Tim Casben
Partner
Head of UAE offices
Article
Published10 February 2022
A guide to key legal updates: UAE and KSA
10
minute read
In 2021, the UAE announced the largest legal reform in its history by introducing a raft of new laws. The announcement came during the 50th anniversary of the UAE, as part of the government's 'towards the next 50' national strategy. Over 40 new laws are included in the reform, many of which align the UAE towards international best practice.
This guide provides a snap shot of the new laws concerning corporate, commercial, IP, projects and technology in the UAE and The Kingdom of Saudi Arabia (KSA). Our experts in these fields can help guide your business through these changes.
Tim Casben: Hi. I'm Tim Casben. I am the Managing Partner of Gowling WLG's Dubai office, and I am here introducing this video from our wonderful new offices in ICD, Brookfield Place.
2021 was a year where the UAE introduced a multitude of new laws, making a significant push to align itself with international best practice and global markets, none more so than the introduction of the Monday to Friday working week.
Here, we give an overview of what is new and how those new laws are likely to impact our clients' business in 2022 and beyond.
Charlotte Wright: My predictions for the year ahead are that while undoubtedly the new Commercial and Companies' Law will continue to attract new investment within the country, and drive competition within the region, it is the new federal law and the protection of personal data that will have my full attention as we enter into 2022. Data protection, data protection, data protection. Businesses within the UAE, and businesses outside the UAE but who are processing data of individuals within the UAE need to have this new law at the forefront of their mind, and that is the key take-away that I would give to you for this bulletin. Thank you, and happy New Year.
Suhail Mirza: I am here to talk about a couple of reforms in the M&A market, as well as some of the reforms in the labour market. I am going to touch upon the introduction of SPACs, which are special purpose acquisition companies and special purpose vehicles, otherwise known as SPVs. In my view, the introduction of these two types of corporate entities under the new Commercial Companies' Law will facilitate more equity capital market fund-raising, and hopefully, some more public markets M&A activity in the UAE.
Beyond that, we are also seeing some further development in 100% foreign ownership, so, as you all know, the DED have permitted 100% foreign ownership in the manufacturing and trading activities, predominantly, but what we are seeing is a lot of our foreign clients are looking at acquiring targets in the mainland, now that 100% foreign ownership is very well understood, and I believe that this will continue to serve as a catalyst for a buoyant M&A market on the private sector side, to complement some of the activities on the public sector side.
Turning now towards the reforms in the Labour Law market, as you know, talk around the town is very much around the Monday to Friday working week, but beyond that, there has also been some changes to the way HR policies are being implemented on the ground here, so for example, you now have part-time and temporary working as a concept, which is generally understood. Flexi-working as well, and also an introduction of gender-equality and equal pay, so again, those are policies that bring the UAE in line with global best practice. What we will find is that some of the challenges for HR is to be able to ensure that those local laws work for those companies that are active in other GCC markets, including KSA and Qatar, for example, where you may have people still being engaged on Sundays, so the ability to be able to balance the flexible working with engaging on a Sunday is very important, so that a company can best serve its markets properly, and we will see a lot more development in that, and more implementing regulations to be able to best clarify how companies can implement these new regulations in practice. Thank you very much.
Jon Parker: So I am going to touch on two new IP laws: the Trademark Law for the UAE and the Copyright Law in the UAE.
With regard to the Trademark Law, it is great news for brand owners. The definition of what trademark can be used has been expanded, so non-traditional marks such as holograms can now be protected. It also increases penalties for infringement, and also introduces for the first time, the concept of injunctions, where you can take a preliminary measure against any impending infringements.
Finally, it is introducing some new rights, such as geographical indications, and collective marks for the first time into local law.
So the next steps for the trademark law is that we wait for the implementing regulations which should be issued at some point in the first half of 2022, from which, we will see some of the mechanics as to how these rights will come into effect.
