Commercial Arbitration in the UAE 2026: DIAC, arbitrateAD, and What Happened to Old DIFC-LCIA Clauses

Commercial arbitration in the UAE is governed by the federal Federal Law No. 6 of 2018 on Arbitration, but the actual landscape of arbitration institutions has changed substantially over the past five years.

In 2021, Decree No. 34 of 2021 abolished DIFC-LCIA (the joint venture between DIFC and the London Court of International Arbitration) and the Emirates Maritime Arbitration Centre, transferring their rights, obligations, and cases to the Dubai International Arbitration Centre (DIAC).

In 2024, Abu Dhabi carried out its own separate reform: the Abu Dhabi Commercial Conciliation and Arbitration Centre (ADCCAC), operating since 1993, was reorganised into arbitrateAD, which began accepting new cases on 1 February 2024.

This means the UAE today has two separate, unconnected flagship arbitration institutions: DIAC in Dubai and arbitrateAD in Abu Dhabi — when drafting an arbitration clause, it is essential to name the specific institution and seat rather than rely on outdated templates.

⚠ Companies with existing contracts referencing DIFC-LCIA should pay particular attention: case law on the validity of such clauses has diverged between jurisdictions — UAE courts have consistently upheld them, while certain US and Singapore court decisions cast doubt on the point.

1. The Legal Basis

The legal foundation for arbitration in the UAE operates on several levels, applicable depending on the chosen seat of arbitration.

Federal Law No. 6 of 2018 on Arbitration is the base federal statute, built on the UNCITRAL Model Law, applicable to arbitration seated on the mainland territory of the emirates (onshore), including mainland Dubai outside DIFC.

DIFC Arbitration Law No. 1 of 2008 applies where the seat of arbitration is designated as DIFC; in that case, the DIFC Courts exercise supervisory jurisdiction.

For arbitration seated in ADGM, the ADGM Arbitration Regulations 2015 apply — Abu Dhabi has its own parallel structure, analogous to Dubai’s DIFC/mainland split.

The 2018 federal statute has not remained static: Federal Decree-Law No. 15 of 2023 amended Article 10 of Federal Law No. 6 of 2018, tightening rules on conflicts of interest when appointing arbitrators connected to the governing bodies of an arbitral institution.

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2. Timeline of the 2018–2024 Reforms

Date	Event
19 November 2006	UAE ratified the 1958 New York Convention without reservation
2018	Federal Law No. 6 of 2018 on Arbitration enacted — the base federal arbitration statute, based on the UNCITRAL Model Law
14 September 2021 (effective 20 September 2021)	Decree No. 34 of 2021: EMAC and the DIFC Arbitration Institute (administrator of DIFC-LCIA) abolished, rights and obligations transferred to DIAC
21 March 2022	The new DIAC Arbitration Rules 2022 took effect
30 November 2023	Abu Dhabi Chamber of Commerce Board of Directors resolved to reorganise ADCCAC as arbitrateAD
1 February 2024	arbitrateAD began accepting new cases, replacing ADCCAC (in operation since 1993)

Five years of reform transformed the UAE’s arbitration landscape from fragmented (several overlapping institutions) to consolidated around two flagship centres — one for each major emirate with international ambitions.

3. The DIAC Reform: What Actually Changed in 2021

Decree No. 34 of 2021, issued by the Ruler of Dubai on 14 September 2021 and effective 20 September 2021, was the most significant reform to Dubai’s arbitration landscape in a decade.

Decree No. 34 of 2021 abolished the DIFC Arbitration Institute — the administering body of DIFC-LCIA, which administered around 140 international arbitrations per year — and the Emirates Maritime Arbitration Centre (EMAC), transferring their property, staff, arbitrator lists, and obligations to the Dubai International Arbitration Centre (DIAC).

A new DIAC Statute attached to the decree establishes a DIAC Court of Arbitration modelled on the ICC International Court of Arbitration — DIAC’s first structural overhaul since its founding in 2004.

ℹ Under the decree, DIAC is required to maintain a branch physically located within DIFC in addition to its onshore Dubai headquarters — the institution has a physical presence in both jurisdictions.

