FIDIC Contracts in the UAE: What the Form Does and What UAE Law Overrides

FIDIC publishes a family of standard-form construction contracts that allocate design responsibility, risk and administration differently between employer, contractor and engineer. In the UAE these forms, usually with substantial bespoke amendment, sit behind a very large share of significant projects, public and private, onshore and inside the financial free zones.

None of that gives them legal status. No FIDIC reference was found in any UAE statute or federal procurement instrument. A FIDIC form here is a private contract: no statutory backing, no displacement of UAE law, and no mandatory status because a sector tends to use it. Content asserting that FIDIC is adopted, required or endorsed by UAE law is unsupported.

• UAE Legislation Portal ↗

For an onshore UAE project the governing law is generally UAE law, and the relevant general law is now Federal Decree-Law No. 25 of 2025 promulgating the Civil Transactions Law — issued 1 October 2025, published in Official Gazette No. 809 on 14 October 2025, and in force from 1 June 2026 under its Article 3. It applies today, not in the future.

That matters for every FIDIC contract in the country, because the general civil law is what a court or an onshore-seated tribunal applies when the form runs out or conflicts with a mandatory rule. The new law expressly repeals Federal Law No. 5 of 1985 (Article 2 of the promulgating decree-law) but states that it does not apply retroactively to earlier facts and acts unless it provides otherwise, so a dispute straddling the commencement date needs a lawyer working from the gazetted Arabic.

• UAE Legislation Portal ↗

Decennial liability is the feature of UAE construction law that most reliably defeats FIDIC drafting. It imposes strict ten-year liability on the contractor and on the engineer or architect for total or partial collapse of a building or fixed installation, and for defects threatening its stability and safety, with a separate three-year limitation period running from discovery.

It attaches by operation of law rather than through the contract, and it survives the contract’s own defects machinery. A FIDIC defects notification period, however defined and however carefully administered, does not measure or discharge decennial exposure. Parties treating the end of the contractual defects period as the end of their risk are reading only half the position.

The long-standing rule in UAE law is that any agreement purporting to exclude or limit the decennial liability of the contractor or the engineer is void, and that rule is understood to be preserved in the new Code. It is the clearest example of UAE mandatory law overriding a negotiated FIDIC position.

An aggregate liability cap, an exclusion of indirect or consequential loss, a net-contribution clause or a bespoke limitation on the engineer’s exposure may each be commercially essential and each be ineffective against a decennial claim. That is worth knowing before the cap is priced into a bid rather than after a claim arrives.

Law-firm commentary places decennial liability at specific articles of the new Code and notes that the previous law’s corresponding articles have been renumbered. That numbering was not confirmed against the gazetted primary text, so it is not published here. An unconfirmed article number in a pleading or a board paper is a liability rather than a convenience.

The description above — ten-year exposure, three-year limitation from discovery, anti-exclusion rule — is the settled substance. The numbering should be checked against the gazetted text before anyone cites it. Ask an adviser to cite from the gazette rather than from a briefing note, and treat any source that cannot do so with caution.

Two independent sources report that the new Code expressly excludes the main contractor–subcontractor relationship from decennial liability. If correct, that would materially change how defect risk passes down a contracting chain and how back-to-back subcontract drafting should be approached under a FIDIC main contract.

Only one of those sources gives article numbers, and the primary text was not confirmed. The position is therefore not established on the public record and should not be planned around in either direction. Where a subcontract structure depends on the answer, it is a question to put to a lawyer reading the gazetted text, and to put early.

Federal Law No. 11 of 2023 on Procurement in the Federal Government is widely treated as the framework governing federal construction tendering, including the tendering of FIDIC-based contracts. Article 4(d) of that law expressly excludes construction projects and contracts from its scope.

So a contractor relying on procurement-law procedures, protections or challenge routes on a federal construction project may be relying on a statute that says in terms it does not apply. Where procurement obligations exist on such a project they come from the contracting entity’s own instruments and from the tender and contract documents — which puts the analysis back into the contract.

• UAE Legislation Portal ↗

There is no statutory security-of-payment or adjudication regime in the UAE. Nothing equivalent to the United Kingdom or Australian construction payment legislation was located — no statutory right to refer a payment dispute to short-form adjudication, no statutory payment notice regime, no statutory suspension right for non-payment.

Every dispute-board, notice and payment protection a party has under a FIDIC form therefore exists only because the contract says so. It can be amended, narrowed or deleted by the particular conditions, and frequently is. A contractor arriving from a jurisdiction with statutory payment rights should assume nothing carries over, and should check what the amended contract actually preserved.

Dubai Decree No. 34 of 2021 concerning the Dubai International Arbitration Centre was issued on 14 September 2021 and came into force on publication under its Article 10. Article 1 constitutes DIAC as a non-governmental, non-profit centre with legal personality and financial and administrative autonomy; Article 2 gives it a head office in Dubai and a mandatory DIFC branch.

Article 4 abolished the Emirates Maritime Arbitration Centre and the DIFC Arbitration Institute and DIFC-LCIA. A very large number of UAE construction contracts, FIDIC-based and otherwise, still carry clauses naming those institutions, and the Decree rather than the clause now determines what happens.

Article 6(a) of the Decree provides that existing agreements naming the abolished centres remain valid, with DIAC substituted, unless the parties agree otherwise. Article 6(b) provides that tribunals already constituted continue under the rules they had adopted. So a DIFC-LCIA or EMAC clause is not void — but it no longer operates as drafted.

Before any notice of arbitration is issued under such a clause, the substituted position should be confirmed and the consequences mapped. This is a common and avoidable source of jurisdictional argument at the start of a construction arbitration, and it tends to be discovered under time pressure rather than in advance.

Article 4(b) of Decree No. 34 of 2021 provides that where the parties have not agreed a seat, the DIFC is the seat. That is a substantial default. It places the arbitration under DIFC curial supervision — a separate common-law jurisdiction with its own courts — rather than under onshore supervision, with different consequences for challenge, interim relief and enforcement.

FIDIC-based contracts are often amended heavily at the dispute clause, and the seat is one of the provisions most frequently left ambiguous or dropped in negotiation. A contract silent on seat is not neutral; it has a seat, and it may not be the one either party assumed. Settle it expressly at drafting and confirm it expressly before any dispute step.

Institutional rules and the arbitration statute do different jobs. The federal arbitration statute is Federal Law No. 6 of 2018, as amended by Federal Decree-Law No. 15 of 2023, issued on 4 September 2023. It governs the arbitration as a matter of onshore UAE law where the seat is onshore; the chosen institutional rules govern the procedure the parties selected.

A FIDIC arbitration clause therefore has to be read against both layers, and against the seat that Decree No. 34 of 2021 supplies if the parties did not choose one. Reading the clause alone, without the statute and the Decree, produces a picture of the parties’ position that can be materially wrong.

• UAE Legislation Portal ↗

Establish the governing law and whether the project is onshore, in the DIFC or in ADGM, because the whole analysis changes. Establish the seat expressly, and if the contract is silent recognise that the DIFC default applies. Establish which institution the clause points to now, given the abolitions. Then establish what the particular conditions did to the standard form — which notice, payment, dispute-board and liability provisions survived amendment.

Finally, identify which clauses cannot work at all because UAE mandatory law overrides them, with the decennial anti-exclusion rule at the top of that list. That is a legal exercise on the specific contract, which is why this guide describes mechanisms rather than giving advice. LEXNOVA is not a law firm: it matches you with a lawyer whose practice covers this, every match is reviewed by a person, and the relationship runs directly between you and the lawyer.