Corporate and commercial
Commercial Contracts
A document has arrived and you have been asked to sign it by the end of the week. It is long, it was written by the other side, and what worries you is not the price. Or the opposite: the work is agreed, nobody has written anything down, and you are about to start on an email chain and a quotation.
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The short answer
Both are ordinary, and both are the point at which a contract is cheapest to get right. Once a deal fails, the only things that matter are what the document says and what you can prove.
We are a licensed advocate practice in Dubai. This page sits under our corporate and commercial lawyers in Dubai page, which covers company structure and transactions. Call +971 50 747 9570 or email help@lawyerindubai.ae.
The contracts a business here needs most often
Supply and purchase agreements
Who delivers what, by when, to what standard, and when payment falls due. Most disputes under these come from two places: a specification that was never written down properly, and an acceptance process nobody followed.
Distribution, reseller and agency arrangements
Appointing someone to sell your product in this market, or being appointed yourself, is the arrangement that most often goes wrong late and expensively. Exclusivity, targets, territory, pricing and what happens at the end all need settling at the start, and the label on the document does not decide how it will be treated.
Services and consultancy agreements
Scope, deliverables, change control, fees, and who owns what is produced. These fail on scope creep more than on anything else, so the change mechanism deserves more attention than the fee schedule.
Confidentiality agreements
An NDA is short and is usually signed without much thought, which is why it often fails to cover the thing actually disclosed. Check the definition of confidential information, the permitted purpose, how long the obligation lasts, and what happens to material on return.
Shareholder and employment contracts
A shareholder agreement decides how owners behave towards each other, and our shareholder and partnership dispute lawyers in Dubai page covers what happens when there is not one. Employment contracts belong in the commercial set because confidentiality and intellectual property assignment live in them.
What a review actually looks for
What you are promising
The first pass is commercial rather than legal: read your own obligations as though you already regret them. Can you deliver in that time, to that standard, with that reporting? An obligation you cannot meet is a breach scheduled in advance.
What happens if the other side does not perform
Most contracts are detailed about your obligations and vague about the remedy when the counterparty fails. Look for what you can do if they are late, if the goods are defective, if they stop paying, and whether you must keep performing while the argument runs.
What you cannot get out of
Automatic renewal, minimum purchase commitments, exclusivity without targets, and notice periods longer than the relationship is worth. Contract review in the UAE is often about the exit rather than the entry, because being locked in is what a business feels first.
What is not in the document
Silence is a term too. No retention of title over goods delivered but unpaid. No right to suspend for non-payment. No ownership clause over what you create. No interest on late payment. No dispute clause at all. A review means listing what should be there and is not.
The clauses that decide what happens when it goes wrong
Governing law
The governing law decides how the document is read. A contract performed in the UAE, with UAE assets behind it, is usually easier to run under UAE law than under a foreign law that then has to be proved to a local court. Some UAE provisions apply whatever the parties choose.
Where the dispute is heard
This is a separate question from the governing law, and it is the clause businesses concede fastest. The onshore Dubai courts, the DIFC Courts working in English under a common law framework, and arbitration under an institution’s rules differ in cost, speed, language and enforcement. Choose by asking where the other side’s money will be if the deal fails. Our arbitration and dispute resolution lawyers in Dubai page covers what makes a clause defective.
Termination
Termination for convenience, termination for cause, and termination after a cure period are three different rights, and a contract with only one of them may not give you the exit you assumed. Say what notice is required, in what form, to what address, and what survives: confidentiality, payment for work done, return of materials, and licences to keep using what has been delivered.
Liability and caps
A cap is useful only if it sits above the loss you would actually suffer and below the loss that would end the business. Look at what it covers, what is carved out of it, whether indirect loss is excluded, and whether an indemnity cuts across the cap and makes it meaningless. Some liabilities cannot be limited by agreement, and an agreed compensation figure is not always the end of the argument.
Force majeure
A force majeure clause should list what counts, say what the affected party has to do and by when, and say what happens if the event continues: suspension, renegotiation, or a right to walk away. Where a contract has no such clause the position falls back to general UAE law, which does not necessarily produce the same answer.
Payment, late payment and security
Say when the invoice is issued, when payment falls due, what has to accompany it, and what happens if it is late: interest if permitted, a right to suspend, a right to terminate. Businesses here often also take a security cheque, a personal guarantee or a bank guarantee, and each has a different legal effect, so we check the current position before recommending which to take. Our debt recovery lawyers in Dubai page covers what recovery looks like once payment has stopped.
