UAE CONSTRUCTION LAW

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					TABLE OF CONTENTS
INTRODUCTION
1.    What is the substantive and procedural legal framework relevant to construction
      disputes in the UAE? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1

2.    What is the form of a Construction contract ? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

3.    Is the Engineer a party to a construction contract ? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

4.    Is the contractually agreed duration of a defects liability period binding
      under UAE Law? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2

5.    What is the Contractor entitled to claim if a project of works is not completed ? . . . . . .3

6.    What is the time limit for bringing a claim against the Contractor for defects
      discovered or collapse of a building or fixed installation? . . . . . . . . . . . . . . . . . . . . . . . .3

7.    Would a clause setting out a time limit to issue arbitration proceedings bar a
      Contractor from commencing these proceedings against the Employer after the
      passage of that time bar? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3

8.    How soon should a claim arising out of a construction contract be lodged and what
      is the time limit for doing so under UAE Law ? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3

9.    How soon should a Contractor notify the Employer that unit rates and quantities
      need to be increased for the completion of the project or of one of its aspects ? . . . . . . .4

10.   Is a Contractor entitled to claim loss of profit as part of its claim against
      the Employer? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

11.   Can a Subcontractor claim directly against the Employer for anything that is
      due to him from the Contractor? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

12.   Should a Subcontractor be paid upon of the completion of its work irrespective of
      whether or not the Main Contractor has been paid ? . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4

13.   Are construction disputes referred to arbitration in the UAE? . . . . . . . . . . . . . . . . . . . . .5

14.   Can an arbitral award resolving a construction dispute be challenged or nullified
      before the UAE Courts at the request of the losing party? . . . . . . . . . . . . . . . . . . . . . . . .5

15.   What are the most important aspects of an Arbitration Clause in a construction
      contract or subcontract? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6

16.   What UAE law procedural aspects should parties to a construction contract or
      subcontract be aware of during arbitration proceedings? . . . . . . . . . . . . . . . . . . . . . . . . .7

17.   In construction disputes resolved through arbitration, what is the time frame for
      issuing an arbitration award under UAE Law ? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7

18.   How can an arbitral award resolving a construction dispute be enforced on the
      loosing party’s assets? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8

19.   Are legal costs and relevant expenses incurred in arbitration proceedings
      recoverable by the successful party to a construction dispute? . . . . . . . . . . . . . . . . . . . . .8

20.   Can one of the parties go to Court in a dispute on a Construction contract
      with an Arbitration Clause? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
ANNEX A:   MODEL CLAUSES OF CONCILIATION AND ARBITRATION . . . . . . . . . .9

ANNEX B:   EXAMPLE OF PERFORMANCE GUARANTEE FORM . . . . . . . . . . . . . . . . .9

ANNEX C:   EXAMPLE OF SURETY BOND FOR PERFORMANCE FORM . . . . . . . . . .11

ANNEX D:   EXAMPLE OF GUARANTEE FOR ADVANCE PAYMENT FORM . . . . . . .12

ANNEX E:   EXAMPLE OF TENDER FORM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .13

           APPENDIX TO TENDER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15

ANNEX F:   MAIN CONTRACT AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19

ANNEX G:   SUBCONTRACT AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21

           APPENDIX TO SUBCONTRACTOR’S OFFER . . . . . . . . . . . . . . . . . . . . . . .22

ANNEX H:   RULES OF COMMERCIAL CONCILIATION AND ARBITRATION OF

           THE DUBAI CHAMBER OF COMMERCE & INDUSTRY : . . . . . . . . . . . . .23
           UAE CONSTRUCTION LAW AND DISPUTE RESOLUTION
           INTRODUCTION
                   Construction contracts form an integral part of the economy and development of
                   many countries including the United Arab Emirates (UAE). It is essential that such
                   contracts should be undertaken on conditions that hold a fair balance between the
                   interests of the employer and the contractor and which reflect the role of
                   independent consulting engineers. Construction disputes are generally complex
                   with many interwoven issues involving multiple claims and counter claims which
                   arise mainly because of the uniqueness of the construction contract itself.
                   Construction disputes normally involve large sums of money and this results in the
                   parties’ attempts to pursue vigorously all issues and engage in extensive legal
                   arguments to overcome technical shortcomings. The number of construction
                   projects and related contracts has increased substantially in the UAE over the last
                   decade. This has inevitably given rise to significant numbers of claims either
                   between contractors and owners / employers or between contractors and sub-
                   contractors. These disputes are resolved either by way of conciliation or arbitration
                   predominantly held in the English language, with specialist arbitrators appointed
                   due to the technical nature of the aspects involved

                   Litigation is a less preferred mode of dispute resolution in the construction
                   industry, although there are a number of Court rulings on important aspects of
                   construction law. As a consequence of this, focus on construction law is increasing.
                   We address below some of the most often encountered issues in construction law
                   related disputes.

           1.    WHAT IS THE SUBSTANTIVE AND PROCEDURAL LEGAL FRAMEWORK RELEVANT TO
                 CONSTRUCTION DISPUTES IN THE UAE?

                   • Articles 870 to 896 of the UAE Civil Law No. 2 of 1987 (the “Civil Code”) relating
                     to construction works, as well as general maxims and principles set out in the
                     same law, form the basis of the legal framework relating to construction.

                       In addition, the provisions of the UAE Commercial Transactions Law No. 18 of
                       1993, (the “CTL”) would also apply to the extent that the parties to a
                       construction claim can be defined as traders carrying out commercial business
                       in accordance with Articles 6 and 11 of the CTL.

                   • Specialised laws and Decrees - such as Law No. 6 of 1997 relating to contracts
                     with Government Departments in the Emirate of Dubai.

                   • Articles 203 - 219 of the Civil Procedure Law (Law No. 11 of 1992) (the “CPL”)
                     relating to Arbitration and appointment of arbitrators as well as authentication
                     of arbitral awards.

                   • Various Rules of Arbitration and Conciliation as promulgated by Abu Dhabi,
                     Dubai or Sharjah Chambers of Commerce & Industry, Dubai or other
                     Municipalities, International Chamber of Commerce, etc.

                   • There are discussions for the promulgation of a Federal Construction Law
                     implementing a “building code” the absence of which has been identified as a
                     major handicap within the local construction industry.




