Shareholder disputes in UAE — rights, remedies and forum options

Shareholder and partner disputes are among the most commercially disruptive events a UAE business can face. Whether the conflict centres on a deadlocked board, a manager siphoning assets, or a majority shareholder squeezing out a minority partner, the legal consequences can threaten the company's survival. UAE law — principally Federal Decree-Law No. 32 of 2021 on Commercial Companies ("FDL 32/2021") — provides a detailed framework of rights and remedies, supplemented by the DIFC Companies Law 2018 for companies registered in the Dubai International Financial Centre. This guide explains your options, the applicable legal tools, and the practical steps needed to protect your position.

1. UAE Company Law Framework

The Principal Legislation

The primary statute governing onshore UAE companies is Federal Decree-Law No. 32 of 2021 on Commercial Companies, which came into force on 2 January 2022 and replaced the former Companies Law No. 2 of 2015. FDL 32/2021 applies to all companies incorporated in the UAE mainland and the non-financial free zones that have not enacted their own company legislation. The law was further amended by Federal Decree-Law No. 26 of 2022, which clarified several provisions relating to governance and minority protections.

For companies in the Dubai International Financial Centre (DIFC), the applicable statute is DIFC Companies Law, DIFC Law No. 5 of 2018 (as amended), which draws heavily from English company law concepts including the unfair prejudice petition and derivative claims.

The Abu Dhabi Global Market (ADGM) applies the ADGM Companies Regulations 2020, which similarly follow English law models.

Types of UAE Company Structure

The structure of a company determines which dispute mechanisms are available and which court has jurisdiction.

Limited Liability Company (LLC)

The LLC is the most prevalent onshore vehicle, governed by Articles 71–117 of FDL 32/2021. An LLC requires a minimum of two shareholders and a maximum of fifty. Day-to-day management is typically vested in one or more managers (not a board of directors), who may or may not be shareholders. Because shares in an LLC cannot be publicly traded, disputes tend to be intensely personal and are frequently complicated by the intertwining of family, commercial, and employment relationships. Resolutions generally require a simple majority by quota (share of capital), though Article 93 allows the memorandum of association (MOA) to specify higher thresholds for reserved matters.

Public Joint Stock Company (PJSC)

A PJSC is governed by Articles 118–255 of FDL 32/2021. It must have a minimum capital of AED 30 million and is managed by a board of directors elected by shareholders. Disputes in listed PJSCs may also engage the oversight authority of the Securities and Commodities Authority (SCA) under Federal Law No. 4 of 2000 (as amended). Minority shareholders in a PJSC have access to a broader range of statutory protections, including the right to requisition a general assembly if they hold at least 5% of capital (Article 156).

Private Joint Stock Company (PrJSC)

A PrJSC has between two and two hundred shareholders, minimum capital of AED 5 million, and is managed by a board. It is often used where founders anticipate eventual listing or where a corporate governance structure is preferred over the manager model of an LLC.

DIFC Companies

DIFC companies — whether private companies limited by shares, public companies, or limited liability partnerships — are creatures of DIFC law and fall outside FDL 32/2021 entirely. Disputes involving DIFC companies are adjudicated by the DIFC Courts (which apply DIFC law and, where gaps exist, common law principles), not by the UAE federal or Dubai local courts.

Shareholder Agreement (SHA) Enforceability: Onshore UAE vs. DIFC

The enforceability of a SHA is a critical threshold question in any dispute.

Onshore UAE (mainland and non-financial free zones): UAE courts will enforce a SHA as a binding commercial contract under Federal Law No. 5 of 1985 (Civil Transactions Code) and Federal Decree-Law No. 50 of 2022 (UAE Commercial Transactions Law). However, any provision of a SHA that conflicts with FDL 32/2021 or with mandatory provisions of the company's MOA registered with the relevant authority is unenforceable. For example, a SHA clause purporting to give a shareholder a right to veto board appointments in a way inconsistent with the registered MOA may be set aside. Courts have also, in some cases, declined to enforce SHA provisions that were not disclosed to the company registration authority. The key principle is that a SHA binds the parties to it contractually, but cannot override the company's constitutional documents or the mandatory statutory framework.

