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This article was co-authored by Karim El Sayegh, Paralegal.

On 8 July 2025, the government of Dubai introduced Law No. 7 of 2025 Regulating Contracting Activities in the Emirate of Dubai (“the New Law”). This important piece of legislation will come into force on 8 January 2026, six months after its publication, and will govern all contracting activities and Contractors operating within the Emirate of Dubai, including those in special development zones and free zones, such as the Dubai International Financial Centre (DIFC). 

The New Law represents a major step forward in how Dubai regulates its construction and engineering sectors.  It establishes the framework for a supervisory hierarchy, with the Dubai Municipality (the “Municipality”) as the ultimate authority, below (or alongside) which sits the “Competent Authority” (i.e. “any other government entity legally competent to supervise and control any contracting activities in the Emirate”, along with the Municipality itself).  There is also provision for the establishment of a “Committee for Regulating and Developing Construction Activities” (“the Committee”).  Each of these authorities has specified competencies, tasks and powers.  The New Law aims to establish a standardised, digital, and unified regulatory framework for all construction activities (e.g. construction, demolition, infrastructure, engineering). It provides a new framework for contractor registration, classification, and oversight, overseen by the Municipality, and aims to improve standards, promote transparency, and support Dubai’s sustainable development and investment confidence in the construction industry.

The New Law complements the existing laws and regulations related to building and planning, and is part of Dubai’s broader ambition to modernise and professionalise the sector, in line with international best practices.

Scope of application

The New Law applies to:

• all contractors working in the Emirate of Dubai; and
• to all contracting activities – including construction, demolition, engineering, roads, bridges, utilities, and more.

Importantly, it extends to contractors operating in free zones and special development zones (including the DIFC), closing previous regulatory gaps.

Only contracting activities related to airports and their associated infrastructure are specifically exempted. However, further exemptions may be granted by the Chairman of the Executive Council, acting on recommendations from the Committee. 

The New Law comprises 29 Articles and sets out the foundational framework. Much of the detail on how the New Law will be implemented will come from regulations and decisions yet to be issued by the Committee or other Competent Authorities, such as the Municipality. In the meantime, existing regulations issued prior to the enforcement of the New Law (such as Dubai Local Order No. 89 of 1994 Concerning the Practice of Engineering Consultancy in the Emirate of Dubai (Order No. 89/1994) and Dubai Local Order No. 3 of 1999 Regulating Construction Works in the Emirate of Dubai (Order No. 3/1999)) will continue to apply until the issuance of substituting regulations, provided they do not conflict with the New Law.

Key features of the new law

While some of the provisions build on existing practices, the New Law consolidates and formalises them in a more structured and enforceable format. Notable features include:

Mandatory contractor registration

All contractors must be licensed and registered in a new central Register managed by the Municipality, and linked to the “Invest in Dubai” digital platform.  Employers will be prohibited from engaging contractors not registered and classified in accordance with the law, and contractors will (as mentioned below) be prohibited from engaging in contracting activities outside the classification category assigned to them.

New classification system

Contractors will be assigned a classification based on their technical, financial and administrative capabilities. This classification will determine the nature and scope of the projects they are authorised to undertake. Contractors can apply to upgrade their classification by meeting enhanced requirements.

This classification system will build upon, and ultimately supplant, the existing framework under:

• Order No. 89/1994, in which engineering offices were classified into categories based on experience and specialisation; and
• Order No. 3/1999, which regulates the issuance of construction permits and addresses technical standards.

Professional competency standards

Contractors must employ a minimum number of qualified technical staff, each of whom must hold a “Professional Competency Certificate” issued by the Municipality. 

Subcontractor and consortium (JV) regulation

The appointment of subcontractors is not prohibited, but will now be subject to approval by the Municipality or the Committee. Both the main contractor and subcontractor must be appropriately licensed and classified. For larger or more complex projects, contractors may form consortia or joint ventures, but all members must be registered and approved, and one must act as the group’s authorised representative.

Consortia and joint ventures were not previously regulated by Order No. 89/1994.

Recognition of turnkey projects

The New Law formally recognises “turnkey” projects, allowing contractors to undertake design, supervision, and execution under a single agreement.  Turnkey projects are said to be subject to conditions which will be set out in future regulations issued by the Municipality. 

Conduct and enforcement

A Code of Conduct and Ethics will be introduced. Contractors will be required to comply with applicable laws, avoid exceeding their approved scope or capacity, and notify the Municipality of any changes or incidents. Breaches may result in penalties, suspensions, downgrades, or even de-registration.

