PRC-Based Investors Can Now Enforce Claims in the Middle East

International investors and other claimants have long struggled to enforce cross-border claims in the United Arab Emirates (UAE) and the wider Middle East. Recent UAE courts decisions informing how they approach enforcement against debtors, including sovereigns, have signalled that the tides may be turning in creditors’ favor. For instance, in May 2024, as part of a global campaign spearheaded by Kobre & Kim, the Dubai Court of Cassation issued a judgment unwinding a debtor’s transfer of shares to a family member to monetize a claim originating in the UK.  This was one of the first foreign judgments to be enforced n the UAE under the new enforcement regime.

In addition to domestic courts increasing willingness to enforce cross-border judgments and awards, aggressive and creative strategies can pay dividends by accelerating enforcement timelines, saving creditors time and money, and managing collection risks, including:

1. Alternate Pathways. Investors should pursue strategies with an outsized impact, such as applying for judicial discovery in a jurisdiction with broad discovery procedures to identify a debtor's assets worldwide. Such creative strategies (1)improve recovery prospects and (2) can also increase the sale value of the claims in secondary markets.
2. Future Receivables or Third-Party Debts. When the debtor is owed money from contracts or unrelated legal claims, a court-appointed receiver may allow creditors to take control of future receivables, preserving them for monetization while shielding them from competing creditors. Various jurisdictions' laws allow receivers to gather receivables as they accrue over time before passing them along to the creditor. Similar principles allow receivers to collect debts owed to the debtor by third parties.

PRC-based creditors now have an expanded suite of tools in the UAE to combat recalcitrant debtors across the region. For clients focused on collecting what is rightfully theirs, new tools provided by the UAE courts, combined with a clear understanding of aggressive enforcement strategies across jurisdictions, can build the leverage needed to reach favorable resolutions and recoveries.

About Kobre & Kim

Kobre & Kim is a global law firm focusing on cross-border disputes and investigations, often involving fraud and misconduct. The firm:

• Formulates and executes cross-border strategies across global jurisdictions, including  Brazil, BVI, Cayman, Cyprus, Delaware, Dubai, Hong Kong, Israel, Korea, New York, and the PRC.
• Focuses on helping clients realize value from their claims, developing investigative, enforcement, and asset tracing/recovery plans in the pre-dispute stage to maximize future monetization.
• Often works with other law firms as special counsel to enforce high-value judgments, arbitration awards, and defaulted debt worldwide with our integrated team of former government prosecutors, Hong Kong solicitors, UK solicitors and barristers (including King's Counsel), and offshore lawyers.