UAE Law and Practice Contributed by: Abdelhak Attalah and Ghassan Hidar, Attalah Legal Consultancy
8.3 Trade Sanctions The UAE legal system enforces international trade sanctions, but it does not enforce unilat - eral sanctions imposed by countries such as the USA or the UK unless they are consistent with United Nations (UN) resolutions. The UAE implements UN Security Council sanctions reso - lutions, ensuring compliance with international trade sanctions as mandated by the UN. How - ever, the UAE has not adopted specific sanc - tions against Russia under its domestic law. As a result, these sanctions do not directly impact Russian citizens or entities conducting business in the UAE. However, although the UAE has not enacted specific sanctions against Russia, the global economic shifts and changes in trade routes may indirectly affect the UAE. The coun - try has maintained a neutral stance on the con - flict, and there have been no direct reports of sanctions-related impacts on the UAE’s trade activities. While the UAE central bank monitors compliance to avoid violations of international law, the UAE does not have special committees that grant permits for trade activities otherwise prohibited by sanctions. However, entities in the UAE are expected to comply with international sanctions when applicable and may seek guidance from regulatory bodies like the central bank to ensure compliance with international laws. 8.4 International Conflict(s) Since the onset of the Russia-Ukraine conflict, the UAE has experienced some disruption in the supply of raw materials, particularly affecting sectors reliant on imports from these countries. While there is no specific public data detailing the full extent of this impact, there have been legal cases before UAE courts involving breach - es of contract between Russian or Ukrainian suppliers and UAE buyers, particularly concern -
ing raw materials like seeds and agricultural by- products. These disruptions could have vari - ous legal and commercial implications, such as frustration of shipping and carriage contracts, where delays or non-delivery of goods due to the conflict may be claimed. War risk insurance coverage may come into play if goods are dam - aged or lost during transit due to the conflict, and issues related to the deterioration of goods because of late delivery could also arise. Addi - tionally, if goods are significantly delayed or lost, this could lead to claims for total loss under the terms of the carriage contract. While the UAE legal system is equipped to handle such disputes, the implications of international conflicts for trade and contracts could include increased litigation, more insurance claims and the renegotiation of commercial terms between affected parties. 9. Additional Maritime or Shipping Issues 9.1 Other Jurisdiction-Specific Shipping and Maritime Issues The ML introduced significant changes, particu - larly regarding foreign ownership. Foreign inves - tors are allowed to own up to 100% of ship - ping companies, a notable departure from the restrictions of the previous Commercial Maritime Law of 1981. The ML also provides comprehen - sive provisions addressing maritime debts, ship mortgages and the foreclosure thereof, offering greater clarity and a more robust legal frame - work for resolving disputes related to maritime financial obligations. This is expected to have a substantial impact on how shipping companies operate and how creditors enforce their rights in relation to ship mortgages.
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