DIFC: The DIFC Courts treat a SHA as a sophisticated commercial agreement and will enforce it according to its terms, applying the same approach as English courts. DIFC companies frequently include a jurisdiction and governing law clause designating the DIFC Courts and DIFC law. Where a SHA is governed by DIFC law and disputes are referred to the DIFC Courts, parties enjoy a high degree of certainty — including enforcement of drag-along and tag-along provisions, deadlock resolution mechanisms, and exit rights — subject only to basic principles of public policy.

Arbitration clauses in SHAs: An arbitration clause in a SHA is generally respected both onshore (UAE Federal Arbitration Law, Federal Law No. 6 of 2018) and in the DIFC (DIFC Arbitration Law, DIFC Law No. 1 of 2008 as amended in 2013). Parties frequently choose arbitration under the rules of the Dubai International Arbitration Centre (DIAC), the ICC, or the DIFC-LCIA (now DIAC after the 2021 merger).

2. Common Causes of Shareholder Disputes

Deadlock

Deadlock arises when shareholders holding equal or blocking stakes cannot agree on a fundamental matter — often the appointment of a new manager, approval of annual accounts, a capital increase, or a strategic pivot. In an LLC with two equal shareholders and no deadlock resolution mechanism in the MOA or SHA, the company can become entirely paralysed. FDL 32/2021 does not prescribe a statutory deadlock-breaking mechanism; the solution must come from the MOA, the SHA, or ultimately from the court's power to order winding-up on just and equitable grounds.

Breach of Shareholder Agreement

Common SHA breaches include: a party transferring shares to a third party without complying with pre-emption or right-of-first-refusal provisions; a party failing to fund a capital call; breach of non-compete undertakings; failure to use reasonable endeavours to appoint an agreed nominee to the board; and failure to pay a deferred consideration for share acquisition. Damages, specific performance, or injunctive relief may be available.

Oppression of Minority Shareholders

Oppressive conduct occurs when the majority exercises its powers in a manner that is unfairly prejudicial to the minority — for example, repeatedly denying dividends while paying inflated salaries to majority-owned related parties, amending the MOA to dilute the minority's voting rights without a legitimate business reason, or excluding a founding minority shareholder from management in breach of an understanding that gave rise to quasi-partnership obligations.

Unfair Prejudice

While the concept of "unfair prejudice" is a term of art under English law and DIFC law (see Section 7 below), UAE onshore courts engage with equivalent conduct through provisions on abuse of rights (Article 106, Civil Transactions Code) and breach of the general obligation of good faith in contractual and commercial dealings.

Improper Asset Transfer

A manager or majority shareholder may transfer company assets — property, intellectual property, key contracts, customer lists — to a related vehicle at below-market value. This can constitute a breach of fiduciary duty, fraudulent preference under insolvency law, or an unlawful distribution. Article 166 of FDL 32/2021 prohibits transactions that benefit related parties at the company's expense without proper disclosure and shareholder approval.

Breach of Fiduciary Duty by Managers

Under Article 84 of FDL 32/2021, the manager of an LLC owes duties of loyalty and care to the company. Breaches include: self-dealing in transactions with the company, competing with the company's business, disclosing confidential information, and making unauthorised payments to themselves or connected parties. A manager who is also a shareholder does not escape these obligations by virtue of their shareholding.

Dividend Disputes

An LLC has no obligation to pay dividends unless the general assembly resolves to do so. However, a pattern of refusing dividends while diverting profits to related parties, or a SHA provision requiring regular distributions that is being dishonoured, can ground a claim. Article 100 of FDL 32/2021 requires that any profit distribution must be in proportion to each partner's share of capital unless the MOA provides otherwise.

Valuation Disputes on Exit

When a shareholder seeks to exit — through exercise of a put option, a drag-along, or a buy-out following a dispute — disagreements about the valuation methodology (earnings multiple, net asset value, discounted cash flow) can themselves become the subject of litigation or arbitration. A well-drafted SHA will specify the valuation methodology and the appointment process for an expert valuer whose determination is binding.

