DIFC Courts vs Onshore Courts: How to Enforce Foreign Arbitral Awards in Dubai

Enforcing a foreign arbitral award in Dubai can be straightforward once you know the two main routes available. As the UAE is a signatory to the New York Convention, foreign awards are usually recognised. The decision you need to make is whether to go through the Dubai Courts (sometimes referred to as mainland courts) or the DIFC courts.

This guide explains the differences in layman’s terms, explains the process, and indicates which approach usually works better depending on the location of the debtor’s assets. It is intended for businesses and award creditors who are seeking clear and practical information.

Why Enforcement of Foreign Arbitral Awards Matters in Dubai

Dubai is a major business centre, and a large number of international contracts are settled by arbitration held outside the UAE. In such cases, if the losing party owns assets in Dubai—such as bank accounts, property, company shares or trading licences—it is necessary to obtain recognition of those assets in a local court before you can seize them.

If it is not properly recognised, the award will remain a piece of paper, and the UAE courts will not permit you to attach assets until there is a local order.

DIFC Courts vs Onshore Dubai Courts: The Main Differences

How the DIFC Courts Enforce Foreign Arbitral Awards

Most often, award creditors go for the DIFC route first, owing to the use of the English language, common law procedure, and consistent enforcement approach.

Standard procedure:

1. File an application (typically in the form of a Part 8 claim) at the DIFC Courts.
2. Provide an original/official copy of the award and arbitration agreement. English translations may be necessary.
3. The court reviews the limited grounds for rejection (lack of capacity, validity of the arbitration agreement, proper notice, scope of the award, public policy, etc.). 
4. Recognition/ratification order is issued if the application is successful.

Once the award has been recognized, the award creditor can present the DIFC court order to the onshore courts of Dubai for enforcement against property outside the DIFC. The “conduit” function is still available under the existing Dubai law. 

 DIFC Courts shall only enforce the award directly against property and persons located within the DIFC.

The conduit function (conduit jurisdiction) is an important characteristic of the DIFC courts. It enables parties to recognize a foreign arbitration award in the DIFC even when the debtor does not have any presence or assets there, and then refer that award to the courts of Dubai for execution.

How Onshore Dubai Courts Enforce Foreign Arbitral Awards

The onshore process has been simplified. According to the Civil Procedures Law, a creditor who has an award may apply directly to the execution judge. In many cases, the judge is able to give an enforcement order within a short time (a period which is generally measured in days) without first holding a full recognition hearing.

Some of the main considerations are:

• The award should be final and enforceable in the state of origin.
• Appropriate documents (the award, the arbitration agreement, translation into Arabic).
• Conformity with the grounds of the New York Convention.

Sometimes, it could be easier to raise the public policy issue onshore than in the DIFC, so it is very important to prepare the case file properly.

Choosing the Right Court for Your Case

DIFC Courts are preferred where:

• English-language proceedings and the common law system are preferred.
• Time is an essential factor.
• The recognition order will be used as a stepping stone to achieve onshore execution.
• There is a possibility of assets within the DIFC.

Onshore Dubai Courts are preferred where:

• It can be seen that assets are onshore and one prefers to follow a direct route to execution.
• The cost factor is essential.
• No complicated international elements exist that may be handled using DIFC proceedings.

As a matter of fact, parties usually go through a process involving a two-step approach – first getting the recognition order from the DIFC Courts and then applying for enforcement before the Dubai execution judge.

Grounds for Refusal of Enforcement

Both systems permit refusal of enforcement only on very limited grounds that correspond to Article V of the New York Convention, namely:

• Invalidity of the arbitration agreement
• Party did not have capacity
• No proper notice or opportunity to present the case
• The award does not concern matters, or it contains decisions on matters beyond the scope of the submission to arbitration. 
• Tribunal composition or procedure does not conform with the agreement or law of the seat.
• The award has not yet become binding on the parties or has been set aside
• Enforcement violates public policy of the UAE.

DIFC Courts apply a high threshold, especially on public policy. Onshore courts have shown more flexibility in interpreting public policy in certain cases.

Practical Tips for Successful Enforcement

• Collect the necessary, properly certified documents as early as possible, since the quality of the translation is important.
• Before selecting the court, determine where the debtor’s assets are located.
• Look into taking interim measures (such as freezing orders) where they are available.
• Act promptly, as delaying may lead to practical problems.
• Choose the lawyers who are experienced in both DIFC and onshore procedures so that the strategy remains coordinated.

How Moores Rowland Dubai Can Help

At Moores Rowland Dubai, our arbitration lawyer will help you with all aspects of the enforcement process, from determining the most appropriate forum for enforcement (DIFC or onshore) through the application, recognition, and execution of an award. We handle both common law and civil law processes and coordinate the strategy through both forums.

If you have a foreign arbitral award and wish to enforce it against assets located in Dubai, please get in touch for expert advice.