Economic Relief Measures for the UAE during COVID-19

The UAE government has introduced certain measures that will offer economic relief to UAE businesses suffering under the strain of COVID-19 ramifications.

Although the UAE has not announced any direct relief from tax payment obligations similar to those introduced in KSA, the governments of both the Emirates of Dubai and Abu Dhabi have introduced financial assistance measures due to the current COVID-19 crisis.

The Emirate of Dubai

In the Emirate of Dubai, the government has introduced the following measures:

  • An AED1,5 billion business stimulation package involving the reduction in fees payable by businesses for three months
  • Dubai Customs introduced the following measures which will be in place from 15 March 2020 till 30 June 2020
  • A refund of 20% of all Customs Duty paid on goods at 5% which have been sold locally
  • The revokation of the AED50,000 cash or bank guarantees required to conduct customs broker activities and the refund of existing guarantees held to these brokers and clearing companies
  • The exemption from berthing fees as well as direct and indirect loading fees for boats that qualify as traditional wooden commercial boats registered in the UAE at either Dubai Creek or Hamriyah Port

The Emirate of Abu Dhabi

In the Emirate of Abu Dhabi, the government has introduced:

  • With effect from 16 March 2020, a 16 point stimulus plan involving fee exemptions, fine waivers, SME support initiatives
  • An AED 5 billion water and electricity subsidy scheme
  • An AED 3 billion SME credit guarantee programme
  • The establishment of a AED 1 billion market maker fund to sustain a balanced supply and demand balance for stocks
  • The suspension of performance bonds for bidding procedures
  • A 25% reduction on new industrial land leasing fees
  • The waiver of industrial and commercial penalties
  • Cancellation of individual and commercial real estate registration fees
  • The payment of government approved invoices within 15 days
  • The suspension of Tourism and Municipality Fees for the tourism and entertainment sectors for 2020
  • Waiver of performance guarantees for start-ups for projects up till AED 50 million

In addition to the government’s measures the private sector has also stepped up to the plate and numerous of the large property leasing companies have offered reduced and even exemptions from rental payments for commercial tenants that have had to shut down their businesses due to COVID-19. Various banks, property developers and even utility suppliers have also offered payment holidays and have deferred evictions and legal collections in the light of the current situation in the UAE relating to COVID-19.

Should you be experiencing financial pressures and would like to take advantage of any of the above measures, BSA is ready and eager to assist.

Rights and Liberties, Liability of the French State and Judicial Review

On 24 December 2019 the Conseil d’Etat ruled that indemnification can be granted under French law on the ground of a prejudice suffered due to the application of a law ruled contrary to the Constitution by the Conseil Constitutionnel.

The Conseil d’Etat now leaves the door open to a new possibility for indemnification, within the framework of a QPC examination (Question Prioritaire de Constitutionnalité) or by application of Article 61 of the Constitution (subject to conditions). Based on the hierarchy of norms, this new kind of liability of the State is stated in three decisions dated 24 December 2019 (req. N°425981, N° 425983 and N°428162).

This new regime lives now next to the already existing liability due to the application of the law (responsabilité du fait des lois) based on equal treatment before public burdens (principe d’égalité des usagers devant les charges publiques).

A QPC is a question raised by a tribunal or a court aiming at determining the conformity of a law to the Constitution. Article 61-1 of the French Constitution states in this respect that during an instance before a tribunal or a court (private or public), a plaintiff can support the view that a law contravenes rights and liberties guaranteed by the French Constitution. In such a situation, the Conseil Constitutionnel can be seized after remand of the case by the Conseil d’Etat or the Cour de Cassation.

The general principle under French administrative law is that the French State can be sued simply because of the application of a law, provided that (i) the plaintiff has suffered a prejudice qualifying as important and specific (grave et special) and (ii) the law in question does not exclude the possibility for a plaintiff to be indemnified. This type of liability is applicable even if the French State is not considered as being in default with the application of the law and is named liability without misconduct (responsabilité sans faute de l’administration).