3. Minority Shareholder Rights under FDL 32/2021

Right to Inspect Books and Records

Under Article 99 of FDL 32/2021, every partner in an LLC has the right — at any time and without the need for a resolution — to inspect the company's books, documents, and records. The partner may also request a copy of the financial statements and the auditor's report. A manager who denies or obstructs this right is in breach of the law and can be compelled to comply by court order. In practice, a minority shareholder who suspects financial misconduct should formally request inspection in writing (creating an evidentiary record) and, if refused, apply to the competent court for an order compelling access.

Right to Appoint an Auditor

The general assembly of an LLC appoints the auditor. Where the majority refuses to appoint a qualified independent auditor — or retains a related-party auditor — a minority partner holding at least 20% of capital may request the court to appoint an independent auditor under Article 105 of FDL 32/2021. The costs of the court-appointed auditor are borne by the company.

Right to Requisition and Attend General Assembly

Under Article 95 of FDL 32/2021, any partner may request the manager to convene a general assembly meeting. If the manager fails to do so within 15 days of the request, the requesting partner may apply to the court for an order compelling the meeting to be held. In a PJSC, shareholders holding 5% or more of capital may requisition an extraordinary general assembly (Article 156). All shareholders have the right to attend, speak, and vote at any validly convened general assembly in proportion to their shareholding.

Right to Challenge Board or Manager Decisions

Any partner may challenge a resolution of the general assembly or a decision of the manager that is inconsistent with the law, the MOA, or a resolution of the general assembly. Article 97 of FDL 32/2021 provides that a partner dissatisfied with a resolution may apply to the court within 30 days of the resolution to have it set aside. Missing this 30-day window does not extinguish all claims — a partner may still bring a claim in damages — but it loses the right to nullify the specific resolution.

Pre-Emption Rights on Share Transfer

Article 78 of FDL 32/2021 gives existing partners the right of first refusal ("pre-emption") whenever a partner wishes to transfer their quota to a third party. The selling partner must notify the other partners through the manager, specifying the price and terms. The remaining partners have 30 days to exercise their pre-emption right. If no partner exercises the right, the transfer may proceed — but only with the approval of the partners holding a majority of the remaining capital (unless the MOA specifies a different threshold). Transfer to a non-partner without compliance with pre-emption is voidable.

Exit Rights and Squeeze-Out Rules

FDL 32/2021 does not contain a standalone statutory exit right for LLC shareholders analogous to the English "unfair prejudice" buy-out remedy. However, a shareholder may seek the court's order for dissolution and liquidation on just and equitable grounds (Article 303), which can in practice incentivise a negotiated buy-out. The MOA or SHA may confer contractual exit rights — put options, tag-along rights, and drag-along rights — which are enforceable as commercial contracts.

For PJSCs, FDL 32/2021 introduced a mandatory squeeze-out mechanism in Article 218: a shareholder who acquires 90% or more of the share capital of a listed PJSC may compulsorily acquire the remaining shares at fair value as determined by a licensed valuer approved by the SCA. Minority shareholders in a PJSC may also exercise appraisal rights following certain mergers and restructurings.

Protection Against Capital Reduction and Dilution

Any resolution to reduce the company's capital requires a majority of partners holding at least 75% of the capital (Article 88, FDL 32/2021) and must not impair creditors' rights. A capital increase by issuance of new shares that is structured to dilute a non-participating minority — particularly without offering pre-emption rights — can be challenged as an abuse of the majority's powers.

4. Dispute Resolution Options

UAE Commercial Courts (Onshore)

For onshore UAE companies, shareholder disputes are adjudicated by the Commercial Court (or the Commercial Division of the Court of First Instance) in the relevant emirate. In Dubai, this is the Dubai Courts; in Abu Dhabi, the Abu Dhabi Courts. The first-instance judgment can be appealed to the Court of Appeal and then to the Court of Cassation. The entire process through all three tiers can take two to four years, although urgent precautionary measures (see Section 6) can be obtained within days.

