Dubai has introduced new laws focusing on registering and regulating contractors in the emirate. Enacted by Sheikh Mohammed bin Rashid Al Maktoum, the law demands contractors comply with rigorous standards and outlines situations for deregistration. Fines up to 200,000 AED could be imposed for violations, which may also result in suspensions or downgrading of contractor status.

In alignment with Dubai's pioneering vision to advance and organize vital sectors by adhering to international best practices, His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, has enacted Law No. (7) of 2025 to regulate the practice of contracting activities in the Emirate of Dubai. This legislation marks a significant step in enhancing the legal and governance framework of the contracting sector.

Contractor Registration Requirements

The law outlines the conditions for contractor registration, the procedures for registration, the period of registration-which is one year, renewable for equivalent periods-and the scenarios in which a contractor may be removed from the register.

Furthermore, the law lists the contractor's obligations, which include:

- Adhering to prevailing legislation in Dubai, including building, planning, environmental, public health, and occupational safety regulations.

- Ensuring all standards, conditions, and requirements upon which they were classified are met throughout the classification period.

- Avoid using any individual not registered on the record or without a professional competence certificate.

- Complying with the scope of contracting activity and specialty allowed, based on their classified category.

- The law also prohibits contractors from engaging in projects that exceed their financial, technical, or administrative capacity, or beyond their available technical staff and workforce.

- Additionally, contractors must adhere to the terms and conditions of the construction contract, follow instructions from the appointed engineering office, and avoid misusing their license, category, or classification for fraudulent projects to gain personal benefits.

- Contractors must undertake contracted work independently, utilizing their available technical staff.

- Assigning work to others is prohibited unless specified by the law and approved by the relevant authority.

Conditions for Subcontracting

The law specifies cases in which a contractor may assign work to another contractor:

- It allows forming a coalition between multiple contractors for a single project, subject to conditions like the project’s size, resources, required specializations, duration, and other considerations. This requires prior approval from both the client and the relevant authority, ensuring all coalition members are registered and up to date.

- The law mandates that the Director General of Dubai Municipality, in coordination with relevant authorities, determines the conditions and procedures for registering and renewing the registration of technical staff in the register, issuing their certificates of professional competence, their registration validity, temporary suspension cases, and deregistration conditions, alongside technical staff obligations.

Consequences of Violating the Law

Without prejudice to stricter penalties outlined in other legislation, anyone breaking this law and its resolutions faces a fine ranging from a minimum of 1,000 AED to a maximum of 100,000 AED. The fine may double if the same violation is repeated within a year, not exceeding 200,000 AED. Additional measures against violators may include:

• Suspending the contractor's operations for up to one year.

• Downgrading the contractor's classification to a lower category.

• Removing the contractor's record from the register with approval from the "Contracting Activities Regulation and Development Committee," and contacting the licensing authority to cancel the commercial license as per their procedures.

• Temporarily suspending any technical staff member from contracting activities.

• Canceling the professional competence certificate of any technical staff member and removing their record from the register.