This possibility started in France at the beginning of the 20th century (Conseil d’Etat, case Couitéas – 1923), with the admission of liability without misconduct of the French State due to an administrative decision of non-enforcement of judicial decisions. In such a case, in the general interest, the French State may decide not to enforce a judicial decision, but in turn, has to indemnify the plaintiff. The ground for indemnification is the breach of equal treatment before public burdens principle (principe d’égalité des usagers devant les charges publiques). This principle is taken from the French 1789 declaration of the human rights and the citizen: each member of the community has to bear a certain amount of public burdens, but equal treatment shall prevail.

This principle has expanded thereafter with the admission of such a claim against a law (and not against an administrative decision only) by the Conseil d’Etat in 1938 (Conseil d’Etat, case Société la Fleurette – 1938). Such a case establishes that, in the silence of the said law, a plaintiff shall not bear a charge created by a law that he/she would not normally lie with, it being specified that, in the event of silence of the said law, such law shall not be considered as excluding the liability of the French State (Conseil d’Etat case Coopérative Agricole Ax’ion – 2005).

The liability of the French State can also be triggered due to its obligations to ensure the application of its international conventions, to indemnify all the prejudices resulting from the application of a law passed illegally because contrary to an international convention (e.g. ECHR) (Conseil d’Etat, case Gardelieu – 2007).

Now, according to the new decisions of the French Conseil d’Etat dated 24 December 2019, the other grounds for indemnification are (1) that the decision of the Conseil Constitutionnel does not decide that no indemnification shall be granted either (i) by excluding it expressly or (ii) by letting alive all or only a part of pecuniary effects caused by the law, that an indemnification would challenge, (2) the existence of a prejudice and (3) the link between the prejudice and the unconstitutional application of the law.

As a consequence, a plaintiff may be indemnified in the following conditions : (i) no express exclusion of indemnification by the Conseil Constitutionnel (ii) no all or part of pecuniary effects left alive by the Conseil Constitutionnel that an indemnification would challenge (iii) and (iv) a link between the prejudice and the unconstitutional application of the law.

According to the decision of the Conseil d’Etat, certain pecuniary effects of the law declared unconstitutional may prevail upon an indemnification. In this respect, it is reasonable to think that an administrative judge would apply an economic balance check between the necessity of indemnifying the plaintiff and the profit of letting alive all or only a part of pecuniary effects caused by the unconstitutional law. An economic balance check is already applied in other circumstances (expropriation with the application of the théorie du bilan coûts / avantages), by the Conseil d’Etat (Conseil d’Etat case Ville Nouvelle Est – 1971).

In this perspective, it is reasonable to think that the application of an unconstitutional law may survive if it is more interesting from an economic point of view. This mentioned carve out is quite important as it gives the possibility to the Conseil Constitutionnel to let alive, even if the law is declared unconstitutional, and then cancelled, parts of its pecuniary effects.

In addition to the breach of equal treatment before public burdens principle (principe d’égalité des usagers devant les charges publiques), it can be suggested that other principles may underpin this kind of liability: preservation of legal safety (sécurité juridique) and /or granted rights (préservation des droits acquis), and / or economic balance check, to take into account all the adverse financial effects that an indemnification would cause.

The claim for indemnification can obviously be barred by effluxion of time, it being specified that the 4 (four) years period during which such a claim can be brought only starts if the prejudice resulting from the application of the law may be known in its reality and its scope by the plaintiff, without the possibility for him or her to be regarded as ignoring the existence of his / her right to claim until the declaration of unconstitutionality.

The indemnification request has to be brought before the administrative judge (Tribunal Administratif). It remains however to be seen whether legal practitioners will try to use these decisions of the Conseil d’Etat to sue the French State before the judicial order (ordre judiciaire). Under French law, the French Conseil d’Etat is the highest court entitled to address administrative cases and is part of the administrative order (ordre administratif) whereas the judicial order (ordre judiciaire) is composed of judiciary tribunal and courts (jurisdictions judiciaires) and is competent for private matters. How dealing with the fact that a tribunal or a court may apply deliberately after the declaration of unconstitutionality a law previously declared unconstitutional outside the scope of the carve out of the ratio decidendi of the Conseil d’Etat? Would Article 141-1 of the Code de l’organisation judiciaire, which gives competence to the judicial order in the event of indemnification of a prejudice due to malfunction of judicial public service, apply? It is reasonable to think that such indemnification would not be allowed even if legal practitioners may wish to test it, and may be, open this possibility, for the residual adverse effects on the plaintiff of the law declared unconstitutional.