Construction Law in the United Arab Emirates                                                               1
    2.   WHAT IS THE FORM OF A CONSTRUCTION CONTRACT ?
          Construction contracts are usually set out in FIDIC (Federation Internationale des
          Ingenieurs Conseils - International Federation of Consulting Engineers) forms.
          These are standard forms of contract that are periodically revised (e.g. the FIDIC
          1998 Conditions) tailored to broad areas of construction (such as Mechanical Works,
          Electrical works, Subcontracting etc). They are usually amended to suit the more
          specific needs of the parties, or the peculiarities of a specific project or legal
          framework of a certain jurisdiction. FIDIC contracts also contain appendixes for the
          parties to complete (such as dates, names of parties, arbitration clause, percentage
          of performance bonds, rates etc). In general FIDIC forms are set in Parts I and II:
          Part I of the conditions is intended to provide a general framework for the
          Construction Contract. Part II contains blank sections for the parties to fill in
          accordance with the particular requirements of the work. Part II also contains the
          specific details of any modifications required by the parties to the general
          provisions of Part I. For the avoidance of any doubt in the interpretation of the
          parties’ intentions, the contract should also provide that in the event of a conflict
          between the provisions of Part I and Part II, those of Part II are to prevail.

          In addition, construction contracts can also have the form of one party’s standard
          terms and conditions (for example, the Dubai Municipality’s Conditions of
          Contract). Whatever the form of the construction contract, it is important for the
          parties to factor in all aspects of the UAE construction industry and of the
          governing law of the contract in addition to all the procedural details of the dispute
          resolution method chosen by them.

    3.   IS THE ENGINEER A PARTY TO A CONSTRUCTION CONTRACT ?
          Although the role of the Engineer is very critical throughout the duration of a
          construction contract (he supervises and authorises the works carried out, issues
          certificates that officially confirm the fulfillment of various stages, considers
          validity of claims, variation orders, etc.) it is not in fact a party to the construction
          contract, which is usually an agreement exclusively between a contractor and an
          employer (owner of the project in question). The engineer is only a party to a
          contract it has entered into with the employer. The engineer operates as a
          representative of the employer throughout the construction contract and therefore
          any actions he carries out are, in law, considered as those of the Employer. To the
          extent the Engineer has acted beyond the scope of his contract with the Employer,
          it is the Employer who has a cause of action against the Engineer and not the
          Contractor. However, it is possible, although relatively rare, to have multi party
          arbitration proceedings where all relevant parties are present in an all embracing
          dispute resolution process.

    4.   IS THE CONTRACTUALLY AGREED DURATION OF A DEFECTS LIABILITY PERIOD
         BINDING UNDER UAE LAW?

          It is important when signing a FIDIC based or other construction contract to always
          be fully aware of the potentially relevant mandatory UAE law provisions, as they
          will override anything in the contract that contravenes them.

          Defects liability periods under most standard form contracts are usually considered
          as extension of contract periods and are for one to two years. However, Article 880
          of the UAE Civil Code states that the Contractor and the Engineer (if the plans were


2                                                                             Construction Law in the United Arab Emirates
                   produced by it) will be jointly liable for a period of 10 years to compensate the
                   Employer for any total or partial collapse of the works to the extent these relate to
                   a building or other fixed installation. This period of time can be extended by
                   contract but cannot be reduced. The provision does not apply to installations that
                   are intended to remain in place for a period of less than 10 years. This liability of
                   the Contractor is unconditional and can not be circumvented even if it is proved
                   that the defect or collapse of the construction in question arose as a result of the
                   defect in the land or even as a result of the Employer’s consent to the construction
                   of defective buildings or installations.

           5. WHAT IS THE CONTRACTOR ENTITLED TO CLAIM IF A PROJECT OF WORKS IS NOT COMPLETED ?
                   If the cause of preventing the works from being completed is not attributable to the
                   Contractor, Article 894 of the UAE Civil Code states that the Contractor will be
                   entitled to the value of the work which it has completed and the expenses it has
                   incurred in the performance of that work up to the amount of the benefit that the
                   Employer has derived from that work.

           6.    WHAT IS THE TIME LIMIT FOR BRINGING A CLAIM AGAINST THE CONTRACTOR FOR DEFEETS
                 DISCOVERED OR COLLAPSE OF A BUILDING OR FIXED INSTALLATION ?

                   Article 883 of the UAE Civil Code states that the time limit for this type of claim will
                   be three years from the date of the collapse or discovery of the defects.

           7.    WOULD A CLAUSE SETTING OUT A TIME LIMIT TO ISSUE ARBITRATION
                 PROCEEDINGS BAR ACONTRACTOR FROM COMMENCING THESE PROCEEDINGS
                 AGAINST THE EMPLOYER AFTER THE PASSAGE OF THAT TIME BAR?

                   Breach of a procedure set out in a clause of the contract would normally not bar the
                   Contractor from instituting arbitration proceedings under UAE law. The time bars
                   that relate to the bringing of legal actions (before the UAE Courts or a UAE based
                   Arbitral Tribunal) are set out by Federal Laws and the parties cannot normally
                   contract out of them to the extent that such time bars constitute mandatory UAE
                   law.

           8.    HOW SOON SHOULD A CLAIM ARISING OUT OF A CONSTRUCTION CONTRACT BE
                 LODGED AND WHAT IS THE TIME LIMIT FOR DOING SO UNDER UAE LAW ?

                   Most construction contracts specifically state that the Contractor/Subcontractor can
                   not suspend its obligations under the contract, simply because a claim has arisen.
                   Therefore, in practice, most Court actions and arbitration proceedings commence
                   after completion of works and it is very rare to see a dispute resolution process
                   taking place before the Courts or the arbitrators whilst works are still in progress.

                   There are various time limits involved from the date a claim is formed until it is
                   filed in the form of arbitration proceedings or a Court action. Most FIDIC form
                   contracts include an elaborate procedure for submission of claims before the
                   Engineer within a specific number of days. The Engineer would normally consider
                   the merit of those claims and will then issue his decision accordingly. If one of the
                   parties is not satisfied with the Engineer’s decision within a further prescribed
                   number of days the concerned party is free to submit a notice for arbitration.

                   The UAE Commercial Transactions Law (CTL) under Article 95 specifies a time
                   limit of ten years for an action to be commenced in relation to obligations of one


Construction Law in the United Arab Emirates                                                                  3
          party towards the other. Over and above the time limits that are described within a
          construction contract (none of which is sufficient to bar a claim from being heard
          before an arbitral tribunal or a Court under UAE law) this ten year time limit
          usually forms the basic time bar for most construction law related claims.

