<p><strong>Background</strong><br /><br />The provisions of the Commercial Agencies  Law (Federal Law No. 18 of 1981) (the Law) relating to the powers and  jurisdiction of the Commercial Agencies Committee (the Committee) have been the  subject of two important amendments on the basis of Law No 13 of  2006:<br /><br />1.&nbsp;All provisions and references relating to the Committee were  repealed because of an amendment to Article (8) as there was reference to the  powers of the Committee under this article.<br /><br />2.&nbsp;The law further  specifically repealed Articles (27) on the constitution of the Committee and  Article (28) on the jurisdiction of the Committee.<br /><br />Further amendments to  the Law, which occurred by virtue of Law No 2 of 2010 restored the powers and  jurisdiction of the Committee and added further significant and important  provisions, which are discussed below.<br /><br />What are the significant  amendments on the jurisdiction of the Committee?<br /><br />Law No 2of 2010 has  restored the Committee as initially provided for under Law No 18of 1981. This  amendment has further added a number of significant provisions. Several  important points arise from these amendments and additions:</p>
<ul>
<li>Article 27 of Law No 18 of 1981 provides directly for the constitution of  the Committee, whereas under Law No 2 of 2010 it is prescribed that the  Committee shall be formed by a decision from the Council of Ministers. This  decision was issued on 10 April 2011 by H.H Mohammad Bin Rashid Al Maktoum, the  Vice President of the UAE and Ruler of Dubai and in his capacity as Prime  Minister issued the Council Of Ministers. The relevant decree is Decree No. 3 of  2011 for the Constitution of the Committee.</li>
<li>The effect of Decree No. 3 of 2011 is that no court can entertain any  dispute relating to commercial agencies during the period from February 2010  when the Law was amended and April 2011 when the Committee was established. In  light of this it may be foreseen that disputes pending before the competent  courts which are yet undecided may also be referred to the Committee due to the  procedural and immediate nature of the amendment.</li>
<li>Article 28 of Law No 18 of 1981 provides that the Committee shall be  competent to look into any dispute that arises by reason of a commercial agency.  Law No. 2 of 2010 imposes an additional qualification in that the dispute must  relate&nbsp; to a registered commercial agency and not just a prima facie commercial  agency arrangement. The significance of this is that the door to the Committee&rsquo;s  jurisdiction will remain firmly closed to all commercial agency disputes which  are not regulated by a registered commercial agency. There is no room for  interpretation in this regard..&nbsp;</li>
<li>Under Law No 2 of 2010 a new provision has been added to Article 28, the  effect of which is that parties may not refer the dispute to courts before  referring the same to the Committee. In essence, it introduces a tiered dispute  resolution system. Such a system did not form part of the Law in its initial  form. The significance of this amendment is discussed further below.</li>
<li>In its initial form, the Law was absent a provision dealing with the  timeframe within which parties could appeal or object to decision of the  Committee. Law 2 of 2010 has amended Article 28 to include a provision parties  may appeal decisions of the Committee to the competent Courts within 30 days  from the date of notification of the Committee&rsquo;s decision. Importantly, failure  to appeal within 30 days will render the Committee&rsquo;s quasi-judicial decision  final. This implements an equitable process, and one which mirrors procedures  adopted in Court.&nbsp;</li>
</ul>
<p>How to contest the Committee decisions?<br /><br />The Committee is required to  issue its decision within 60 days of hearing the dispute. As stated above, the  aggrieved party may contest such a decision before the competent court, by way  of a traditional law suit.<br /><br />The Statement of Claim should include the  particulars of the claim as required by the Civil Procedures Code. The parties  shall be able to file all the documents and pleadings they wish, irrespective of  those submitted at the Committee.<br /><br />These proceedings should be filed  before the Federal Courts in Abu Dhabi as the Ministry should be joined as  co-defendant to the proceedings.<br /><br />The Judgment of the Court of First  Instance in this respect shall be subject to a right of appeal at the Court of  Appeal and then subsequently at the Federal Supreme Court level.<br /><br />What is  the Extent of Jurisdiction of the Committee?