In recent decades, Dubai has transformed into a dynamic city with substantial investment in real estate and infrastructure shaped by the contracting and construction industry. As Nicole Leahy writes, construction output has been steadily rising in the region, and major projects have highlighted the need for a unified system to regulate activities in the industry.
In July of this year, Dubai issued Law No. 7 of 2025 Regulating Contractors’ Activities in the Emirate of Dubai (the “CA Law”),[1] marking a major development in the regulation of activities in the construction sector. The CA Law casts its net wide: subject to certain exceptions, it applies to all contractors working in Dubai, including those operating in freezones (including the Dubai International Financial Centre); and covers a variety of activities, including engineering, electrical, architectural, building, construction and demolition.[2]
The law will take effect in January 2026 and provides a one-year grace period for compliance.[3]
Purpose and scope of the CA Law
The CA Law seeks to enhance contractor contributions to Dubai’s urban and economic development by aligning activities with international standards. It will introduce clear contractor categorisation, detailing experience, financial, technical, and administrative capabilities, alongside defined steps to ensure compliance with Dubai’s building and planning standards.[4]
Notably, certain activities are exempt from the provisions of the CA Law, including those related to airport infrastructure and facilities, and other activities that may be exempt by way of a decision of the Executive Council.[5]
Highlights from the CA Law
The Register
The Dubai Municipality will maintain a unified register of all contractors operating in Dubai, which shall be linked to the “Invest in Dubai” platform (as established pursuant to Decree No. (13) of 2024). The Register will record data including details of the activities each contractor is permitted to undertake, details of technical staff, classification category and any other data deemed necessary.[6] Contractors will be required to renew their registration each year.[7]
Classification of Contractors
The CA Law will establish contractor classification, in a manner consistent with the experience and financial, technical and administrative abilities of the contractor. As part of registration, contractors will be classified into a category and will not be permitted to engage in any activities or operate outside of their approved classification.[8]
Furthermore, contractors must maintain technical staff to carry out certain activities, and those technical staff must hold a professional competency certificate as imposed by the CA Law [9]
Adherence to a Code of Ethics
A Code of Ethics and Conduct is to be prepared and adopted, and must be adhered to by all contractors.[10]
Consortiums and subcontracting
Consortiums (such as joint ventures) have historically been popular in Dubai for large-scale construction projects, forming temporary alliances between companies to undertake complex infrastructure projects which require diverse expertise. The CA Law allows consortiums for singular projects where necessitated, subject to prior approval. In such instances, all members must be registered, and the classification and activities of each member must be commensurate with the nature of the project.[11]
Further, subcontracting is also permitted, provided a number of conditions have been satisfied, including prior approval.[12]
Document Retention
The CA Law provides that contractors must retain records, data and documents for 10 years from the date of the completion certificate.[13]
Turnkey Projects
A “turnkey project” (being fully completed and ready for immediate use upon handover) is popular in Dubai. The CA Law states that the authorities will decide which projects qualify as “turnkey projects”, and specific regulations governing such contracts will be issued.[14]
Violations and Penalties
The CA Law provides for fines from AED 1,000 to AED 100,000 in the event of violations. Fines shall also be doubled (up to a maximum of AED 200,000) in the event of repeat infractions of the CA Law within one year.
In addition to a fine, contractors may also face suspension from engaging in contractor activities for up to one year; the downgrading of their classification category into a lower category; the cancellation of a contractor’s listing on the Register; the temporary suspension of technical staff from engaging in contractor activities; and/or the revocation of professional competency certificates and subsequent deregistration.[15]
Final thoughts
The CA Law represents a major step in unifying and strengthening regulation within Dubai’s industry, promoting higher quality standards in a rapidly evolving sector.
Contractors should consider several practical steps moving forward, such as:
- Reviewing current licensing and classification;
- Identifying steps needed to meet the CA Law requirements for specific activities they intend to undertake;
- Ensuring technical staff compliance with the CA Law;
- Ensuring best practice in respect of document management so that documents are appropriately retained; and
- Staying updated on developments, including new regulations or guidance from the Dubai Municipality and related authorities.
[1] Dubai Government Official Gazette, Gazette No. 726.
[2] Contractor Activities are defined as follows:
“Any activity undertaken by a contractor from among the activities approved by the Committee, and is related to any of the various engineering fields: civil, architectural, electrical, mechanical, industrial, environmental, agricultural, coastal, or others, and includes, without limitation, construction, building, demolition, roads, bridges, tunnels, railways, irrigation, rainwater drainage, sewage, electricity networks, water networks, cooling networks, and extension of service lines.”
[3] Pursuant to Article 29 of the Law it “shall be published in the Official Gazette and shall enter into force six (6) months following the date of its publication.”
[4] The CA Law, Article 3.
[5] The CA Law, Article 4.
[6] The CA Law, see definition of Register.
[7] The CA Law, Article 12.
[8] The CA Law, Articles 3 and 5.
[9] The CA Law, Articles 14 and 20.
[10] The CA Law, Article 15.
[11] The CA Law, Article 18.
[12] The CA Law, Article 17.
[13] The CA Law, Article 15.
[14] The CA Law, Article 19.
[15] The CA Law, Article 22.