Key procedural features of UAE Commercial Court litigation include: pleadings in Arabic (official language), reliance on expert panels appointed by the court rather than party-appointed experts, and a tendency to focus on documentary evidence. Proceedings are generally less expensive than DIFC litigation for straightforward matters but can become protracted where the factual record is complex.

Approximate first-instance court fees in Dubai: 7.5% of the claimed amount, subject to a cap of AED 40,000 for most civil and commercial claims. Registration fees for urgent applications are lower.

When appropriate: UAE onshore courts are appropriate where the company is mainland-incorporated, there is no valid arbitration clause, the dispute primarily involves rights under FDL 32/2021 (which UAE courts are best placed to apply), or where precautionary attachments against UAE-based assets are needed urgently.

DIFC Courts

The DIFC Courts — comprising the Court of First Instance and the Court of Appeal — have mandatory jurisdiction over disputes involving DIFC-incorporated entities and claims arising under DIFC law. They also have opt-in jurisdiction available to parties who choose the DIFC Courts in their agreement even for non-DIFC disputes (Article 5(A)(2) of the Judicial Authority Law, Dubai Law No. 12 of 2004 as amended). Proceedings are conducted in English by legally qualified judges drawn largely from common law jurisdictions.

Approximate DIFC Court fees: Filing fees start at USD 1,000 for smaller claims and scale with claim value; complex multi-party shareholder disputes may attract fees in the range of USD 5,000–USD 25,000 at first instance. Legal costs are substantially higher than onshore proceedings.

When appropriate: DIFC Courts are the natural forum for disputes involving DIFC-incorporated companies, for parties who have opted into DIFC jurisdiction in their SHA, and where complex common-law remedies (unfair prejudice petition, derivative action) are being pursued.

Arbitration

Where the SHA or MOA contains an arbitration clause, the parties are generally bound to arbitrate rather than litigate — subject to the court's power to grant precautionary measures in support of arbitration. The Dubai International Arbitration Centre (DIAC) is the most commonly used arbitral institution for UAE-seated disputes following the merger of the DIFC-LCIA with DIAC in 2021. The ICC, LCIA (London), and Singapore International Arbitration Centre (SIAC) are also frequently used for cross-border shareholder disputes.

DIAC 2022 Rules: Emergency arbitrator provisions allow urgent interim relief within 24–48 hours of an application. A full DIAC arbitration typically takes 12–24 months to final award.

Arbitral awards seated in the UAE are enforceable under Federal Law No. 6 of 2018. Awards from foreign seats are enforceable through the New York Convention (UAE acceded in 2006) or the Riyadh Arab Convention.

When appropriate: Arbitration is appropriate where the SHA mandates it, where confidentiality of the proceedings is important (protecting commercially sensitive information from public court records), where a technical expert tribunal is desired, or where multi-jurisdictional enforcement of the award is anticipated.

Mediation

UAE courts actively promote mediation under Federal Decree-Law No. 40 of 2023 on Mediation and Conciliation in Civil and Commercial Disputes. The Dubai Centre for Amicable Settlement of Disputes provides court-connected mediation services; the DIFC-LCIA Mediation Centre (now part of DIAC) offers institutional mediation. Mediated settlements can be registered as court judgments, giving them enforcement status.

When appropriate: Mediation is particularly valuable in shareholder disputes where the parties have an ongoing relationship they wish to preserve, the company is operationally sound and the dispute is limited to financial terms, or where the cost and time of arbitration or litigation is disproportionate to the amount in dispute.

How to Choose

5. Specific Remedies

Injunction to Prevent Asset Dissipation

A shareholder who believes company assets are being dissipated, transferred to related parties at undervalue, or otherwise removed from the company's balance sheet may seek an urgent injunction from the competent court. Under Article 252 of Federal Decree-Law No. 42 of 2022 (UAE Civil Procedure Code), a court may issue a precautionary order restraining the company or its manager from disposing of specific assets pending resolution of the substantive dispute. The applicant must demonstrate: (a) the existence of a right to be protected; (b) urgency; and (c) that the measure will not cause harm disproportionate to the benefit. No prior notice to the respondent is required for truly urgent ex parte orders.

