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Franchising in Dubai, also referred to the United Arab Emirates, is a thriving business sector, with international and regional brands taking advantage of the region's economic stability, diverse population and strong consumer culture. Franchising law in Dubai is not governed by a specific franchise law. Instead, a network of commercial, civil and federal laws provides the legal framework for franchise arrangements. Dubai laws that pertain to franchising are designed to safeguard the interests of both parties, the franchisor and franchisee.
Though franchising can be a lucrative business avenue, it is also a complex legal field that requires careful navigation. Franchisors, especially those from outside the region, may need legal assistance to ensure compliance with UAE legislations and regulations. A lawyer can help you navigate the local legal landscape, assist with contract drafting, enforcement and dispute resolution, and provide advice on intellectual property rights protection. On the other hand, potential franchisees may require legal help for due diligence, contract review and negotiation, as well as advising on potential risks and liabilities involved.
In Dubai, franchising is governed under the UAE Commercial Agencies Law, which regulates the relationship between foreign companies and their local agents or distributors. Its application to franchises, however, is not direct and may require legal interpretation. Other relevant laws include the UAE Civil Code and the UAE Commercial Transactions Law, which deal with contractual obligations, and the Federal Law No. 18 of 1993 on commercial transactions. Intellectual property rights are protected under the Federal Law No. 7 of 2002. The UAE also has certain mandatory registration requirements related to trademarks and commercial agencies which should be complied with by franchises.
Yes, if you are a foreign franchisor, you need to register your commercial agency with the UAE Ministry of Economy. Furthermore, you would also need to register your trademark.
Yes, however termination rights and procedures typically need to be contractually agreed upon between the franchisor and franchisee. The Commercial Agency Law provides certain protections to agents and it's recommended to consult a lawyer to understand grounds for termination.
While there's no specific language requirement for franchise agreements, it is advisable to have agreements in both Arabic and English. An Arabic version might be required if the agreement needs to be presented in court.
While there's no specific legislation targeting unfair franchising practices, the general principles of fair dealing and good faith in the UAE Civil Code apply to all business practices, including franchising.
It is a legal requirement for foreign companies to have a local partner or agent in the UAE, with the exception of free zones. In some cases, the franchisee may act as your local partner.
Those seeking legal advice in franchising might find assistance from the Department of Economic Development (DED) in Dubai, the UAE Ministry of Economy, or the Dubai Chamber of Commerce. Additionally, various law firms and consultancies in Dubai specialize in franchising and can provide valuable guidance.
If you need legal assistance in franchising, the first step is to identify a reputable law firm or legal consultant with expertise in franchising. It helps to prepare a list of questions or concerns you have about your particular franchise situation. The legal expert would typically assist in providing legal advice or representation, reviewing or drafting franchise contracts, advising on trademark registration, or guiding on dispute resolutions.
