TRW & Co · Disputes & Arbitration
Mediation and Settlement in the UAE
Mediation in the UAE lets businesses settle disputes faster and more cheaply than litigation or arbitration, while keeping control of the outcome. Since 2023 a single federal law governs mediation and conciliation, ratified settlements carry the force of a judgment, and the UAE's 2026 accession to the Singapore Convention makes cross-border settlements easier to enforce.
Key pointA mediated settlement ratified by the court under Federal Decree-Law No. 40 of 2023 becomes an enforceable instrument with the effect of a judgment, so the drafting of the settlement matters as much as the negotiation.
At a glance
One federal mediation law
Federal Decree-Law No. 40 of 2023, issued on 28 September 2023, replaced the 2021 Mediation Law and the 2016 conciliation centres law with a single framework.
Three-month mediation window
Contractual and judicial mediation each run for up to three months, renewable once for a similar period with the parties' agreement or consent.
Ratification within seven days
The court should ratify a mediated settlement within seven working days, after which it becomes enforceable and has the same effect as a judgment.
Limitation suspended
Legal and judicial time limits are suspended once contractual or judicial mediation starts, and resume if the mediation ends without a settlement.
Singapore Convention accession
The UAE acceded to the Singapore Convention on Mediation on 8 October 2026, effective 8 April 2027, applying it only where parties have agreed.
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What mediation in the UAE covers
Mediation in the UAE is a structured, confidential negotiation led by a neutral mediator who helps the parties reach their own settlement. The mediator does not decide the dispute. Its value lies in speed, cost and control: the parties choose the outcome, keep the relationship intact where that matters, and can agree terms a court or tribunal could never order, such as a revised supply schedule or a staged buy-out.
UAE law distinguishes mediation from conciliation. In mediation, the parties appoint or accept a mediator and negotiate with that person's help. Conciliation takes place before court-annexed conciliation centres, where a conciliator works to settle claims that must pass through the centre before litigation. Both sit alongside direct negotiation, arbitration and court proceedings, and a well-run dispute strategy often uses more than one.
The question becomes legal earlier than many businesses expect. A contract may require mediation before arbitration or litigation; a court may refer a pending case to mediation; and certain claims cannot be filed in court until a conciliation centre has tried to settle them. Getting these steps wrong can delay a claim or hand the other side a procedural objection.
The legal framework for mediation and conciliation
Federal Decree-Law No. 40 of 2023
The core federal statute is Federal Decree-Law No. 40 of 2023 on Mediation and Conciliation in Civil and Commercial Disputes, issued on 28 September 2023 and in force 90 days after publication. It replaced Federal Law No. 6 of 2021 on mediation and Federal Law No. 17 of 2016 on mediation and conciliation centres, bringing both systems under one law.
The law recognises two forms of mediation. Contractual (non-judicial) mediation starts by agreement, before or after a dispute arises, and is supervised by a judge who appoints mediators where needed and ratifies settlements. Judicial mediation starts when a court refers a pending case, on its own proposal with the parties' consent or at a party's request. Mediation proceedings and the material exchanged in them are confidential, and concessions made during mediation cannot be relied on in court without the consent of the party that made them.
The law also applies to international commercial disputes mediated outside the UAE where the parties agree to apply it. Implementing resolutions issued in 2025 introduced an electronic mediation and conciliation platform and remote sessions with identity verification through UAE PASS or the Emirates ID.
Emirate and free zone regimes
Dubai regulates mediation through Dubai Law No. 18 of 2021, which governs the Dubai Courts' Centre for Amicable Settlement of Disputes and mediation services in the emirate. In the DIFC, Dubai Law No. 2 of 2025 established a Mediation Centre within the DIFC Courts, using mediators registered with the Courts. The ADGM Courts operate court-annexed mediation procedures for cases before them.
Mediation in the UAE is therefore available through several doors. The right one depends on where the dispute would otherwise be heard and on the parties' choice in the contract. See our pages on DIFC Courts proceedings and ADGM Courts proceedings for the court context.
| Form | How it starts | Time frame | Outcome |
|---|---|---|---|
| Contractual mediation (federal law) | Agreement of the parties, before or after a dispute | Up to three months from the mediator's acceptance, renewable once | Settlement ratified by the supervising judge becomes enforceable |
| Judicial mediation (federal law) | Court referral of a pending case | Up to three months from notification, renewable once with consent | Ratified settlement ends the case in whole or part |
| Conciliation centre | Mandatory for claims within the centre's jurisdiction | 21 working days from first appearance, extendable | Settlement record; if it fails, the claim proceeds to court |
| DIFC or ADGM court mediation | Court process or party agreement | Set by the court's rules and directions | Settlement recorded as a consent order or agreement |
When and how to mediate: key decisions
Timing
Mediation works best once each side understands the strengths of its case but before costs have hardened positions. That is often after the key documents have been exchanged, or after an expert has given a preliminary view. Mediating too early can fail because neither party has the facts; mediating on the eve of a final hearing can fail because the sunk costs make compromise harder.
