United Arab Emirates: Ready, Steady Go On the Starting Blocks

Last Updated: 20 December 2017
Article by Nadim Bardawil

As use of blockchain technology increases in the UAE, Nadim Bardawil of BSA Ahmad Bin Hezeem & Associates LLP looks at how it is being used in the Emirates and the legal questions it is raising.

The Middle East continues to be a base for businesses which want to gear towards digitalisation and achieve results using cutting edge technology. As a result, in order to remain competitive and maintain growth, many companies are beginning to let go of their traditional operating models and are replacing them with new, improved ones which maintain security. One particular trend which is emerging is blockchain technology, a technology which integrates a shared database with smart contracts in order to reduce costs and speed transactions.

What is blockchain?

Blockchain is a transparent and secure storage unit that operates without a central control body. It is a database that contains the history of all information exchanged and transmitted between its users since its creation. This information is integrated into 'blocks' and can be shared by its users without the need for intermediaries.

Each block contains information stored on and accessed by unrelated computers or servers around the world. These then form a ledger of all the transactions involving the information and these blocks are grouped together in a chain to which new information is added.

Blockchain is considered to be secure and even unhackable for two major reasons - the high level of computing power required to find a vulnerability in the system and the blockchain's lack of complexity.

While it is often used as a decentralised public ledger (for example with bitcoin and other crypto-currencies), it can also be used as a private intranet system where only authorised participants can access the information and network, or add blocks to the chain.

Blockchain Integration in the UAE

The UAE has become a leader in integrating blockchain technology and there have been various ventures launched in the Emirates by public and private institutions.

For example, Emirates Islamic is currently planning to integrate blockchain technology into cheques and will be the first Islamic bank to do this.

In order to help prevent fraud, they have taken the initiative to enhance security and banking transaction protection.

They plan to issue new cheque books which have a combination of Quick Response (QR) codes and blockchain technology. In addition, each cheque will be registered in order to validate the authenticity of the cheque the moment it is issued.

Meanwhile, the Abu Dhabi Securities Exchange (ADX) is another UAE institution which has announced plans for developments in this area, in the form of an e-voting platform which will be based on blockchain technology. ADX aims to use blockchain to allow annual general meetings to be conducted faster and with less effort while also ensuring secure voting and access to confidential documents.

In addition, in Dubai, Smart Dubai has been launched to help the city use innovative technology to improve the quality of life. One of its goals is to use blockchain technology in both public and private business transactions to increase efficiency.

The Department of Economic Development has already begun testing the use of blockchain when licensing companies in the Emirate and the Department of Naturalisation and Residency is looking to use this technology to speed up immigration procedures at Dubai airports.

Industry Potential

While these examples are a positive start, blockchain also has the potential to be used in many other industries to increase efficiency and security.

For example, IP registration (e.g. of trademarks, patents, copyrights and designs) can be greatly improved by integrating blockchain technology into the registration process at the trademark office level in individual jurisdictions. By using an interconnected smart ledger, trademark offices can ensure more accurate record keeping and improve usage registration. IP owners can also securely register where and when they use their IP, aiding protecting against counterfeit products and unlawful usage.

There have also been a number of attempts to use blockchain to assist in land registrations. As using a secure, robust recording system like blockchain can ensure the registration of title deeds is traceable and help reduce incidents of fraud in property transactions.

Recently the Dubai Land Department announced it was going to implement blockchain technology to register real estate transactions.

However, as with any new technology, there are always integration and application obstacles, and with blockchain, these need to be carefully considered.

Anonymous transactions

One of blockchain's fundamental innovations is the ability to transact and exchange information anonymously. Most currency related transactions do not require the parties to know each other, meet face-to-face or directly interact in order to exchange value. However, legislators can still face difficulties in this respect on the application of their laws and regulations. For example, it is necessary to follow rules on 'know your customer' and anti-money laundering when processing financial transactions. Over time, blockchains and other new payment networks will not be exempt from these legal requirements, and some countries have already gone as far as banning or severely restricting crypto-currencies because of the lack of regulations and uncertainty.

Data Privacy

Blockchain also raises challenges on data privacy as data is stored on each block. Some laws require corporations to permanently remove data which belongs to individuals once a request has been made. This creates problems for a blockchain platform, as by nature, they do not allow data to be easily modified or deleted, but instead merely updated in subsequent blocks. As data protection legislation continues to evolve, blockchain models will need to evolve in parallel and find solutions to these privacy issues.


In theory a decentralised blockchain system can be accessed from any computer around the world. Therefore, there is a question of which jurisdiction governs any dispute which arise in a blockchain transaction. In practice, regardless of the transaction mechanism used in a contract, or the location of that contract, a suit can be brought based on the jurisdiction detailed in the contract. However, with blockchain, identifying the proper forum for a dispute is a complicated matter. Therefore, it is necessary to exercise caution when creating a blockchain to ensure users' rights are clearly protected and a forum for disputes is pre-selected when users begin to transact using the blockchain.


The issue of liability is also raised with a decentralised blockchain model, if and when individual transactions are not properly registered. If there is any breach of privacy or security, it is difficult to pinpoint who is liable for these actions. Liability, is still an issue in a private blockchain model, as there is potential for a malfunctioning blockchain. If this happens, the company hosting and or managing the blockchain may have to bear the brunt of the blame. In either situation, it is vital liability questions are considered and answered in order to allow users and companies to adequately measure risks of using blockchain. Although blockchain has clear untapped potential, there are still issues with the day to day application of this technology. Therefore, both governments and businesses should work together to try to highlight these and jointly find innovative ways to overcome them, as the fast-paced nature of today's technology requires greater cooperation between all relevant stakeholders.

Originally published in the December 2017 edition of Emirates Law Magazine.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement

    Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of www.mondaq.com

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at enquiries@mondaq.com.

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions