REINSTATEMENT OF THE CAP ON JUDICIAL FEES BEFORE THE COURT OF ABU DHABI – LAW NO 13 OF 2017
The Law No 13 of 2017 issued by His Highness Sheikh Khalifa Bin Zayed Al Nahyan, amending the judicial court fees structure applicable in the courts of Abu Dhabi (the “Law”).
The New Law has reinstated the cap on the court fees over a certain claim amount for filing claims (civil or commercial) before the Court of First Instance and repealed the predecessor Law No 6 of 2013 which previously imposed a 3% fee of the claimed amount with no cap.
The court fees are namely the fees that the litigant has to settle for filing of the lawsuit before the competent court. However, this does not include legal fees, advocacy fee, translation fee or any cost relative to expert witness.
KEY CHANGES INTRODUCED BY THE NEW LAW
- The court fee is set at 5% of the total claim amount for filing a case before the Court of First Instance with a cap of AED 40,000.
- A cap of AED 5000 is set for the ratification and annulment of arbitral awards this is a significant change from the previous law which required 3% of the value of the award.
- Foreign judgments can be enforced at a fixed sum of AED 1000 before the Abu Dhabi courts.
- Changes have also been made to the fees pertaining to several claims, applications and the rates for appeals. Article 60 of the new Law provides the relevant fee provision. A change in the amount of the fee has increased and decreased compared to the previous structure.
THE POSSIBLE IMPACT OF THE NEW LAW
The new changes will open up lawsuits in the region specifically for higher value claims as litigants will feel more economical due to the re-introduction of the cap of AED 40,000. The New Law will also make it easier for individuals and small businesses to resort to the court system to resolve their matters.
However, on the downside, the changes will encourage a number of litigants to speculate on high value litigation and inflated monetary claims including damages, loss of opportunity, loss of profits and loss of reputation claims. The replacement of the 3% rule may result in a substantial increase of lawsuits for the court dockets.