What's Happening?
Dubai has introduced Law No. 7 of 2025, set to take effect on January 8, 2026, which mandates all contractors operating within the Emirate to be licensed and registered in a new central Register managed
by the Dubai Municipality. This law aims to regulate contracting activities, including construction, demolition, and engineering, across Dubai, including special development zones and free zones. Contractors must comply with new classification systems based on technical, financial, and administrative capabilities, and ensure all technical staff hold a Professional Competency Certificate. The law also introduces penalties for non-compliance, such as fines, suspension of licenses, and downgrading of contractor classifications.
Why It's Important?
The implementation of Law No. 7 of 2025 is significant as it seeks to elevate the standards of Dubai's construction industry by promoting transparency and reducing unsafe practices. By enforcing stricter registration and classification requirements, the law aims to minimize technical failures and project delays, thereby enhancing investor confidence and supporting sustainable development. The regulation may lead to market consolidation, as smaller contractors might struggle to meet the new standards, potentially increasing operational costs but offering long-term benefits in reliability and safety.
What's Next?
Contractors are encouraged to begin preparations immediately to comply with the new law by January 8, 2027. This includes registering on the Municipality's system, ensuring technical staff certification, and adhering to new subcontracting regulations. The establishment of a permanent oversight committee will further regulate and develop construction activities, ensuring compliance and proposing additional policies. Contractors who act early will reduce risks and position themselves favorably in the competitive market.
Beyond the Headlines
The law represents a shift towards international best practices in credentialing and transparency, aligning Dubai's construction sector with global standards. The integration with the 'Invest in Dubai' platform will facilitate digital transformation, streamlining approvals and enhancing transparency. This reform is part of Dubai's broader ambition to modernize the sector, supporting its reputation as a world-class construction hub.
