Kluwer Construction Blog

The UAE construction sector is a continually developing market with complex transactions becoming increasingly prevalent. The evolution of the construction sector has highlighted the need for more robust construction contracts that deal with all the relevant risk issues for a project.

Presently, many companies in the UAE rely heavily on the use of standard form construction contracts (“SFCCs”) as a basis for their contractual obligations, as opposed to using bespoke construction contracts drafted for each project.

There are various types of SFCCs which have been developed by different entities in different regions. Some examples of SFCCs include the Fédération International des Ingé [...]

Arbitration has long been established as a method of dispute resolution in the Middle East. In recent times, with the enormous economic growth experienced in the region, and the UAE’s liberal approach to foreign investment, the provision for solving disputes by arbitration has become even more prominent in commercial contracts, aided in part by the fact that it is the favoured method of resolving disputes under many standard form construction contracts.

The UAE has been a signatory to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, commonly known as the “New York Convention”, since 1996, but there is currently no federal legislation in force that is solely conce [...]

The activity of construction is liable to Value Added Tax (“VAT”) on “the transfer of property in goods involved in the execution of a Works contract”, under the extended definition of Sale, pursuant to introduction of Article 366(29A) by the 46th Amendment in the Constitution of India.

This blog considers the issues arising when a person goes and buys a flat or a commercial property from a builder; is it a “Sale”, and can the activity be amenable to a levy of VAT? The controversy emanates from the decision of the Hon’ble Supreme Court in K. Raheja Development Corporation [141 STC 298 (S.C)], wherein, it was held that if the Agreement is entered into after the flat or unit is a [...]

One of the most interesting aspects of working in different jurisdictions is seeing how different regions approach the same issues in different ways – both legally and commercially. An example of this in the context of PPP transactions, is the differing approach taken in the UK and the Middle East in respect the inclusion of delay liquidated damages regimes in Project Agreements.

Liquidated Damages in UK PPP transactions

In the UK, the general presumption is that a Project Company will not be liable for delay liquidated damages in the event that the service availability date (or “commercial operation date”) is not achieved by the relevant target service availability date (or “s [...]

To continue the nuclear theme of my last blog, which considered the legal and regulatory frameworks necessary for a country aspiring to nuclear power, and suggested that the UAE had set the bar high in its progress to date, this blog looks at what other countries in the region are up to and how all these projects might be financed.

I had the good fortune to attend the Middle East Nuclear Energy Summit in Amman, Jordan last month. Jordan is arguably second only to the UAE in the race for peaceful nuclear energy. Indeed the Chairman of the Jordan Atomic Energy Commission told the conference of his country’s plan to become a net exporter of electricity, and to use their indigenous su [...]

INTRODUCTION

News headlines in the UAE have recently proclaimed that “companies defaulting on salaries will soon be a thing of the past” (Gulf News), as the UAE government has launched its Wage Protection System (the “WPS”). Certainly the WPS is a significant step to protect the rights of workers in the UAE, and given the size and importance of the construction sector in the UAE, the WPS will also have a big impact on how employers in the UAE construction industry operate and pay employees. Below we look at the WPS, how it will operate and the impact the WPS will have on employers and employees across the UAE.

WHAT IS THE WPS?

The WPS is an electronic salary transfer system that requires com [...]

As you will all have noticed, there is something of a nuclear renaissance underway. Among existing nuclear powered countries those leading the comeback are the US, China and India, all building, or with ambitious plans to build many more nuclear power plants. There is also substantial interest in nuclear power from countries that do not currently have nuclear power. Of these countries, the United Arab Emirates (UAE) can probably claim to be one of the furthest along the path of nuclear new build having recently announced the award of a contract to build four nuclear reactors to a South Korean consortium and with first power to the grid scheduled for 2017. So what does an aspiring nuclear [...]

Mediation has become established in the West as a useful alternative to more confrontational and adversarial forms of dispute resolution. Here in Dubai it is uncommon, but in our experience the number of disputes is on the increase, so could it, or should it, have a role to play?

Mediation is an alternative dispute resolution procedure that allows parties with a dispute to engage a neutral third party to facilitate communication between the parties, with the aim of resolving the dispute. As it is a voluntary and consensual process, parties must agree to mediate and are free to withdraw at anytime. Mediation is also non-binding and it may well not lead to a resolution of the d [...]

We are all still feeling the impact the global downturn is having on the construction sector in the UAE. Not only is it a challenge to find work in this market, increasing numbers of contractors and consultants are finding it difficult to recover payment for work they have already undertaken.

In the past many companies working in the region have been wary of pursuing their entitlements through formal dispute resolution processes, due to perceived cultural sensitivities, many now feel that they have no choice but to consider the available debt recovery options.

In many instances, the amounts owed are not disputed. However, in the current market some developers/contractors consid [...]

If you’re based in the UAE, the answer to the above question is probably not.

Why is copyright important?

If a company has invested significant time and money in the creation of designs for a particular project then it will want ownership rights in relation to those designs. Copyright provides some protection against third parties copying your designs.

Copyright becomes particularly important in the event of a dispute where one of the parties to a construction project may try to move on and to take your valuable designs with them. If you do not own the copyright in those designs then you will not be able to prevent others from using them on other projects.

Who owns the copyrigh [...]