Dubai has long positioned itself as a global hub for commerce and finance, and in recent years it has also become a focal point for the evolution of alternative dispute resolution (ADR). With a series of bold legislative and institutional reforms, the Government of Dubai is signalling a clear intent: to make mediation the preferred route for resolving commercial disputes.
For exporters, credit insurers, lenders, and businesses engaged in cross-border trade, these developments are particularly significant. Mediation offers not only efficiency and cost savings but also a framework that supports confidentiality, enforceability, and the preservation of business relationships.
Building the framework: from Federal Law to local reform
The roots of mediation in the United Arab Emirates (UAE) can be traced back to the Federal Decree-Law (No. 40) on Mediation and Conciliation in Civil and Commercial Disputes, which came into force on 29 December 2023. This legislation laid the foundation for mediation practices across the country.
Since then, Dubai has taken decisive steps to develop this framework into a robust and practical system. In the space of just six months this year, several landmark reforms were enacted:
- 3 March 2025 – H.H. Sheikh Mohammed bin Rashid Al Maktoum, Ruler of Dubai, issued Dubai Law No. (2) of 2025 establishing a dedicated mediation centre within the DIFC Courts, an English-language common law judiciary based in the Dubai International Financial Centre.
- 2 May 2025 – The UAE Cabinet, led by H.H Sheikh Mohammed bin Rashid Al Maktoum, in his capacity as the UAE Prime Minister, issued Cabinet Resolution No. (56) of 2025 with the aim to regulate the licensing of private mediation centres and branches of foreign mediation centres in the UAE.
- 26 June 2025 – The Executive Council of Dubai, chaired by H.H. Sheikh Hamdan bin Mohammed Al Maktoum, approved the launch of the onshore Dubai International Mediation Centre.
- 10 July 2025 – The UAE Minister of Justice issued a ministerial decision regarding the formation and operating system of the Committee for the Licensing Affairs of Private Mediation Centres and Branches of Foreign Mediation Centres.
These developments reflect a strategic shift in Dubai’s legal landscape, aligning with global trends that favour faster, more cost-effective, and less adversarial dispute resolution methods.
Mediation in practice
Institutional mediation in Dubai has traditionally been available through both Dubai Chambers (DC) and the Dubai International Arbitration Centre (DIAC).
At DC, parties can voluntarily agree to resolve their commercial disputes via a relatively low-cost mediation service, with fees ranging from AED 500 to AED 20,000 depending on the disputed amount. Proceedings are overseen by accredited mediators and are designed to deliver efficient, commercially sensible outcomes.
At DIAC, mediation can also be pursued voluntarily. However, where a dispute resolution clause specifically requires mediation under the DIAC Mediation Rules 2023, the process becomes mandatory before arbitration can proceed. In this way, mediation may serve as a contractual prerequisite to arbitration, or as a standalone step if parties choose to pursue it independently. DIAC’s mediation process involves a USD 2,000 registration fee plus administrative charges set out in its rules.
Until recently, these institutional options had limited practical impact. However, with the introduction of the new legislation permitting the establishment of private mediation centres, alongside the creation of a mediation centre within the DIFC Courts, the landscape is changing. These initiatives represent a major step towards making mediation a central, rather than peripheral, route for resolving commercial disputes in Dubai.
Key advantages of mediation in Dubai
For businesses and financial institutions, mediation provides several notable benefits:
Expertise
Dubai’s accredited mediators bring industry-specific knowledge and commercial insight—often more relevant than traditional judicial experience. Compared to arbitration, mediation offers similar expertise at a fraction of the cost.
Confidentiality
Mediation proceedings are strictly confidential. Unless agreed otherwise in writing, documents, communications, and settlement terms cannot be disclosed or used in later proceedings (with the exception of legally required disclosure). This protects sensitive business information and allows parties to negotiate openly, without fear of reputational or commercial fallout.
Enforceability
Perhaps most importantly, mediation agreements in Dubai are legally binding once ratified by the courts. Under Article (25) of the Federal Decree-Law, settlements become enforceable as court judgments—provided the agreement is properly documented, validated by the mediation centre, and does not conflict with public policy. This step underscores the importance of engaging accredited Dubai-based mediators who can navigate the legal requirements effectively.
These advantages not only make mediation attractive at a transactional level but also support Dubai’s wider economic strategy. Faster and more cost-effective dispute resolution contributes directly to its goal of being one of the world’s leading centres for trade, logistics, and financial services.
Supporting international commercial recoveries in a changing legal landscape
Dubai’s evolving mediation framework offers new opportunities for resolving commercial disputes more efficiently. For international creditors, this shift can mean faster outcomes, reduced costs, and greater certainty—especially when navigating complex cross-border claims.
Understanding how and when to engage with mediation in Dubai requires more than legal knowledge; it demands familiarity with local procedures, cultural expectations, and the practicalities of enforcement. These are areas where Recovery Advisers brings valuable insight.
With over 16 years of experience in international commercial recoveries, our team is well-versed in the nuances of dispute resolution across jurisdictions. In the UAE, we help clients assess the viability of mediation, prepare strategically, and ensure that any settlement reached is enforceable and aligned with their commercial goals.
Importantly, our services are offered on a success fee basis, meaning our interests are directly aligned with those of our clients. We are committed to achieving practical, cost-effective outcomes—whether through mediation, arbitration, or judicial recovery—without adding financial pressure during already challenging situations.
As Dubai continues to position itself as a global hub for trade and finance, we remain focused on helping our clients navigate this dynamic environment with confidence and clarity.
For more information, please contact your local Case Manager or email info@recoveryadvisers.com.
