Dubai Court of Cassation (General Assembly), Resolution No. 1 of 2024, 31 January 2024
All of a debtor's assets secure its debts (Article 391 of the Civil Transactions Law), and a creditor may attach the debtor's movable and immovable property except what the law exempts (Articles 242 and 247 of the Civil Procedure Code). Attachable property must have a money value and be capable of being dealt in (Article 98). A company's trade licences are intangible elements that add to its value and can be valued; UAE federal and local legislation does not prevent their sale with the approval of the competent authorities and payment of the prescribed fees. Trade licences and all of a company's intangible assets may therefore be attached unless dealings in them are prohibited by their nature or by law.
In Appeal No. 122 of 2018 (real estate) the Court of Cassation had held that a trade licence is no more than a certificate from a government authority allowing a named person to carry on a specific activity, which nobody else may use or benefit from. For anyone other than the licensee it had no value and could not be bought or sold, so, where only the licence (and not the business as a commercial establishment) was attached, the attachment could not achieve its purpose and a debtor's trade licence could not be attached.
After reviewing a report of its secretariat, the General Assembly took a different view. Under Article 391 of the Civil Transactions Law all of a debtor's assets secure the payment of its debts. Article 247 of Federal Decree-Law No. 42 of 2022 (Civil Procedure Code) allows a creditor, as a general rule, to attach the debtor's real and movable property whenever he fears losing the security for his right, except for assets exempted by Article 242 or by a special law. Property attached must have a money value so that it can be sold, and must not be outside commerce by nature or by law (Article 98). Trade licences are intangible components of a company that increase its value and can be valued in money, and UAE legislation does not prohibit their sale once the competent authorities approve and fees are paid, with buyer and seller complying with the rules governing commercial activities.
By the majority required under Article 20(b) of Dubai Law No. 13 of 2016, the Assembly departed from the 2018 principle and adopted the rule that trade licences and all intangible assets of a company may be attached unless dealing in them is prohibited by their nature or by law.
For creditors, a debtor company whose main value lies in its licences, registrations and other intangible assets is no longer outside the reach of attachment in Dubai. For debtors and their owners, licences cannot be treated as protected assets when judgments go unpaid. Any transfer following attachment still depends on the approval of the licensing authority.
| Articles 98 and 391 of Federal Law No. 5 of 1985 (Civil Transactions Law) — text of articles 98, 391 Decided under this law; it has been replaced by Civil Transactions Law 2025. |
| Articles 242 and 247 of Federal Decree-Law No. 42 of 2022 (Civil Procedure Code) — text of articles 242, 247 |
| Article 20 of Dubai Law No. 13 of 2016 on the Judicial Authority in the Emirate of Dubai (powers and majority of the General Assembly) |
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