In his capacity as the Ruler of Dubai, His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE, has issued Law No. (5) of 2026 regulating the outsourcing of government services in Dubai.
The new law aims to enhance the efficiency and quality of government services while making them more accessible to customers. It also seeks to strengthen collaboration between the public and private sectors, support Dubai’s strategic goals, and create more private-sector job opportunities for UAE nationals.
What the new law says
Under the law, outsourcing allows a contracted company to provide some or all government services on behalf of a government entity, based on agreed terms and conditions. The regulation aligns with global best practices to ensure transparency, efficiency, and improved service delivery.
The law outlines the role of the Department of Finance in overseeing government service outsourcing, including setting the rules, procedures, and compliance requirements for such arrangements. Contractors must be licensed private for-profit or non-profit organisations authorised to operate in Dubai.
Who is allowed to engage contractors?
Government entities are allowed to engage multiple contractors for the same service, ensuring fair competition. Exclusive contracts are only permitted if a contractor is the sole bidder.
The legislation also defines the contents and duration of outsourcing contracts, rules for termination, and protections for contractor assets. It includes provisions on violations and penalties, and allows contractors to assist in collecting fines related to service users who breach applicable regulations.
However, contractors whose employees are granted judicial enforcement authority are prohibited from imposing fines or administrative penalties beyond those specified in the government entity’s regulations.
Who will monitor performance?
Government entities must also monitor and evaluate contractor performance regularly, using performance indicators aligned with their strategic objectives.
In addition, contractors are required to employ at least one UAE national for every non-national employee, with salaries and incentives determined according to applicable regulations and contract terms.
The law states that Law No. (12) of 2020 on Contracts and Warehouse Management in the Dubai Government will apply to contractor selection procedures and any matters not addressed in outsourcing contracts.
Government entities and contractors have three years to align their operations with the provisions of the new law, which comes into force upon publication in the Official Gazette.