4. The Fate of Old DIFC-LCIA Clauses: Diverging Case Law

The key practical question since 2021 is whether arbitration clauses concluded before the reform, expressly referring to DIFC-LCIA, remain valid.

Article 6(a) of Decree No. 34 of 2021 expressly provides that arbitration agreements referring to DIFC-LCIA or EMAC remain “valid and effective”; DIAC administers such disputes unless the parties agree otherwise.

✅ UAE courts have consistently upheld the validity of such clauses: the Abu Dhabi Court of First Instance (case no. 1046/2023) and Abu Dhabi Court of Appeal (case no. 449/2024, confirmed 24 April 2024), as well as the DIFC Court of First Instance in Narciso v Nash (ARB 009/2024, decision by Justice Michael Black KC dated 20 June 2024) — all found the decree to form part of the applicable law and DIFC-LCIA clauses to remain enforceable.

⚠ Foreign courts have taken a different position in certain decisions: Foreign courts expressed doubts in individual decisions, but the ultimate outcome often still favoured enforcement through DIAC. The US District Court for the Eastern District of Louisiana (Baker Hughes Saudi Arabia Co. Ltd. v. Dynamic Industries Saudi Arabia, Ltd.) initially, in November 2023, refused to compel a party to DIAC arbitration, treating the clause as a forum-selection agreement voided by the institution’s abolition. However, the US Court of Appeals for the Fifth Circuit REVERSED this ruling on 27 January 2025, holding that the clause designated only a set of rules (the DIFC-LCIA Rules), not a specific forum, and remanded the case. On 30 January 2026, on remand, the district court ultimately compelled arbitration before DIAC as the forum consistent with the parties’ intent. The Singapore High Court in DFL v DFM (March 2024, upheld by the Singapore Court of Appeal in October 2024) agreed with the reasoning of the Louisiana court’s original decision regarding the inability to compel parties to rules they never agreed to, but ultimately still enforced the award — because the respondent had submitted to DIAC’s jurisdiction through its own conduct by not raising timely objections.

Practical takeaway: legacy DIFC-LCIA clauses are not automatically invalid, but they create a genuine risk of a procedural dispute — particularly when seeking cross-border enforcement outside the UAE.

5. The New 2022 DIAC Rules

The new DIAC Arbitration Rules took effect on 21 March 2022, replacing DIAC’s previous rules, which had not been updated since 2007.

✅ Per Article 8(c) of Decree No. 34 of 2021, disputes originally providing for DIFC-LCIA Rules are now subject to the 2022 DIAC Rules — the former DIFC-LCIA Rules were replaced, not preserved in parallel.

ℹ Per Covington & Burling, citing DIAC statistics, approximately 32% of all DIAC arbitration cases in 2024 arose from clauses originally referring to DIFC-LCIA — illustrating the reform’s practical scale for actual caseflow, not merely a theoretical question.

A separate practical change: the 2022 DIAC Rules expressly permit recovery of legal costs as part of arbitration expenses — the Dubai Court of Cassation confirmed this interpretation with respect to the ICC Rules on 19 November 2024, following earlier, less consistent rulings on the point.

6. Abu Dhabi’s Own Arbitration Reform: arbitrateAD

Abu Dhabi carried out its own reform of the emirate’s arbitration landscape, separate from Dubai’s.

On 30 November 2023, the Abu Dhabi Chamber of Commerce’s Board of Directors adopted Resolution No. 75, reorganising the Abu Dhabi Commercial Conciliation and Arbitration Centre (ADCCAC, operating since 1993 as a department of the Chamber) into a new institution: the Abu Dhabi International Arbitration Centre (arbitrateAD).

arbitrateAD began accepting new cases on 1 February 2024; cases already registered under ADCCAC rules before that date continue to be administered under the previous rules until completion.

⚠ Unlike the DIAC/DIFC-LCIA reform, ADCCAC was not a separate legal entity subject to abolition but a department of the Chamber — the Chamber itself was never dissolved. This structural difference means the question of “validity of old ADCCAC clauses” is likely less contested than the DIFC-LCIA situation.

The default seat for arbitrateAD, absent party agreement, is ADGM (Abu Dhabi Global Market) — a parallel to Dubai’s model, where DIFC serves as the default seat for DIAC.

