How can a U.S. startup sign a contract with a UAE company despite legal differences?

In international contracts, the parties usually explicitly agree on the applicable law. This means:

You can write: "This contract is governed by the laws of the State of Delaware, United States of America."

Or: "This contract is governed by the laws of the Emirate of Dubai, United Arab Emirates."

Or you can even choose a neutral legal system such as English law.

The rule: There is no legal problem in specifying the law of a different country, as long as it is clearly stated in the contract.

Thank you for contacting us via Legal Advice Middle East!

In cross-border contracts between a US startup and a UAE company, there are several lawful routes.

The most effective approach is usually to use a bilingual agreement with a neutral governing law and arbitration clause, while adding a compliance annex to satisfy UAE requirements.

We recently handled an identical matter and secured a favorable result for our client by drafting a clear contract that protected their intellectual property, defined payments, and ensured enforceability in both jurisdictions.

The smartest step now is to turn your commercial offer into a short-term sheet and let us prepare the binding cross-border agreement that works for both sides.

To advise you precisely, we need to review the offer and related correspondence. For further assistance and a complimentary 20-minute listening session.

Please message us on WhatsApp at [-----------].

Hello,

When your company in the USA is unable to create a direct contract with a UAE company due to differing laws, several legal alternatives can be considered:

1. Draft an international consultancy or service agreement, specifying governing law and jurisdiction, often choosing neutral venues like DIFC or ADGM courts or international arbitration.

2. Use Memoranda of Understanding (MoUs) or Letters of Intent (LoIs) as precursors to formal contracts.

3. Engage a UAE-based agent, distributor, or partner company that will enter into the contract locally while your USA company provides services.

4. Include arbitration clauses aligned with the 1958 New York Convention for enforceability.

5. Seek specialized legal advice to tailor contracts fitting both jurisdictions with clear dispute resolution mechanisms.

If needed, we can assist in drafting or reviewing cross-border contractual frameworks to ensure compliance and protection of your business interests.

Please let us know how to assist further.

Dear Client,

We have reviewed the details of your proposed engagement with the UAE company. Given that your company is U.S.-based and the legal frameworks differ, a conventional contract may not be immediately enforceable under UAE law.

To proceed safely, we recommend the following approach:

- Letter of Intent (LOI) / Memorandum of Understanding (MOU): This should outline the key terms, deliverables, and payment structure, while specifying that a binding contract will be executed once the applicable legal framework is finalized.

- Arbitration Clause: Include a neutral arbitration mechanism (e.g., DIAC or Singapore) to resolve potential disputes.

- Escrow / Payment Security: If funds are involved, an escrow arrangement can ensure protection until the formal agreement is executed.

- Optional UAE Entity: For long-term arrangements, establishing a UAE Free Zone entity can allow fully enforceable contracts under UAE law.

We can prepare a legally robust LOI or MOU tailored to your situation, ensuring your interests are protected while moving forward with the UAE company.

Please share the offer details and any relevant documents, or we can set up an online meeting so we can proceed with drafting the agreement.

Kind regards,

Adv. Rihan Raheem

Senior Legal Consultant

In your situation, the challenge is common when two companies are in different countries with different laws.

The solution is not to stop the contract, but to structure it in a way that protects both parties. This is usually done by:

Choosing a Neutral Governing Law and Jurisdiction – Instead of using UAE or US law, you can agree on an internationally recognized jurisdiction such as DIFC Courts in Dubai or ADGM Courts in Abu Dhabi, which are based on English common law and accepted by international businesses.

Alternatively, you may select arbitration through DIAC (Dubai International Arbitration Centre) or ICC (International Chamber of Commerce).

Using International Arbitration Clauses – This allows both parties to enforce the agreement in a neutral forum without being limited by one country’s law.

Drafting a Bilingual or Dual-Law Agreement – Many businesses sign contracts governed by UAE law but drafted in English, making it enforceable and understandable internationally.

Creating a Simple MOU First – While the full contract is being worked out, a Memorandum of Understanding or Letter of Intent can record your deal terms to give comfort until the final binding contract is signed.

I can help you draft a legally binding agreement tailored for your startup, ensuring enforceability both in the UAE and internationally. This will protect your interests while also making the deal attractive for the UAE company.

If your US startup cannot sign a UAE contract due to legal differences, you can:

MOU or LOI – Draft a non-binding agreement outlining key terms, governing law, and dispute resolution.

Service Agreement via US Company – Provide services from your US entity, with payment and terms under US or neutral law.

Escrow / Payment Protection – Use an escrow or secure payment method to ensure funds.

Future UAE Entity Formation – Establish a UAE Free Zone company to formalize the contract later.

Clear Exit/Termination Terms – Include termination and liability clauses in all preliminary agreements.

Advise: Document everything in writing and consider a UAE-licensed lawyer to review agreements.

We are honored to represent you legally. If you wish to be represented, please contact us via email: [------------] or by phone: [------------].

To create a legally binding contract between your US startup and an Emirati company, contact a UAE contract law specialist to ensure it complies with UAE law and addresses legal differences between the two countries.

You must also include essential elements, such as a clear offer and acceptance, a legal purpose, and specific payment terms, to make the contract enforceable in the UAE.

Greetings,

When dealing with cross-border contracts between a U.S. company and a UAE company, the key issue is determining the applicable law and jurisdiction. You may include specific clauses in the agreement to resolve this, or structure the contract under a neutral jurisdiction that both parties accept.

To protect your rights and avoid future disputes, we recommend a tailored legal review. You may book a consultation through our website or authorize our office to draft and negotiate the contract on your behalf.

We are happy at Future Vision Law Advocates and Legal Consultancy to assist you and provide the best legal services that meet your needs.

To contact us, you can call or WhatsApp us at [------------].