Law Regulating the Practice of Contracting Activities in Dubai: Your Complete Legal Guide
2025-07-27المقال السابق: Legal Advice in the UAE: Expert Guidance for Contracts Disputes and Compliance 2025
Recently, a newly licensed contractor in Dubai was forced to suspend his first project in a free zone after unknowingly violating the latest legal requirements. This incident highlights how critical it is to understand the Law regulating the practice of contracting activities in Dubai, officially Law No. (7) of 2025 Regulating the Practice of Contracting Activities in the Emirate of Dubai.
This law represents a strategic shift in how contracting businesses operate in Dubai. It establishes stringent rules for licensing, classification, technical staffing, and legal responsibilities.
In this guide, we break down the key elements: scope of application, municipality jurisdiction, and contractor registration conditions.
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Table Of Contents
An Overview about The Law Regulating the Practice of Contracting Activities in Dubai
Law regulating the practice of contracting activities in came into effect in July 2025, enforcing a digital registration system managed by Dubai Municipality. Contractors are prohibited from operating or even advertising themselves as contractors unless duly registered in the official electronic registry.
This law aims to enhance urban development, ensure project quality, and attract responsible investment into the construction sector.
Scope of Application
Understanding who the law applies to is crucial for compliance. This section outlines the contractors, regions, and activities covered under the law.
The law applies to:
- All contractors operating in Dubai, including in free zones and the DIFC.
- All contracting activities—civil, mechanical, electrical, environmental, coastal, etc.
Exceptions include:
- Activities linked to airports and their infrastructure.
- Activities exempted by Executive Council decision based on the Committee’s recommendation.
(Article 4, Law No. 7 of 2025, Official Gazette No. 726, Effective Date: 15 July 2025)
Municipality Jurisdiction and Powers
Dubai Municipality plays a central role in implementing the law regulating the practice of contracting activities in UAE.
Its responsibilities include:
- Operating the unified electronic system linked to “Invest in Dubai”.
- Maintaining a database of registered contractors, activities, classifications, and technical staff.
- Issuing professional competency certificates.
- Preparing a code of ethics for the contracting profession.
Conditions for Contractor Registration
According to Article 10, contractors must fulfill the following requirements:
- Hold a valid commercial license.
- Have no disqualification from practicing contracting or engineering consultancy.
- Possess the technical qualifications and experience required for their category.
- Employ a minimum number of certified engineers and technicians.
- Pay all applicable government fees.
- Meet any additional requirements imposed by the competent authority.
Failing to meet these conditions leads to refusal or removal from the registry, which in turn bars any contracting activity.
Classification System for Contractors
Each contractor is categorized based on financial, technical, and administrative capacity. New contractors start from the lowest tier but may apply for promotion once higher standards are met.
Misrepresenting one’s classification may result in penalties or suspension under the law regulating the practice of contracting activities in Dubai.
Violations and Penalties
The law empowers inspectors with judicial authority to enter construction sites, review records, and issue fines. Penalties include:
- Fines ranging from AED 1,000 to AED 200,000.
- Temporary or permanent suspension of registration.
- Downgrading classification tier.
- Revocation of trade license in severe cases.
FAQs
The law regulating the practice of contracting activities in Dubai enforces order and transparency in a sector vital to the emirate’s infrastructure and investment. From registration and classification to ethical conduct and municipal oversight, contractors must strictly comply with the law to operate legally and efficiently in Dubai.
Ready to register your contracting business or need to resolve a compliance issue? Contact our law firm in Dubai via the WhatsApp button below.
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