Establishment of a permanent oversight committee

The Committee is yet to be established, but when it is, it will proactively oversee implementation and propose further policies and regulations. It will also handle approval of all contracting activities, and the classification of Contractors. It is likely that this committee effectively replaces the Committee of Registration and Licensing established under the Municipality’s resolution No. 32 of 2006.

Compliance timetable

The New Law will take effect on 8 January 2026. All contractors must regularise their status within one year; that is, by 8 January 2027.

This includes completing registration on the new system, complying with classification requirements, and ensuring all technical staff are properly certified. The Committee, or the Municipality, may extend this deadline, but contractors are strongly encouraged to act early.

Achieving compliance

Contractors should begin preparations without delay. All contractors must:  

• Hold a valid commercial licence issued by the appropriate authority;
• Register on the Municipality Register;
• Ensure all technical employees hold a valid Professional Competency Certificate;
• Follow prescribed standards and maintain accurate and current records;
• Ensure subcontracting and consortium arrangements comply with the new legal framework.

Enforcement and penalties

The New Law introduces a clear enforcement regime:

• Fines ranging from AED 1,000 to AED 100,000 as determined by the Chairman of the Executive Council, on the recommendation of the Committee. Repeat violations can see fines rising to AED 200,000.
• Suspension of the contractor’s licence, or construction activities, for up to one year
• Downgrading of the Contractor’s classification;
• Cancellation of the Contractor’s registration (rendering it unable to trade);
• Deregistration of technical staff and/or cancellation of competency certificates. 

The Municipality will retain a right to inspect premises and project sites, seize and review records and enforce penalties.

Market impacts and broader consequences

The New Law is intended to bring significant change to Dubai’s construction landscape:

Higher standards, fewer risks

With stronger classification and competency requirements, the law aims to reduce unsafe practices, technical failures, and project delays. Over time, this should also help curb disputes and improve project delivery.

Enhanced professionalisation and market consolidation

Tighter regulation may raise barriers to entry, particularly for smaller or informal contractors. Some may struggle, ultimately exiting the market, merging, or being absorbed, leading to greater consolidation and a more competitive, professionalised sector.

Increased costs, greater predictability

While compliance may increase operational costs in the short term, the resulting standardisation and oversight should deliver longer-term benefits in terms of reliability, safety, and investor confidence.

Digital transformation and transparency

Integration with the “Invest in Dubai” platform will streamline approvals, allow for performance tracking, and simplify due diligence. Employers and developers will have more data to assess contractor capability before awarding work.

Alignment with global best practice

The New Law represents a further shift toward internationally recognised standards in respect of credentialing, licensing and transparency, and should enhance Dubai’s reputation as a world-class construction hub.

What contractors should do now

Immediate steps (within Rectification Period)

• Review your current registration, classification, and technical workforce;
• Submit necessary declarations if your licence expires during the transition;
• Engage with the Municipality to begin the registration process.

Organizational readiness

• Update internal HR systems;
• Review subcontracting practices;
• Prepare for new record-keeping and compliance protocols;
• Begin drafting or revising joint venture or consortium agreements, where applicable.

Final thoughts

The New Law marks a new chapter in the governance of contracting activities in Dubai. It consolidates existing frameworks, introduces new safeguards, and sets a clear path for regulatory modernisation; a significant evolution in the governance of construction activities in Dubai. While it presents initial compliance burdens, particularly for small and mid-sized contractors, it ultimately lays the groundwork for a more professional, reliable, and scalable construction sector.

For contractors, the message is clear: prepare now. Those who act early and invest in compliance will not only reduce risk but also position themselves to thrive in an increasingly structured and competitive market.

This reform comes at a time when Dubai’s project pipeline is expanding through ongoing residential and mixed-use builds, repurposing legacy developments, green building initiatives, and large-scale infrastructure and development projects, under the 2040 Urban Master Plan. The New Law will likely have the overriding effect of ensuring that only competent, well-structured contractors are awarded critical work, thus reducing the risk of delay and overspend.

Sharper rules, stronger compliance: MAS updates AML/CFT Guidelines for insurers

The Monetary Authority of Singapore recently revised its notices and guidelines on anti-money laundering and countering the financing of terrorism (“AML/CFT”), applicable to financial institutions (“FIs”), including direct life insurers,^₁  direct general insurance business, and foreign insurers operating in Singapore.²  The revisions took effect from 1 July 2025. 