Derivative Action on Behalf of the Company

A derivative action allows a shareholder to bring a claim on behalf of the company to remedy a wrong done to the company — typically by its own managers. FDL 32/2021 does not codify a derivative action in the same explicit terms as, for example, the English Companies Act 2006. However, the Supreme Court and Court of Cassation have recognised the right of shareholders to sue managers for acts causing damage to the company where the company itself has failed to act, drawing on the general principles of the Civil Transactions Code and Article 84 of FDL 32/2021 (manager's duties). In practice, a shareholder bringing such a claim should first formally request that the general assembly authorise the company to bring the action; if refused, the refusal itself (especially where motivated by the majority's self-interest) strengthens the minority's case for a derivative action.

Winding-Up Petition (Just and Equitable)

Article 303 of FDL 32/2021 empowers the court to order the dissolution and liquidation of a company on the petition of any partner where: (a) it is impossible to achieve the company's objects; (b) the company suffers irreparable harm or persistent losses; or (c) a partner is in serious breach of their obligations. The "just and equitable" grounds, familiar from English law, are incorporated through the broader concept of impossibility of achieving the company's purpose and persistent harm. A winding-up order is a remedy of last resort — courts will typically decline to order winding-up if a less drastic remedy (such as a buy-out) is available and appropriate. Filing a winding-up petition, however, is often a powerful lever to bring a majority shareholder to the negotiating table.

Buy-Out Order

UAE onshore courts have broad discretionary powers to craft remedies in commercial disputes. While FDL 32/2021 does not contain an explicit statutory buy-out order equivalent to section 996 of the English Companies Act 2006, courts have the power to order specific performance of a contractual buy-out obligation (under a SHA or MOA provision) and to award damages measured by the value of the claimant's shareholding where the respondent's conduct has rendered it impossible for the shareholder to realise that value. In DIFC proceedings, the unfair prejudice remedy expressly includes a buy-out order (Section 7 below).

Account of Profits

Where a manager or majority shareholder has made profits by exploiting a corporate opportunity belonging to the company, or by diverting business to a competing entity, the court may order them to account for and disgorge those profits to the company. This remedy is particularly powerful where the manager has received secret commissions, undisclosed payments from third parties, or has diverted business to a company in which they hold an interest, in breach of Article 84 and Article 85 of FDL 32/2021 (which prohibit managers from competing with the company without prior approval).

Invalidation of Resolutions

Under Article 97 of FDL 32/2021, resolutions of the general assembly that violate the law or the MOA may be challenged within 30 days. Successfully invalidating a resolution — for example, a resolution that diluted the claimant's shareholding through a new share issuance — can restore the status quo ante.

Damages

A shareholder who suffers loss as a result of a breach of the SHA, breach of the MOA, or breach of a manager's duties may claim compensatory damages. The UAE Civil Transactions Code requires proof of loss, causation, and quantum. Consequential loss is recoverable where it was foreseeable at the time of the breach (Article 292, Civil Transactions Code). Courts apply the principle that damages should place the claimant in the position they would have been in had the breach not occurred.

6. Precautionary Measures

Attachment of Shares

A shareholder facing a risk that the opposing party will transfer their shares (for example, to frustrate a pre-emption right or to put assets beyond reach) may apply to the court for a precautionary attachment (hajz tahtiyati) of those shares. Once attached, the shares cannot be transferred or encumbered without the court's permission. The application can be made urgently under Article 252 of the UAE Civil Procedure Code, often on the same day the application is filed, and the court may grant it without hearing the respondent where urgency is demonstrated. The applicant must provide a security deposit (typically 20–25% of the value of the shares being attached) and must file the substantive action within 8 days of the precautionary order.

Freezing of Dividends

Where dividends declared by the general assembly have not yet been distributed, or where there is a risk that the company will distribute profits to the majority while withholding payment from a claimant shareholder, an order may be sought freezing the dividend payments or preserving the funds in escrow pending resolution of the dispute. This remedy is particularly relevant where the company is cash-rich but the minority is being excluded from distributions in breach of a SHA or MOA provision.