A lack of indemnification by the French State may also give rise to a lawsuit before the ECHR (European Convention on Human Rights), a plaintiff would still have in fine, the right to be indemnified on the basis of the application of a law declared unconstitutional. From a theoretical point of view, and on the basis of the hierarchy of norms, letting a country member of the European Council apply a law declared unconstitutional could raise issues.

Up to date 24 December 2019

Attorney General announces fines to prevent spread of COVID-19

The UAE Attorney General has issued resolution No. (38) of 2020 following Cabinet Decision No. 17 of 2020 regarding the implementation of regulations for spreading communicable diseases. The resolution covers 15 penalties, ranging from AED 500 to AED 50,000, which aim to curb the spread of the novel coronavirus in the UAE.

The Attorney General has clarified that the fine for not wearing medical masks in closed places can only be imposed on patients suffering from chronic diseases and on people who are suffering from symptoms of flu and cold and fail to maintain social distancing while among other people.

The following are the violations and associated fines as issued under the Attorney General’s resolution:

  • Fine for not complying with instructions of home quarantine and/or not following the guidelines under the Home Quarantine Guide– AED 50,000
  • Fine for patients who refuse mandatory hospitalisation or fail to take the prescribed medicines despite being alerted – AED 50,000
  • Fine for violating administrative closure of public places like shopping centres, malls, outdoor markets, gyms, public swimming pools, cinemas, clubs, parks and restaurants – AED 50,000 (Additionally, there is a fine of AED 500 for people caught visiting these public places)
  • Fine for organising social gatherings, meetings and public celebrations – AED 10,000 (Additionally, there is a fine of AED 5,000 for people attending the social gatherings and events)
  • Fine for not conducting a medical test upon request – AED 5,000
  • Fine for violating precautionary measures set by the UAE Ministry of Health and Prevention by people coming from nations affected by communicable diseases – AED 2,000
  • Fine for failure to observe health measures regarding regulation of roads, markets and other public places exempted from temporary closure – AED 3,000
  • Fine for failure to dispose of clothes, luggage or any temporary structures proved to be contaminated, which can’t be disinfected by the standard established methods – AED 3,000
  • Fine for unnecessary visits to hospitals and other health facilities – AED 1,000
  • Fine for exceeding the maximum number of allowed persons in a car (i.e. more than 3 persons in car) – AED 1,000
  • Fine for not wearing medical masks indoors and failure to maintain social distancing by persons suffering from chronic disease or having symptoms of flu and cold – AED 1,000
  • Fine for leaving home unnecessarily and without reason, except for important work or a genuine reason (purchase of essentials, medicines, etc.) – AED 2,000
  • Fine for violating provisions of the law when burying or transporting the body of a person who died from a communicable disease – AED 3,000
  • Fine for drivers failing to maintain hygiene and following sterilisation procedures in public transportation – AED 5,000
  • Fine for failure to take precautionary measures, failure for the crew of ships from the captain or shipping agent, as the case may be – AED 10,000

The National Emergency, Crisis and Disasters Federal Prosecution has been entrusted with the task of implementation of the resolution and may seek assistance from local and public authorities as required.

The penalties shall be doubled in amount for repeat violators and if the violator commits a third offence, he will be referred to the National Emergency, Crisis and Disasters Federal Prosecution for appropriate action. Further, the violator must also bear the costs of any repairs for damages occurring due to the violation.

The resolution is a part of the government’s measures to combat the spread of coronavirus and to protect the health of citizens and residents of the UAE by curbing unnecessary gathering and outings.

Dentons adds Insurance Regulatory duo in Los Angeles

Dentons, the world’s largest law firm, today announces that Robert P. Barbarowicz and Kathleen M. McCain have joined the Insurance Regulatory practice. Focused on complex insurance transactions and regulatory disputes, the pair will be resident in the Firm’s Los Angeles office.

Both highly experienced in regulatory proceedings and transactions, the pair bring a balance of Barbarowicz’s transactional experience in complex transactions involving insurance companies and agencies and McCain’s perspective from litigating insurance disputes at the trial and appellate levels.

“We’re delighted to welcome Bob and Kathleen to our world class insurance practice,” said Keith Moskowitz, co-chair of Dentons’ US Insurance practice. “Our insurance clients will benefit from their wealth of experience and their transactional and litigation experience serving the industry.”

