United Arab Emirates: Tender And Procurement Law Of Abu Dhabi

Last Updated: 12 July 2018
Article by STA Law Firm
Most Read Contributor in United Arab Emirates, November 2018

What are Tender and Procurement processes?

Tender and procurement are two processes that go hand in hand. You cannot have one without the other, and these processes are ones which occur in a multitude of countries and jurisdictions around the world. In a world with as many complexities as ours, it would be near impossible for a single business to perform at the top level in all different aspects due in large part to the vast number and extensive variety of elements of a company. There will almost always be another entity that can do a specific aspect of work of a business better than that business itself.

Below mentioned is a rudimentary example of the tender and procurement process. In this instance, IT projects within a fashion company need to be completed. In terms of such work, they would have to call in specialists. Tender and procurement work on the fundamental principle that companies subcontract parts of their business to those who have superior capabilities in the relevant fields. This principle can be seen on a scale much more significant than the abovementioned.

Tender is a process through which a party, known as the promoter, will first specify what service they are looking to obtain. They can then begin a bid, which is what is known as a tender. Interested parties will then be able to come up with proposals on how exactly they would go about meeting the specifics of the requirement. The promoter will have provided specific qualifications as to how they would want the service to be acquired or completed, and this would include a deadline, etc. The party would then select from the biding entities based on their proposals, and then the winning bidder would be contracted to perform the work.

Procurement is the other side of this story. While the tendering party is looking to bid away work to the best potential entity, the procurement party engages in a bid in a tendering to procure a project from the promoter and obtain contracts in this way. There are entire businesses which rely on acquired work, and these types of companies often specialize in specific industries.

One of the most common tenders is usually the government and public sector themselves, as they outsource activities to private businesses, and this can include immense scale and essential projects. However, any company can start a tendering. There are usually differences between a public tender and a private tender, with individual bids often being an integral part of the businesses operations and a required process. However, this is often not the case with public tenders.

From a global perspective, public sector tendering is massive business, and not just anyone can win a bid. To give an idea of the scale of this, in European countries (or at least those that are part of the EU), the laws that dictate tender and procurement may originate from within that country, though there are general underlying EU rules on the matter. This inclusion shows that the issue is on a scale where the attention of the EU is upon it.

The UAE’s Approach

The primary law governing tenders and procurement in the UAE is the Law Number 6 of 2008 and all issues relating to this matter including the legislation are under the wings of the Department of Finance (DOF). The DOF is in Abu Dhabi, and they provide public financial services to the Abu Dhabi Government. Since its creation in 2008, there has been an amendment of the law, and it is now available on the DOF website and acts as a manual which is intended for all government entities.

As per the law, there should be a standard format that government contracts should look to follow and this general standard applies in most cases, except for the area of construction contracts according to Article 5 section 1 of Law Number 6. While this may be the case, there may indeed arise occasions where the standard contract doesn't contain certain elements that may be required. In this case, Article 5 section 2 states that any and all exceptions must be approved of by the Purchases section head and reviewed by the legal division at the specific government entity that is the promoter. This provision is the minimum requirement for any diversion from the standard.

Under Article 7 of the guide introduces the concept of purchasing section. This section is the group that is responsible for securing the government entity throughout their deals with external parties. Some of their key responsibilities include:

  1. Ensuring the best prices and facilities are obtained for the government entity
  2. The outsourcing of work to suitable entities
  3. Also ensuring that the work is completed and takes into account the appropriate locations, times and quantities

The purchasing section is also able to make purchases on materials and related items through bids of the value of between AED 25,000 and AED 250,000. Anything above this must be taken up with the Tenders and Auctions Committee via memorandum.

On top of this, there are three primary responsibilities which the purchasing section must watch over. These are:

  1. To collect information regarding materials and suppliers, and to maintain those records
  2. To determine the standard specifications of the items and materials
  3. To ensure quality assurance on the topic of purchases activities tender documents and evaluations and consider the standards of the sustainability, environmental protection and SME and local economy support.

Article 9 considers the ethical responsibilities of government entities while they are in the processes of tender and procurement. The work is to be completed with the utmost transparency and in a highly professional manner. The aim of government work, in the end, is to move the country progressively forward, in a respectable and dignified direction. This aim includes not taking on contracts with those whose intentions are only to progress their matters rather than thinking of the more significant concern of the nation as a whole. I order to achieve this more easily; the government entity should look to educate and instill these concepts into their employees, and thus creating a positive atmosphere and ensuring that the proceeding contracts and outcomes are only favorable.

Article 12 introduces the requirement for government entities to set up a Tender and Auctions Committee. This job falls to the chairman of said entity, and there is a specific structure with is also mentioned in the Article. The committee must be composed of a minimum of 5 members and requires a chairperson and their alternate. This committee will meet to discuss and further all elements of the tender and Auction activities, and the voting system within the committee works on a simple majority basis with the casting vote going to the committee chairman. Their primary purpose is to govern the overall strategies and future of tenders and procurement for their respective government branch.

The manual proceeds to discuss further committees within the entity and outlines procedure rules across all stages of tender and procurement.

The Future and PPP

Private Public Partnership (PPP) are very much as they sound. The PPP is a partnership formed between public government bodies and private external entities. Within this relationship, each party has its role to play, and of late, the matter has seen a rise of attention in the UAE. With the implementation of this concept within the country, the hope is that a culture of growth based on knowledge, expertise, and diversity will begin to flourish and help the economy to grow to new strengths. It will also expand business within the country, and the hope is that it may bring in foreigners and their innovations and investments.

What has given hope and light to this is the recent introduction of the UAE Cabinet Resolution (1/1) of 2017. Similar to Law Number 6 of 2008, this piece of legislation behaves as something of a manual that is to be followed to attain the abovementioned and the location of such is on the Ministry of Finance website.

Chapter two of the manual covers the contracts between private and public parties in an overview. 2.1 states that the agreements between these parties are for the good and growth of the country and the projects should look to improve the infrastructure of the nation. These contracts are to be long-term and should use to their advantage the resources, knowledge, and expertise of the private party. The projects and works provided are not intended for the maximization of profit of either of the parties to the contract. Preferably the primary focus should be on the growth and well-being of those sectors of the UAE.

The announcement of the initial project under the new PPP law was in March of 2018, and the plan is to build a new fully automated carpark with over 1,200 spaces, and the structure would also house the Supreme Court. The project is purported to take around three years to complete, and cost around AED 290 million.

Projects such as this demonstrate the goal of the PPP scheme. In this specific case, the construction is commencing of a car park that will provide and ease the lives of hundreds and thousands of individuals within the city, and this is just the first project of many more to come. It will allow for highly valuable and needed projects to rise and be run by private sector experts allowing for high quality and innovative expansion. The setting in motion has taken place for the achievement of the goal of growing the country's economy and expanding the infrastructure to achieve the UAE of the future.

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
Related Topics
Related Articles
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
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

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 or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq 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 of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

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