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 “scheduled commercial operation date”). Indeed, English guidance suggests that delay liquidated damages should only be included in exceptional circumstances.

The main reasons for this are three fold:

First, English law prohibits the levying of penalties and liquidated damages must be a genuine pre-estimate of loss. In the majority of PPP projects it is difficult to envisage how a procuring authority will suffer any loss and, accordingly, how liquidated damages will be held to be anything other than a penalty. This is because the procuring authority is unlikely to have made any capital contribution or other payment during the construction phase and the fact that it will not be obliged to pay the service charge until the service availability date is actually achieved. Therefore it is unlikely that the loss that the procuring authority suffers as a result of any delay to commencement of the service will be greater than the service charge it will no longer be obliged to pay in respect of such delay.

Secondly, the way in which PPP projects are structured means that there is already a large incentive on the Project Company (and the Construction Sub-Contractor) to achieve the service availability date on or before the target service availability date. As mentioned above, the procuring authority will not start paying the service charge until the service availability date is achieved. However, the payment profile of senior debt (principal and interest) is likely to require repayment to start on, or soon after, the target service availability date. Where, as a result of delay, the service charge is not being paid to the Project Company on the date that it has to start making debt repayments then the Project Company has a funding gap. This funding gap is filled by the Project Company levying delay liquidated damages on the Construction Sub-Contractor under the Construction Sub-Contract. Accordingly, the Construction Sub-Contractor is incentivised to minimise delay through the operation of a delay liquidated damages mechanism even where no such mechanism exists in the Project Agreement.

Thirdly, best value for money is not likely to be achieved by including a delay liquidated damages mechanism in a Project Agreement. As we have already seen, a PPP Construction Sub-Contract is likely to include a delay liquidated damages mechanism even if the Project Agreement does not. The Construction Contractor will mitigate its exposure to such delay liquidated damages by both including a financial contingency in its price and a time contingency in its construction programme. Both such contingencies will be included in the Project Company’s service charge and construction programme. Should the procuring authority include a delay liquidated damages mechanism in the Project Agreement, then the Project Company will simply pass down in full such mechanism to the Construction Sub-Contractor in addition to the “debt service” liquidated damages that would have be included in any event. Obviously the effect of this is that the financial and time contingencies in the project would be significantly increased and this is unlikely to provide best value for money.

The common position in the Middle East

General market practice in the Middle East is almost entirely the opposite. The inclusion of substantial delay liquidated damages in PPP/BOT Project Agreements is common. Of course, this means that a full pass down of risk from the Project Company will require the Construction Sub-Contractor to assume both the Project Agreement delay liquidated damages and well as the “debt service” delay liquidated damages (referred to above). This is likely to create a significant daily liability for the Construction Sub-Contractor.
The reasons for such a differing approach could be down to the combination of a number of factors:

The law of most Middle Eastern countries does not prohibit penalties in the same way that English law does. Accordingly, there is less of an emphasis on whether the Project Agreement delay liquidated damages are a genuine pre-estimate of loss. However, note that under the Civil Code of many countries in the region, where the amount of compensation payable in respect of a breach has been fixed in advance by the contract (eg. delay liquidated damages) a party may apply to the court and request that such compensation be adjusted to reflect the actual loss suffered by the relevant party. In some jurisdictions that adjustment may be downwards only, in others it may be upwards or downwards. Whether the courts actually exercises that discretion in practice is a different matter and difficult to predict.

The majority of PPP / BOT projects tendered to date in the region are for process plants and not accommodation based projects. It may be that the price that the procuring authority would pay for the relevant off-take (eg. power or water) under the relevant purchase agreement is significantly less than the price that it is paying, or costs that it is incurring, for its current supply. In such circumstances it is possible to envisage that any delay in achieving the commercial operation date could cause the procuring authority to suffer a loss.

The procuring authorities in the region are not subject to the same obligations to achieve “best value” as their counterparts in the UK. Often, as is typical in the region, the emphasis is more on the speed of delivering the relevant asset than on achieving the absolute best value solution. To an extent, and certainly from a presentational perspective, it is possible to understand why this could lead to including delay liquidated damages in the Project Agreements.