Here is what you need to know 

The main revisions relevant to insurance businesses (including direct life insurers, direct general insurance business, and foreign insurers) involve mandating proliferation financing (“PF”) assessments as well as clarifying and updating the requirements for filing of suspicious transaction reports (“STRs”).

Additionally, specifically for direct life insurers, the Guidelines to Notice 314 also include amendments to clarify MAS’ supervisory expectations on AML/CFT measures, including on screening and Source of Wealth and Source of Funds establishment.

The purpose of the revisions is to enhance the financial sector’s AML/CFT regime, with reference to global standards set by the Financial Action Task Force (“FATF”).

(A) Mandating proliferation financing assessments

Notice 314 and both sets of guidelines now expressly refer to PF, when they previously did not. Insurers are now expressly required to carry out PF risk assessments, as part of their AML risk assessments. 

In practice, insurers should have already been covering PF risks as part of their existing AML/CFT or sanctions compliance controls. 

Offences under MAS’ sanctions regulations for financial institutions against the proliferation of weapons of mass destruction have been designated as predicate offences for money laundering, under the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act 1992.

(B) Amendments to clarify and update the requirements for filing of STRs

(i) Timelines

All persons, including insurers, must file a suspicious transaction report (“STR”) with the Suspicious Transaction Reporting Office (“STRO”), when it knows or has reasonable grounds to suspect that any property represents the proceeds of, was used in connection with or is intended to be used in connection with criminal conduct.³

Under the previous AML/CFT notices and guidelines, insurers were expected to file STRs with STRO promptly.  MAS’ previous expectation was that companies take not more than 15 business days to evaluate internally whether an STR should be filed, from the time the case was first flagged by an employee/officer. 

MAS has now clarified its expectations that:

• The filing of an STR should not exceed 5 business days after the suspicion was first established, unless there are exceptional circumstances.⁴ 
• IIn cases involving sanctioned parties, and parties acting on behalf of or under the direction of sanctioned parties, the STR should be filed as soon as possible, and no later than 1 business day after the suspicion was first established.⁵

MAS has not prescribed timelines for the conclusion of internal investigations, to determine whether there is a suspicion that property represents or is used in connection with criminal conduct. In refraining from setting out such precise timelines, MAS acknowledged the wide-ranging nature and complexity of cases, as well as the range of financial institutions’ profiles, scale and complexity of operation.⁶

(ii) Requirement to provide copies of STRs to MAS

As MAS can already access the STRs filed with STRO directly, MAS has removed the requirement for direct life insurers to extend copies of all STRs filed to MAS for information. However, MAS has clarified that direct life insurers will need to do so upon request by MAS.⁷ 

(C) Changes to the AML/CFT guidelines to clarify and reflect supervisory expectations for direct life insurers when addressing higher ML/TF risks

MAS emphasised its supervisory expectations that financial institutions, including insurers, should implement robust controls and processes to ensure the:

• Timely review of suspicious transactions, and 
• Mitigation of ML/TF/PF concerns.

These supervisory expectations are outlined in MAS’ Consultation Paper⁸, and they are of general application to all financial institutions and variable capital companies.

In addition, specifically for direct life insurers, the Guidelines to MAS Notice 314 has been amended to require direct life insurers to ensure that there are processes in place to:⁹

• Identify and prioritise the review of concerns of higher ML/TF risks;¹⁰
• Ensure that such concerns of higher ML/TF risks are reviewed promptly; and
• Require any such concerns of higher ML/TF risks that cannot be reviewed promptly to be escalated to senior management or a similar oversight body, for appropriate ML/TF risk mitigation measure to be applied. 

We highlight some of the key amendments. 

(i) Screening 

MAS clarified that where necessary, ML/TF information sources used for screening should include pertinent search engines used in countries or jurisdictions closely associated with the person screened, and screening should be conducted in the native language(s) of the person screened.¹¹

(ii) Source of wealth information obtained by a direct life insurer

Source of wealth generally refers to the origin of the customer’s and beneficial owner’s entire body of wealth (i.e. total assets). MAS has clarified in the Guidelines to Notice 314 that a customer’s source of wealth includes seed money and gifts. 

The source of wealth information obtained by the direct life insurer should give an indication about:

• the entire body size of wealth that the customer and beneficial owner would be expected to have; and 
• how the customer and beneficial owner acquired the wealth.

