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How to Terminate a Commercial Contract in UAE?

  • August 12, 2021
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  • Comments Off on How to Terminate a Commercial Contract in UAE?

Terminating a contract without any familiarity with the law most often leads to mistakes. Therefore, corporate lawyers in Dubai are guiding people to know about their rights and responsibilities. They are assisting in learning about the legislation of UAE.

The increasing number of people to the UAE convinced legal consultants to provide services in corporate organizations. Whether you are an employee working in any organization or company owner in UAE, you can get their services to know about UAE laws.

 Lawful Termination of Commercial Contracts 

Article 273 of Federal Law No. 5 of 1985 governs the rules of the dissolution of contracts. Article 267 states 3 ways to terminate labour contracts which are described as:

·         By Mutual Consent

Most often, contracts are terminated with mutual consent of both parties and whenever a breach of contract is observed. If both parties are agreed on terminating the contract, then the Civil Code of UAE allows them to terminate the contract by drafting the clauses legitimately.

In case of breach of contract by any employees or the manager, notices a decline in employee’s performance, then they can consult corporate lawyers in Dubai and terminate the employee without any prior notice.

According to the Article 271 of Civil Law, business owners are not allowed to dismiss the employment contract without any logical reason. However, managers are allowed to terminate the contract if the employee fails to abide by the conditions stated in the contract.

  • Judicial Orders

 One can reach out to Arbitration Institute or a relevant court to seek termination of the contract according to the lawful terms stated in the contract and UAE legislation. In case the contract does not include termination clauses, this option is still valid.

  • Operation of Law

The rules and regulations of the UAE can be considered for terminating the contract under this condition. In UAE, corporate sign different types of contracts with their workforce. For using this option, it is suggested to refer to the specific laws as per the contract category.

If any unforeseeable situation occurs making the contract unfeasible to abide by, then it leads to termination of contracts. According to article 273 of the Civil code, if an event of public nature occurs and could not be handled by contracting parties, then the contract can be terminated as well.

Conclusion

Terminating a contract is not a smooth process sunless or until you get assistance form corporate lawyers in Dubai. They are familiar with resolving the issues and dealing with the legal matters expediently. You can also get their services in Ras Al Khaimah, Ajman, and other emirates of the UAE.

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