<br /><br />According to the clear  wordings of Article 28 the disputes relating to registered commercial agencies  have to be filed before the Committee first and may not be filed directly to the  Court. Rather than being prohibitive, the regime is designed to foster early  settlement of disputes before the parties incur unnecessary time and costs  litigating in the Court.<br /><br />Although this provision was not included in the  old provision of Article 28 of the Law,&nbsp; Federal Courts have historically  refused to entertain disputes relating to commercial agencies. Such judgments  were based on an understanding that Article 28 granted jurisdiction to the  Committee. Even in the absence of the new provision formalizing this  arrangement, it had already been the consistent approach of the UAE Federal  Courts.&nbsp;<br /><br />Having said that, it is worth mentioning here that the Dubai  Court of Cassation has adopted a different understanding and approach to this  matter in the past. The Dubai Court of Cassation has issued several rulings&nbsp;  confirming that it is not imperative to file the law suit to the Committee  before the Court.<br /><br />In these cases the Dubai Court of Cassation held that  complainant / plaintiff enjoyed the option of filing his complaint to the Court  directly, without going through the Committee, or to file with the Committee  first and thereafter with the court. In these rulings the Dubai Court of  Cassation appears to have assumed that there is nothing in the commercial  agencies law that prevents such a process.<br /><br />This is an important reasoning  because the Court of Cassation has made it very clear that had there been any  provision in the law that clearly outlined this process in that a claimant was  obliged to first file the complaint with the Committee before filing with the  Court, then this process should be followed. This could be understood from the  judgments referred to even though they do not specifically hold so.<br /><br />Now,  reading this in light of the amendment prescribed by Law No 2 of 2010 may give  an indication as to the future process of this matter before the Dubai Courts,  because the process set down by the amendment to Article 28 is very clear that  parties may not refer the dispute to Courts prior to reference to the Committee.  This may, therefore, be read and applied by the Courts in Dubai to rule that  commercial agency disputes should be first referred to the Committee before the  Court. Although this has not yet been tested before the Dubai Court of Cassation  (due to the very recent issue of Decree No. 3 of 2011) this approach is expected  to be taken in the future litigation of registered commercial agency disputes  before the Dubai Courts.<br /><br />Are there any disputes that may fall out of the  committee&rsquo;s jurisdiction and powers?<br /><br />It is important to remember that  there are some disputes related to commercial agencies which can be filed  directly to the Court without prior recourse to the Committee. A number of  examples, derived from rulings of the Federal Supreme Court, are set out  below:</p>
<ul>
<li>The Federal Supreme Court defines disputes that fall within the jurisdiction  of the committee as those arising by reason of the agency itself, such as its  duration, territory, products and termination etc.</li>
<li>The Courts shall have jurisdiction to hear disputes falling outside of the  jurisdiction of the Committee, notwithstanding they appear prima facie to relate  to issues of agency. Such matters include compensation for breach of contract  between the agent and principal, as these disputes are considered as issues  relating to&nbsp; the implementation of the agency agreement and not issues arising  by reason of the commercial agency.</li>
<li>Courts shall also have jurisdiction to hear disputes if the commercial  agency is not registered as the jurisdiction of the Committee relates only to  registered commercial agencies.</li>
<li>Disputes in which claimants are seeking to prove the existence and validity  of an agency agreement in order to procure registration&nbsp; fall outside the scope  of the jurisdiction of the Committee and shall be heard by the Courts.</li>
<li>Disputes relating to compensation for termination of unregistered agency  agreement can be heard directly by Courts and not by the Committee, even if  there are no written agreements.</li>
</ul>
<p>A final note to be added here is that although Decree 3 of 2011 establishing  the Committee has 60 days to fix a date for hearing the dispute, it is not clear  whether a party may proceed to the court if the Committee failed to so set a  date. Under the old provision of the Law there was a practice that parties would  usually proceed and file their complaint to the Court after the Committee  exceeded the 60 days provided for under Article 28. This however is yet to be  tested in light of the new amendment.</p>