This is to enable the direct life insurer to make an assessment as to whether a customer or beneficial owner present a higher risk for ML/TF.¹²

(iii) Corroboration of information regarding the source of wealth and source of funds 

Direct life insurers are expected to corroborate the information regarding source of wealth and source of funds. In this regard, direct life insurers should take a risk-based approach and focus on the more material and riskier sources, and exercise prudence in the use of non-independent sources of information such as customer representations, assumptions and benchmarks.¹³

(iv) Ongoing monitoring where risks have increased 

For direct life insurers, MAS expects that, where there are indications that the risks associated with existing business relations have increased (e.g. anomalies in the control or conduct of an account or discrepancies relating to a customer’s source of wealth), the direct life insurer should promptly implement commensurate risk mitigation measures, including enhanced ongoing monitoring such as:¹⁴

• enhanced monitoring of transactions (including pre-transaction checks); and 
• impositions of restrictions on the account. 

The direct life insurer should also request additional information and conduct a review of the customer’s risk profile in order to determine if further measures are necessary.

(v) Processes regarding indicators of fraudulent or tampered data

In relation to processes regarding fraudulent or tampered data, documents or information, MAS expects a direct life insurer to ensure that:¹⁵

• Staff are provided with adequate guidance on how to identify indicators of fraudulent or tampered data, documents or information.
• Processes are in place to ensure that such indicators are escalated.
• Processes are in place to ensure that the appropriate ML/TF risk mitigation measures are applied in a timely manner. 

Examples of indicators of fraudulent or tampered data, documents, or information set out by MAS include:¹⁶

• significant discrepancies in a customer’s representations (e.g. relating to material sources of wealth or significant transactions) that are found when these representations are checked against independent sources of information, such as corporate data reports;
• anomalies in financial statements that are not in line with the direct life insurer’s understanding of the customer’s profile; and
• lack of sign-off by relevant certifying parties such as an auditor or notary public.

The recent amendments to MAS’ AML/CFT Guidelines demonstrate MAS’ continued effort to strengthen Singapore’s AML/CFT regime, to ensure it remains clear and aligned with international standards. Financial institutions should keep an eye on future updates and check that their present policies, processes and controls are in line with MAS’ expectations. 

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¹For direct life insurers, the relevant documents are: (a) MAS’ Notice 314 on the Prevention of Money Laundering and Countering the Financing of Terrorism – Direct Life Insurers, dated 30 June 2025 (“Notice 314”); and (b) MAS’ Guidelines to MAS Notice 314 on Prevention of Money Laundering and Countering the Financing of Terrorism, dated 1 July 2025 (“Guidelines to Notice 314”).

²For other MAS licensed insurers (under s 11 of the Insurance Act 1966), foreign insurers operating in Singapore under a foreign insurer scheme, and direct life insurers writing accident and health policies, the relevant document is the MAS’ Guidelines on Prevention of Money Laundering and Countering the Financing of Terrorism – Direct General Insurance Business, Reinsurance Business and Direct Life Insurance Business (Accident & Health Policies), dated 1 July 2025 (“Guidelines for non-life insurers”).

³S 45(1) of the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act 1992.

⁴For Non-Life Insurers, see Guidelines for non-life insurers at paragraph 7.6. For Life Insurers, see Guidelines on Notice 314, paragraph 12-1.

⁵For Non-Life Insurers, see Guidelines for non-life insurers at paragraph 7.6. For Life Insurers, see Guidelines on Notice 314, paragraph 6-15-2.

⁶MAS Consultation Paper on Proposed Amendments to AML/CFT Notices and Guidelines, paragraph 2.13.

⁷Notice 314, paragraph 12.2.

⁸MAS Consultation Paper on Proposed Amendments to AML/CFT Notices and Guidelines at paragraph 2.13.

⁹Guidelines to Notice 314, paragraph 12-A.

¹⁰MAS has also amended the Guidelines to Notice 314 to include characteristics of higher-risk shell companies that require enhanced customer due diligence, see Guidelines to Notice 314, paragraph 8-2.

¹¹Guidelines to Notice 314, paragraph 6-15-3.

¹²Guidelines to Notice 314, paragraph 8-5-6.

¹³Guidelines to Notice 314, paragraph 8-5-8.

¹⁴Guidelines to Notice 314, paragraph 6-10-3.

¹⁵Guidelines to Notice 314, paragraph 6-5-5A.

¹⁶Guidelines to Notice 314, paragraph 6-5-5A.