Dubai Arbitration Week 2025: Singularity Legal’s Panel Discussion on “The Litigation Framework in the DIFC – The Last 365 Days”

1.      New JAL and the Scope of Freestanding Injunctions in the DIFC

Mr Bagaria began by addressing what he described as the defining legislative development of the year: the promulgation of the New JAL in March 2025. The law attracted substantial attention among practitioners because it refurbished several key aspects of the enforcement framework in the DIFC. Initially, the New JAL was understood to confirm the position adopted in Carmon v Cuenda (“Carmon”)^[1] which overruled the DIFC Courts’ refusal to grant injunctions in aid of foreign proceedings in Sandra Holding v Al Saleh^[2]. Following the Court of First Instance’s (“CFI”) decision in Nadil v Nameer,^[3] however, it appeared that the New JAL implied the removal of the conduit jurisdiction, with the result that a nexus to the DIFC was necessary to commence enforcement in the jurisdiction. The subsequent Court of Appeal (“CA”) decision in the un-anonymised Trafigura v Gupta, set aside the CFI decision and confirmed that asset-preservation measures in aid of foreign proceedings and ancillary to the DIFC Courts’ enforcement jurisdiction could well be granted under the New JAL. Mr Bagaria invited Ms O’Sullivan KC, who had appeared as lead counsel in Carmon v Cuenda (“Carmon”)^[4] to share her thoughts on these decisions.

Commenting on the uncertainty created by the conflicting decisions of the DIFC Court and ultimately resolved to a considerable extent by Trafigura v Gupta, Ms O’Sullivan KC observed that the CA had reaffirmed the “enforcement principle” in clarifying that the New JAL had not reduced the DIFC’s jurisdiction but had instead codified it through Article 15(4), which expressly authorises the DIFC Courts to issue precautionary measures in support of foreign proceedings. Ms O’Sullivan KC noted that she did not favour the expression “freestanding” insofar as it was improperly taken to imply that a DIFC Court might make an order against any party “anywhere” without limitation. She remarked that instead, the test was to check for a judgment that could be ultimately enforceable in the DIFC Courts, which could provide the “nexus” that justified the DIFC Courts in exercising what would otherwise be an exorbitant jurisdiction. She added that the judgment in Techteryx v Aria Commodities (“Techteryx”)^[5]exemplified this very principle – the CFI in that case, affirmed the DIFC Courts’ jurisdiction to grant freezing orders in aid of foreign proceedings under the New JAL, and clarified that the only purpose of exercising such jurisdiction would be to prevent dissipation of assets and nothing else.

Mr Bagaria cautioned that this jurisdiction was however constrained by certain limitations. He addressed the CA’s decision in Nashrah v Najem and Nex,^[6] which restricted the DIFC Courts’ power to grant freestanding injunctions (in the form of an anti-suit injunction) in aid of a (potentially) foreign-seated arbitration.

Mr Craig KC explained that there was a significant rowing back of the DIFC Courts’ jurisdiction to grant anti-suit injunctions in favour of arbitration in Nashrah v Najem and Nex. He contrasted this decision against the approach taken by the courts of the Abu Dhabi Global Market (ADGM) on similar facts in A22 & B22 v C22.^[7] He explained that in that case, he represented the defendant who had commenced onshore proceedings in the Abu Dhabi courts which were eventually subject to an anti-suit injunction filed by the claimant. Although the claimants did not ultimately secure the injunction, the ADGM court relied on Section 41 of the ADGM Courts’ Regulations, which mirrored Section 37 of the English Senior Courts Act, 1981, to hold that it could grant an anti-suit injunction in support of an arbitration even if it were not seated in the ADGM. Notwithstanding the uncertainty surrounding the existence of the arbitration agreement in this case – specifically, given that the seat was argued to be the ADGM but not with high probability – Mr Craig KC explained that the ADGM Court found that it possessed the freestanding jurisdiction to grant anti-suit injunctions in support of an arbitration not seated in the ADGM and not necessarily connected to the ADGM, should it be just and convenient to do so. Mr Craig KC noted this was potentially problematic because it heralded a very wide jurisdiction for the ADGM courts. In light of the divergence between A22 & B22 v C22 and Nashrah v Najem and Nex, he further remarked that this created a conflict between the DIFC Courts and ADGM Courts, both of which apply common law principles within the UAE.

2.      Enforcement Jurisdiction in the DIFC

Mr Bagaria reflected on the New JAL’s reformation of the enforcement jurisdiction in the DIFC. Mr Bagaria turned to Article 31(4) of the New JAL, which introduced the concept of enforcing foreign interim measures and judgments bearing an executory formula within the DIFC. Mr Bagaria explained that this provision reflected a deliberate attempt to bridge civil law and common law procedures in the UAE since the use of executory formulae, had long existed in civil law systems as a tool for cross-jurisdictional enforcement. Mr Reed KC opined that while foreign judgments would bear the executory formulae, interim measures issued by foreign courts would not need to be stamped with executory formulae for enforcement in the DIFC.

Mr Bagaria then addressed a novel aspect of the New JAL – the creation of the role of the Enforcement Judge under Article 29. He noted that the Enforcement Judge would have wide-ranging powers, including the ability to direct bailiffs, supervise execution proceedings, and impose sanctions for non-compliance. Mr Reed KC explained that although a formal appointment of an Enforcement Judge had not yet been made in the DIFC, the practice of appointing enforcement judges was similar to that observed in the onshore courts.