Finally, there other cultural, commercial and structural factors. For example, whilst there have been a number of PPP / BOT projects in the region, some on a staggering scale, the market is still in its relative infancy and is a melting pot of different international contractors and advisors, each with a different idea of the “correct” way of doing things and all with a desire to do business in the region. Arguably, this leads both to the seeking of commercial positions that would not, necessarily, be sustainable in other markets as well as the willingness to accept commercial positions that may be severely resisted in the relevant home market. It remains to be seen whether an economic upturn might lead to a hardening of position on this and other points by the private sector.

Co-authored by Rob Graham, an associate in Pinsent Masons’ Dubai office

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 supply of uranium as part collateral to assist with the financing of new nuclear new build. There has been further progress in Jordan since the conference with the site selection team identifying suitable sites for a nuclear power plant, the inauguration of a waste facility for low and medium level waste and the award of a contract to build a 5MW research reactor.

Other countries in the region plan to follow suit: at the conference we heard from representatives from Bahrain and Yemen who are considering nuclear power. Separately the Kingdom of Saudia Arabia recently launched plans to consider the feasibility of nuclear power, and Qatar, Kuwait and Oman are reputed to be engaged in similar plans.

However it was clear from all the speakers that one of the big unresolved issues for many of them (and for some countries in the region this will be more critical than for others as there is a vast disparity in wealth), is securing the financing that will be necessary to pay for these very capital intensive projects. There was a good deal of debate on whether project financing, which has been successfully used in a number of countries in the region to finance significant power and water projects, could be the answer.

As the global nuclear renaissance marches on and the world becomes more familiar and relaxed about nuclear technology it seems likely that in due course there will be a nuclear power project that is project financed. For now though, risks that will concern lenders of project will be many and varied but are likely to include political risk, the reliability of the chosen technology and the reliability of the price to build it, the legal and regulatory frameworks including the robustness of the licensing regime and the nuclear liability regime, demand risk and so on. Arguably, many of the mitigants to these risks (eg robust licensing frameworks, de-politicised decision making, compliance with international conventions on third party nuclear liability) are more readily found in countries with experience of nuclear power and which are well immersed in the nuclear industry, rather than countries seeking to build their first nuclear power plant. Jordan may be an exception that proves this rule though as it has clearly evinced an intention to adopt a PPP model for delivery of its nuclear power ambitions. Indeed Abu Dhabi is also reputedly about to appoint a further set of financial advisers which suggests they again might be about to break new ground. Time will tell.

It must be the case though that not every Middle Eastern country claiming an interest in nuclear power will be successful. The reasons are well documented in the industry and the problems well rehearsed – there are serious shortages in the supply chain to meet the current and predicted global demand, there are insufficient people with the sufficient skills and experience to meet the current and predicted global demand, and perhaps even more obviously the economics don’t make sense: if most countries in the region have a nuclear power plant, to whom will they all export their electricity?

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 companies to pay workers’ wages via specific financial institutions, such as banks and bureaux de change, approved and authorised by the government to provide such a service.

The system, developed by the Central Bank of the UAE, allows the Ministry of Labour (the “Ministry”) to create a database that records wages payments in the private sector in an attempt to guarantee the timely and full payment of agreed-upon wages. The WPS is essentially an initiative to safeguard the payment of workers’ wages – a system that is arguably overdue in the UAE.

REQUIREMENTS OF THE WPS

In order to comply with the WPS, a company will need to do the following:

• register with the Ministry;
• have a bank account with a bank operating in the UAE;
• enter into a contract with any financial institution approved and authorised by the Central Bank of the UAE to provide the WPS service;
• transfer workers’ wages via WPS by the specific deadlines set by the Ministry; (which is within 2 weeks of their due date or on the dates specified in the work contract if wages are to be paid more frequently); and
• meet all costs and expenses incurred in complying with the WPS.