7. Comparing Institutions and Seats

Parameter	DIAC (Dubai)	arbitrateAD (Abu Dhabi)	ADGM Arbitration Centre
Established / reformed	Founded 2004; reformed by Decree No. 34 of 2021	Launched 1 February 2024, successor to ADCCAC (est. 1993)	Founded 2017
Status	Own administering institution with own rules	Own administering institution with own rules	NOT an administering institution — hearing infrastructure only
Default seat	DIFC, if parties have not specified a seat	ADGM, if parties have not specified a seat	Determined by the chosen institution and party agreement
Governing law if seat is onshore Dubai	Federal Arbitration Law No. 6 of 2018	—	—
Governing law if seat is DIFC/ADGM	DIFC Arbitration Law No. 1 of 2008	ADGM Arbitration Regulations 2015	ADGM Arbitration Regulations 2015

The ADGM Arbitration Centre is not an administering institution and has no rules of its own; it is hearing infrastructure that parties use alongside their chosen institution (DIAC, arbitrateAD, ICC, or others) and its own rules.

8. Enforcement: The New York Convention

The UAE ratified the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the 1958 New York Convention) on 19 November 2006, without reservation.

This means an arbitral award rendered in a Convention member state is, in principle, recognisable and enforceable in the UAE under the Convention, and vice versa for an award rendered in the UAE.

⚠ In practice, UAE courts’ application of the Convention did not develop linearly: early local court decisions raised debate over whether the Convention’s principles were applied in full or whether additional compliance with Articles 235–236 of the Civil Procedure Law was required. Current practice has broadly stabilised toward consistent application of the Convention, but for a significant transaction, request a current legal assessment rather than relying on the general rule.

9. Practical Recommendations for Drafting a Clause

1.     Name the specific institution (DIAC or arbitrateAD), not a generic formulation like “arbitration in Dubai” — generic wording creates a risk of dispute over applicable rules.

2.     Explicitly state the seat of arbitration: mainland Dubai, DIFC, Abu Dhabi (mainland), or ADGM — this determines the governing procedural law and supervisory court.

3.     For new contracts, do not reuse older templates directly referencing DIFC-LCIA or EMAC — these institutions are abolished; use current DIAC or arbitrateAD model clauses.

4.     For existing contracts with a legacy DIFC-LCIA clause, assess cross-border enforcement risk in light of the diverging case law, particularly if the counterparty or assets are located in a jurisdiction that has taken a sceptical approach.

5.     For cross-border contracts, confirm whether the New York Convention’s applicability requires separate recognition in the jurisdiction of intended enforcement.

10. Common Mistakes

•       Reusing an arbitration clause template drafted before 2021 in a new contract. A direct reference to DIFC-LCIA or EMAC in a new contract creates unnecessary legal uncertainty — use current model wording.

•       Assuming DIAC and arbitrateAD are interchangeable or related structures. These are two fully independent institutions for two different emirates, arising from different circumstances and with different legal histories.

•       Not specifying a seat of arbitration in the clause. Omitting an explicit seat triggers the default-seat rule (DIFC for DIAC, ADGM for arbitrateAD) — this may not match the parties’ actual intent.

•       Ignoring the risk of diverging case law when cross-border enforcement of a legacy DIFC-LCIA clause is needed. An award UAE courts recognise without difficulty may face resistance in the counterparty’s jurisdiction.

11. Who Arbitration Suits as a Dispute Resolution Method

•       Companies with cross-border contracts and counterparties across multiple jurisdictions. An arbitral award under the New York Convention is easier to enforce abroad than a local court judgment.

•       Parties for whom confidentiality of proceedings matters. Unlike litigation, arbitration is not public by default.

•       Companies in DIFC/ADGM or operating under common law. A DIFC or ADGM seat provides access to common-law courts experienced in international arbitration.

12. When Professional Verification Is Essential

Self-assessment is worth supplementing with specialist international arbitration advice when: drafting a new arbitration clause for a large or cross-border contract; assessing the risk of an existing clause referencing the now-abolished DIFC-LCIA or EMAC; and planning enforcement of a UAE arbitral award in a foreign jurisdiction, particularly the US or Singapore, where case law on Decree 34 has proven less predictable.

