Claims see 108% growth at DIFC Courts

The Dubai International Financial Center (DIFC) Courts handled 747 cases in 2021 with a total enforcement claims value of AED 2.3 billion, an increase of 108% from 2020.

The main Court of First Instance (CFI) recorded 147 cases, with a total case value of AED 3.8 billion and an average case value of AED 46.7 million, which also includes the Technology and Construction Division (TCD) and Arbitration Division (ARB) cases.

Cases brought before the CFI covered a range of sectors including banking and finance, construction, technology, and real estate, and involved disputes related to breach of contract, insolvency, arbitration agreements, employment, and public international law. There was also a noticeable increase in the number of opt-in cases in 2021, with 50% of claims in the CFI originating from parties electing to use the DIFC Courts to resolve their disputes.

The Small Claims Tribunal (SCT) recorded 361 cases in 2021, with 65% of claims in the SCT originating from parties electing to use the DIFC Courts to resolve their disputes. Cases were driven primarily by breach of contract, which represented 62% of all cases in 2021, followed by employment (22%), property and tenancy (13%), and banking & finance (3%). Underlining the SCT’s increasing popularity for SME-related dispute resolution, the total value of claims recorded in 2021 was AED 36.9 million, with an average case value of AED 106,000.

Awareness of the DIFC Courts services was also bolstered by cooperation agreements signed in 2021. The DIFC Courts continued to strengthen its partner ecosystem and signed several memoranda with entities across the public and private sectors, as well as with academic institutions, including Ajman Media City Free Zone (AMCFZ), Ajman Chamber of Commerce and Industry (ACCI), Emaar Properties, Dubai World Trade Center Authority (DWTCA), Umm Al Quwain (UAQ) Chamber of Commerce and Industry, and the American University in the Emirates (AUE).

While the DIFC Courts has developed a directive to absorb the maturing needs of the regional legal community, the original and purest foundational mandate still remains: to promote Dubai and the UAE’s geographic position in the Gulf as a significant strategic advantage for international investors - a gateway bridging those working in South and East Asia, the Middle East, Europe, Africa, and the western hemisphere. The reputation of DIFC Courts as a safe harbor and business gateway continues to mature. The increasingly international nature of its caseload is a clear signal that international businesses with interests in the Middle East region consider the DIFC Courts to be their first choice for dispute resolution.

The international Digital Economy Court launched in 2021 is aimed at simplifying the settlement process of complex civil and commercial disputes related to the digital economy, reviewing national and international claims related to current and emerging technologies, including big data, blockchain, cryptocurrencies, artificial intelligence, and cloud services.

In early 2022, the new court will assign a group of international lawyers and industry experts to draft and approve new rules for the Digital Economy Court, which will then be issued after a 30-day public consultation campaign. Leading international judicial expertise is also being recruited to oversee and operate the new court’s cutting-edge digital infrastructure and service capabilities.

The DIFC Courts and the Dubai Future Foundation (DFF) embarked on a new initiative in 2021 and activated Courts of Space. The launch of the project signals to the international space community the intent of the UAE to play a leading role in advancing its judicial systems to specifically direct capacity and capability to commercial space-related disputes. Later in the year, the courts also announced the formation of an international Working Group. Consisting of public and private sector bodies and experts, the Working Group is exploring space-related legal innovations and providing an outlook on potential outcomes of scenarios revolving around space-related disputes.

In 2021, the Court Tech Lab initiative was also activated, with companies entering a competition in conjunction with DFF’s Accelerator Program in Area 2071. In exploring how judicial systems can be strengthened through technology, the Court Tech Lab unites individuals and companies helping to prototype and launch the advancement of court-based technology.