The maritime landscape in the UAE witnesses a transformative shift with the introduction of the New Law, focusing on three crucial aspects: UAE-registered vessel ownership, vessel registration procedures, and the dynamics of vessel arrest and letters of undertaking (LOUs). This legal evolution aims to modernize and streamline the maritime sector, positioning the UAE as a prominent hub in the global maritime landscape.
Broadened Horizons in Vessel Ownership
The New Law reshapes vessel ownership criteria, eliminating the prerequisite of Emirati nationality. Now, entities with a domicile in the UAE and individuals from the UAE or other GCC countries can own UAE-registered vessels. This expansion marks a departure from the previous restrictions based on nationality.
Evolving Vessel Registration Procedures
While specific details on vessel registration under the New Law are pending in the ‘Implementing Regulation,’ notable changes include the Ministry of Energy and Infrastructure’s approval for newly built vessels and the establishment of a special register for shipbuilding contracts. This reflects a commitment to transparency and regulatory efficiency.
Enhanced Dynamics in Vessel Arrest and LOUs
The New Law aligns the UAE with the 1999 Arrest of Ships Convention, broadening creditor actions and expanding the claims for vessel arrests. Notably, the acceptance of P&I Club LOUs by UAE Courts introduces a globally recognized mechanism for releasing vessels from arrest, counterbalancing potential litigation and reinforcing the maritime legal framework.
In summary, the New Law marks a significant step in modernizing the UAE’s maritime legal framework. Beyond clarifying ownership, registration, and arrest procedures, it positions the UAE as a reliable and dynamic maritime hub, fostering business development locally and globally.
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Source: Kennedys
