In March 2025 Dubai rewrote the law governing the DIFC Courts. The new law makes their jurisdiction clearer, confirms how parties can choose them in a contract, widens their powers and creates a Mediation Centre. Here is what it means for DIFC businesses.
The short answer
- One new law since 14 March 2025. Dubai Law No. 2 of 2025 replaced DIFC Law No. 10 of 2004 and Dubai Law No. 12 of 2004.
- Clearer jurisdiction. A single provision now covers civil, commercial and employment claims across the Small Claims Tribunal, Court of First Instance and Court of Appeal.
- Choosing the DIFC Courts. Parties can agree in writing to their exclusive jurisdiction, before or after a dispute, if the agreement is specific, clear and express.
- Stronger tools. Broad interim relief, express powers to appoint receivers and provisional liquidators, and support for arbitration.
- A Mediation Centre. Approved settlement agreements can be enforced, giving businesses a faster, more private route to resolve disputes.
Last reviewed 2 October 2026
One of the main reasons international businesses choose the DIFC is its courts: an independent, English-language, common law court system sitting in the middle of Dubai. In March 2025 the law that governs those courts was rewritten. Dubai Law No. 2 of 2025, the DIFC Courts Law, replaced the two laws that had governed the courts since 2004, and it makes the DIFC Courts' jurisdiction clearer and their powers broader.
This guide explains what changed and what it means in practice for DIFC companies, investors and anyone signing a contract with a DIFC counterparty. It is a practical overview for business owners, not legal advice on drafting a dispute clause, which should always be settled with a lawyer.
The short answer
The DIFC Courts Law No. 2 of 2025 came into force on 14 March 2025 and replaced DIFC Law No. 10 of 2004 and Dubai Law No. 12 of 2004. It sets out the courts' subject-matter jurisdiction in one clear provision covering civil, commercial and employment claims, confirms that parties can choose the DIFC Courts by a specific, clear and express written agreement made before or after a dispute, gives the courts a discretion to decline jurisdiction where the parties chose another court, widens their power to grant interim relief, and establishes a DIFC Courts Mediation Centre.
Why the DIFC Courts matter to investors
For a business setting up in the DIFC, the courts are part of the product. The DIFC has its own civil and commercial laws drafted on common law principles, and the DIFC Courts hear disputes in English, with judges drawn from leading common law jurisdictions. Knowing in advance which court will hear a dispute, in what language and under which principles, is one of the most valuable protections a jurisdiction can offer. Our guide to the benefits of setting up in the DIFC covers how the courts fit alongside the other advantages.
What the 2025 law changed
The Charles Russell Speechlys overview and Curtis's outline of key changes summarise the main points.
| Area | What the 2025 law does |
|---|---|
| One consolidated law | Replaces DIFC Law No. 10 of 2004 and Dubai Law No. 12 of 2004 |
| Subject-matter jurisdiction | A single provision covering civil, commercial and employment claims across all DIFC Courts |
| Choosing the DIFC Courts | Parties can agree in writing to the exclusive jurisdiction of the DIFC Courts, before or after a dispute, if the agreement is specific, clear and express |
| Declining jurisdiction | The courts may decline a case where the parties agreed to another court, or where another competent court has already given an enforceable final judgment |
| International treaties | Jurisdiction extends to claims under international treaties and conventions to which the UAE has acceded |
| Arbitration | The DIFC Courts are the supervisory courts for arbitrations taking place in the DIFC where the parties have not chosen a seat |
| Interim relief | A broad power to grant interim measures, including in support of litigation or arbitration elsewhere |
| Court powers | Express powers to appoint receivers and provisional liquidators, manage proceedings and order security for costs |
| Mediation | A DIFC Courts Mediation Centre, with approved settlement agreements enforceable as court documents |
Clearer jurisdiction
Before 2025, working out whether a case belonged in the DIFC Courts or Dubai's onshore courts could mean reading two laws side by side. The new law sets out subject-matter jurisdiction in one general provision applying to the Small Claims Tribunal, the Court of First Instance and the Court of Appeal. Employment claims are now expressly included, which is helpful for every DIFC employer.
