Unfair Competition and the Protection of Trade Secrets in Dubai: Transparency and Sanctions

Introduction
As Dubai rapidly grows as a regional trade and investment hub, ensuring fair competition and the confidentiality of trade secrets has become critically important. In this context, the United Arab Emirates has repealed Federal Law No. 4 of 2012 by issuing Federal Decree-Law No. 36 of 2023, which regulates competition, and has published Federal Decree-Law No. 26 of 2021 to protect trade secrets. These regulations aim to prevent unfair competition and insider trading through both a transparent business environment and severe penalties.

1. Competition Law Framework

The new Federal Decree-Law No. 36 of 2023 on the Regulation of Competitionprohibits all monopolistic and anti-competitive practices that distort the market structure. The law defines “competition” as economic activity free from restrictions that may harm consumer interests, sustainable development, or trade. All businesses are subject to these provisions in the markets for goods and services within its jurisdiction.

2. Unfair Competition Practices

The law specifically considers the following practices to be unfair competition :

• Price fixing, market splitting, or bid manipulation together,

• Abuse of dominant position, for example, market control through exclusionary discounts or forcible bundling,

• Non-competitive partnershipsinvolve preventing competing businesses from accessing the market through producer or supplier agreements.

3. Transparency and Reporting Obligations

Mergers and acquisitions the Competition Regulatory Committee. Businesses must provide accurate data during the application process; otherwise, they will face administrative fines.

4. Sanctions for Competition Violations

Competition violations can result in administrative fines of up to 2–10% of a company's annual turnover, administrative measures to stop the violation, and restrictions on operations in case of repetition. In addition, the injured parties may file a claim for damages ; the competition authority's decision serves as evidence in court.

5. Protection of Trade Secrets

Federal Decree-Law No. 26 of 2021 , a “trade secret” refers to any information (formulas, processes, customer lists, etc.) that is not publicly available, has economic value, and is protected by reasonable confidentiality measures. The law prohibits its unlawful acquisition, use, or disclosure as an actual crime.

6. Legal Remedies Against Trade Secret Violations

In the event of a trade secret breach, the owner may request the court to:

• Blocking access,

• Confiscation of evidence,

• Compensation for damages or

• Publication bans can be requested. In the DIFC region, there is also a separate protection and arbitration environment under DIFC IP Law
  

7. Business Practices for Transparency

Proactive measures such as internal audits, confidentiality agreements (NDAs), staff training, and data access control reduce the risk of trade secrets. Competition compliance programs, on the other hand, play a preventive role in preventing allegations of price fixing and market discrimination.

8. Dispute Resolution Mechanisms

Competition disputes are first mediation ; if no agreement is reached, by the Dubai Courts or the ICC/DIAC comes into play. This ensures a swift and internationally recognized solution.

9. Strategic Recommendations for Businesses

1. Competition Review: Evaluate market entry, pricing, and distribution strategies from a competition law perspective.

2. Trade Secret Inventory: Classify your critical information and determine their protection levels.

3. Contractual Arrangements: Include clear confidentiality, non-compete, and sanctions clauses in supplier and employee contracts.

4. Compliance Training: Periodically train all personnel on current competition and confidentiality obligations.

As a result
, Dubai has strengthened transparency and deterred unfair competition and insider trading with severe penalties through Federal Decree-Law No. 36 of 2023 and No. 26 of 2021. Businesses, with strong compliance and protection mechanisms, both reinforce consumer confidence and contribute to a sustainable competitive environment.