Contractor Competence Required by New Dubai Law

Dubai's construction sector is undergoing a significant transformation with new regulations prioritizing quality and contractor capabilities over the lowest bid. This shift aims to ensure that projects are awarded based on a company's track record, technical expertise, and ethical business practices, rather than solely on cost. The changes are particularly important as Dubai embarks on a new wave of mega-projects, including a new airport, skyscrapers, and infrastructure developments.

The updated rules introduce a Contracting Activities Regulation & Development Committee to oversee the sector. Contractors will be classified based on their expertise, qualifications, and resources, with subcontracting requiring prior approval. These measures aim to foster a construction environment that values competence and compliance, ensuring only qualified firms operate in Dubai.

The new law also introduces substantial penalties for non-compliance. First-time violations can result in fines up to Dh100,000, while repeat offenses within a year may incur fines of up to Dh200,000. Additional penalties include temporary project suspension, downgrading of contractor classification, and removal from the official registry. This framework mirrors similar legal advancements for developers and brokers, reflecting Dubai's commitment to a robust and well-regulated construction sector.