    9.   HOW SOON SHOULD A CONTRACTOR NOTIFY THE EMPLOYER THAT UNIT RATES
         AND QUANTITIES NEED TO BE INCREASED FOR THE COMPLETION OF THE PROJECT
         OR OF ONE OF ITS ASPECTS       ?
    Article 886 of the UAE Civil Code states that :

          “If a contract is made under an itemised list on the basis of unit prices and it
          appears during the course of the work that it is necessary for the execution of the
          plan agreed substantially to exceed the quantities on the itemised list, the
          Contractor must immediately notify the Employer of this, setting out the increased
          price expected, and if he does not do so he shall lose his right to recover the excess
          cost over and above the value of the itemised list.”

          Although Article 886 only refers to unit rates it may apply to any additional costs
          or time that a Contractor needs to incur and then claim in order to complete the
          works. FIDIC contracts often vary the period of time during which the Contractor
          has to request the Engineer for a variation and any time frame agreement between
          the parties that would depart from the above provision is usually recognised as
          valid by UAE law.

    10. IS A CONTRACTOR ENTITLED TO CLAIM LOSS OF PROFIT AS PART OF ITS CLAIM
        AGAINST THE EMPLOYER?

          UAE law normally does not provide grounds for claimants to successfully pursue
          loss of profit claims or financial loss/economic loss claims. In addition, this type of
          claim is normally excluded in the FIDIC standard forms of contract.

    11. CAN A SUBCONTRACTOR CLAIM DIRECTLY AGAINST THE EMPLOYER FOR
        ANYTHING THAT IS DUE TO HIM FROM THE CONTRACTOR?

          Article 891 of the Civil Code expressly precludes the Subcontractor from claiming
          directly from the Employer for any amounts that are properly claimed against the
          Contractor unless the Contractor has given an assignment of its rights against the
          Employer to the Subcontractor. In addition, standard clauses are often included to
          reflect this. For example, Clause 4.3 of the FIDIC Conditions of Subcontract for
          works of Civil Engineering Construction, states:

          “Nothing herein shall be construed as creating any privity of contract between
          Subcontractor and the Employer”.

    12. SHOULD A SUBCONTRACTOR BE PAID UPON THE COMPLETION OF ITS WORK
    IRRESPECTIVE OF WHETHER OR NOT THE MAIN CONTRACTOR HAS BEEN PAID ?

          A recent Court of Cassation judgment has held that during the Subcontract a
          Subcontractor will only be entitled to proportional payment during the
          performance period from any payment received by the Main Contractor from its
          client. However, it was also held that the same does not apply when a
          Subcontractor has completed all its works and delivered the project to the Main
          Contractor. It was held that in such circumstances a Subcontractor has no
          obligation to wait for payment until such time as the Main Contractor has been
          paid.


4                                                                            Construction Law in the United Arab Emirates
           13.     ARE CONSTRUCTION DISPUTES REFERRED TO ARBITRATION IN THE UAE?
                   Arbitration is gradually becoming a popular construction dispute resolution mode
                   in the UAE. An important factor influencing parties’ decision to opt for arbitration,
                   as a dispute resolution process is the fact that English is the widely accepted and
                   agreed language of conducting arbitration proceedings. The benefits arising out of
                   this factor are substantial: not only do parties save costs in translating voluminous
                   documentation but, more importantly, specialised English speaking experts from
                   various fields of the construction industry are appointed as arbitrators. They are
                   usually very familiar with the technical aspects of a construction dispute and they
                   possess a wealth of experience on the basic principles of construction dispute
                   resolution. This, together with the time limit of six months (subject to extension by
                   mutual agreement) for issuing an award provided for in Article 210 of the UAE
                   Civil Procedures Law renders arbitration an increasingly preferred option for
                   construction dispute resolution.

           14. CAN AN ARBITRAL AWARD RESOLVING A CONSTRUCTION DISPUTE BE
               CHALLENGED OR NULLIFIED BEFORE THE UAE COURTS AT THE REQUEST OF THE
               LOSING PARTY?

                   It is possible to challenge an arbitral award but only on specific procedural
                   grounds. These are set out in Article 216 of the UAE Civil Procedures Law, which
                   states that:

           “ARTICLE - 216

                   1. In the following instances, the opposing parties may apply for the annulment of
                      an Arbitrator’s ruling when the court is examining whether to validate it:

                       (a) If given without a deed of arbitration or if based on an invalid deed, or if
                           lapsed through prescription, or if the arbitrators have exceeded the limits of
                           the deed.

                       (b) If the ruling has been given by arbitrators not appointed according to the law,
                           or if given by some of them without being so empowered in the absence of
                           the others, or if given under deed of arbitration in which the subject of the
                           dispute is not stated, or if given by someone not competent to agree to
                           arbitration or by an arbitrator who does not fulfill the legal requirements.

                       (c) If there is something invalid in the ruling or in the procedures affecting the
                           ruling.

                   2. Acceptance of invalidity shall not be inhibited by the opposing party
                      abandoning his right thereto before the Arbitrator’s ruling is issued.”

                   Ultimately, the award will take the form of a judgment and as such it is imperative
                   to ensure that it is as legally sound as possible so that its nullification by the UAE
                   Courts is avoided and that throughout the Arbitration procedure (in fact from the
                   stage of drafting the arbitration clause or arbitration agreement) attention is
                   focused on the ultimate validity of the arbitration award.




Construction Law in the United Arab Emirates                                                                 5
    15. WHAT ARE THE MOST IMPORTANT ASPECTS OF AN ARBITRATION CLAUSE IN A
        CONSTRUCTION CONTRACT OR SUBCONTRACT?

        The Claimant needs to ensure that the arbitration award, when issued, will
        “survive” any attempt made by the Defendant through the three tiers of the UAE
        judicial system (Court of First Instance, Court of Appeal, Court of Cassation) to
        nullify it on the basis of lapse of procedure or breach of a mandatory provision of
        UAE law.

        Some of the basic points that the parties should bear in mind in this respect, include
        the following:

    •   Jurisdiction of Arbitration

        As the UAE have not yet signed the 1958 New York Convention on mutual
        enforcement of arbitration awards, it is important for a party potentially interested
        in enforcing an arbitration award on UAE based entity/security, to avoid agreeing
        a foreign (i.e., non-GCC) arbitration clause. However, there are some bilateral
        agreements with certain countries (e.g. France) making enforcement of arbitration
        awards issued in those countries possible.

    •   Clear Arbitration Clause - Arbitration Agreement

        The arbitration clause or agreement should specify the rules under which any
        dispute resolution by way of arbitration should be conducted. These may be the
        Rules of the Dubai Chamber of Commerce & Industry, Dubai Municipality Rules,
        UNCITRAL, ICC etc. For a more effective supervision and conduct of arbitration
        proceedings held in the UAE it is advisable to agree to local (as opposed to
        international) rules. This will facilitate the certification of the award by the
        supervising body and subsequently its authentication through the UAE Courts. In
        addition, it is preferable that the parties to the dispute, rather than their lawyers,
        sign any arbitration agreement. This is because in most cases, although a Power of
        Attorney gives a lawyer rights to conduct an arbitration on behalf of his client,
        occasionally it may not include an express right for the lawyer to sign binding
        arbitration agreements.

