listed UAE banks reflect that Dubai and the UAE are not immune from this reality with the disclosure of increased loss provisions. Where customers get into difficulty, a bank may need to protect its investment through enforcement action in local courts. Below is an overview of common issues that arise which may impede or delay the enforcement of the two most typical credit support instruments in the Dubai context: the property mortgage and personal guarantee.\r\n\r\n<strong>Property Mortgage </strong>\r\n\r\n<em>1. Enforcement Challenges  </em>\r\n\r\nThe Law Concerning Mortgages in Dubai (Law No. 14 of 2008) (the ‘Dubai Mortgage Law’) prescribes the content of a land mortgage. Without this key information, a mortgage is unlikely to be permitted to be registered by the Dubai Land Department. However, the Dubai Land Department officials are not responsible for ensuring the correctness of all information. If a mortgage deed does not provide for any information identifying the particular facility secured (i.e. it does not identify what the mortgage secures, or more correctly, the debtor’s obligations the mortgage secures), the customer may challenge the bank’s enforcement of the mortgage deed on the basis that:\r\n<ul>\r\n 	<li>the mortgage deed does not expressly refer to a certain facility, and therefore it does not secure the resulting liabilities. However, the bank can argue that all of the finance and security documents, taken as a whole, provide sufficient certainty as to the liabilities secured by the mortgage deed; and</li>\r\n 	<li>where applicable, the mortgage deed was provided to secure a previous facility and therefore the bank cannot enforce the mortgage deed to recover under the current facility. However, the bank’s argument could be that the mortgage deed was given to secure the facilities provided to the customer as a whole and not to limit the bank’s security under each facility.</li>\r\n 	<li>In respect of point (a), the Civil Transactions Law (Federal Law No. 5 of 1985) makes it clear that consideration for a pledge way of security must be an ascertained debt owed or promised, ascertained at the time of the pledge, or specific property which is guaranteed.</li>\r\n</ul>\r\n<em>2.   Enforcement Procedures in Dubai</em>\r\n\r\nThe Dubai Mortgage Law also outlines the procedures for enforcement of a loan secured by a mortgage over land, which are:\r\n<ul>\r\n 	<li>the Bank is required to notify the customer of the default in payment by serving a legal notice through the notary public requiring it to cure the default within thirty days; and</li>\r\n 	<li>in the event that the customer fails to pay in accordance with the notice served, the Bank may submit an application/petition to the execution department of the Dubai Courts seeking enforcement of the mortgage. This application/petition will include details of the loan provided to the customer, copies of the relevant documents and evidence of service of the default notice mentioned above. In accordance with the Dubai Mortgage Law, upon the failure of the customer to pay the overdue amount in response to the Bank’s notice, the execution judge may order an attachment against the mortgaged property so that it can be sold by public auction in accordance with the relevant execution procedures followed by the court.</li>\r\n</ul>\r\nTo obtain a judgment, in a simple case where no dispute is raised by the customer, at present takes approximately two to four months, excluding the public auction process.\r\n\r\n<em>3.  Dubai Mortgage</em>\r\n\r\nUnder the Law Concerning Real Property Registration in the Emirate of Dubai (Law No. 7 of 2006) (the ‘Title Registration Law’), every document creating, transferring or extinguishing property rights has no effect unless the document is registered with the Dubai Land Department.\r\n\r\nAccording to Article 4 of the Title Registration Law, UAE and other GCC nationals and companies wholly owned by such nationals have the right to own any property interest in the Emirate of Dubai, and to have such rights registered at the Dubai Land Department. All nationalities other than UAE or GCC nationals are granted the right to own a freehold interest or a long lease right in designated areas (as approved by the Ruler of Dubai). Article 26 of the Title Registration Law makes clear any disposal made in violation to the provisions of this law is null and void. Hence, any unregistered sale of land, including a purported sale to a non-UAE or non-GCC national outside of the designated areas, will not have protection of the law. As a corollary, a mortgage could not be granted by the purchaser were they to obtain finance for the acquisition (as the land would not be transferable).