UNITED ARAB EMRITES Law and Practice Contributed by: Ali Dakhlallah, Karen Seif, Matthew Page and William Prasifka, Habib Al Mulla & Partners
Conciliation Conciliation is less frequently used than mediation but remains relevant in certain commercial and regulatory contexts. Unlike mediation, the conciliator may active- ly propose settlement terms, making it suitable where parties seek guided resolution. It is most effective for low-value disputes requiring structured intervention. 1.3 Key Dispute Resolution Trends The Shift From Traditional Litigation to ADR Mechanisms Over the years, there has been a clear shift towards ADR mechanisms over traditional litigation, espe- cially regarding arbitration and mediation. Media- tion and conciliation in civil and commercial disputes have been strengthened by the formal introduction of Federal Decree Law No 40 of 2023; this has led to an increased number of court-referred and voluntary mediations aimed at reducing the burden of the courts and encouraging early settlements. The Dominance of Arbitration Arbitration continues to be the preferred mechanism for large, technical and international commercial dis- putes, particularly in the realm of construction, energy and infrastructure. Institutions such as DIAC and arbi- trateAD remain central and are supported by a pro- arbitration judiciary and reliable enforcement under the New York Convention. The Growing Use of Offshore Courts The DIFC and ADGM courts are now increasingly being chosen for complex cross-border and financial disputes. Recent reforms in legislation, including the establishment of the DIFC Mediation Centre under DIFC Law No 2 of 2025, signals an expansion from a trend of pure litigation towards integrated dispute resolution services. The Insititutionalisation of Mediation Mediation is no longer informal; it is now institution- alised and regulated across onshore and offshore courts. Court-annexed mediation platforms, such as Wasata, and enforcement mechanisms for mediated settlements have significantly increased its credibility and uptake, especially for SMEs and relationship- driven disputes.
The Increased Digitalisation Of Dispute Resolution The UAE continues to lead regionally in online dis- pute resolution with the introduction of fully digital court systems in the mainland courts, as well as in the DIFC and the ADGM. This has since led to paper- less processes across arbitration and mediation. Vir- tual and hybrid hearings are now the new norm and have helped improve efficiency, accessibility and cost management for international parties. Overall, there is a strong trend in the UAE towards faster resolution and enforceable outcomes that are driven by economic diversification and investor con- fidence goals. Courts and institutions increasingly emphasise early settlements and streamlined pro- cedures while also maintaining robust enforcement pathways for judgments and arbitral awards. Limitation periods in the UAE vary depending on the nature of the claim as well as its governing legislation. The limitation period for the following types of claims are as follows. Civil Claims The prescriptive period in general civil contractual claims is subject to a default limitation period of 15 years under the Civil Transactions Law, unless a short- er period is prescribed by law or agreement. Commercial Claims Commercial claims are governed by the UAE Com- mercial Transactions Law (Federal Decree-Law No 50 of 2022), which reduced the limitation period for commercial obligations between merchants from ten years under the former law to five years from the date the obligation fell due. Certain commercial matters, such as cheque claims, share transfer disputes and agency agreements, are subject to even shorter pre- scribed periods. Insurance Claims Insurance claims are subject to a three-year limitation period, which runs from the occurrence of the insured event or the date of knowledge. 2. Litigation 2.1 Limitation Periods
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