CONSEQUENCES OF FAILURE TO COMPLY WITH OR JOIN THE WPS

Compliance with the WPS is mandatory for all businesses operating in the UAE and, of course, there are consequences for those businesses that fail to comply. The current sanctions are as follows:

• Institutions failing to transfer workers’ wages by the specific deadlines set by the Ministry will be denied the right to obtain new work permits. This ban will only be lifted 1 month after the transfer of the workers’ wages in full; and
• Institutions that delay wages’ payment more than 1 month after the due date will be denied the right to obtain new work permits, as well as all the institutions owned by the violating institution and all those responsible for the violation will be referred to court (in accordance with Ministerial Resolution No. 788 of 2009).

IMPACT OF THE WPS

Advantages

It is thought that this new system will apply to over 4 million employees when fully implemented and one significant advantage is that it is likely to enhance the Ministry’s ability to implement preventative measures to reduce labour disputes over wages.

The system will allow the Ministry to know, on a ‘real time’ basis, whether or not salaries have been paid in full.

Defaulting companies can be easily identified, and as the supervision and sanctions will be administered by the same Ministry, the application of sanction should also be quite simple. As discussed above, defaulting companies will be prevented from obtaining new work permits, which may create significant problems for employers and therefore be a significant incentive for a company to comply with the WPS.
Another consequence of the WPS is that disclosures must be made to the Ministry, impacting on the ability of local companies to ‘sponsor’ the employees of international businesses that do not have a corporate presence in the UAE. The illegal, but widespread, practice of local companies ‘sponsoring’ foreign individuals that are in fact employed by and performing services for an international business without a corporate presence in the UAE, will be affected by the disclosure and transparency required under the WPS. Under the new system, such arrangements will be harder to maintain.

While the WPS offers wage protection to all employees, it is unskilled workers, who are particularly vulnerable, that are arguably most in need of the protection afforded by the WPS however as is noted below, some difficulties are apparently being experienced in extending the WPS to this sector of the labour market.

Difficulties

It is apparent that there have been some teething difficulties in implementing the System, which unless resolved, may affect the utility of the System. Some businesses have cited the unwillingness of some banks to open accounts for low-income workers, which may represent a major obstacle in satisfying the requirements of the WPS. Time will tell how such issues are resolved.

WHERE TO NEXT?

The WPS is a positive step for the UAE in respect of disclosure and transparency, and may serve to protect the interests of often powerless employees. While the WPS appears to have been implemented to address a specific problem, it is inevitable that questions will be asked whether the centralisation and disclosure of labour and wage data to the Government may not also represent the first step towards subsequent governmental wage or employment policies.

By Sachin Kerur and Nicola Milne, Pinsent Masons Gulf Region

Safety and the Role of The Regulator

As anyone involved in the nuclear industry will testify, safety is paramount both in the inherent design characteristics of the technology itself and in the operating procedures adopted on site. For safety also to be seen to be paramount, the role of an independent oversight authority is of critical importance, as enshrined in the IAEA Convention on Nuclear Safety. Under the convention the regulator is required to implement and enforce a regulatory framework which sets out national safety requirements, a system of licensing for nuclear installations and a system of inspections and assessment of nuclear installations. Aspiring nuclear powered countries will need to set up such a regulatory body, and ensure its independence.

In this regard it is interesting to note that as well as setting up an independent regulator headed by an internationally recognised individual (the former Executive Director for Operations of the United States Nuclear Regulatory Commission), the UAE has also collected together an illustrious group of individuals to comprise an International Advisory Board to advise it on matters such as safety and security. As the UAE has recognised, an acceptance of peer review, openness and an absolute commitment to safety and security as well as the peaceful use of nuclear energy is essential in convincing existing nuclear countries to allow and encourage their contractors, reactor vendors and suppliers to share their technology and work on new nuclear new build projects in a country.