    •   Determination of whether the dispute will be resolved by one or three Arbitrators.

        Very often this issue is left unclear in arbitration clauses or agreements that are part
        of a Construction contract or Subcontract and becomes the object of a separate
        dispute. The options available are essentially three:

        • either one Arbitrator appointed by mutual agreement of the parties or by a
          neutral entity (such as a Chamber of Commerce & Industry) or

        • three Arbitrators, one appointed by each party and the third appointed by the
          two arbitrators or a neutral entity, the majority of whom will determine the
          dispute or finally

        • two Arbitrators one appointed from each party and an Umpire who will only
          determine the dispute if the two Arbitrators disagree on their findings.




6                                                                           Construction Law in the United Arab Emirates
           16. WHAT PROCEDURAL ASPECTS OF UAE LAW SHOULD PARTIES TO A CONSTRUCTION
               CONTRACT OR SUBCONTRACT BE AWARE OF DURING ARBITRATION PROCEEDINGS?

           •       Powers of Attorney

                   It is essential under UAE law that, parties are represented by authorised attorneys
                   who should carry with them during all arbitration hearings a letter of authorisation
                   or ideally, a Power of Attorney appointing them as legal representatives of the
                   parties with powers to draft pleadings (written submissions), attend hearings and
                   perform advocacy on their behalf.

           •       Arbitrators’ limits under the arbitration clause / agreement.

                   If arbitrators exceed the limits of the powers given to them in the arbitration
                   clause/agreement, paragraph 1(a) of Article 216 of the UAE Civil Procedures Law
                   (set out above under 14) clearly states that the award will be invalid - at least to the
                   extent that it includes decisions that have been made beyond the powers of the
                   arbitrators as these are set out in the arbitration clause / agreement.

           •       Arbitrators should not violate or overlook any of the Rules of Arbitration agreed to
                   by the parties.

                   Paragraph 1(c) of Article 216 of the UAE Civil Procedures Law sets out the general
                   provision that “if there is something invalid in the ruling or in the procedures
                   affecting the ruling” the Arbitrator’s Award may be nullified.

           17. IN CONSTRUCTION DISPUTES RESOLVED THROUGH ARBITRATION, WHAT IS THE
               TIME FRAME FOR ISSUING AN ARBITRATION AWARD UNDER UAE LAW ?

                   The time limit for issuing an arbitral award is usually six months, but can often be
                   extended up to another six months or more by mutual agreement. Any time
                   extensions need to be agreed upon at an early stage. Time extensions need to be in
                   compliance with the agreed rules of Arbitration and Article 210 of the UAE Civil
                   Procedures Law, which states:

           “ARTICLE - 210

                   (1) If the opposing parties do not specify a time for a ruling to be given in the
                       arbitration agreement, the arbitrator is to give his ruling within six months from
                       the date of the initial arbitration hearing, otherwise any of the opposing parties
                       may raise the dispute to the court or may pursue it before the court if already
                       raised.

                   (2) The opposing parties may explicitly or implicitly agree to extend the date
                       prescribed by agreement or by law, and they may empower the arbitrator to
                       extend it to a particular date. At the request of the arbitrator or one of the
                       opposing parties, the court may extend the date specified in the foregoing
                       paragraph for such period as it deems appropriate for a settlement of the
                       dispute.

                   (3) The period shall be interrupted whenever the proceedings are interrupted or
                       suspended, and shall be resumed from the date on which the arbitrator becomes
                       aware that the cause of the interruption or suspension has been eliminated. If the
                       remaining period is less than a month, it shall be extended to a month.”



Construction Law in the United Arab Emirates                                                                  7
         It is important that the Claimant always focuses on this issue and ensures that if it
         becomes obvious that the arbitration award will not be issued within the prescribed
         time limit, an agreement for extension is obtained as soon as possible.

    18. HOW CAN AN ARBITRAL AWARD RESOLVING A CONSTRUCTION DISPUTE BE
        ENFORCED ON THE LOOSING PARTY’S ASSETS?

         As in most jurisdictions, an award needs the authentication of the local courts for it
         to be equivalent to a Court judgment and to be enforceable against the Defendant’s
         assets. This involves an application to the Court of First Instance, the judgment of
         which is then appealable within 30 days before the Court of Appeal. Thereafter, the
         Court of Appeal judgment can be appealed within 30 days before the Court of
         Cassation, the judgment of which is final. During the process of this authentication,
         the UAE courts cannot consider the merits of the arbitrators’ findings. This is
         clearly stated in paragraph 1 of Article 217 of the UAE Civil Procedure Code, which
         states that arbitrator’s rulings may not be contested in any way. There have also
         been a number of Dubai and Abu Dhabi Court of Cassation rulings confirming that
         appeals against the merits of arbitrators’ awards are not permissible.

    19. ARE LEGAL COSTS AND RELEVANT EXPENSES INCURRED IN ARBITRATION
       PROCEEDINGS RECOVERABLE BY THE SUCCESSFUL PARTY TO A CONSTRUCTION DISPUTE?

         Although legal costs are not generally recoverable by the successful party under
         UAE Law, in some cases, the successful party will be awarded a greater portion of
         its actual expenses and legal costs than it would have done had it resolved its
         dispute through litigation. For example, Article 48 of the Dubai Chamber of
         Commerce & Industry Rules for Arbitration and Conciliation states that:

         “The costs of conciliation or arbitration shall include charges of the Chamber,
         remuneration and actual expenses of the conciliator’s or arbitrators, fees and
         expenses of the experts and the translators if any, normal expenses incurred by the
         parties in preparation of their pleadings, any administrative expenses relating to
         meeting-rooms rentals, typing, recording, photocopying and others incurred in the
         course of the conciliation or arbitration proceedings.”

         In addition, it is possible for both parties at the beginning of the Arbitration to agree
         on bearing their own legal costs or that these will be borne by the losing party. The
         higher costs that are generally involved in arbitration coupled by the inevitable
         legal and court fees of the subsequent litigation (for authentication of the arbitration
         award) can mean that the ultimate cost exposure to the successful party in
         arbitration may be substantially greater than in litigation.

