DIAC annual report underscores position as international dispute resolution forum

Dubai-based Mark Raymont and Melissa McLaren of Pinsent Masons, who specialise in international arbitration, were commenting after DIAC’s annual report for 2022 (14-page / 5.2MB PDF) revealed details of the cases the institution handled last year.

According to the report, 340 new cases were registered with DIAC in 2022. Of that number, 44% concerned international disputes, with parties from 48 different countries represented in the cases. The total value of the cases was AED 11.2 billion ($3.1bn) – the values in dispute in individual cases ranged from AED 17,300 to AED 1.5bn.

Almost half of DIAC’s 2022 caseload involved cases from the construction sector (49%). Disputes in the commercial and real estate sectors were the next most prominent, accounting for 27% and 16% of the institution’s annual caseload, respectively.

In 2021, major changes were announced to the dispute resolution landscape in Dubai. Both the Dubai International Financial Centre’s Arbitration Institute (DAI) and the Emirates Maritime Arbitration Centre (EMAC) were abolished. The rights and obligations of the two institutions transferred to DIAC, which gained independent status and a more modern corporate governance framework through the reforms. The New DIAC Arbitration Rules took effect in March 2022 – updating rules that had been in place since 2007 – and further bolstered public confidence in the institution.

In its annual report 2022, DIAC, which was founded in 1994, said the introduction of the new arbitration rules had strengthened Dubai’s position “as a leading hub for arbitration” and had contributed to the “continued growth and success” of the institution. Earlier this year, DIAC reformed its Arbitration Court, which now consists of 13 arbitration experts tasked with matters including oversight of case administration and the implementation of the new rules.

Raymont said: “The popularity of DIAC is on the increase. Not only have its arbitration rules been updated in recent times, but the recent composition of its advisory committee and arbitration court should also be welcomed as increasing oversight and leading to enhanced market confidence in the institution.”

McLaren added “The reforms made to DIAC’s institutional rules and corporate governance structure have been well received and help the institution demonstrate that it is a serious player in the Middle East and global market,” she said.

The new report highlighted initiatives DIAC has engaged in in relation to environmental sustainability and diversity and inclusion, and how it is looking to new technologies as a way in which to “enhance efficiency, transparency, and security in arbitration, ensuring users have a seamless experience throughout the dispute resolution process”. It cited virtual reality, the metaverse and artificial intelligence as examples of “emerging technologies” it will explore “to improve our services and remain at the forefront of the arbitration landscape”.

Other future strategies the DIAC mentioned in its report include improving the capacity of the case management team at the institution and establishing a new e-case management system and portal. It also said it intends to optimise and improve the arbitrator selection and onboarding process.