Non Reliance Letter Hold Harmless Letter Template for the United Arab Emirates
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What is a Non Reliance Letter Hold Harmless Letter?
The Non Reliance Letter Hold Harmless Letter is a critical document in UAE business transactions where information is shared between parties but the provider wishes to limit their liability and potential exposure. This document type is commonly used in due diligence processes, business sales, consulting arrangements, and financial transactions within the UAE jurisdiction. The letter explicitly states that the recipient is not relying on any representations made by the provider and includes hold harmless provisions to protect the provider from future claims. It must be carefully drafted to comply with UAE civil and commercial laws, particularly Federal Law No. 5 of 1985 and Federal Law No. 18 of 1993, while ensuring the disclaimers and indemnifications are enforceable. The document is especially relevant in situations where sensitive business information is shared, but the provider needs to maintain legal protection against potential misuse or misinterpretation of the information.
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About the Non Reliance Letter Hold Harmless Letter
A Non Reliance Letter Hold Harmless Letter is a protective legal document that serves as a shield for parties sharing sensitive business information in the United Arab Emirates. When you provide confidential data, financial records, or business intelligence to another party, this letter ensures you cannot be held liable for how that information is interpreted or used. The document combines two powerful legal concepts: a non-reliance declaration stating that recipients cannot claim they relied on your representations, and hold harmless provisions that protect you from future legal claims.
When do you need this document?
You need this letter whenever you are sharing sensitive business information but want to limit your legal exposure. Common scenarios include due diligence processes for mergers and acquisitions, where potential buyers review confidential company data. Investment transactions often require these letters when financial projections or market analyses are shared with potential investors. Consulting arrangements benefit from this protection when advisors provide strategic recommendations or industry insights. Joint venture discussions frequently involve sharing proprietary information that requires legal protection. Professional service providers, such as auditors or legal advisors, also use these letters when providing opinions or analyses to clients or third parties.
Key legal considerations
The effectiveness of your Non Reliance Letter depends on carefully crafted language that clearly defines the scope of information being disclaimed. You must explicitly state which representations, warranties, or assurances are being excluded from reliance. The hold harmless clause should comprehensively cover legal costs, damages, and claims that might arise from the recipient's use of the information. Indemnification provisions should be mutual where appropriate, ensuring both parties understand their obligations. The letter must identify all parties involved, including parent companies, subsidiaries, and professional representatives who may have access to the information. Time limitations on the protections should be clearly specified, and the document should address how confidential information must be handled and returned.
Legal requirements in United Arab Emirates
Under UAE law, your Non Reliance Letter must comply with Federal Law No. 5 of 1985 (UAE Civil Code), particularly Articles 246 regarding good faith in contract execution and Articles 472-475 concerning disclaimers and warranties. The UAE Commercial Transactions Law (Federal Law No. 18 of 1993) governs commercial representations and warranties, making proper disclaimer language crucial for enforceability. If your transaction involves DIFC entities, DIFC Contract Law (Law No. 6 of 2004) applies additional requirements for contractual relationships and liability limitations. The document must be written in clear, unambiguous language that courts can interpret consistently with UAE legal principles. Professional legal review is recommended to ensure the disclaimers and hold harmless provisions will be enforceable under UAE jurisdiction, as courts may scrutinize attempts to completely exclude liability.
GOVERNING LAW
Applicable law
This Non Reliance Letter Hold Harmless Letter is drafted to comply with United Arab Emirates law. Key legislation includes:
UAE Commercial Transactions Law (Federal Law No. 18 of 1993): Regulates commercial transactions and business dealings, including provisions about commercial representations and warranties
UAE Federal Law No. 2 of 2015 on Commercial Companies: Contains provisions relevant to business relationships and corporate dealings, particularly in relation to representations and warranties between companies
DIFC Contract Law (DIFC Law No. 6 of 2004): If the transaction involves DIFC entities, this law governs contractual relationships and includes specific provisions about disclaimers and representations
UAE Federal Law No. 24 of 2006 on Consumer Protection: May be relevant if the non-reliance letter involves consumer relationships, as it contains provisions about disclaimers and warranties that cannot be waived
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