    20. CAN ONE OF THE PARTIES GO TO COURT IN A DISPUTE ON A CONSTRUCTION
        CONTRACT WITH AN ARBITRATION CLAUSE?

         The claiming party may file a case with the court even where the contract contains
         an Arbitration clause, but this will be subject to the Defendant expressly referring
         to the Arbitration clause at the first court hearing in accordance with Article (203/5)
         of the Civil Procedures Law. Upon the Defendant so doing, the Court will refer the
         matter to Arbitration. Conversely, if the Defendant fails to object and refer to the
         Arbitration clause at the first court hearing, the Court will assume that the
         arbitration clause has been waived by both parties and will continue with the
         resolution of the dispute through litigation. The Plaintiff in such approach should
         bear in mind that it may lose the court fees and advocacy charges if the Defendant
         successfully raises the Arbitration clause defence at the first hearing.


8                                                                            Construction Law in the United Arab Emirates
           ANNEX A: MODEL CLAUSES OF CONCILIATION AND ARBITRATION
                   The DCCI Centre for Commercial Conciliation & Arbitration recommends the
                   parties wishing to resolve their disputes under the DCCI Rules of Commercial
                   Conciliation and Arbitration include in their contracts one of the following clauses
                   according to their choice of dispute resolution mode:

                   Conciliation Clause:

                   “Any dispute arising from this contract shall be referred to conciliation in
                   accordance with the provisions set forth in the Rules of Commercial Conciliation
                   and Arbitration of the Dubai Chamber of Commerce & Industry.”

                   Arbitration Clause :

                   “Any dispute connected with the formation, performance, interpretation,
                   nullification, termination or invalidation of this contract or arising therefrom or
                   related thereto in any manner whatsoever shall be referred to arbitration in
                   accordance with the provisions set forth in the Rules of Commercial Conciliation
                   and Arbitration of the Dubai Chamber of Commerce & Industry”.

                   Conciliation and Arbitration Clause:

                   “Any dispute connected with the formation, performance, interpretation,
                   nullification, termination or invalidation of this contract or arising therefrom or
                   related thereto in any manner whatsoever shall be referred to conciliation in
                   accordance with the provisions set forth in the Rules of Commercial Conciliation
                   and Arbitration of the Dubai Chamber of Commerce & Industry.”

                   If the Dispute is not settled by conciliation, it shall be referred to arbitration in
                   accordance with the provisions set forth in the said Rules.

           ANNEX B:            EXAMPLE OF PERFORMANCE GUARANTEE FORM

                   THIS AGREEMENT is made on the ........ day of ....... 20...........................

                   BETWEEN: (1)          ................................... ....... [name of bank surety or insurance
                                         company] of .................................... [address] (hereinafter called
                                         “the Guarantor”); and

                                  (2)    .................................................. [ name of Employer]
                                         of ............................................... [address] (hereinafter called “the
                                         Employer”).

                   WHEREAS:

                   A. This agreement is supplemental to a contract (hereinafter called “the Contract”)
                      made between (1) the Employer and (2) [name of Contractor] of
                      ....................[address of Contractor] (hereinafter called “the Contractor”)
                      whereby the Contractor agreed and undertook to design and execute and
                      complete and remedy any defects in the Works of ........................................ [name
                      of Contract and brief description of the works] for the sum of ........................
                      [amount in Contract currency] being the Contract Price ; and

                   B. The Guarantor has agreed to guarantee the due performance of the Contract in
                      the manner hereinafter appearing.


Construction Law in the United Arab Emirates                                                                                     9
     IT IS HEREBY AGREED as follows:

     1. Subject to Clause 2 if the Contractor (unless relieved from the performance by
        any clause of the Contract or by statute or by the decision of a tribunal of
        competent jurisdiction) shall in any respect fail to execute the Contract or
        commit any breach of his obligations thereunder then the Guarantor will
        indemnify and pay the Employer the damages sustained by him as a
        consequence of such failure or breach not exceeding the aggregate sum of .........
        [amount of guarantee] ............ [in words], such sums being payable in the types
        and proportions of currencies in which the Contract Price is payable.

     2. The payment by the Guarantor will only be made if, prior to the earlier of the
        date of issue of the Performance Certificate or .......................(“the End Date”), the
        Guarantor has received:

         (a) Written notice from both the Employer and the Contractor that the amount
             of damages payable to the Employer is agreed between the Employer and the
             Contractor; or

         (b) A copy of a notice of arbitration issued by either the Employer or the
             Contractor under the Contract which is subsequently followed (whether
             before or after the End date) by a legally certified copy of an award issued in
             arbitration proceedings carried out in conformity with the Contract that the
             amount of the damages is payable to the Employer; or

         (c) a legally certified copy of a decision of the Dispute Adjudication Board under
             the Contract in respect of which no notice of dissatisfaction has been given
             by either the Employer or the Contractor within twenty eight days of the
             decision under the Contract stating an amount due to the Employer.

     3. The Guarantor shall not be discharged or released from his Guarantee by an
        arrangement between the Contractor and the Employer, with or without the
        consent of the Guarantor, or by any forbearance on the part of the Employer,
        whether as to payment, time, performance or otherwise, and any notice to the
        Guarantor of any such arrangement, alteration or forbearance is hereby
        expressly waived.

     4. This Guarantee shall not be assignable by the Employer and upon it ceasing to
        be in full force and effect the Employer shall return the same to the Guarantor
        within 14 days.

     5. Words and expressions defined in the Contract shall so far as the context admits
        bear the same meaning in this Guarantee.

     6. This Guarantee shall be governed by the laws of ................



     Signed by ....................................   Signed by ....................................

     For and on behalf of ......................      For and on behalf of ......................

     On (date) ..................................     On (date) ..................................

     in the capacity of .........................     in the capacity of .........................

     and in the presence of ....................      and in the presence of ....................

     Seal (where applicable)                          Seal (where applicable)



10                                                                                    Construction Law in the United Arab Emirates
           ANNEX C: EXAMPLE OF SURETY BOND FOR PERFORMANCE FORM
                   By this Bond..................................................[name and address of Contractor] as
                   Principal (hereinafter called “the Contractor”) and ........................... [ name, legal
                   title and address of surety, bonding company or insurance company] as Surety
                   (hereinafter called “the Surety”), are held and firmly bound unto
                   ..............................[name and address of Employer] as Obligee (hereinafter called
                   “the          Employer”)                 in        the  amount      of   ...... [amount  of  Bond]
                   ..................................................[in words], for the payment of which sum well and
                   truly to be made in the types and proportions of currencies in which the Contract
                   Price is payable, the Contractor and the Surety bind themselves, their heirs,
                   executors, administrators, successors and assigns, jointly and severally, firmly by
                   these presents.