Choosing the DIFC Courts in a contract
The law confirms that parties can submit to the exclusive jurisdiction of the DIFC Courts by written agreement, either in the original contract or after a dispute arises, provided the agreement is specific, clear and express. The emphasis on clarity is the practical lesson: a vague or contradictory clause invites argument about which court should hear the case.
Respecting the parties' choice
The courts now have a discretion to decline jurisdiction where the parties agreed to go to another court, even if the DIFC Courts could otherwise hear the case. That respects commercial agreements and supports certainty for everyone.
Stronger tools for protecting assets
The power to grant interim measures is now broad. It includes measures relating to disclosure of the identity of defendants and of funds and assets, and measures in support of arbitrations seated outside the DIFC where the relief is needed inside it. The courts can also appoint receivers and provisional liquidators at any stage.
Mediation and enforcement
The new Mediation Centre gives parties a formal route to settle disputes amicably. Settlement agreements approved by the Mediation Centre or ratified by the DIFC Courts are added to the documents that can be enforced, and the existing routes for enforcing judgments and awards inside and outside the DIFC continue as before.
What this means for DIFC companies
- Review your template contracts. If you want disputes heard in the DIFC Courts, make sure the clause is specific, clear and express, and ask your lawyer to confirm the wording.
- Check your employment documents. With employment claims expressly within the courts' jurisdiction, consistent employment contracts and policies matter. Our DEWS guide for DIFC employers covers one of the key employer obligations.
- Keep corporate records in order. Disputes about ownership, director decisions or share transfers turn on registers, resolutions and minutes. Our guide to changing owners or directors of a DIFC company explains the filings that keep records accurate.
- Consider mediation early. The Mediation Centre offers a faster, more private route for many commercial disagreements.
How Atlas helps
Atlas Corporate Services is a DFSA-registered Corporate Service Provider in the DIFC. We are not a law firm and do not advise on disputes, but we keep the corporate records that disputes so often turn on: registers of members and directors, board and shareholder resolutions, and filings with the DIFC Registrar, through our company secretarial and governance service. For businesses still deciding where to establish, our team can explain how DIFC company setup works and introduce you to DIFC-qualified lawyers for contract and dispute advice.
This article is general information and does not constitute legal advice. Dispute resolution clauses and jurisdiction questions depend on the facts; take advice from a qualified lawyer before relying on any provision of the DIFC Courts Law.
Frequently Asked Questions
What is the DIFC Courts Law 2025?
It is Dubai Law No. 2 of 2025 concerning the Dubai International Financial Centre Courts. It came into force on 14 March 2025 and replaced DIFC Law No. 10 of 2004 and Dubai Law No. 12 of 2004, consolidating the rules that govern the DIFC Courts.
Can parties choose the DIFC Courts in a contract?
Yes. The DIFC Courts have jurisdiction where the parties agree in writing to submit to their exclusive jurisdiction, whether before or after a dispute, provided the agreement is specific, clear and express. The exact wording should be settled with a lawyer.
Do the DIFC Courts hear employment disputes?
Yes. The 2025 law expressly includes employment claims within the DIFC Courts' subject-matter jurisdiction, alongside civil and commercial claims.
Can the DIFC Courts decline to hear a case?
Yes. The courts have a discretion to decline jurisdiction where the parties agreed to resort to another court, or where a competent court has already issued a final judgment that can be enforced in the DIFC.
What is the DIFC Courts Mediation Centre?
A centre established under the 2025 law to help parties resolve disputes amicably. Settlement agreements approved by the Mediation Centre or ratified by the DIFC Courts can be enforced as court documents.
Does the new law change how DIFC judgments are enforced?
The existing processes for enforcing judgments, orders and arbitral awards inside and outside the DIFC continue as before, and approved or ratified settlement agreements are now added to the documents that can be enforced.