Contracting activities in Dubai: New law issued

Gulf Business

3 days ago

Image credit: WAM
Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, has issued Law No. (7) of 2025, establishing a comprehensive regulatory framework for contracting activities in the emirate.
The law marks a major step in enhancing governance and transparency within Dubai's contracting sector and aligns with the emirate's long-term development goals and international best practices,
Designed to unify and strengthen oversight, the legislation introduces standardised processes for contractor classification, licensing, accountability, and supervision. It also supports the broader objectives of Dubai's economic strategy and sustainable growth ambitions.
New oversight committee formed
A central feature of the law is the creation of the Contracting Activities Regulation and Development Committee, which will be formed through a decision by the Chairman of The Executive Council of Dubai. Chaired by a representative from
The committee will oversee the implementation of the new law, determine the regulatory authority for each contracting activity, and propose new policies or legislation for the sector. It will also mediate jurisdictional disputes between oversight bodies, develop a sector-wide code of ethics, and coordinate efforts with both public and private stakeholders.
Additionally, the committee is tasked with reviewing and acting on recommendations from relevant authorities to ensure continuous development of the sector.
Scope and exemptions
The law applies to all contractors operating in Dubai, including those within special development zones and free zones, such as the Dubai International Financial Centre. However, contracting work related to airports and associated infrastructure is excluded, as are any other activities exempted by the Executive Council based on the committee's recommendations.
Digital oversight system
Dubai Municipality has been assigned responsibility for developing and managing an integrated electronic system that will serve as a central registry for all contracting activities. The platform will be linked with the 'Invest in Dubai' portal to streamline processes and improve accessibility.
The municipality is also charged with classifying contractors involved in construction, building, and demolition work, issuing professional competency certificates, and preparing a code of conduct for technical personnel in the sector.
Contractor requirements and penalties
Under the new law, contractors must operate within the limits of their approved classification and comply with all relevant legislation. Unauthorised subcontracting or exceeding approved technical or financial capacities is strictly prohibited.
Violations may incur fines ranging from Dhs1,000 to Dhs100,000. Repeat offenses within a year could see penalties doubled to a maximum of Dhs200,000. Other disciplinary actions may include temporary suspension from operations for up to one year, downgrading of classification, removal from the official registry, cancellation of commercial licenses, and de-registration of technical staff, including revocation of their professional certifications.
Compliance period and enforcement
All contractors operating in Dubai at the time the law takes effect must regularise their status within one year. This period may be extended by the committee for an additional year if needed. Contractors whose registrations expire during this transition will be allowed to renew them, provided they submit a declaration pledging compliance with the new law.
Any previous legislation that conflicts with Law No. (7) of 2025 will be annulled. The new law will come into force six months after its publication in the Official Gazette.