                   WHEREAS the Contractor has entered into a written Agreement with the Employer
                   dated the ...... day of ...19.... for ......[name of Contract] in accordance with the
                   documents listed therein, which are by reference made part hereof and are
                   hereinafter referred to as the Contract.

                   NOW, THEREFORE, the Condition of this Obligation is such that, if the Contractor
                   shall promptly and faithfully perform the said Contract (including any
                   amendments thereto) then this obligation shall be null and void; otherwise it shall
                   remain in full force and effect. Whenever the Contractor shall be, and declared by
                   the Employer to be, in default under the Contract, the Employer having performed
                   the Employer’s obligations thereunder, the Surety may promptly remedy the
                   default, or shall promptly:

                   (1) complete the Contract in accordance with its terms and conditions; or

                   (2) obtain a tender or tenders from qualified tenderers for submission to the
                       Employer for completing the Contract in accordance with its terms and
                       conditions, and upon determination by the Employer and the Surety of the
                       lowest responsive tenderer, arrange for a Contract between such tenderer and
                       Employer and make available as work progresses (even though there should be
                       a default or a succession of defaults under the Contract or Contracts of
                       completion arranged under this paragraph) sufficient funds to pay the cost of
                       completion less the Balance of the Contract Price; but not exceeding, including
                       other costs and damages for which the Surety may be liable hereunder, the
                       amount set forth in the first paragraph hereof. The term “Balance of the Contract
                       Price”, as used in this paragraph, shall mean the total amount payable by
                       Employer to Contractor under the Contract, less the amount properly paid by
                       Employer to Contractor;

                   (3) Pay the Employer the amount required by Employer to complete the Contract in
                       accordance with its terms and conditions up to a total not exceeding the amount
                       of this Bond.

                   The Surety shall not be liable for a greater sum than the specified penalty of this
                   Bond.

                   Any suit under this Bond must be instituted before the issue of the Performance
                   Certificate.

                   No right of action shall accrue on this Bond to or for the use of any person or


Construction Law in the United Arab Emirates                                                                             11
        corporation other than the Employer named herein or their heirs, executors,
        administrators, successors and assigns of the Employer.

        In testimony whereof, the Contractor has hereunto set his hand and affixed his seal,
        and the Surety has caused these presents to be sealed with his corporate seal duly
        attested by the signature of his legal representative, this ........ day of ....... .

        Signed by ..................................                  Signed by ....................................

        For and on behalf of .....................                    For and on behalf of ......................

        On (date). .................................                  On (date) ..................................

        In the capacity of .........................                  In the capacity of .........................

        and in the presence of ....................                   and in the presence of ....................

        Seal (where applicable)                                       Seal (where applicable)

     ANNEX D: EXAMPLE OF GUARANTEE FOR ADVANCE PAYMENT FORM

        To:....................................... [name of Employer]

        ................................................ [address of Employer]

        ............................................. [name of Contract]

        Gentlemen:

        In accordance with the provisions of the Conditions of Contract, Sub-Clause 13.2
        (“Advance Payments”) of the above mentioned Contract, ..............[name and
        address of Contractor] (hereinafter called “the Contractor”) shall deposit with
        .....................[name of Employer] a bank guarantee to guarantee his proper and
        faithful performance under the said Clause of the Contract in an amount of
        ................. ..........[amount of guarantee] ...........[in words].

        We, the ..........................[bank or financial institution], as instructed by the
        Contractor, agree unconditionally and irrevocably to guarantee as primary obligor
        and not as Surety merely, the payment to ..........................[Name of Employer] on his
        first demand without whatsoever right of objection on our part and without his first
        claim to the Contractor, in the amount not exceeding ........................[amount of
        guarantee] ..................................[in words].

        We further agree that no change or addition to or other modification of the terms of
        the Contract or of Works to be performed thereunder or of any of the Contract
        documents which may be made between ........[name of Employer] and the
        Contractor, shall in any way release us from any liability under this guarantee, and
        we hereby waive notice of any such change, addition or modification.

        No claim may be made by you under this guarantee until we have received notice
        in writing from you specifying the amount of each advance payment which has
        been paid to the Contractor pursuant to the Contract.

        Our outstanding liability under this guarantee will reduce by such amounts as may
        be notified to us in your authorised writing and stated to be the reduction of this
        guarantee required to be made in accordance with the Contract by reason of the


12                                                                                                    Construction Law in the United Arab Emirates
                   repayments made by the Contractor.

                   This guarantee shall remain valid and in full effect from the date of the first advance
                   payment under the Contract until ......... [name of Employer] receives full
                   repayment of the same amount from the Contractor.

                                                  Yours truly,                                .........................................

                                                  Signature and Seal :                        .........................................

                                                  Name of Bank:                               .........................................

                                                  Address:                                    .........................................

                                                                                              .........................................

                                                                                              .........................................

                                                  Date:                                       .........................................




           ANNEX E: EXAMPLE OF TENDER FORM
                   NAME OF CONTRACT :

                   TO:

                   GENTLEMEN,

                   We have examined the Conditions of Contract, Employer’s Requirements,
                   Schedules, Addenda Nos...... ......... ........ and the matters set out in the Appendix
                   hereto. We have understood and checked these documents and have not found any
                   errors in them. We accordingly offer to design, execute and complete the said Works
                   and remedy any defects, fit for purpose in conformity with these documents and
                   the enclosed Proposal, for the fixed lump sum of

                   (in currencies of payment)

                   ....................................... ............ ......... ......... ......... ......... ......... ...... ...... ...... ... ...... ............
                   ............ ................. .............................. ..................... ..................... ............... .....................
                   ..................... ......................

                   We accept your suggestions for the appointment of the Dispute Adjudication Board,
                   as set out in Schedule. ......[We have completed the Schedule by adding our
                   suggestions for the other members of this three-person Board, but these suggestions
                   are not conditions of this Tender].*

                   We agree to abide by this Tender until................... and it shall remain binding upon
                   us and may be accepted at any time before that date. We acknowledge that the
                   Appendix forms part of our Tender.


Construction Law in the United Arab Emirates                                                                                                                             13
     If our Tender is accepted, we will provide the specified performance security,
     commence the Works as soon as reasonably possible after receiving the Employer’s
     Representative’s notice to commence, and complete the Works in accordance with
     the above-named documents within the time stated in the Appendix to Tender.

     Unless and until a formal Agreement is prepared and executed this Tender, together
     with your written acceptance thereof, shall constitute a binding contract between
     us.

     We understand that you are not bound to accept the lowest or any tender you may
     receive.