\r\n\r\n<strong>Personal Guarantee </strong>\r\n\r\n<em>1.  Specifying Guaranteed Obligations</em>\r\n\r\nUnder the Civil Transactions Law, a guarantee (either personal or corporate) is required to clearly state the guaranteed obligation(s). This is usually achieved by mentioning a certain amount of money or referring to a certain facility so the guarantor is aware of what is guaranteed. We have seen instances where the scope of the obligations being guaranteed is unclear in the documentation — this is fertile ground for a challenge to any enforcement of the guarantee by the guarantor.\r\n\r\nGuarantees for ‘all monies’ may not be enforceable in the UAE, as Article 1061 of the Civil Transactions Law requires that guarantees must be issued with respect to a specified debt or a thing certain in amount. ‘All monies’ guarantees are not usual practice but we have seen these in a small number of situations. While there have been judgments in the recent past where the UAE Courts have recognised and enforced all monies guarantees, the application of such judgments is limited and not binding for future situations.\r\n\r\nArticle 1061 of the Civil Transaction Law is extracted below:\r\n\r\n<em>“In order for the suretyship to be valid, the subject matter of the suretyship must be something for which the principal obligor is liable by way of debt or specific property ...”.</em>\r\n\r\n<em>In Dubai Court of Cassation appeal No. 79 of 2008 dated 16 June 2008, the Court reinforced the legal position where it stated:</em>\r\n\r\n‘The guarantee contract shall be void unless it: determines (fixes) the guaranteed amount (debt); or includes the basis on which the amount guaranteed should be calculated; or refers to the credit facility(s) granted to the debtor’.\r\n\r\nConsequently, there is a risk that a guarantee may be found to be unenforceable by the court if it does not refer to the facility or an amount, as it may be found to be uncertain. However, any such claim could be countered by documentary evidence showing that the guarantee secures or intended to secure the relevant facility by referring directly to the security documents listed in the facility itself.\r\n\r\n<em>2.  Time Limitation</em>\r\n\r\nThe general position under the Civil Transactions Law is that legal proceedings against a guarantor (either corporate or personal) must be initiated within a certain period stipulated by law from the date on which the debt falls due, unless otherwise agreed between the parties in the guarantee contract.\r\n\r\nThe Dubai Court of Cassation characterises a contract of guarantee, whether corporate or personal, as a civil activity concluded between ordinary persons and accordingly is subject to the six-month limitation period stipulated within Article 1092 of the Civil Transactions Law.\r\n\r\nThat Article provides that a demand or claim must be originated by the bank against the guarantor within six months from the date on which the debt fell due. Such demand or claim includes a letter, regardless of whether or not it is notarised, issued by the bank to the guarantor requesting repayment of the due outstanding amount.\r\n\r\nDubai Courts also clearly recognise that the limitation in Article 1092 of the Civil Transactions Law can be waived by the parties. For example in Dubai Court of Cassation appeal no. 6 of 2009 dated 24 May 2009 it was found:\r\n\r\n<em>“The guarantor is competent to terminate the guarantee contract, if the creditor did not claim the guarantor the guaranteed amount within six months starting from the date on which the debt is due, unless otherwise agreed between the parties in the guarantee contract”.</em>\r\n\r\n&nbsp;\r\n\r\n<strong>Conclusion</strong>\r\n\r\nWhile not being an exhaustive summary of every obstacle that could be faced by a lender in enforcing a land mortgage or guarantee, this article is illustrative of roadblocks that could be faced in the process. Not every obstacle will impede enforcement, and many issues have ready solutions that can be presented in argument at Court. However, obstacles and roadblocks serve to delay and lessen eventual recovery, sometimes significantly where appeals are required through multiple levels of Court. Ensuring that any uncertainty is avoided or resolved before entering into the enforcement process (which should ideally occur at origination) is the best approach.\r\n\r\n&nbsp;');

