DUBAI, United Arab Emirates — Courts in the United Arab Emirates have been given the power to enforce British court decisions in several categories of cases, in a landmark ruling by the UAE Ministry of Justice.
The change applies to all court decisions in non-criminal civil, financial and matrimonial matters and already applies. It represents a significant step in cooperation between the United Arab Emirates and the United Kingdom, long-standing partners in trade, diplomacy and defence.
Dubai, the commercial capital of the UAE, has for years been seen as a sort of “safe haven” for people smuggling money or avoiding various penalties in other countries, as the UAE will not seize money owed in a British civil judgment. This was due to what the UAE described as a lack of “reciprocity”, as the UK generally did not enforce UAE court decisions.
The new ruling announced on Wednesday will essentially make it no longer possible for people convicted in civil cases in the UK to flee to the UAE and avoid paying their debts.
Some legal experts predict an increase in cases from creditors seeking to repay debts owed by people who left the UK for the UAE.
“For too long errant husbands or wives unwilling to meet the financial obligations of a divorce as ordered by an English court have found a safe haven in Dubai,” international family lawyer Alexandra Tribe of London-based Expatriate Law told the Emirati newspaper The National.
“These legal reports are likely to open the floodgates for enforcement of previously unpaid orders, particularly given the significant British expat population in the UAE,” she said.
Dubai, United Arab Emirates
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According to the British Business Group in Dubai and the Northern Emirates, there are more than 120,000 British citizens living in the UAE. The oil-rich Gulf nation of 10 million has a roughly 90% foreign population and is trying to attract even more foreign talent with the help of a series of recent liberalizing economic and social reforms.
UK court decisions must be final to be enforceable in the UAE and cannot conflict with a previous UAE court decision, if any, or be contrary to public policy or morals in the UAE, according to the decision.
The change also comes as the UAE pushes to improve its image on money laundering and illicit financing. The country is known for welcoming investors from all countries and backgrounds, mostly without examining where the money comes from. Russian money flowed into Dubainotably pumping up its real estate sector, in the months since Moscow went to war with Ukraine and the UAE has refrained from imposing Western sanctions on various nationalities.
It put the UAE under increased scrutiny because of “strategic deficiencies” in its anti-money laundering efforts, the task force said at the time. The UAE government responded to the designation, pledging to “work closely with the FATF to rapidly remedy identified areas of improvement.”