     Yours faithfully



     Signature ............................................. in the capacity of ............................



     Duly authorized to sign tenders for and on behalf of .............................................

     ......................................................................................................

     Address .......................................................................................................

     ......................................................................................................

     Date ............................................

          * If the Tenderer does not accept, this paragraph may be deleted and replaced by:

     We do not accept your suggestions for the appointment of the Dispute Adjudication
     Board, and propose that we jointly agree upon the appointment after the Effective
     Date (unless previously agreed) in accordance with Sub-Clause 20.3 of the
     Conditions of Contract. [OPTIONAL: Our Proposal includes our suggestions for
     this appointment, but these suggestions are not conditions of this Tender.]




14                                                                                                            Construction Law in the United Arab Emirates
           APPENDIX TO TENDER

                   [Note: with the exception of the items for which the Employer’s requirements have
                   been inserted, the following information must be completed before the Tender is
                   submitted]

           Sub-Clause

                   Employer’s name and address .........        1.1.2.1 ............................................

                                                                & 1.8       ............................................



                   Contractor’s name and address ........       1.1.2.2 ............................................

                                                                & 1.8       ............................................



                   Name and address of                          1.1.2.3 ............................................

                   The Employer’s Representative .......        & 1.8       ............................................



                   Time for notice to commence .........        8.1         ...................................... days



                   Time for completion of the Works ....        1.1.3.4 ...................................... days



                   If Sub-Clause 13.15 does not apply:



                   Foreign Currency / Currencies .........      1.1.5.3 as named in the TENDER



                   Law of Contract .........................    1.4         ..............................................



                   Ruling language .........................    1.4         .............................................



                   Language for communications.........         1.4         .............................................



                   Electronic transmission systems ......       1.8         .............................................



                   Confidential details .....................   1.12        .............................................




Construction Law in the United Arab Emirates                                                                                 15
     Time for access to the Site.............           2.2       ...days after the Commencement date



     Amount of performance security......               4.2       ....................% of the Contract
                                                                  Price, and in the proportions of
                                                                  currencies in which the Contract
                                                                  Price is payable.



     Time for submission of programme...                4.14      ....... Days after the effective Date



     Normal working hours..................             6.5       ..............................................



     Liquidated damages for the Works.....              8.6       .............% of the Contract Price
                                                                  per day, in the proportions of
                                                                  currencies in which the Contract
                                                                  Price is payable.



     Limit of liquidated damages for delay...           8.6       .......% of the Contract Price



     If Clause 11 applies:                              11.4

     Liquidated Damages for failing

     Tests after Completion

     (details of test failure) ......................             .............................................

     (details of test failure)......................              .............................................



     Total amount of advance payments......             13.2      .................% of the Contract Price



     Number and timing of installments......            13.2      ..............................................



     Start repayment of advance payment....             13.2(a) When payments are 10% of the

                                                                  Contract Price



     Repayment amortization of advance payment. 13.2(b) ........................................25%




16                                                                                       Construction Law in the United Arab Emirates
                   Percentage of retention ...................       13.3        ..........................................%



                   Limit of Retention Money................          13.3        .................% of the Contract Price



                   If Sub-Clause 13.5 applies:                       13.5        ....................................[list]

                       Plant and Materials for payment

                       When delivered to the Site.......



                   Minimum amount of Interim                         13.6        ................% of the Contract Price.

                   Payment Certificates.......................



                   If Sub-Clause 13.15 applies:                      1.1.5.3

                                                                     &

                   Payments in local and Foreign Currencies. 13.15



                   Currency Unit                         Percentage payable in            Rate of exchange: number
                                                         such Currency                    of Local per unit of Foreign

                   Local: ____________[name] _____________________                        1.000

                   Foreign: __________[name]             _____________________            _____________________

                             ___________[name]           _____________________            _____________________



                   If there are Provisional Sums:



                   Percentage for adjustment of                      14.5(b) ...........................................%

                   Provisional Sums ..........................



                   Amount of insurance for design.........           18.1        ..............................................



                   Amount of third party insurance.........          18.3        ..............................................




Construction Law in the United Arab Emirates                                                                                      17
     Periods of submission of insurance:                18.5

         (a) evidence of insurance ......                        .................................. days

         (b) relevant policies ............                      ................................... days



     Number of members of

     Dispute adjudication Board ..............          20.3     ...........................................



     Member of Dispute Adjudication Board                        The President of FIDIC or a person

     (if not agreed) to be nominated by.......          20.3     appointed by such President



     Arbitration rules ...........................      20.6     ..............................................



     Number of arbitrators......................        20.6     ..............................................



     Language of arbitration....................        20.6     ..............................................



     Place of arbitration.........................      20.6     ..............................................



     If ICC rules are NOT to apply - Either:



             Arbitration rules to be                    20.6     ..............................................

             administered by, Or: Arbitrator

             (if not agreed) to be nominated by



     Description                 Value (percentage of   Time for completion               Liquidated Damages

     (Sub-Clause 1.1.6.9)        Contract Price) *      (Sub-Clause 1.1.3.4)              (Sub-Clause 8.6)

     _____________               _____________          _____________                     _____________
     _____________               _____________          _____________                     _____________
     _____________               _____________          _____________                     _____________

     * These percentages shall also be applied to the first half of the Retention Money
     under Sub-Clause 13.9


     Initials of signatory of Tender ____________________________________________

18                                                                                      Construction Law in the United Arab Emirates
           ANNEX F: MAIN CONTRACT AGREEMENT
                   This Agreement made the ................................day of ..........................................19 ......

                   Between .............................of............................(hereinafter called “the Employer”) of
                   the one part, and ....................of ......................(hereinafter called “the Contractor”) of
                   the other part.

                   Whereas the Employer desires that the Works known as ..................... should be
                   designed and executed by the Contractor, and has accepted a Tender by the
                   Contractor for the design, execution and completion of such Works and the
                   remedying of any defects therein,



                   The Employer and the Contractor agree as follows:



                   1. In this Agreement words and expressions shall have the same meaning as are
                      respectively assigned to them in the Conditions of Contract hereinafter referred
                      to.

                   2. The following documents shall be deemed to be for and be read and construed
                      as part of this Agreement:



                       (a) The Letter of Acceptance dated ............
                       (b) The Employer’s Requirements
                       (c) The Tender dated ...........
                       (d) The Conditions of Contract (Parts I and II)
                       (e) The Addenda nos.............
                       (f) The completed Schedules, and
                       (g) The Contractor’s Proposal.



