Letter Of Intent To Extend Contract Template for the United Arab Emirates

A Letter of Intent to Extend Contract is a formal document that expresses your intention to continue an existing contractual relationship beyond its original expiration date. Under UAE law, this document serves as a preliminary commitment while you negotiate the detailed terms of the extension, providing legal protection and clarity for all parties involved in the business relationship.

When do you need this document?

You need this document when your current contract is approaching its expiration date but you want to continue the business relationship. This commonly occurs in construction projects where additional time is required for completion, service agreements that have proven successful and warrant continuation, or supply contracts where ongoing procurement is beneficial. The document is particularly valuable when immediate formal extension isn't possible due to pending negotiations on modified terms, budget approvals, or regulatory requirements. In the UAE's dynamic business environment, this document helps maintain business continuity while ensuring legal compliance during transition periods.

Key legal considerations

Your Letter of Intent must clearly identify all parties involved and reference the original contract with specific details including contract number, execution date, and key terms. You should specify the proposed extension period, any modifications to existing conditions, and the timeline for finalizing the formal extension agreement. The document should address whether existing terms remain in effect during the extension period and clarify any changes to pricing, scope of work, or performance obligations. Include provisions for what happens if formal extension negotiations fail, and ensure all parties understand their continuing obligations under the original contract during the interim period.

Legal requirements in United Arab Emirates

Under UAE Federal Law No. 5 of 1985 (Civil Code), particularly Articles 141-176 governing contract formation, your Letter of Intent must demonstrate clear mutual consent and consideration for the extension. The document must comply with UAE Federal Law No. 18 of 1993 (Commercial Transactions Law) if it involves commercial entities, ensuring proper corporate authority exists for contract modifications. If either party operates within the Dubai International Financial Centre (DIFC), you must also consider DIFC Contract Law requirements. The letter should be executed on company letterhead, include proper signatures from authorized representatives, and specify the governing law clause. For contracts involving government entities or certain commercial sectors, additional regulatory approvals may be required before the extension becomes effective.