The language of the contract and the language of the court
A contract can be written in English and still end up before a court that works in Arabic. That is not a reason to write it in a language your own team cannot read, but it changes how you prepare.
Bilingual contracts and the prevailing version
If the document is bilingual, say clearly which version prevails, then have both versions checked against each other by someone who reads both. A prevailing clause is no help if the two texts say different things and the prevailing one says the wrong thing.
What translation costs you later
Documents put before an onshore court have to be produced in the language of the court, which means legal translation of the contract, the annexes, the purchase orders and the correspondence. A short, plainly drafted contract is cheaper to run a case on than a long one full of imported boilerplate.
Signing, authority and formalities
Check that the person signing has authority to bind the company, that the entity named is the one that actually trades, and that the signature method will be accepted. Electronic execution is normal commercially, but its status is worth confirming for anything significant.
Commercial agency arrangements in the UAE
This is where a supplier from outside the market is most likely to be caught out, and the regime has been amended, so nothing here should be relied on without checking the current position for your arrangement.
Agency and distribution are not the same
They are treated differently, and what matters is the substance of the arrangement rather than the title on the document. Calling an agreement a distribution agreement does not by itself determine how it will be characterised.
Registration changes the relationship
Where an arrangement is registered as a commercial agency, the consequences for exclusivity, for imports, for renewal and for ending the relationship are materially different from an unregistered one. Whether registration is available, what it requires and what it gives the agent all need confirming before signature.
Ending an agency
This is the point at which suppliers discover what they agreed to. Before serving any notice on an agent or distributor in this market, have the agreement and the registration position reviewed, because the sequence matters and a wrong first step is hard to undo.
When a contract is breached
The first week
Stop and collect: the signed contract and every amendment, the purchase orders, the delivery and acceptance records, the invoices, and the emails where the problem first appeared. Do not send an angry message, and do not accept a partial payment described as full settlement without advice.
The demand letter
A properly drafted letter setting out the breach, the contractual basis, what is required and by when resolves a good proportion of commercial disputes without a filing. It also builds the record you will rely on later, which is why it should not be a template.
Claiming and what you can recover
A claim is normally for the money owed, for loss caused by the breach, or for an order that the other side perform. What you recover depends on what you can prove you lost, so quantification is part of the case from the first day. Whether the claim is still in time is the first thing we check.
How we work on contracts
Businesses come to commercial lawyers in Dubai for three things: drafting from scratch, reviewing something they have been sent, and building a set of templates the team can reuse. For a review you get a marked-up document and a short note on what matters, what is negotiable and what can be lived with. For contract drafting in Dubai we start from what the business actually does rather than from a precedent, because a precedent written for another deal is how unenforceable clauses travel.
Send us the draft, any earlier version or term sheet, a short description of the commercial deal, and the deadline you are working to.
Questions people ask us
Do I need a contract lawyer in Dubai for a standard agreement?
Standard usually means standard for whoever wrote it. If the value or the term is significant, if it is exclusive, or if you cannot easily replace the counterparty, a review is worth the cost. For a low value one-off a short checklist may be enough.
Can a contract be in English only?
Commercially, yes, and many are. The practical consequence is translation if the matter later goes before an onshore court, and the drafting consequence is that the English should be simple enough to translate accurately.
What does a contract review cost?
It depends on the length of the document, how many versions it goes through, and whether we negotiate it for you. We quote before we start and set out what is included. Our legal fees and how our charges work page explains the structures we use.
The other side has breached. Do I have to give notice before claiming?
Usually you should, and often the contract requires it in a specified form. Send us the contract before you send anything to them, because a notice given in the wrong form can weaken the claim it was meant to support.
Can I terminate a contract that has become uneconomic?
Not simply because it has stopped being profitable. Look first at whether there is a termination right you can use, then at whether the other side is in breach, then at whether a renegotiation is realistic. Walking away without a contractual basis makes you the party in breach.
Speak to a contract lawyer in Dubai
If you have a document to sign, a relationship to paper before it starts, or a counterparty who has stopped performing, the first conversation is short and it is usually about the commercial deal rather than the clauses.
Call +971 50 747 9570 or email help@lawyerindubai.ae with the draft and a short summary. Our office is at Empire Height Towers, Marasi Drive, Business Bay, Dubai. You can also use the form on our contact page.
Related pages: corporate and commercial law, shareholder disputes, arbitration and dispute resolution, debt recovery, legal fees.
What this costs
The first ten minutes are free. After that a standard fee applies and you are told what it is, in writing, before any work starts. Court and government fees are set by the court and are separate from ours.
Tell us what happened
Ten minutes, no charge, and a straight answer about whether you need a lawyer for this.