Liability for third party nuclear damage

The term third party nuclear damage means broadly, damage to property and people unconnected to the nuclear installation but caused by a nuclear incident – in contrast to conventional damage which is has no nuclear cause. It is extremely rare. Yet, it’s the big risk to the nuclear supply chain and the big issue for populations of nuclear powered countries or countries near to nuclear powered countries (nuclear damage doesn’t respect territorial boundaries). As such the international nuclear world has devised a way of addressing the risk and seeking to balance the needs of any victims of third party nuclear damage with ensuring that the nuclear industry can operate without fear of financial ruin. Essentially the big idea is to channel all the liability for third party nuclear damage to the operator of the nuclear installation where the nuclear incident occurred. This means all the victims know who to sue, the insurance industry knows who to insure, and the other parts of the supply chain only need to worry about (and insure) conventional liabilities. Of course it is more complicated than that and currently debates abound about the scope of damage covered and the limitations to the operator’s liability, but essentially the key is the channelisation of liability.

As you will have realised, channelisation is only any good if the principle is harmonised across the globe so that if damage does occur in the neighbouring country to the nuclear installation country, the victims in that neighbouring country should still be able to (and be obliged to) sue the operator. Different rules shouldn’t apply. Such an international harmonised regime was the goal behind the development of a number of international conventions which enshrine these ideals, known as the Paris convention and the Vienna convention, and then latterly the Convention on Supplementary Compensation for Nuclear Damage.

Unfortunately no such harmonised regime is in place. Over half the nuclear reactors worldwide are currently in countries which have not ratified any of these international conventions. While a number of these countries do have national laws which reflect the principle of channelisation they don’t and can’t address trans-boundary issues.

The UAE in its Policy Statement clearly recognises the need for the UAE to introduce a regime of nuclear liability which complies with these international conventions and also indicates an intention to conclude the Vienna convention. This would be a welcome development to those who seek a harmonised regime, and give new impetus to such efforts. It is to be hoped that the nuclear renaissance can lead to increased pressure on all nuclear powered countries to adhere to these principles as part of a globally harmonised regime.

Conclusion

In the manner in which it has addressed and has committed to address key legal issues for new nuclear new build, the UAE has set the bar high and it is to be hoped that other countries in the region will follow suit when developing their legal and regulatory framework for nuclear power plants in their countries. In this regard the author will be attending the Middle East Nuclear Energy Summit in Jordan next week at which representatives from Jordan, Saudia Arabia, Bahrain, Yemen and the Arabic Atomic Energy Agency will be speaking and hopes to learn of a similar approach being adopted.

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 dispute. However, if the parties do reach agreement on the dispute, they then record that agreement in writing and it then becomes enforceable in the usual way.

The pros

Mediation is inexpensive when compared with litigation and arbitration which are also far more time intensive, so there is a significant time and cost saving if the dispute is successfully resolved without reference to these more traditional dispute resolution methods It is also quicker: specifically in Dubai, arbitration can take up to two years and parties may face issues in relation to enforceability of arbitral awards in the local courts. Mediations usually last one or two days, although to ensure the greatest chance of success it is important that significant preparation is done in advance, and that perhaps a programme for the mediation is agreed, although flexibility on the day will be important.

Further, mediation, as with arbitration, should also be a confidential process. This is important so parties feel able to make concessions without fear of repurcussions. If everyone attends feeling that whatever they say may be used against them, then there will be little movement from entrenched positions. The confidentiality of proceedings and presence of an experienced mediator also allows a party to test out an argument and perhaps even get an opinion from the mediator as to its chances of success. This may make it more or less amenable to settlement.

Moreover mediation is often regarded as having a number of significant commercial benefits. More often than not, a contractor will wish to be seen as cooperative and will want to try and preserve, to the extent possible, a good relationship with its employer. As anyone who has been a party to litigation or arbitration will testify, it is very difficult to maintain even civil relations with the other side. Avoiding the loss of a business relationship is a benefit that surely cannot be overestimated in the market conditions facing contractors in Dubai and elsewhere

Culturally, mediation would seem to fit in Dubai and the Gulf where bargaining is an art form and where, in the construction industry, we see instinctive reluctance to take drastic action against an employer.