Mr Bagaria remarked that another interesting development over the past year were several decisions that gave teeth to the enforcement powers of the DIFC Court. Mr Bagaria drew on his own experience litigating for the successful award holder in Naqid v Najam where the DIFC Court found an India-seated award was executable in the DIFC on the basis of the India-UAE Judicial Cooperation Agreement (which has lesser requirements than the New York Convention). In doing so, the DIFC Courts refused to set aside the recognition and enforcement order previously granted on the basis of the set-aside grounds in Article 44 of the DIFC Arbitration Law. Mr Bagaria further emphasised how reciprocal enforcement opened up the DIFC as a strong enforcement jurisdiction not only within the UAE (using conduit jurisdiction) but also in the region and globally, with other nations with whom the UAE shared a string treaty framework. Mr Craig KC noted that although few treaties had been enforced between the UAE and other nations, when enforced, these treaties were to be given full effect including where they watered down a larger multilateral instrument like the New York Convention.

On a related note, Mr Reed KC considered the recent decision of Oaklen v Obadiah^[8]  concerning the examination of foreign officers of corporate judgment debtors. Drawing on his own experience litigating before the DIFC Courts on this issue,^[9] Mr Reed KC explained that the DIFC Courts adopted a purposive interpretation of the term “officer” under RDC 50.2(2) which included any person with practical control over company assets or access to relevant information, regardless of their formal designation. He further explained that these judicial approaches were designed to ensure that individuals exercising actual authority in a corporate debtor could not avoid scrutiny by remaining outside the DIFC. 

3. The Act of State Doctrine

The panel then turned its attention to another seminal development in the DIFC, namely the adoption of the Act of State Doctrine (“AOS Doctrine”) into DIFC law in Korek Telecom v Iraq Telecom.^[10] Mr Bagaria observed that the AOS Doctrine assumed special significance in the DIFC’s commercial context given the increasing number of disputes involving sovereign entities, state-owned companies, and foreign regulatory measures in the DIFC.

Ms O’Sullivan KC, who acted for Korek Telecom, explained the historical origins of the AOS Doctrine and noted that the CA had progressively moderated the application of the AOS Doctrine in light of the complex commercial realities before it. She discussed several well-known exceptions, including the public policy exception and the commercial capacity exception, and their origins in English law. She further observed that the 2024 amendment to Article 8A of the DIFC Application Law expanded the DIFC’s reference point from English law to common law principles of various jurisdictions, permitting the DIFC Courts to draw on judicial traditions from Singapore, Hong Kong, Canada, and other common law jurisdictions. She observed that although this increased the burden on practitioners litigating before the DIFC Courts, it permitted the DIFC Courts to develop their own version of a common law befitting the DIFC. Ms O’Sullivan KC noted this was useful where different courts did not necessarily agree on the ambit, or even the existence of particular legal doctrine.

Mr Bagaria remarked that given the marked differences between the American and English approaches to applying the AOS Doctrine, it would be especially interesting should the DIFC Courts be persuaded to follow the American approach in future cases, permitting a wider ability to defend sovereign immunity claims at the enforcement stage in the DIFC.

4. Jurisdictional Conflicts with Onshore Courts

The panel turned to consider the jurisdictional conflicts between the DIFC Courts and the onshore non-DIFC courts. Mr Bagaria remarked that the wide ambit of the DIFC Courts’ opt-in jurisdiction had led to several conflicts between litigants who had initiated proceedings in multiple jurisdictions using the same clause.

Mr Craig KC, who had extensive experience in issues concerning jurisdictional conflict between the DIFC Courts and onshore Dubai courts, addressed his role in litigating Union Insurance v IPMR,^[11] a case he described as involving a “race to judgment.” He represented the insurers of a metal smelter company that lost $45 million worth of gold in an alleged industrial accident, who subsequently started proceedings in the DIFC Court while corresponding proceedings remained afoot before Sharjah courts. Mr Craig KC explained the disadvantage of these conflicting jurisdictions was that while the DIFC Court had to decide whether it had jurisdiction before proceeding with the merits, onshore courts did not necessarily need to make such a jurisdictional determination first. Onshore courts might combine both jurisdiction and merits phases. In this case, Mr Craig KC explained that although there was a jurisdictional challenge pending in the DIFC, it was waylaid by several appeals while the Sharjah courts continued with the proceedings before it, rendering judgments at both first instance and appeal stages, in favour of the owner of the lost gold. Ultimately, the owner of the lost gold urged the DIFC Courts to decline the exercise of their jurisdiction under Article 14(C) of New JAL in light of the final jurisdictional determination issued by the Sharjah courts. The DIFC Courts granted a stay, finding that there was no useful purpose in continuing DIFC proceedings when there had already been a final determination in Sharjah courts.

Mr Craig KC observed that these sort of jurisdictional races between courts were unsatisfactory given that it was well established that as between the DIFC Court and other UAE courts, common law principles of forum non conveniens did not apply. He remarked that, at the same time, there was no principle of lis alibi pendens at play which created an unsatisfactory situation with multiple parallel proceedings afoot and the continual risk of one court being put in the position of trumping another. 

Conclusion

The panel concluded with a shared recognition that the past year has been a defining one for the DIFC Courts. In his closing remarks, Mr Bagaria reflected that the DIFC’s evolution over the past year illustrates its dual commitment to judicial integrity and commercial practicality. He observed that the DIFC continues to emerge as both, a court of enforcement and a court of thought leadership within the international judicial community.

In connection with this panel discussion, Singularity published a comprehensive book providing a bird’s eye view of the litigation framework in the DIFC in the past 365 days, available for download here.