On 2 January 2023, a new UAE law “Federal Law 34/2022 regulating the advocacy and legal consultancy profession” came into force. This was followed by the implementation of several administrative decisions in Dubai. We refer to the new federal law and the Dubai decisions as the “New Laws”.
In the New Laws, the legal profession in the UAE continues to be categorized in two ways: (i) advocates (i.e. those lawyers that appear before the UAE courts and have rights of advocacy); and (ii) legal consultants (lawyers practising at law firms that do not have rights of audience before with the UAE courts). The New Laws also contain provisions that deal with in-house lawyers.
We set out below the key features of the New Laws:
In-house lawyers
In-house lawyers are now required to register as non-practising lawyers. The procedures, terms and conditions for registration will be set out in executive regulations that are due to follow. Notably, for in-house lawyers in Dubai, the Dubai Legal Affairs Department (the DLAD) shall establish a roll of “non-practising advocates” and “non-practising legal consultants” whose registration will be renewable on a yearly basis.
The federal law seeks to regulate the activities of in-house lawyers to restrict them from carrying on an independent practice in addition to their in-house role. In-house lawyers can only work for the company they are employed by and cannot appear in courts, other than in their role as an in-house lawyer representing his/her employer.
There is no clarification as yet on whether in-house lawyers will now be required to complete CPLD accreditation or whether in-house lawyers could be subject to the regulatory grievance processes or could be sanctioned for violations in the way that practising lawyers are.
We expect that the executive regulations that are due to be passed will clarify these matters.
Advocates
The New Laws set out enhanced obligations for UAE advocates.
These include stringent registration requirements, which include written exams, an interview and a medical test and a copy of a valid professional liability insurance policy.
A significant development is that advocates can now agree contingency payments for their fees (where relevant, of up to 25% of the court awarded amount).
We note that non-UAE national advocates can be registered as advocates, which was the position under the previous law.
In 2023, a new Civil Procedure Code was passed which paves the way for certain cases in UAE court circuits to be heard in English. It remains to be seen whether all advocates will still need to be Arabic speakers or whether (now that some court proceedings can be heard in English), there will be a way for English speaking lawyers in the UAE to appear as advocates.
Legal consultants
Legal consultants continue to be prohibited from appearing in courts, which is a right reserved only for advocates.
The New Laws place an emphasis on the duties and obligations of lawyers with a specific focus on:
- Informing clients of any conflicts;
- Keeping clients informed of case stages and progress;
- Returning original paperwork and documents after the engagement is over (subject to exceptions where the professional fees have not been paid);
- Obligations around confidentiality which are broader in this law than in previous laws; and
- Requirements to have retainer agreements in place and the factors to be taken into account when assessing the fee payable.
The law sets out more stringent requirements on foreign law firms setting up branches in onshore UAE who are now required to develop and train UAE nationals.
Legal consultants continue to be required to meet CLPD requirements.
Visiting legal consultants
A notable change is that the New Laws issued in Dubai make it a regulatory requirement that any “Visiting Legal Consultants”, (i.e. individuals outside the UAE providing legal services in the UAE) must now obtain a permit to provide those services.
This includes any legal services being provided in the DIFC, before DIAC or at any law firm licensed in the UAE. The visiting legal consultant shall be granted a permit to practice the profession for no more than 30 working days per year (which can be extended) or until the completion of a specific legal service.
Supervision and disciplinary provisions
The New Laws issued in Dubai provide for the setting up of a DLAD professional conduct committee, as well as a DLAD violations committee.
The procedures and timeframes are now detailed in these laws, which include (in the case of complaints) that a division within the DLAD can:
- Gather information and seek responses from the practitioner or managing partner of the firm;
- Summon any interested parties to hear their statements; and
- Request data and documents relating to complaints.
Once a report has been prepared by a directorate within the DLAD, the report will be referred to the relevant committee.
Both the DLAD professional conduct committee and the violations committee will have wide powers to continue their investigation of potential violations. This includes hearing witnesses and seeking documents.
If a violation has occurred, the lawyer could be at risk of (i) a written warning, (ii) suspension for a period of up to 2 years or (iii) being struck off from the roll.
Once a decision has been issued, appeals can be issued to the DLAD Grievance Committee, within a 30 day period of the decision.
At a federal level, the regulatory authorities across the Emirates (i.e. other than lawyers regulated by the DLAD which has its own Emirate-specific processes) can also impose sanctions and call lawyers before a disciplinary board.
The disciplinary board’s hearings will be held behind closed doors although the lawyer can be legally represented.
Conclusion
In summary, the regulation of foreign law firms and legal consultants, as well as those lawyers that visit the UAE on an ad-hoc basis and give legal advice is tightening.
The processes in place to deal with grievances against lawyers is now more specific and detailed.
Law firms, as well as individual lawyers, should ensure that they are aware of the duties and obligations upon them.
These changes will also be of interest to professional indemnity insurers since the tighter legal and regulatory environment for lawyers in the UAE potentially means a change in the risk landscape of the legal profession.
