DeHeng Advised a Chinese Subcontractor on Canceling Two Bank Guarantees Totaling RMB 130 Million in the UAE

2022-03-16

On March 15, 2022, the Commercial Court of Abu Dhabi, United Arab Emirates, issued the first-instance judgment that terminated and canceled the performance and warranty guarantees provided by the Chinese subcontractor to the EPC contractor of Abu Dhabi airport, totaling 71.49 million dirhams (equivalent to about RMB 130 million), and ordered the bank in the UAE to return the original of the two guarantees to the issuing bank in China. 

After stopping the payment of the two bank guarantees, DeHeng’s Dubai Office managed to terminate and cancel the two bank guarantees, thus completely eliminating the risk for the Chinese subcontractor. The case was brought to a complete victory. 

Lawyers Jia Huaiyuan, Hussain Al Bannai and Mr. Saeed, after accepting the mandate, checked the contract and relevant materials and applied to the Abu Dhabi Court of Appeal for stopping the payment of the two guarantees. On September 21, 2021, after careful consideration, the judge issued a stop-payment order. 

To completely get rid of the risk, the Chinese subcontractor again mandated the three lawyers to file a separate lawsuit for termination and revocation of the two bank guarantees. The lawyers worked for months and submitted extensive and complete evidence to the Commercial Court of Abu Dhabi which finally issued a judgment terminating and cancelling the two bank guarantees and ordered the return of the original of the two guarantees to the issuing bank in China, thus completely freeing the Chinese subcontractor from the risk.

The victory of the case proves once again that Chinese lawyers have the expertise and rich hands-on experience to provide overseas legal services to Chinese companies and protect their lawful rights.