DIFC Enacts Important Amendments To Application Law On Civil And Commercial Laws

Dubai International Financial Centre (DIFC), a prominent financial hub in the Middle East, Africa, and South Asia (MEASA) region, has revised its Application Law. These changes aim to clarify the source and interpretation of DIFC Law. Additionally, updates have been made to the Real Property Law and Regulations within DIFC.

The amendments confirm that DIFC laws are supplemented by English Common Law and other common law jurisdictions. Jacques Visser, Chief Legal Officer at DIFC Authority, stated, "We are delighted to announce the enactment of key amendments to the DIFC Law on Application of Civil and Commercial Laws. These amendments reinforce DIFC’s status as an international common law jurisdiction and as the leading financial centre in the MEASA region. The amendments confirm that DIFC laws are supplemented with reference to English Common Law and the laws of other common law jurisdictions. These important amendments provide statutory confirmation, for practitioners and the Courts, regarding the source of law in DIFC and the way in which DIFC legislation may be interpreted."

Since its inception, it was understood that DIFC Laws were supported by common law principles. To solidify this understanding, a new Article 8A has been added to the Application Law. This article establishes that DIFC Law is primarily determined by its statutes and court judgments interpreting these statutes.

Article 8A further clarifies that while DIFC law is not strictly statutory, it is supplemented by common law principles and equity rules. The courts can refer to English common law and other jurisdictions when determining applicable laws for DIFC.

The enacted version of Article 8A differs from initial proposals by omitting references to importing specific doctrines or remedies into DIFC Law. This change ensures that while courts can consider comparative jurisprudence from various jurisdictions, they do not possess broader legislative powers.

A new Article 8B confirms that interpretation of DIFC statutes can be guided by principles from analogous laws in established common law jurisdictions. If a statute is based on an international model law, international jurisprudence may also guide its interpretation.

Property Registration Updates

DIFC has introduced a Mortgage Registration fee of 0.25% for registering mortgages on real property purchases. This aligns with current practices elsewhere and covers administrative costs for document review and registration processing.

The registration period for Off Plan Sales has been extended from 30 days to 60 days. This extension accommodates timelines from launch to final agreement production, giving purchasers more time for transaction registration and fee payment.

These legal amendments aim to enhance regulatory frameworks within DIFC, aligning them with best practices globally. They ensure both English Common Law and developments in other established jurisdictions remain central features of DIFC’s legal system.

With inputs from WAM