1. Introduction

Debt recovery is an important aspect of cash flow management. It refers to the process of recovering money that is owed on account of unpaid loans, invoices, cheques or other transactions. It is a formal demand made to assert the rights of parties. This is because unpaid debts can seriously affect cash flow, business continuity, and financial stability.

To prevent such situations, the UAE provides a comprehensive legal framework to secure the rights of creditors by ensuring that every party to the transaction respects its undertaking and promise. It is based on the principles of Stakeholder Theory, which stipulates that partnerships are meant for the mutual benefit of the parties and aim for long-term cooperation rather than confrontation.

Are you facing unpaid dues and unsure how to initiate the debt recovery process in the UAE? Continue reading to understand your legal rights, available remedies, and the correct procedure to recover your money under UAE law.

2. Legal Framework Governing Debt Recovery in the UAE

The Federal Law Decree No. 5 of 1985[1] (as amended) is the core legislation that governs the contractual rights, obligations and remedies. The Commercial Transactions Law (Federal Decree-Law No. 50 of 2022) addresses business-specific debts, including promissory notes and dishonoured cheques[2]. The procedural aspects are governed by the Federal Decree-Law No. 42 of 2022 which provides the basis for initiating civil action before the Court of First-instance, if the creditor’s right is well established[3]. The right must be due for settlement. The subject matter of the claim can either be:

• A debt of money of a specified amount; or
• Self-defined or specified moveable property.

It is important to note that cheques are not included in this category and such matters are taken up through Cheque Execution. (link for cheque execution article can be added here for later)

The recent amendment on 11^th December 2025 introduced specialized inheritance chambers, expanded appeal rights to the Court of Cassation, and enhanced technical expertise in courts, thereby streamlining dispute resolution[4]. This interplay of regulations aims at building a creditor-friendly environment which helps to promote investor confidence and economic stability.

3. Preconditions for Initiating Debt Recovery Proceedings in the UAE

The first step towards formally initiating the process of recovery is sending a legal notice or demand letter. This marks the beginning of the process. The creditor sends a notice formally asserting his/her right to be paid back as per the agreement that was entered into with the debtor[5]. It is different from friendly reminders and often resorted when the debtor defaults to perform his obligations.

It is sent to assert the obligation of performance agreed by parties in good faith and state the consequences of non-fulfilment. This consequence is often in the form of initiating a legal action before the competent court to recover the amount.

4. Legal Remedies Available for Undisputed Debts in the UAE

If the debtor defies the notice, the next resort is to initiate a petition before the Court of First Instance where the debtor resides, contract was executed or performance is due. The petition is often called a Payment Order or Writ of Debt[6]. It is a fast-track court order intended to prevent lengthy litigation and avoid causing irreparable harm to the creditor. The proceedings are summary in nature and used for simple debts only. It can be used in cheque bounce cases or where the debt is fixed, due, undisputed and admitted in writing.

 The petition must include the following:

• Statement of the claim;
• Proof of debt;
• Proof of sending the demand notice.

The petition is reviewed ex-parte by the court, and the order is issued within 3 days if the court is satisfied. The parties are generally not required to be physically present before the Court. After the order is issued, the creditor serves the writ upon the debtor within three months of issuance. The debtor has 15 days to notify any grievances with respect to the order. This marks the completion of the process.

5.  Judicial Remedies for Disputed or Complex Debt Claims

If the debt is complex in nature, creditors prefer resorting to filing a civil or commercial case as per the provisions of Federal Law Decree No. 42 of 2022. The proceedings are not summary and also deals with record of evidence. After the legal notice is served, the case can be initiated before the Court having jurisdiction either where the debtor resides or where the contract was executed[7].

Before filing the case, it is important to understand the nature of the case i.e., whether it is civil or commercial? The difference lies on the basis of court jurisdiction, limitation and interest.

Take a look at this compare table to help you make the right choice based on correct understanding.

To initiate the case, the creditor is required to submit a detailed Statement of Claim online via the court portal, outlining the dispute, legal grounds, and requested remedy. The process is complex and requires legal expertise to ensure compliance.

6. Adjudication and Determination of Debt Recovery Claims

After the trial procedure is complete depending upon the nature of the debt, the court issues a judgement. The judgement may order full payment, allow instalments, award interests/cost or dismiss the claim if it is not proved to the satisfaction of the court.

However, it is important to note that while judgement is the deciding factor; it is only a part of the process. The actual recovery takes place during execution proceedings. UAE law provides strong enforcement tools against non-paying debtors. Travel bans are commonly used where there is a risk of the debtor absconding.

7. Importance of Hiring a Debt Recovery Lawyer in the UAE

Debt recovery in the UAE involves strict procedural requirements, jurisdictional rules, and enforcement mechanisms such as asset attachment and travel bans, making legal guidance essential. Engaging an experienced debt recovery lawyer ensures that claims are filed correctly, evidence is properly presented, and enforcement actions are pursued efficiently without procedural delays. A specialized law firm like Khalifa Bin Huwaidan Advocates and Legal Consultants helps creditors navigate UAE civil and commercial laws effectively, maximize recovery prospects, and protect their legal rights at every stage of the debt recovery process.

[1] Federal Law Decree No 5 of 1985 (UAE)

[2] Federal Decree-Law No 50 of 2022 on Commercial Transactions (UAE).

[3] Federal Decree-Law No 42 of 2022 on Civil Procedure (UAE).

[4] UAE government issues Federal Decree-Law amending certain provisions of Civil Procedures Code, WAM (11 December 2025) https://www.wam.ae/en/article/bn5rrj4-uae-government-issues-federal-decree-law-amending

[5] Civil Procedure Code, Art 63 of Cabinet Decision No 57 of 2018 (as amended).

[6] Payment orders, Abu Dhabi Judicial Department (ADJD) https://www.adjd.gov.ae/en/pages/PaymentOrder.aspx

[7] Debt Recovery & Legal Proceedings in the UAE, Inlex Partners (14 November 2025) https://inlex-partners.com/blog/debt-recovery/

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