For some while, the Dubai Department ofEconomic Development (DED) has hada Commercial Control and ConsumerProtection Department (CCCPD), dealingwith consumer disputes. However, it has recentlyset up a new sub-department, called the BusinessProtection Department (BPD) which will functionas a local commercial dispute-resolution and settlementbody.
In the past, there were numerous disputesamong businesses and professionals in Dubai butalthough the CCCPD had means of dealing withconsumer disputes it had no way of dealing withbusiness-to-business (B-2-B) ones. As a result,even those disputes which should have beeneasily resolvable became contentious andadversarial in nature, so a more convenient,affordable and amicable alternativemeans was needed. This led tothe establishment of the BPD in 2015,following internally conducted studies.This Department has alreadyhandled hundreds of cases, witha high success rate and its internalworking regulations are an extension ofthe CCCPD operating manual.
According to the CCCPD, the BPD isauthorised to provide a ‘local commercialdispute settlement service’ in Dubai ‘byintermediation or by other amicable settlementmethods’. It bases its activities on informal intermediation,primarily based on standing law, to arriveat (preferably) amicable settlements, betweentwo entities or companies licensed by the DED. Ithas also been taking on an educational role makingsure traders in Dubai understand the laws andprocedures required to create a mutual safe tradingenvironment. It runs workshops, conventions,presentations, and distributes literature to all businessesand entities licensed under DED authority,in order to spread awareness, and undertakes ‘economicstudies’ on Dubai’s business sector.
Advice is also given to newly DED-licensed businessesand the business sector on unwritten conventionsand business habits which are unique toDubai. Traders are also told about the existence,powers and availability of the BPD as a forum forjudiciously settling disputes.
The BPD is an ‘informal dispute resolution body’and its ‘jurisdiction’ is its limited authority toassist in easing backlogs in the Dubai Courts. As aCCCPD sub-department handling B-2-B disputes,it works under the CCCPD authority on a sub-setof consumer-protection disputes.
Its jurisdiction extends to businesses registeredwith and licensed under the DED under a minimalshare capital threshold of 200,000 AED. However,both parties do not need be present in Dubai for theBPD to be asked to conduct a mediation conference.
Even if one party is headquartered outside Dubai,as long as it trades in Dubai, and has a DED licenseto do so, it can either be summoned as a respondentor complainant.
Foreign traders and consumers
The BPD cannot assume a mediationrole for foreign traders or entitieswhich are not licensed by the DED,primarily because they will not haveany meaningful power or authorityto ‘persuade’ the other party to settlebeforeheading to the courts, orbe able to apply sanctions.
Disputes involving individuals orconsumers who are not licensedunder the DED are also beyond itsjurisdiction.
The BPD can also only hold mediation conferences,if the dispute is strictly commercial in nature, and itcannot accept any role in disputes involving insurance,real estate, banking, finance, or labour matterswhich have a dedicated board or department,and more appropriate statutorily empowered tribunals.It is not a tribunal or a substitute for actualadjudication of disputes in the Courts. It is simply amore convenient, cost-effective alternative way toresolve disputes.
Companies or individuals representing companieswho wish to consult and engage the BPD’s servicesregister their grievance either via an e-mail email@example.com or by calling+971600545555, or they can file them manually byvisiting the Commercial Suits Section in the DED’smain building or one of the CCCPD branch officeswhich form an integral part of every operable DEDAuthority branch. They then provide an official letterand documents which evidence the veracity ofthe claim and a non-refundable fee of 2,020 AED ispaid on filing.
Before even accepting a file, BPD arbitrators checka number of things including whether the complainantis a representative of the company, if thecompany is a trading establishment licensed byand registered with the DED and, if the disputeis commercial in nature. They also look at whetherthe dispute should be looked at by another judicial,legal or administrative authority and inrarer cases, on a prima facie determinationof the complaint’s initial validity, decideif the dispute merits further BPDinvolvement.
If the BPD Board accepts the complainanthas satisfied these criteria,they contact the party the complainthas been filed against. The entiresetting is amicable, and proceedingsare meant to promote an atmosphere of‘informality’. However, the complaint willhave an ‘official’ character. The BPDcan settle disputes by phone, or conferencecalls, if both parties agree.
There is a promise that all caseswill be determined expeditiouslyand flexibly within ‘10 businessdays’. However, this time limitshould not be taken as an officialguarantee, as the BPD Board hasthe discretion to take more timeif cases require.
The dispute resolution methoditself is more discretionary thanbinding. The BPD, has limited,very specific competencies, e.g.it has no ‘binding’ authority toenforce any of its rulings. The Board base theirdeterminations on expertise and familiarity withthe subject matter of each dispute. A more adhoccase by case approach is used rather than strictprocedural guidelines and a formal schedule.They do not necessarily provide exhaustivereasons and legal argumentsin their ‘judgments’ in the way acourt judge would justify their determinations,although they will dothis where possible with referenceto explicit legislative or contractualprovisions in more clear-cut cases.
They will not necessarily provideinternal BPD precedence for their decisions,although they have already settledhundreds of cases. They do notautomatically keep comprehensivedocumentation or maintain recordsand minutes of all their mediationconferences and meetings.