Judicial Supervision of Management

In cases of serious mismanagement or deadlock that threatens the company's viability, a party may apply to the court for the appointment of a judicial supervisor (muraqib qadai) or a temporary provisional manager (mudeer muaqat) to oversee or replace the existing management pending the outcome of the substantive proceedings. This remedy is exceptional and requires evidence of a real risk of irreparable harm to the company. The court-appointed supervisor typically has defined powers — for example, authority to sign cheques above a certain threshold, or to prevent asset disposals — without taking over management functions entirely. The costs of the judicial supervisor are borne by the company.

Preservation of Evidence

Under Article 30 of the UAE Civil Procedure Code, a party may apply to the court for an order preserving evidence (including electronic records, financial documents, emails, and bank statements) before proceedings are filed, where there is a risk that the evidence will be destroyed or altered. This is particularly useful at the outset of a dispute, before the opposing party is aware that proceedings are contemplated.

Travel Ban on Key Individuals

In cases involving allegations of fraud or criminal misappropriation, a parallel criminal complaint filed with the Public Prosecution may result in a travel ban (hazar safar) being imposed on the suspect. While a travel ban is a criminal law measure rather than a civil precautionary measure, it can significantly assist in securing the personal attendance of a respondent and concentrating minds on settlement.

7. DIFC Company Disputes

DIFC Companies Law 2018

Companies incorporated in the DIFC are governed by DIFC Law No. 5 of 2018 (DIFC Companies Law) and its subsidiary regulations. The DIFC Companies Law draws heavily on English company law (the Companies Act 2006) and provides an expressly codified framework for minority shareholder protection that is generally more detailed and more accessible than the equivalent framework under FDL 32/2021.

DIFC Courts Jurisdiction

The DIFC Courts have exclusive jurisdiction over disputes concerning DIFC-incorporated entities. Proceedings are conducted in English before legally qualified judges (many of whom have Common Law, particularly English, backgrounds). The DIFC Court of First Instance issues reasoned written judgments in the common law tradition, which are publicly available and provide significant precedent value. DIFC Court judgments are directly enforceable in Dubai through the Judicial Tribunal that coordinates between the DIFC and Dubai Courts, and more broadly through a network of enforcement treaties.

Unfair Prejudice Petition

Part 9 of the DIFC Companies Law 2018 provides for an unfair prejudice petition in terms closely analogous to section 994 of the English Companies Act 2006. A member of a DIFC company may petition the DIFC Court on the grounds that the company's affairs are being or have been conducted in a manner that is unfairly prejudicial to the interests of the members generally or some part of the members (including the petitioner). The concept of "unfair prejudice" covers a wide range of conduct including:

• Exclusion from management in breach of legitimate expectations (particularly in quasi-partnerships);
• Misapplication of company assets;
• Breach of the SHA or articles of association;
• Failure to pay dividends while majority shareholders receive excessive remuneration;
• Dilutive share issuances without proper justification.

The DIFC Court has broad remedial powers on an unfair prejudice petition, including: ordering a buy-out of the petitioner's shares at fair value (without minority discount in quasi-partnership cases), ordering the company to take or refrain from taking specified action, authorising a derivative action to be brought in the name of the company, and regulating the conduct of the company's affairs in future. The buy-out remedy is the most commonly sought outcome.

Derivative Claims in the DIFC

Part 8 of the DIFC Companies Law 2018 provides a statutory derivative claim procedure. A member may apply to the DIFC Court for permission to bring a derivative claim on behalf of the company in respect of a cause of action vested in the company. The court will grant permission if it is satisfied that (a) the cause of action arises from an actual or threatened act or omission involving negligence, default, breach of duty, or breach of trust by a director; and (b) the claim appears to be prima facie in the interests of the company. Permission is refused where the act has been ratified or where the applicant is not acting in good faith.