FAQ

Is an arbitration clause referencing DIFC-LCIA still valid after its abolition?

UAE courts have consistently upheld such clauses, with case administration transferring to DIAC. Certain courts outside the UAE (US, Singapore) have expressed doubts in some decisions, though the ultimate outcome in those cases most often still resulted in enforcement.

What is the difference between DIAC and arbitrateAD?

DIAC is Dubai’s arbitration institution, reformed in 2021 following the abolition of DIFC-LCIA and EMAC. arbitrateAD is Abu Dhabi’s arbitration institution, launched in 2024 as ADCCAC’s successor. These are independent of one another.

Is the UAE a party to the New York Convention?

Yes, the UAE ratified the Convention on 19 November 2006, without reservation, in principle ensuring mutual recognition and enforcement of arbitral awards with all other member states.

What is the default seat of arbitration if the parties have not specified one?

For DIAC, it is DIFC; for arbitrateAD, it is ADGM. In both cases, explicitly stating the seat in the clause is preferable to relying on the default rule.

Key Takeaways

•       The base statute is Federal Law No. 6 of 2018 on Arbitration, applicable to arbitration seated on the mainland.

•       Decree No. 34 of 2021 abolished DIFC-LCIA and EMAC, transferring their cases to DIAC; the new DIAC Rules have applied since 21 March 2022.

•       Legacy DIFC-LCIA clauses remain valid under UAE law, but foreign case law has diverged — cross-border enforcement requires a separate risk assessment.

•       arbitrateAD in Abu Dhabi is an institution separate from DIAC, launched 1 February 2024 as ADCCAC’s successor.

•       The UAE has been a party to the New York Convention since 2006, without reservation.

•       For new contracts, use current DIAC or arbitrateAD model clauses with an explicit seat of arbitration.

Summary

Commercial arbitration in the UAE is governed by the federal Federal Law No. 6 of 2018 on Arbitration for mainland-seated arbitration, DIFC Arbitration Law No. 1 of 2008 for a DIFC seat, and ADGM Arbitration Regulations 2015 for an ADGM seat. In 2021, Decree No. 34 of 2021 abolished DIFC-LCIA and the Emirates Maritime Arbitration Centre, transferring their rights and cases to the Dubai International Arbitration Centre (DIAC); the new DIAC Rules have applied since 21 March 2022. Legacy arbitration clauses referencing DIFC-LCIA remain valid under UAE law (confirmed by Abu Dhabi and DIFC courts), though certain foreign courts in the US and Singapore expressed doubts in individual decisions. In 2024, Abu Dhabi carried out its own reform: ADCCAC was reorganised into arbitrateAD, which began accepting new cases on 1 February 2024, with a default seat of ADGM. The UAE ratified the New York Convention on 19 November 2006, without reservation.

Sources

• United Nations / UNCITRAL — Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 1958), official status (uncitral.un.org)

• Al Tamimi & Company — UAE Practice of enforcement of Foreign Arbitral award in light of New York Convention 1958 (tamimi.com)

• arbitrateAD — official website, About Us section (arbitratead.ae)

• White & Case — New implications following Decree No. 34 of 2021 on the Dubai International Arbitration Centre (whitecase.com)

• Linklaters — Dubai Abolishes DIFC-LCIA Arbitration Centre and Moves to Revamp DIAC Arbitration (linklaters.com)

• Pinsent Masons — DIFC Court confirms enforceability of DIFC-LCIA arbitration agreements (pinsentmasons.com)

• Covington & Burling — International Arbitration in the Middle East: 2024 in Review (cov.com)

• Clifford Chance — New arbitration institution, arbitrateAD, launches in Abu Dhabi (cliffordchance.com)

• U.S. Court of Appeals for the Fifth Circuit — Baker Hughes Saudi Arabia Co. Ltd. v. Dynamic Industries, No. 23-30827 (5th Cir. 2025), decision text (justia.com)

Disclaimer

This material is for informational purposes only and does not constitute legal advice. The article is based primarily on analysis published by major international law firms and does not substitute consultation with a qualified international arbitration specialist when drafting or assessing a specific arbitration clause. Information is accurate as of June 2026; case law on the topics covered continues to develop.