The UAE’s new maritime law, implemented through Federal Decree-Law No. 43 of 2023, came into effect on March 29, 2024, replacing the 1981 maritime law. This updated legislation aims to modernize the country’s maritime framework, align it with international standards, and solidify the UAE’s position as a leading shipping hub. Here are the key changes and highlights:
- Expanded Vessel Ownership and Registration:
- Previously, UAE-registered vessels could only be owned by Emirati nationals or entities dominated by Emiratis. The new law extends eligibility to individuals and entities from Gulf Cooperation Council (GCC) countries and UAE-domiciled foreign entities, promoting inclusivity in vessel ownership.
- Revised Ship Arrest Provisions:
- The law aligns with the 1999 International Convention on Arrest of Ships, broadening the scope of maritime claims that can lead to vessel arrests, such as environmental damage, port fees, and insurance disputes.
- It introduces the concept of sister-ship arrests, allowing creditors to seize not just the debtor’s ship associated with the debt but also any other vessel owned by the debtor.
- Claimants must now provide financial security to ensure crew welfare and vessel maintenance during the arrest period.
- Chartered Vessel Arrests:
- Arrests of bareboat-chartered vessels are now permitted for debts incurred during the charter term, marking a significant shift from previous rules.
- Legal Proceedings for Arrests:
- A distinction is made between claims validating an arrest and substantive claims on merits, reducing procedural complications. Claims for validity must be filed within five days of arrest, while substantive claims may follow court or arbitration proceedings.
- Counter-Security Mechanisms:
- Letters of Undertaking (LOUs) from P&I Clubs or financial institutions are now recognized as valid security for vessel release, simplifying procedures.
These updates provide greater clarity and flexibility while enhancing the UAE’s maritime legal environment. They are expected to attract more global stakeholders and promote sustainable maritime operations in the region.