In terms of the new Copyright Law, it is great news for rights holders, commissioners and creatives, so there have been some significant changes, so rights that are now created for you as an employer or commissioner are now automatically transferred to you, which was not always the case. Also, the definition of what can be worked has been broadened, so it is now possible for smart applications to be protected as copyrights, and also, architectural designs will now be owned by the building owner automatically, rather than by the architect, so there have been some significant changes that will be coming through. We will see these in more detail through the implement in regulations that are expected in the first half of 2022. Thank you ever so much.
Tamara El-Shibib: In terms of patents, there have been some big developments in the last year, both at the UAE level but also on the GCC level, so in the UAE, we have had a new Patent Law issued, which has brought about some changes that sort of harmonise the Patent Law with international standards, some might say maybe the US, so there has been an introduction of a couple of changes. I think, the first one, I would say is critical is a grace period, so before pan-applicants were not able to disclose their inventions publicly before filing. In grace period countries, they can do that, as long as they file the application within the grace period, so the UAE has introduced a 12-month grace period, so as long as they file within 12 months, they are still good, but they need to keep in mind that other countries might not have a grace period, so that is important.
In terms of other changes, there has been introduction of divisional applications, accelerated examinations and also the penalties for infringement have gone up. With the GCC patent office there have been some big changes as well, so they no longer accept applications. What has happened is it has basically turned into an outsourcing model, so the national pan offices can refer applications to the GCC for examination for grant. Anything that has already been filed with the GCC pan office pre-2021 is going to continue through the system. It is only affecting new applications from January 2021, so no more independent GCC applications and UAE applications, and that will avoid the issues of double-patenting.
We have covered this in a lot more detail in our article, so make sure you check out our website.
Sau Lin Wan: One of the exciting IP developments is the Madrid system coming into effect on 28 December. This is great news, of course, for existing holders of international registrations, so they can easily extend their trademark protection to the UAE.
This is also great news for local UAE companies who can now use international registration system to file trademarks in many other countries using the Madrid system. This has benefits in terms of cost savings and easier management through one IP office, so we look forward to helping brand owners with their UAE protection using the Madrid system.
Tim: So, that concludes our legal overview for 2022. I am very much looking forward to seeing our clients during the course of the year, and if you require any further information, please do look on our website, where there is much more detailed articles covering all the matters that have been discussed today. Thank you.
Legal updates for 2022
UAE Patent Law
Law: Federal Law no. 11 of 2021 concerning the regulation and protection of Industrial Property Rights.
Effective as of: 1 December 2021.
Summary: The new UAE patent law is finally here. The published law introduces some welcomed changes and continues the reform of the UAE's legal framework to support the UAE Vision 2021 and its goals of developing a knowledge-based economy driven by entrepreneurship and innovation. Further details on the practical implementation of the law are expected to follow in the implementing regulations, which are yet to issue.
The main takeaways:
- Introduction of a novelty grace period of 12 months. This allows applicants to disclose an invention within 12 months of filing the UAE application and this will have no effect on the novelty requirement. Applicants need to be aware that many countries do not provide for a grace period (e.g. other GCC countries and most European countries) and that public disclosure can be harmful for patent protection in those countries.
- Positive changes in the UAE patent examination process including the option of filing divisional applications and accelerated examinations to speed up patent grants.
- Courts are recognising the importance of stronger enforcement measures and imposing higher penalties for patent infringement.
UAE Copyright Law
GCC Patents Law
UAE Commercial Companies Law
UAE Data Protection Law
KSA Private Sector Participation Law Implementing Regulations
UAE Trademarks Law
UAE Labour Law
UAE Accedes to the Madrid Protocol & Nice Classification
KSA Personal Data Protection Law
Our UAE based team are ready to assist if you require any advice relating to the legal reforms mentioned in this guide. Please don't hesitate to get in touch.
NOT LEGAL ADVICE. Information made available on this website in any form is for information purposes only. It is not, and should not be taken as, legal advice. You should not rely on, or take or fail to take any action based upon this information. Never disregard professional legal advice or delay in seeking legal advice because of something you have read on this website. Gowling WLG professionals will be pleased to discuss resolutions to specific legal concerns you may have.