Parties cannot appeal a BPD Board final decision.The highest authority for determining such casesrests with the BPD Board itself because the entireprocess is meant to be amicable. However,the BPD cannot bind parties to its final decision ordetermination and if parties choose not to abide bythe decision, they are free to resort to the DubaiCourts. In addition, at any point during an ongoingBPD case, either or both parties can opt to proceedunilaterally to any other appropriate judicial tribunals,and the mediation and the BPD Board’s jurisdiction,instantly ceases. Neither the process northe decision unilaterally voids parties’ rights fromexercising their statutory right to dispute adjudicationin the Dubai Courts.
Parties’ provisional or interim adherenceto the BPD Board’s authority isnot deemed to be a unilateral waiverof that right. However, should a partyopt to exit the mediation this may,however remotely, be construedagainst the party by their opponentsin the course of a trial, and in rarer instances,there could be a ‘judicial presumption’against them for having doneso but this would not be guaranteed.
Deterrents and punitive powers
As a sub-department of the DED, themain licensing authority in Dubai for commercialentities which wish to pursue commercial activitiesin Dubai, the BPD has been known to block or temporarilysuspend the license of DED-registered or licensedtraders, businesses, or entities. Their penaltiesinclude 500 AED fines for not appearing whensummoned after having accepted BPD mediation inprinciple, and for not abiding by Board’s decisionsand findingsafter having accepted, the mediationprocess in principle.
Exiting the jurisdiction
If either party decides to ‘exit the jurisdiction’ orsimply leave the country while the dispute remainsunsolved, the BPD reserves the right to applysanctions including blocking or suspending tradelicenses.
This can be done if the absconding partyhas left without attending to or addressingthe dispute or complaint launchedagainst them, or has left midwaythrough the mediation or without orbefore abiding by the decision afterthe mediation process had endedand the decision has been issued.However, the statutory basis of theBPD’s deterrent or punitive powers arenot clear.
They are meant to be an informal but‘official’ dispute resolution bodytasked with settling disputes amicablyrather than contentiously. Punitivesanctions, instruments, tools andmeasures against non-cooperative ornon-compliant parties are judicial powers whichno DED department legally enjoys or can conceivablywield, as the DED as a whole is an administrative,not a judicial body. Therefore, the BPD is adispute resolution and mediatory body, not a statutorily-empowered ‘inferior’ administrative tribunaland compliance with its decisions is not statutorilyenshrined in any standing law, statute, regulation,ordinance or legislation. Its authority stems fromits amicable nature and its ability to encourage andconvince parties, through unanimity, not coercion,to accept its decisions instead of going to court. Itsauthority also rests on the provision of the ‘option’for either or both of the parties to accept BPD mediationin the first place, as this mediation is notcompulsory or required (although the Courts mayremand some claims in the pretrial or preliminarystages to the BPD Mediation Board if they feel thecase can be more adequately settled and resolvedthere).
As a result if a party chooses not to accept BPDmediation, and await formal process service in linewith trial hearings at the Courts, can they be conceivably‘penalized’ for freely choosing not to engagewith the BPD just because the other party haddone so, as by the BPD’s own admission, the DubaiCourts enjoy final binding authority in any settlementor case resolution once they are engaged inline with correct procedure?
Relationships with Dubai authorities
The Dubai Court may take ‘judicial notice’ of parties’prior attempts at BPD mediation. The BPD canbe asked to provide documents of interest to theCourt, or those which are material and pertinentto the successful adjudication of the case, as perthe Court’s determination. However, this has nothappened often. The BPD maintains contacts withthe Dubai Courts, and liaises with them via a specialisedjudicial-authorities contact. The Courts useBPD expertise or knowledge, especially when theBPD is asked to provide documents for use in a trial,case, action or commercial suit, where the partieshave been involved in a BPD mediation. Partiescan file for a Court Order or warrant or summonsrequest to secure the BPD’s production of documents.The instances and ‘proof thresholds’ thesummoning party must offset are still to be determinedby any rigorous case-law, as this method hasnot been used yet.
Parties can also petition the Court to issue a judicialwarrant, or the Courts can summon the BPDor issue orders for the production of evidence on itsown accord. In these cases, the BPD Board presumablyplays the role of ‘intervenors’, which is vaguelycomparable to ‘amicus curae’ or ‘friends of theCourt’, as they are invited to file briefs and providetestimony at the Courts, not necessarily at the litigatingparties’ behest.
Both these mediums function as channels through which the BPD can effect standing, butthere is no information on how and if the BPD canbe called upon as intervenors, witnesses, or for motionsto produce documents, as it is a relatively newdepartment.
The Courts also have to adequately determinehow appropriate any BPD testimony in the form ofmotions to produce documents is, especially if itcan be used in support of one party’s position orclaim, or be used as a judicial presumption againstthe party who lost the BPD mediation.
The BPD also maintains contact with the DubaiPolice and can be called on to produce documentsto facilitate and assist in police investigations, e.g.where commercial quarrels between businesses involvebounced or dishonoured cheques.