Choosing the mediator
The federal law allows parties to use mediators on official rosters maintained by the judicial authorities, which may include experts, retired judges and lawyers, or private mediators they choose themselves. For a technical construction or technology dispute, sector knowledge may matter more than legal background. For a family business or shareholder dispute, a mediator with Arabic and English and experience of family dynamics can be decisive.
Combining mediation with arbitration or litigation
Many UAE contracts now use tiered clauses: negotiation, then mediation, then arbitration or court. Draft the tiers with clear time limits and a defined trigger for moving to the next step, or the clause may be argued to be a condition precedent that has not been satisfied. Our pages on UAE-seated arbitration and commercial litigation in the UAE explain the next stages if mediation does not settle the dispute.
Costs and who pays
The federal law expects the mediation agreement to state the mediator's fees and which party bears them. The usual commercial approach is to share the mediator's fees and venue costs equally and for each side to bear its own legal costs, whatever the outcome. If a settlement is reached, the agreement should say expressly how costs already incurred in any court or arbitration are to be treated, because silence invites a later argument.
Mediation is not free, but it is usually a fraction of the cost of a contested hearing. The larger saving is management time: a one- or two-day mediation can replace months of witness preparation, document review and expert work.
Sector patterns
Different disputes call for different approaches to mediation in the UAE. Shareholder and family business disputes often turn on valuation, exit mechanics and personal relationships, so a mediator who can manage family dynamics adds real value. Construction disputes frequently involve tiered clauses, interim payment disputes and expert evidence on delay and quantum, and can benefit from a mediator with engineering or quantity surveying experience.
Employment claims follow a separate route: labour claims are excluded from the conciliation centres under the federal law and usually pass through the Ministry of Human Resources and Emiratisation's own amicable settlement process before a court will hear them. Rent disputes before specialised committees are likewise excluded and have their own conciliation stages.
The mediation process step by step
- Check the contract and the law. Review the dispute resolution clause for mediation steps, time limits and institutions, and check whether the claim must first go to a conciliation centre.
- Agree to mediate. Record the mediation agreement in writing, covering language, subject matter, how the mediator is appointed, fees and who pays them, as the federal law expects.
- Appoint the mediator. Choose a roster or private mediator with relevant expertise, confirm independence and agree the timetable and venue, in person or online.
- Prepare position papers. Exchange concise written statements and key documents, and prepare a confidential note for the mediator on interests, risks and settlement range.
- Hold the mediation. Use joint sessions and private meetings with the mediator to test positions and explore options. Attend with a decision-maker who has authority to settle.
- Draft the settlement. Record the terms precisely, including payment dates, security, releases, confidentiality and what happens on default.
- Ratify and enforce. Submit the settlement for ratification where available, so it becomes an enforceable instrument, or record it as a consent order in DIFC or ADGM proceedings.
Settlement agreements and how they are enforced
A settlement is only as good as its enforceability. Under the federal law, a settlement reached in contractual or judicial mediation is submitted to the court, which should ratify it within seven working days. Once ratified, it becomes an enforceable instrument that can carry the executory formula and has the same effect as a court judgment.
Ratified settlements can be challenged only on narrow grounds, such as a party's lack of legal capacity, a void or voidable agreement, a settlement reached after the mediation period had ended, or a party being unable to present its position because of defective notice. An annulment claim must be brought within 30 days of notification of the court's decision. This gives settling parties a high degree of finality.
Settlements reached outside these frameworks are binding contracts but are not directly executable. If the other side defaults, you must sue on the agreement. For that reason, larger settlements often include security, such as bank guarantees, escrow or staged releases, and a clause stating how the settlement can be converted into a judgment or award.
Where the dispute is already before the DIFC or ADGM Courts, the usual course is to record the settlement in a consent order. The order can set out the payment terms on its face or stay the proceedings on agreed terms set out in a schedule, with liberty to apply to the court if a party defaults. Either way, the creditor gains a court order that can be enforced without starting a new claim, and the court's own enforcement arrangements with the onshore courts then apply.
