Mandate And Fee Agreement Template for the United Arab Emirates

A Mandate and Fee Agreement is a legally binding contract that establishes the relationship between a principal and a service provider or agent in the United Arab Emirates. This document grants specific authority to the service provider to act on behalf of the principal while outlining the commercial terms, including fee structures and payment arrangements. Under UAE law, these agreements are essential for ensuring clarity in business relationships and protecting the interests of both parties involved in professional service arrangements.

When do you need this document?

You need a Mandate and Fee Agreement when appointing consultants, financial advisors, or professional service firms to act on your company's behalf in the UAE. This document is particularly important when engaging corporate service providers to handle business registration, licensing, or regulatory compliance matters. Investment advisors and management companies require this agreement to establish clear authority for financial decisions and portfolio management. Commercial agents representing your business in the UAE market must have a properly documented mandate to ensure legal compliance. Professional services firms providing ongoing advisory services, such as legal or accounting support, also require this agreement to define their scope of authority and fee arrangements.

Key legal considerations

The scope of authority granted to the service provider must be clearly defined to prevent disputes and ensure compliance with UAE commercial law. Fee structures should specify whether charges are fixed, hourly, percentage-based, or performance-related, along with detailed payment schedules and VAT implications under UAE Federal Decree-Law No. 8 of 2017. Termination clauses must address notice periods, outstanding obligations, and the return of confidential information or documents. Liability limitations and indemnification provisions protect both parties while ensuring compliance with UAE Civil Code requirements. The agreement should include dispute resolution mechanisms, preferably specifying UAE courts or arbitration procedures. Confidentiality obligations are crucial when the service provider will access sensitive business information or trade secrets.

Legal requirements in United Arab Emirates

Under UAE Federal Law No. 5 of 1985 (Civil Code), mandate agreements must clearly establish the relationship between principal and agent, with specific attention to the scope of authority granted. The UAE Commercial Code requires that commercial mandate agreements comply with general contract formation principles, including offer, acceptance, and consideration. For commercial agency relationships, UAE Federal Law No. 18 of 1981 (Commercial Agency Law) mandates registration requirements and provides specific protections for agents. Corporate principals must ensure they have proper authority under UAE Federal Law No. 2 of 2015 on Commercial Companies to enter into mandate agreements. VAT registration and compliance obligations must be addressed for professional services under UAE tax law. The agreement should specify governing law as UAE law and designate UAE courts for jurisdiction to ensure enforceability.