                   3. In consideration of the payments to be made by the Employer to the Contractor
                      as hereinafter mentioned, the Contractor hereby covenants with the Employer to
                      design, execute and complete the Works and remedy any defects therein, fit for
                      purpose in conformity with the provisions of the contract.

                   4. The Employer hereby covenants to pay the Contractor, in consideration of the
                      design, execution and completion of the Works and remedying of defects
                      therein, the Contract Price or such other sum as may become payable under the
                      provisions of the Contract at the times and in the manner prescribed by the
                      Contract.

                   In witness whereof the parties hereto have caused this Agreement to be executed
                   the day and year first before written in accordance with their respective laws.




Construction Law in the United Arab Emirates                                                                                            19
                       Authorised signature                Authorised signature

      Seal                 of Employer         Seal            of Contractor

     (if any)                                 (if any)



     In the presence of:                          In the presence of:



     Name ______________                          Name ______________

     Signature____________                        Signature____________

     Address ____________                         Address ____________




20                                                             Construction Law in the United Arab Emirates
           ANNEX G: SUBCONTRACT AGREEMENT


                   This Subcontract Agreement made the ............ .................. .................. .........
                   day of .................................................... 19 ..........................................
                   Between ...............................................................................................
                   Of ......................................................................................................
                   .....................................(hereinafter called the “Contractor”) of the one part and
                   .................................................. of ......................................................

                   (hereinafter called the “Subcontractor”) of the other part

                   Whereas the Contractor is desirous that certain Subcontract Works should be
                   executed by the Subcontractor, viz ....................................... and has accepted a
                   Subcontractor’s Offer for the execution and completion of such Subcontract Works
                   and the remedying of any defects therein.

                   Now this Subcontract Agreement witnesseth as follows:

                        1.         In this Subcontract Agreement words and expressions shall have the same
                                   meanings as are respectively assigned to them in the Conditions of
                                   Subcontract hereinafter referred to.

                        2.         The following documents shall be deemed to form and be read and
                                   construed as part of this Subcontract Agreement, viz:

                                   (a) The Contractor’s Letter of Acceptance;
                                   (b) The Subcontractor’s Offer;
                                   (c) The Conditions of Subcontract (Parts I and II):
                                   (d) The Subcontract Specification;
                                   (e) The Subcontract Drawings: and
                                   (f) The Subcontract Bill of Quantities

                        (3)        In consideration of the payments to be made by the Contractor to the
                                   Subcontractor as hereinafter mentioned the Subcontractor hereby
                                   covenants with the Contractor to execute and complete the Subcontract
                                   works and remedy any defects therein in conformity in all respects with
                                   the provisions of the Subcontract.

                        (4)        The Contractor hereby covenants to pay the Subcontractor in
                                   consideration of the execution and completion of the Subcontract Works
                                   and the remedying of any defects therein the Subcontract Price or such
                                   other sum as may become payable under the provisions of the
                                   Subcontract the times and in the manner prescribed by the Subcontract.

                        Seal                  In witness whereof the parties hereto have caused this Subcontract
                          if                  Agreement to be executed the day and year first written in
                        any                   accordance with their respective laws.


                                    The common Seal of ............................................................................................

Construction Law in the United Arab Emirates                                                                                                          21
                      .................................................................................................................................

                      was hereunto affixed in the presence of :


                      or


             Seal                Signed Sealed and Delivered by the
             if                  said .............................................................................................
             any                 in the presence of:




     APPENDIX TO SUBCONTRACTOR’S OFFER


                                                                                Sub-Clause

         Amount of security (if any) ....................                       2.2           ______________percent

                                                                                              of the Sub contract Price

         Time for issue of notice to commence .........                         7.1           _________ days

         Subcontractor’s Time for Completion .........                          7.1           _________ days

         Percentage of invoice value of listed                                  16.1(c) _______ per cent

         materials and plant ...............................

         Percentage of Retention .........................                      16.3          _______ per cent

         Minimum amount of Statement ................                           16.3 (a) ______________

         Initials of Signatory of Offer ...................

         (Notes: All details in the list above shall be inserted before issue of Offer
         documents. Where a number of days is to be inserted, it is desirable. For consistency
         with the Conditions of Subcontract that the number should be a multiple of seven.

         [Additional entries are necessary where provision is included in the Subcontract
         for:

         (a) completion of Sections

         (b) liquidated damages

         (c) a bonus

         (d) an advance payment




22                                                                                                                    Construction Law in the United Arab Emirates
           ANNEX H:
           Rules of Commercial Conciliation and Arbitration of the Dubai Chamber of Commerce &
           Industry :



                    Table of Chamber’s Administrative fees and Arbitrator’s remunerations


                           The Chamber’s *                                Arbitrators Remunerations in Dirhams and
            The Disputed  Administration Fees                                           in Percentage
               Amount
             In Dirhams Conciliation Arbitration                   Minimum Amount                     Maximum Amount

            Up to              500               1,000            3,000                          7.5% of the amount subject of dispute
            Dhs.200,000                                                                          (Maximum amount shall be 15,000)

            From 200,001       1,000             2,000            3,000 + 1.5% of the amount 15000 + 6% of the amount exceeding
            upto 500,000                                          exceeding 200,000              200,000

            From 500,001       1,500             3,500            7,500 + 1% of the amount       33,000 + 4% of the amount exceeding
            upto 1,000,000                                        exceeding 500,000              500,000

            From 1,000,001     2,000             5,000            12,500 + 0.5% of the amount    53,000 + 2% of the amount
            upto 2,500,000                                        exceeding 1,000,000            exceeding 1,000,000

            From 2,500,001     3,000             10,000           20,000 + 0.3% of the           83,000 + 1.5% of the amount
            upto 5,000,000                                        amount exceeding 2,500,000 exceeding 2,500,000

            From 5,000,001     4,000             15,000           27,500 + 0.2% of the           120,500 + 0.8% of the amount
            upto 10,000,000                                       amount exceeding 5,000,000 exceeding 5,000,000

            From 10,000,001    5,000             20,000           37,500 + 0.1 % of the          160,000 + 0.4% of the amount
            upto 20,000,000                                       amount exceeding 10,000,000    exceeding 10,000,000

            20,000,001         7,500             25,000           47,500 + 0.5% of the amount 200,000 + 0.2% of the amount
            upto 50,000,000                                       exceeding 20,000,000           exceeding 20,000,000

            More than          10,000            30,000           62,500 + 0.02% of the amount   260,000 + 0.1% of the amount
            50,000,000                                            exceeding 50,000,000           exceeding 50,000,000

                              * Registration Fee for conciliation and arbitration claims is Dhs.200 non-refundable




Construction Law in the United Arab Emirates                                                                                             23

				
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