The UAE acceded to the Singapore Convention on Mediation on 8 October 2026, with entry into force for the UAE on 8 April 2027 according to the UNCITRAL status table. The UAE declared that the Convention will apply only where the parties have agreed to its application, and excluded certain settlements involving government parties. If you want a cross-border settlement to benefit from the Convention, say so expressly in the settlement agreement.
Documents and preparation
Good preparation is what separates productive mediation in the UAE from an expensive day of positional bargaining. Assemble:
- The contract, including the dispute resolution clause, and any amendments, side letters and correspondence on performance.
- A chronology and a short statement of the key issues, with the documents that prove or disprove each one.
- A realistic assessment of legal risk, likely costs and timing if the dispute proceeds to court or arbitration.
- Evidence of quantum, such as invoices, payment records, expert reports or valuation material.
- Proof of authority for each attendee, such as a board resolution or power of attorney permitting settlement.
- A draft term sheet or settlement agreement, so that agreed terms can be recorded before the parties leave.
Risks and common mistakes
Attending without authority to settle
Mediation often fails because the person in the room cannot commit the company. A director or manager without a clear mandate may agree terms that the board later rejects, wasting the day and damaging trust. Bring a decision-maker with documented authority, such as a board resolution or a power of attorney that expressly covers settlement. Where approvals are unavoidable, agree in advance how quickly they will be obtained and what happens if they are refused.
Overestimating confidentiality
The federal law protects mediation communications and concessions, but confidentiality does not extend to the terms of the settlement itself, and it may not protect documents that already existed independently. Do not assume that a document becomes privileged because it was shown in mediation. If confidentiality of the settlement terms matters, include an express confidentiality clause with carve-outs for regulators, auditors and enforcement.
Losing track of limitation
Under the federal law, legal and judicial time limits are suspended once contractual or judicial mediation begins and resume when it ends without settlement. Mediation outside those frameworks may not have the same effect. Record when mediation starts and ends, and if in doubt issue protective proceedings or obtain a standstill agreement. Our article on limitation periods explains the main time limits that apply in the UAE.
Ignoring mandatory conciliation
Claims within a conciliation centre's jurisdiction generally cannot proceed in court until the centre has attempted settlement. Excluded categories include urgent and interim applications, claims involving the government, rent disputes before special committees, labour claims and personal status claims. Filing in court without going through the centre can lead to delay. Check the centre's jurisdiction before issuing proceedings.
Vague settlement drafting
Settlements that say a party will pay 'the agreed amount' or 'cooperate in the transfer' invite a second dispute. Specify amounts, currencies, dates, bank accounts, the documents each side must sign, tax treatment, releases and consequences of default. Where the settlement will be ratified or recorded as a consent order, make sure the operative terms are clear enough for an execution judge to enforce without interpretation.
Cross-border mediation and the UAE's counterparties
Mediation in the UAE often involves parties from Bangladesh, India, the UK, Singapore, China or Saudi Arabia. Mediation sessions can be held online, and the federal law can apply to mediations conducted abroad if the parties agree. The practical questions are which law governs the settlement, where it will need to be enforced and whether the Singapore Convention will help.
Once the Convention is in force for the UAE, a qualifying international settlement agreement may be relied on directly in another Contracting State without first converting it into a judgment, subject to the UAE's opt-in reservation and to each state's own position. Check the UNCITRAL status table for the other country before relying on it, because some states have signed the Convention without ratifying it, and others have made their own reservations.
Where a settlement must be enforced in a country that is not a party, consider recording it as a consent award in an arbitration, which can be enforced under the New York Convention, or as a consent judgment in a court whose judgments are readily enforceable where the assets are.
A ratified UAE settlement has the force of a judgment. Draft it as though an execution judge will one day have to read it, because one might.
How TRW & Co helps
We advise and represent parties in mediation in the UAE as counsel and settlement advisers, from drafting mediation clauses to concluding enforceable settlements. Where representation before UAE onshore courts or the DIFC/ADGM Courts is required, we work alongside locally licensed advocates and registered practitioners. Mediation is often part of wider work on shareholder disputes, construction disputes and employment disputes; see the full list on our practices page.
Clause design
We draft tiered dispute resolution clauses with workable mediation steps, time limits and links to arbitration or litigation, avoiding conditions that can later be used to delay a claim.
Case assessment
We prepare an honest risk, cost and timing analysis so that decision-makers can set a settlement range based on evidence rather than instinct.
Mediator selection
We help identify mediators with the right sector, language and cultural experience, whether from official rosters or private practice.