Cons

The most obvious down side with mediation is that neither party can force the other to use it, unlike litigation or abitration which once prescribed in a contract, must be adopted to resolve any disputes arising from that contract. However, the pros outlined above are in both parties interests and even if a party is convinced that right is on its side, it will still incur a degree of irrecoverable costs and considerable time expended if it brings or defends litigation or arbitration proceedings.

In addition, the increase in disputes in Dubai will inevitably lead to pressure on resources in the Dubai courts and the Dubai International Arbitration Centre, which may well lead to an increase in the time taken to litigate or arbitrate a dispute, thereby increasing the financial and human cost of these routes, which only benefits lawyers!

The current position

Dubai does have a mediation centre already for property disputes, which was established as a direct result of the high case load of the property court (only those of you living on another planet will not have heard about the downturn in the Dubai property market and the difficulties caused for investers and developers).

Within the construction industry, again, as has been covered extensively in the media, there has also been a considerable downturn resulting in projects being delayed or stalled (latest figures suggest over 300 stalled projects) and contractors and consultants are experiencing delays in payments and severe payment shortfalls. Only yesterday Lord Mandelson representing the British Government was in Dubai seeking to further the cause of British contractors and consultants still owed vast sums. Could this pressured situation be ripe for resolution of dispute by mediation?

It is probably important here to make a distinction between issues of non-payment and disputes about termination, defects etc. In the former case it is hard to see the benefit of mediation – the sum is owed, but the money is either not available or not being made available. Mediation will not advance the creditors position and a more definitive step is probably required. However, if a contractor does see some benefit in maintaining a business relationship with that employer, mediation may still have some value in allowing parties to consider more creative ways for the debt to be repaid.

Contrast issues of termination and defects where a mediation, if properly approached, may provide a genuine alternative to parties spending the next two years absorbed in and paying for resolution of such issues by litigation or arbitration.

Conclusion

Mediation is useful if there is a genuine dispute and/or relationship issues and certainly has a place in Dubai. The current increase in construction disputes enhances the case for mediation and probably the likelihood of its use increasing. However if faced with a non-payment claim where there is a lack of money or lack of willingness to pay undisputed sums and no ongoing relationship issues to be considered, a more definitive and enforceable approach is probably necessary.

co-authored with Helen Turner

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 consider that they should not be obliged to pay their debts in full, and are attempting to avoid, defer, reduce and/or make piecemeal payments over a substantial period of time.

How to Recover Your Debts in the UAE?

Wherever you are from, outstanding payments can be frustrating, not to mention costly. However, a contractor will usually be aware of the tools available in its home jurisdiction in order to speed payment along.

When working overseas, however, the different cultural, legal and practical issues can make the whole process much more challenging. In the UAE, this challenge is in part due to the local civil legal system. Those instruments that common law practitioners are so used to wielding are not present in quite the same form.

The options available to pursue non-payment of due monies will depend on the dispute resolution mechanisms contained within the relevant contract. Typically, a contractor/consultant will have to litigate or arbitrate to recover payments.

In addition, there are a number of procedures available under local laws that could assist in the recovery of debts. Potential options available under UAE law include:

1. An Order of Payment

1.1 An order for payment within the UAE is a developing area of law. It can therefore often be hard to determine the likelihood of success before the UAE Courts when making such an application.

1.2 It is a procedure where a party applies to the Courts for summary judgment against a defendant for commercial debts, substantiated by a commercial instrument such as a bill of exchange, promissory note or cheque, which are valid, but not paid.

1.3 If a party has a successful application for an order for payment, the outcome would be a direction from the Courts for the outstanding debts to be paid by the debtor. Success is by no means guaranteed, but the mere threat of an order for payment can be a persuasive tool for the creditor, as an outstanding debt can bring with it considerable public embarrassment within the local community. This in turn can act as an incentive for the debtor to settle any outstanding debts.

2. Precautionary Attachment Order

2.1 A precautionary attachment order, if granted, essentially allows the Court to seize the assets in question at the claimant’s request prior to judgment/arbitral award in order to preserve those assets during the trial. It is as close to seeking injunctive relief as it gets in the UAE. The procedure, timing and effect of precautionary attachment orders can at times be somewhat unclear.

