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Transport, Energy & Revolving Synergy
The final Law Update of 2022 is here, and it’s packed full of articles. The double edition features two focus areas, first is a spotlight on Energy and Resources and second we feature a collection of articles on Transport and Logistics. The developments occurring in these sectors in the MENA region are unprecedented and our lawyers cover vast themes for you.
The Energy and Resources focus features topics such as diversifying energy resources, solar PV, mining in the Middle East, renewable energy and green hydrogen. From a transport perspective, we draw attention to the Bahrain metro project, discuss the challenges and remedies associated with the repossession of an aircraft, and there is advice on what to consider should a party vary the terms of a shipping contract.
This edition navigates you through updates from across jurisdictions such as, Oman, Jordan, Saudi Arabia, Egypt, Iraq, Qatar, and the UAE. Each article is timely and provides insights into legal issues and cases that are affecting these sectors across the region.
Read the full edition
A complete spectrum of legal services across jurisdictions in the Middle East & North Africa.
Abu Dhabi Executive Committee Circular No. 1 of 2019 – Concerning the Payment of Entitlements of Contractors and Suppliers
The Abu Dhabi Executive Committee has issued an Executive Council Circular which signifies an important new step in regulating the payment process under Government contracts. Under Circular No. (1) of 2019, dated 26 March (“Circular”), Government Bodies and companies are now required to observe the following requirements:
- Payment of all entitlements to contractors and suppliers within 30 days as of the date of receipt of the relevant invoices.
- The inclusion of a clause in their contracts with contractors and suppliers that stipulates the obligation of contractors and suppliers to pay the dues of subcontractors and sub-suppliers within 30 days as of the date of receiving their entitlements from the Government Bodies and companies.
- Amending all valid contracts with contractors and suppliers as stipulated above.
- In the event of a disagreement between the parties on part of the amounts due, the undisputed amount shall be paid. This shall not be regarded as a waiver of the right of any of the parties until an agreement is made on the remaining amount according to the contract.
The above requirements have been introduced with retrospective effect and therefore must be reflected in all contracts previously entered into with contractors and suppliers prior to the date of issue of the Circular, in addition to all new contracts.
This recent announcement comes at a time when contractors and suppliers in the UAE are increasingly feeling the strain of reduced liquidity and cash flow, in part due to reduced economic growth as a result of lower oil prices.
Our Construction & Infrastructure team regularly advise on all elements of the construction procurement process. If you have any questions or would like further information, please don’t hesitate to contact our team:
Euan Lloyd
Senior Counsel, Construction & Infrastructure
e.lloyd@tamimi.com
Leith Al-Ali
Associate, Construction & Infrastructure
l.alali@tamimi.com
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