The Dubai Conflict of Jurisdiction Tribunal (CJT) has clarified which Dubai court has jurisdiction to hear a reinsurance dispute concerning claims arising from the unprecedented April 2024 floods, according to the global law firm Clyde &Co.
In an insight article posted on its website, Clyde & Co says that its UAE insurance team successfully resisted a jurisdiction challenge on behalf of local and international reinsurers before the CJT, securing an early ruling in favour of the Dubai International Financial Centre courts. The team who represented the successful reinsurers were Messrs Alfred Thornton (Partner), Moamen Elwan (Associate), Robert James (Legal Director) and Ms Masa Abu-Issa (Associate).
Background
The proceedings concerned a reinsurance dispute between a group of local and international reinsurers, one of which was established in the DIFC (Reinsurers), and a local Dubai insurance company (Insurer). The Insurer had reached a settlement of a high value property insurance claim arising from the 2024 floods. Reinsurers contended that they were not liable for the claims under the reinsurance agreements, which contained a dispute resolution provision conferring exclusive jurisdiction on the ‘competent’ UAE Courts.
The Reinsurers commenced proceedings in the DIFC Courts seeking various declarations in relation to the reinsurance agreements. Before those proceedings were served, the Insurer commenced proceedings before the Dubai Courts. Following service of the DIFC proceedings, the Insurer challenged the jurisdiction of the DIFC Courts and, shortly thereafter, applied to the CJT seeking a determination that jurisdiction lay with the Dubai Courts.
On 26 January 2026, the CJT held that the DIFC Courts had jurisdiction on the basis that one of the Reinsurers was a licensed entity registered and conducting business solely within the DIFC. The CJT disagreed with the Insurer’s arguments that the underlying insurance policy had no substantive link to the DIFC, nor were the insured losses sustained in the DIFC.
Significance of ruling
Clyde & Co says that the CJT decision is significant for the UAE insurance market (and more generally) in that it confirms that jurisdiction in multi-party disputes is determined on the basis of the DIFC Courts Law, and that the CJT is prepared to intervene proactively where one of the jurisdictional gateways in the DIFC Courts Law is satisfied.
The CJT’s conclusion confirms that the presence of a single DIFC establishment is sufficient to give the DIFC Courts exclusive jurisdiction, notwithstanding that other parties are based onshore or outside the UAE, or that the underlying insured losses or aspects of the performance of the contract took place outside the DIFC.
Early stage
Both the DIFC Courts and the ‘onshore’ Dubai Courts have previously reached the same conclusion. However, this is the first occasion that the CJT has intervened proactively at an early stage in proceedings to make a decisive ruling on jurisdiction, thereby preventing the need for lengthy (and costly) parallel proceedings, says Ckyde & Co.
Parallel proceedings have hitherto been possible because a conflict of jurisdiction usually requires the existence of an actual and established dispute between two judicial bodies as to jurisdiction over the same matter, rather than the mere existence of parallel proceedings or the filing of a pending jurisdictional challenge before one court. The invariable effect has been that parties commence tactical parallel proceedings, which inevitably cause delay, create duplication and result in irrecoverable costs being incurred.
“The certainty provided by the decision reduces the scope for unnecessary and costly preliminary jurisdiction litigation, and helps preserve the utility of the DIFC Courts as a forum in which declaratory relief may be obtained efficiently in complex commercial disputes,” said Clyde & Co.
The CJT was established as a joint initiative between the ‘onshore’ Dubai civil courts and the Dubai International Financial Centre (DIFC) Courts to make rulings on the proliferation of disputes concerning which of these courts has jurisdiction over specific cases issued in the Emirate. CJT members comprise judges from both the Dubai Courts and the DIFC Courts.