2.2 Precautionary attachment orders are made in absence of the other party and are ordinarily used as a tool to ensure that assets are not disposed of prior to receiving the court’s judgment/arbitration.

2.3 The order can be made against any assets in the UAE, including machinery, bank accounts, goods or other assets owned by the defendant and under his possession or owned by a defendant, but in the possession of a third party. It should be noted that the assets, money or material to be attached must be client specified before the application will be granted.

2.4 If a precautionary attachment order is granted, the substantive case must be filed at Court within eight days.

3. An Order for Sale

3.1 This is a procedure whereby a claimant applies to Court for an order that a property or part thereof be sold where a defendant has failed to pay for material and equipment supplied for that property.

4. An Order for a Lien Over Property:

4.1 In certain circumstances a contractor can exercise a form of lien over a property on which it is doing work until payment for that work is received.

Substantive Action

As discussed above, pursing substantive action is also a possibility, either through the local courts or via arbitration. Litigation in Dubai can be both costly and time-consuming. There are cases that continue for five years or more and only local advocates can appear and plead before the Courts. Arbitration might allow a claimant to remain within their common law comfort zone, however cases usually take at least a year to reach a decision and the costs are not insignificant.

Practical tips

(a) Examine the payment terms in the contract;
(b) Ascertain your entitlement to the outstanding debt and collate all the documentation in support of it;
(c) Review the dispute resolution mechanism in the contract, if any;
(d) Determine what assets the debtor owns and where these assets are held; and
(e) Review the amount in question and determine what is the best avenue for recovery.

Final thoughts

The road to debt recovery within the UAE, as in many countries, can be a protracted one. A supplier of services should, as far as possible, try to recover the amounts outstanding from the debtor before bringing any action for recovery through the Courts. A claimant needs to demonstrate clear and strong evidence of the outstanding debts if their application before the Courts is to be successful. With advocacy and court fees included, the process can be a long and costly one, so you should make sure that the amount outstanding will offset the cost. If you have an arbitration agreement then this can be a less costly mechanism for substantive recovery if the other avenues, such as the payment order, fail.

Helen Turner and Andrew Mackenzie

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 copyright in the designs?

Provided that the designs are original, then the owner of copyright in those designs will be the person who created them. This sounds fair enough. But, unlike other jurisdictions such as the UK, UAE law does not provide that the copyright in works created during the course of employment will vest in the employer. This means that the individual employees involved in the creation of the designs will own the copyright in those designs and not the employer.

You may now be thinking that this isn’t a problem for you because your employees’ employment contracts contain the usual standard clause assigning all intellectual property created during the course of employment to you as the employer. Well, unfortunately under UAE law there is a further problem.

The UAE Copyright Law states that a copyright owner cannot assign copyright in more than five future works. The threshold for when copyright attaches to a work is low – a simple email or sketch on a piece of paper will likely be a copyrighted work.

Therefore, even if your employment contracts contain a clause assigning intellectual property, the effect of such an assignment may be minimal. As soon as the employee has created five pieces of work, which he or she may do within hours of beginning work, then the assignment provision is no longer effective and the employee will own the copyright in all further future works.

What can you do?

The first step is check your employees’ employment contracts to ensure there is that provision in there which assigns all intellectual property in work created by them during their employment to you. The “five future works” law is yet to be tested in the courts and there remains a chance an assignment provision will be upheld beyond that limitation.

Secondly, we recommend that all construction companies operating in the UAE regularly require employees involved in the creation of potentially valuable works to which copyright attaches to make a written assignment to them of the copyright in all works that the employee has already created. There are no limitations in the UAE Copyright Law on the assignment of the copyright in works that have already been created.

The position in the UAE is not ideal and reflects the fact that at the moment intellectual property protection here is less well developed than in other jurisdictions . However, if you know about the problem, there are steps you can take to solve it.

By Brett Sherrard and Melanie Grimmitt