Sheikh Mohammed Issues Law Regulating Outsourcing Of Government Services In Dubai

In his capacity as the Ruler of Dubai, Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE, has issued a law (No. (5) of 2026) regulating the outsourcing of government services in Dubai.

As defined by this law, outsourcing refers to a contracted company delivering some or all services on behalf of a government entity under agreed terms.

The law aims to enhance the efficiency of government services efficiency, improve quality and ease customer access.

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The law lays out the responsibilities of the Department of Finance in governing this kind of outsourcing.

It details the rules and procedures for outsourcing and sets out the obligations of the contractor - defined as a licensed private (for-profit or non-profit) organisation authorised in Dubai to carry out the outsourcing contract.
Fair competition: According to the law, a government entity may engage one or more contractors to provide the same service but cannot enter into exclusive contracts unless a contractor is the sole bidder, ensuring fair competition.
Outsourcing contract: The Law defines what must be included in the outsourcing contract, its duration, rules for termination and measures to protect the contractor's assets.

Violations and penalties: It also covers violations and penalties, allowing the entity to involve the contractor in collecting any fines related to breaches of applicable regulations by service users.
Monitoring: According to the law, the government entity must regularly monitor and evaluate the contractor's performance, using performance indicators set out in the outsourcing contract.
At least one Emirati for each expat employee: The law requires the contractor to employ at least one UAE national for each non-national employee. The salaries and incentive mechanisms for UAE national employees must follow applicable regulations and the terms agreed in the outsourcing contract.

Provisions of Law No. (12) of 2020 on Contracts and Warehouse Management in the Dubai Government apply to the procedures to selecting a contractor and to any matters not specifically addressed in the outsourcing contract.

The new law also requires the government entity and the contractor to ensure their operations comply with its provisions within three years from the date the law takes effect.
Any provision in other legislation that may conflicts with this law is repealed to the extent of the conflict. This law is effective from the date of its publication in the Official Gazette.

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