Barbarowicz has more than 30 years’ experience in the insurance industry with a particular focus on large and complicated insurance transactions, purchase transactions, redomestications, securing regulatory approvals for complex transactions in many states, force-placed insurance, rate regulation and rate filings. His experience includes representing property and casualty, life and title insurance companies. Prior to entering private practice he held leadership roles at several large insurance companies, including Balboa Insurance Group and the Ahmanson Insurance Companies. In addition to counseling insurance clients Barbarowicz advises clients on corporate finance transactions including substantial capital extraction. He holds both a JD and a BA from Pennsylvania State University.

McCain represents insurance companies and regulators in navigating rate regulations, policy review, insurance M&A, compliance, financial and market conduct examinations, litigation strategy, holding company matters, reinsurance, corporate governance, insolvency and asset recovery. Experienced across all lines of insurance including property and casualty, life, title insurance and surplus lines matters, she also uses her litigation background to offer clients unique perspective and insight. McCain is an Accredited Insurance Receiver for Legal and Reinsurance by the International Association of Insurance Receivers. She holds a JD from Valparaiso University Law School and a BA from Ohio Northern University.

Dubai Notary Public Services to be Provided Remotely

A recent circular from the Notary Public in Dubai confirmed that due to COVID-19 all Notary Public services, in all branches, would cease up till the 9th April 2020. Up until this date it has been confirmed that certain Notary Public services may be conducted remotely.

The following Notary Services can be conducted remotely:

  • i) Power of Attorney notarisation;
  • ii) Notarisation of legal notices;
  • iii) Acknowledgements;
  • iv) Notarisation of Local Service Agent Agreements;
  • v) Notarisation of Memorandums of Association and addendum’s thereto for civil companies.

All services relating to commercial companies’ memoranda and addenda have been transferred to Dubai Economy and are no longer dealt with by the Dubai Notary Public.

The remote working times for the Dubai Notary Public will be from 8am till 4pm from Sunday to Thursday.

The service requires a subscription to BOTIM and the Notary office will contact the attestor to the document through this video connection to establish identity and knowledge of the document which must be sent to the Dubai Notary Public’s dedicated email address in PDF format with an approved reference to the remote signing on the bottom of each page. The fees will be payable by credit card and the courier will deliver the document at a cost of AED21 to your address.

There is therefore no need to wait for 9th April 2020 before important notarisation’s are attended to and BSA is able to assist you in finalising the arrangements for notarial execution of your documents during this already stressful time.

Dentons announces US COVID-19 50-State Tracker

Dentons, the world’s largest law firm and the only global law firm operating in most of the countries where there is a significant outbreak of COVID-19, including in the US, today adds a COVID-19 50-State Tracker to a suite of client resources available publicly.

Dentons’ COVID-19 50-State Tracker provides an overview of key information for each US state and the District of Columbia, including reviews of state and local governmental orders, directives and financial assistance, official links, public restrictions, health and business directives, school closures and updates on courts and legislative sessions. Official links are provided where possible throughout the Index to ensure that the latest guidance and orders are available.

In addition to official links, the COVID-19 50-State Tracker will be updated regularly. Slated for future additions are information on remote online notarisation and eNotarisation, mortgage and rent payment relief and tele-medicine/tele-health. Those interested in regular COVID-19 updates can opt-in to an e-mail list.

Dentons, which has been a leader in advising and collaborating with the global legal and business communities, pledges to continue to share insights and best practices with clients and contacts around the world, and proactively support the business community as it navigates business challenges created by the COVID-19 pandemic. Dentons has developed multiple resources throughout Q1 2020 and these are available to the public and global business community at large through its COVID-19 hub on the Firm’s website.

About Dentons

Dentons is the world’s largest law firm, delivering quality and value to clients around the globe. Dentons is a leader on the Acritas Global Elite Brand Index, a BTI Client Service 30 Award winner and recognised by prominent business and legal publications for its innovations in client service, including founding Nextlaw Enterprise, Dentons’ wholly owned subsidiary of innovation, advisory and technology operating units. Dentons’ polycentric approach, commitment to inclusion and diversity and world-class talent challenge the status quo to advance client interests in the communities in which we live and work.