Mediation advocacy
We prepare position papers, attend sessions with clients and manage negotiations in joint and private meetings.
Settlement drafting
We draft settlement agreements that are clear, secured and ready for ratification, a consent order or a consent award where needed.
Cross-border settlements
We coordinate with TRW & Co colleagues in Bangladesh, the UK and Singapore on governing law, tax and enforcement where settlement terms cross borders.
Checklist for decision-makers
Before committing to mediation in the UAE, check that you can answer yes to these points:
- We have checked the contract for mediation steps and the law for mandatory conciliation.
- We have a realistic view of our legal risk, costs and the time to a final decision.
- We know who will attend and that they have documented authority to settle.
- We have recorded when mediation starts so that limitation is protected.
- We have a draft settlement agreement ready with security and default terms.
- We know how the settlement will be enforced: ratification, consent order, consent award or the Singapore Convention.
- We have spoken to TRW & Co about strategy if the dispute is significant or cross-border.
For a wider overview of amicable settlement options, read our article on mediation and settlement in the UAE and our guide to limitation periods in the UAE.
Frequently asked questions
01Is mediation in the UAE mandatory?
Mediation itself is generally voluntary unless the contract requires it or a court refers the case with the parties' consent. Conciliation is different: certain civil and commercial claims within the jurisdiction of court-annexed conciliation centres must go to the centre before a court will hear them. Exclusions include urgent and interim applications, claims involving the government, rent disputes before special committees, labour claims and personal status matters. Check both the contract and the centre's jurisdiction before filing.
02How long does a mediation take?
Under the federal law, contractual mediation runs for up to three months from the mediator's acceptance and judicial mediation for up to three months from notification, each renewable once. In practice, many commercial mediations are completed in one or two days of sessions once the parties have prepared. Conciliation before a centre runs for 21 working days from the first appearance, extendable by the conciliator.
03Is a mediated settlement enforceable in the UAE?
Yes, if it is ratified. A settlement reached in contractual or judicial mediation under Federal Decree-Law No. 40 of 2023 is submitted to the court, which should ratify it within seven working days. It then becomes an enforceable instrument with the same effect as a judgment. A settlement signed privately without ratification is a binding contract, but if the other party defaults you would need to sue on it.
04Is what I say in mediation confidential?
Mediation proceedings and the material presented in them are confidential under the federal law, and concessions made during mediation cannot be relied on in court without the consent of the party that made them, except in criminal matters. Confidentiality does not cover the terms of the settlement itself, so add an express confidentiality clause if you need the terms kept private. Documents that exist independently of the mediation are not protected merely by being shown there.
05Can we mediate a dispute that is already in court or arbitration?
Yes. Under the federal law a court can refer a pending case to judicial mediation at any stage, on its own proposal with the parties' consent or at a party's request. Arbitration proceedings can be paused by agreement to allow mediation, and any settlement can be recorded as a consent award. The DIFC and ADGM Courts also support mediation of cases before them.
06What does the Singapore Convention mean for UAE businesses?
The UAE acceded on 8 October 2026 and the Convention enters into force for the UAE on 8 April 2027. It allows qualifying international settlement agreements to be relied on directly in Contracting States. The UAE declared that it will apply the Convention only where the parties have agreed to it, so include an express clause in cross-border settlements. It also excluded certain settlements involving government parties.
07Who can act as a mediator?
Parties can choose a mediator from the official rosters kept by the federal or local judicial authorities, which can include registered experts, retired judges and lawyers, or appoint a private mediator. The federal law sets independence and conflict-of-interest rules. In the DIFC, the Mediation Centre established under Dubai Law No. 2 of 2025 uses mediators registered with the DIFC Courts. Choose for sector knowledge, language and track record.
Sources and official materials
- Federal Decree-Law No. 40 of 2023 on Mediation and Conciliation — Federal mediation and conciliation law
- Singapore Convention on Mediation: status (UNCITRAL) — UAE accession, entry into force and declarations
- Mohammed bin Rashid issues law on DIFC Courts — Dubai Law No. 2 of 2025 and the DIFC Courts Mediation Centre
- ADGM Courts — Court-annexed mediation and ADGM procedure
- UAE Ministry of Justice — Federal judiciary, mediators and conciliation
- Federal Law No. 6 of 2018 concerning Arbitration — Arbitration law for consent awards and tiered clauses
General information only, current as at 27 October 2026. It is not legal advice and does not create a lawyer–client relationship. UAE law differs between the onshore jurisdiction, the DIFC, ADGM and the free zones, and changes frequently; check current official sources and take advice on the facts of your matter.