Winding-Up on Just and Equitable Grounds (DIFC)

Article 155 of the DIFC Companies Law 2018 empowers the DIFC Court to wind up a company on just and equitable grounds. The DIFC Court follows the English approach established in Ebrahimi v Westbourne Galleries Ltd [1973] AC 360, recognising that in quasi-partnerships — companies formed on the basis of a personal relationship and mutual confidence — a breakdown of that relationship or exclusion from management can justify winding-up even absent strict legal fault. As in English law, the court will consider whether a buy-out order is a more appropriate remedy before making a winding-up order.

DIFC vs. Onshore: Which to Choose for Structuring?

The DIFC framework is generally superior for minority shareholder protection because: (a) the unfair prejudice petition is expressly codified; (b) the derivative claim procedure is clear and accessible; (c) proceedings are in English with common law procedural rules; and (d) the body of DIFC Court jurisprudence is growing and provides commercial certainty. However, DIFC incorporation is not available for all business activities (it is primarily for financial services, professional services, and holding companies), and the cost of DIFC Courts proceedings is substantially higher than onshore litigation.

8. Checklist for Dispute Preparation

• Secure the founding documents: Obtain certified copies of the current memorandum of association (MOA) / articles of association from the relevant authority (DED, ADNEC, DIFC Registrar, etc.), the original SHA, and any subsequent amendments.
• Compile the cap table: Confirm the current shareholding structure, including any undisclosed transfers or pledges over shares.
• Collect financial records: Gather all audited and management accounts for the past three to five years, bank statements, related-party transaction schedules, and board/manager resolutions approving significant expenditures.
• Document the board/management timeline: Identify who were the appointed managers or directors, when they were appointed, and the basis of any removal.
• Preserve electronic evidence: Take steps to preserve all relevant emails, WhatsApp messages, board minutes, and management information. Do not delete or alter records — this can constitute contempt of court or an offence under Federal Decree-Law No. 34 of 2021 (Combating Rumours and Cybercrimes).
• Check the dispute resolution clause: Review the SHA, MOA, and any side letters to confirm whether there is an arbitration clause, a mediation obligation, or any notice/cure period that must be complied with before proceedings can be commenced.
• Identify which assets need to be protected immediately: If there is a risk of dissipation, identify the specific assets (bank accounts, real property, shares in subsidiaries, IP registrations) that should be the subject of precautionary measures.
• Assess limitation periods: Claims for breach of contract must generally be brought within 15 years under UAE law (Article 473, Civil Transactions Code); however, the 30-day deadline for challenging a general assembly resolution (Article 97, FDL 32/2021) and the three-year period for commercial claims under the UAE Commercial Transactions Law may apply depending on the nature of the claim. Take urgent advice.
• Consider parallel proceedings: If the conduct complained of is potentially criminal (fraud, embezzlement, breach of trust), a complaint to the Public Prosecution may be appropriate in addition to civil proceedings. Criminal proceedings can also accelerate the return of assets and create leverage in settlement negotiations.
• Engage experienced counsel early: A shareholder dispute involves intersecting company law, contract law, procedural law, and (in cross-border cases) private international law. Engage a firm with specific UAE company law experience before taking any action that might prejudice your position.
• Document your own conduct: Ensure you have not taken steps that breach the SHA, MOA, or your own fiduciary or contractual obligations — a respondent will use any such breach to seek a set-off or to discredit the claimant.
• Obtain an independent valuation: If the dispute is likely to involve a buy-out or damages measured by share value, commission an independent valuation at an early stage. This establishes a baseline and demonstrates that the claimant's case is fully quantified.

9. Advice & Next Steps

10. Frequently Asked Questions

Related guides

• Setting Up a Company in UAE — Complete Legal Guide for Foreign Investors
• UAE Corporate Insolvency & Restructuring — 2026 Practitioner Guide
• Arbitration vs Litigation in UAE — 2026 Strategy Guide
• Precautionary Attachment & Freezing Orders in UAE Courts
• How to File a Lawsuit in Dubai Courts — Step-by-Step Guide

Published 3 June 2026. General information only — not legal advice. Contact us for matter-specific advice.