Part of our series on the new UAE Civil Transactions Law (Federal Decree-Law No. 25 of 2025), in force since 1 June 2026.
The starting principle is classic and reassuring: where the terms of the contract are clear, they prevail. The judge cannot distort a plain clause under the guise of equity. This mirrors the French rule that clear and precise clauses cannot be reinterpreted without distortion.
In case of ambiguity
It is in case of ambiguity that the method becomes interesting. The Emirati judge must seek the common intention of the parties, as article 1188 of the French Civil Code provides, but the new text expressly allows recourse to three contextual elements: the commercial customs and usage of the sector, the circumstances surrounding the conclusion of the contract, and the relative position of the parties — that is, the balance of power between them.
Good faith at the centre
Above all, good faith is established as a central principle of interpretation. The contract must be read in the way that ensures loyalty between the parties. French lawyers will recognise article 1104 of the Civil Code, which requires contracts to be negotiated, formed and performed in good faith — a matter of public policy since 2016. Emirati law, heir to the Egyptian civilist tradition itself inspired by French law, fully embraces this lineage, where common-law systems traditionally remain more reluctant to enshrine a general duty of good faith.
The practical consequence is direct: in the UAE, a clause is never read in isolation. It is read in context, in the light of usage and contractual loyalty. Drafting clearly has never paid off so well.
This is work Prosilame handles: having a contract reviewed before signature.
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This article is general information and does not constitute legal advice. Each situation calls for its own analysis.