The DIFC Court of First Instance has affirmed its jurisdiction over a high-stakes recovery claim, ruling that a bank’s status as a Recognised Member of NASDAQ Dubai qualifies it as a "DIFC Establishment" for the purposes of the Courts Law.
What is the nature of the USD 90 million dispute between Emirates NBD Bank and the Almakhawi family?
Emirates NBD Bank (ENBD) initiated these proceedings to recover approximately USD 90 million, alleging that the Defendants—Rashed Abulaziz Almakhawi and his children, Abdulaziz, Hessa, and Shamma—engaged in a coordinated scheme to frustrate the execution of existing judgments. The Bank asserts that the Defendants transferred assets to one another specifically to place them beyond the reach of creditors following a Dubai Court of Cassation judgment and an English High Court cost order.
The legal basis for the Bank’s claim rests on several provisions of the UAE Civil Code. Specifically, the Bank seeks damages for acts causing harm under Article 283, orders to unwind asset transfers under Article 391, and declarations that the transactions between the family members were "sham transactions" pursuant to Articles 394 and 395. The stakes are underscored by the scale of the underlying liabilities, as noted in the court record:
A default costs certificate issued by the English High Court dated 20 October 2023 against both the First and Second Defendants ordering them to pay the Claimant’s costs of the English proceedings in the sum of GBP 1,144,319.45 (AED 5,291,104).
Which judge presided over the CFI 039/2025 jurisdiction challenge and when was the order issued?
The matter was heard before H.E. Justice Michael Black in the DIFC Court of First Instance. Following a hearing held on 17 March 2026, Justice Black issued the Order with Reasons on 3 April 2026, dismissing the Defendants' jurisdictional challenges and granting the Bank’s application for a freezing order.
What specific legal arguments did the Defendants and Emirates NBD Bank advance regarding DIFC jurisdiction?
The Defendants challenged the court's jurisdiction under RDC Part 12, arguing that ENBD did not meet the criteria of a "DIFC Establishment" or "Licensed DIFC Establishment" required to invoke the court's authority under the relevant statutes. They contended that the Bank’s corporate structure and operations outside the DIFC precluded the court from exercising jurisdiction over a claim involving non-DIFC parties and assets.
Conversely, counsel for the Bank, James Weale and Gregor Hogan, argued that ENBD’s status as a Recognised Member of NASDAQ Dubai brought it squarely within the definition of a DIFC Establishment. They maintained that the legislative intent of the Courts Law was to provide a forum for international financial institutions operating within the DIFC ecosystem, regardless of whether the specific transaction in question was physically executed within the Centre.
What was the precise doctrinal issue the court had to resolve regarding the definition of a DIFC Establishment?
The court was tasked with determining whether the statutory definition of a "DIFC Establishment" under Dubai Law No. (2) of 2025 is broad enough to encompass a bank that is a Recognised Member of NASDAQ Dubai. The doctrinal tension lay in whether the "DIFC Establishment" status is strictly limited to entities physically licensed to conduct financial services within the DIFC or if it extends to entities that participate in the DIFC’s financial infrastructure, such as the NASDAQ Dubai exchange.
How did Justice Michael Black apply the test for DIFC Establishment status to ENBD?
Justice Black rejected the Defendants' restrictive interpretation, emphasizing that the legislative purpose of the Courts Law would be undermined if entities participating in the DIFC’s financial markets were excluded from the court's jurisdiction. He reasoned that the Bank’s participation in NASDAQ Dubai constituted the carrying out of financial services within the meaning of the law.
The judge found the Defendants' arguments to be disconnected from the commercial reality of the DIFC’s regulatory framework. He noted:
I find an air of complete unreality in the Defendants’ submissions. It is inconceivable that the legislative purpose of the Courts Law was to exclude transactions undertaken on an international financ
Furthermore, the court clarified the scope of its authority once that status is confirmed:
In the same way once it is established that a bank trading on NASDAQ Dubai is a DIFC Establishment the DIFC Courts will
“exclusive jurisdiction”
to hear and determine claims over any branch of that bank wherever located.
Which specific statutes and RDC rules were applied to determine the court's authority?
The court relied primarily on Dubai Law No. (2) of 2025, specifically Article 14(A)(1), which governs the jurisdiction of the DIFC Courts. Justice Black also referenced Article 37 and Article 41 of the same law to interpret the scope of the court's powers. Procedurally, the applications were governed by RDC Part 12 (Jurisdiction), RDC 25.1(6) (Freezing Orders), and RDC 4.2(1) (Extensions of Time).
How did the court utilize previous DIFC precedents to support its jurisdictional finding?
The court drew upon Dr. Lothar Ludwig Hardt and Hardt Trading F.Z.E. v DAMAC (DIFC) Company Limited to reaffirm that the jurisdiction of the DIFC Courts is entirely statutory. Additionally, the court looked to Larmag Holdings BV v First Abu Dhabi Bank PJSC to interpret the requirements for "Licensed DIFC Establishment" status. Justice Black used these precedents to bridge the gap between the Bank’s status as a NASDAQ member and the statutory definition of a DIFC Establishment, concluding:
Turning to the first stage, I agree with the Bank that for present purposes there is no material difference between the wording of Article 5 of the JAL and Article 14 of the Courts Law.
What was the final disposition of the applications and the relief granted to the Bank?
Justice Black dismissed the jurisdiction challenges brought by the First, Second, Third, and Fourth Defendants. The court granted the Bank’s FO Application, issuing a freezing order against the Defendants' assets. Additionally, the court granted the Second Defendant’s application for an extension of time to file jurisdictional challenges. The Defendants were ordered to pay the Bank’s costs, to be assessed on the standard basis. The court also noted the suspicious nature of certain financial activities:
I find the absence of any explanation for the payment of over USD 26 million to the jewellers to be remarkable.
How does this ruling change the landscape for banks and litigants in the DIFC?
This decision significantly broadens the understanding of who qualifies as a "DIFC Establishment." By confirming that Recognised Members of NASDAQ Dubai fall under the court's jurisdiction, the ruling ensures that major financial institutions participating in the DIFC’s capital markets are subject to the DIFC Courts' oversight. Future litigants must now anticipate that any entity with a formal connection to the DIFC’s financial infrastructure—even if not a traditional "licensed" entity—may be subject to the court's jurisdiction, including the power to issue freezing orders over global assets.
Where can I read the full judgment in Emirates NBD Bank PJSC v Rashed Abulaziz Almakhawi [2026] DIFC CFI 039?
The full judgment can be accessed via the DIFC Courts website: https://www.difccourts.ae/rules-decisions/judgments-orders/court-first-instance/cfi-0392025-emirates-nbd-bank-pjsc-v-1-rashed-abulaziz-almakhawi-2-abdulaziz-rashed-abdulaziz-mohammed-almakhawi-3-hessa-rashed
Cases referred to in this judgment:
| Case | Citation | How used |
|---|---|---|
| Dr. Lothar Ludwig Hardt and Hardt Trading F.Z.E. v DAMAC (DIFC) Company Limited | [2009] DIFC CFI 036 | To establish that DIFC jurisdiction is entirely statutory. |
| Larmag Holdings BV v First Abu Dhabi Bank PJSC | [2019] DIFC CFI 030 | To interpret the status of Licensed DIFC Establishments. |
Legislation referenced:
- Dubai Law No. (2) of 2025, Concerning Dubai International Financial Centre Courts, Articles 14(A)(1), 37, 41
- Rules of the DIFC Courts (RDC), Part 12, RDC 25.1(6), RDC 4.2(1)
- UAE Civil Code, Articles 283, 391, 394, 395