Good morning, friends, and happy Christmas Eve Eve (if you know, you know). The slowdown continues and the pile of OOO emails in our inbox is bigger than ever, but an update on Dubai’s property sector in 3Q 2025 and several regulatory and tax updates are keeping us busy.

Dubai’s property market has been going from strength to strength — but analysts have been forecasting a slowdown for a while now, and the official data says it’s beginning to take shape. 3Q 2025 saw the first decline in prices on a q-o-q basis since at least before 2024, though commercial property prices are still on the up amid tight supply.

Also: The Federal Tax Authority has added scrap metals to its growing VAT reverse charge mechanism list, while yachts will soon be more easily able to move between Dubai and Abu Dhabi.

^^ We have everything you need to know on this and more in the news well, below.

PSAs

#1- Smooth sailing for foreign yachts moving between Dubai and Abu Dhabi: From January 2026, visiting yachts will be able to move between Dubai and Abu Dhabi under a single, consolidated protocol that mutually recognizes sailing permits and eliminates duplicate local entry and exit procedures, according to a statement.

What’s changing: Vessel, crew, and passenger data will be shared via an early inquiry system API to avoid repeat checks, and visiting yachts will not need to issue a permit for each emirate.

Why it matters: The UAE is gunning for regional yachting hub status, and has been working to strengthen its appeal as a maritime tourism destination, with superyacht owners becoming eligible for a golden visa earlier this year.

The UAE is extending its crackdown on VAT leakage to the scrap metals sector, shifting the responsibility for VAT payments to buyers rather than suppliers as of 14 January of next year, according to a statement.

Good news and bad news for industrial operators and recyclers: The move is a bit of a double-edged sword for suppliers, who now don’t need to pay the 5% VAT upfront but have a much bigger compliance burden, as they are now required to verify a buyer’s tax registration number (TRN) and obtain written declarations before a transaction, or face being personally liable for the tax.

This marks the third time the FTA cracks down on VAT leakage, after the FTA introduced the same mechanism earlier in the year for precious metals and gemstones traders, and for electronic devices earlier in 2023.

Spot the pattern: The FTA is systematically targeting industries with high “informal” trade volumes and complex supply chains.

WEATHER- It’s a sunny day today, with a high of 25°C and a low of 15°C in Dubai, while in Abu Dhabi, the mercury rises to 24°C with a low of 15°C.

Sign of the times

The court vs AI — round one: The ADGM has issued the UAE’s first ruling squarely addressing AI misuse in judicial filings against lawyers who filed documents containing fabricated legal citations, according to statements here (pdf) and here (pdf). The claim was brought by regional law firm Matouk Bassiouny.

Hallucinations aren’t cheap: The court ordered AED 282.5k in wasted costs against the lawyers behind the filings, with the defendant separately picking up another AED 245k tab.

The takeaway: AI wasn’t banned or blamed, but the judge called the failure to verify AI research “reckless,” drawing a clear line — machines can assist, but liability stays human.

This is unlikely to be a one-off. “This is the first judgment in the UAE to address the misuse of AI in legal practice and establish clear guidelines,” Ahmed Tony, partner at Matouk Bassiouny, told EnterpriseAM UAE, calling it “an important reference for courts and regulators across the UAE and the region.” He added that the judgment could prompt UAE regulators to issue formal guidance on AI use in legal practice.

Expect closer scrutiny: Courts will now hold lawyers accountable “regardless of how the research was conducted,” Tony said, warning that fabricated citations and misleading material are becoming easier to detect as courts and opposing counsel grow familiar with “the hallmarks of AI output.”

Don’t ditch AI: “The integration of AI tools into legal practice is inevitable,” Tony said, adding that firms adopting them “with appropriate safeguards will gain a competitive advantage,” while those that do not will “find themselves behind.” That edge, he said, hinges on clear verification protocols and an understanding of the tools’ limits.

What to watch: This is a first, not a rulebook. The real test is whether it gets cited, and whether courts or regulators move to formalize how AI can (and can’t) be used in professional practice.

Data point: Construction

AED 335.6 bn — the value of construction contracts awarded in the UAE in 9M 2025, Al Ittihad reports, citing BNC Network data. That’s up from AED 325.9 bn a year earlier, with the UAE accounting for 48.8% of total GCC contract awards. The figure builds on momentum we’ve tracked all year: in 1H 2025, the UAE recorded USD 39.7 bn (c. AED 145.8 bn) in contract values, with sector output on track to reach c. AED 480.9 bn by 2029.

The read-through: Real estate remains the engine. Property-related projects made up 64.7% of awards, rising 16.7% y-o-y to AED 217 bn as residential and mixed-use development continues at pace. Utilities spending also more than doubled to AED 46.7 bn, as the boom extends beyond housing and into infrastructure and industry.

THE BIG STORY ABROAD-

It’s a mixed bag in the global business press as ink-stained wretches the world over long for their Christmastime news slowdown. There’s no single story dominating the front pages, but among the bits and pieces about which you should know:

Apollo Global is “building up cash, cutting leverage and selling out of riskier corners of debt markets” as top execs there get ready for market turbulence. The firm’s CEO says that will put Apollo in the best position possible “when something bad happens” and leave it well-positioned to invest during turmoil he expects to come on the back of “challenging” credit and equity markets. Must read: Apollo cuts risk and stockpiles cash in preparation for market turmoil (Financial Times)

Speaking of credit markets: Tech companies around the world have taken on record debt in the race to build out AI capacity, issuing some USD 428 bn in bonds through the first week of December.

Meanwhile:

  • Washington’s pivot away from green energy continues: The Trump administration has suspended leases at all large offshore wind projects in the United States.
  • A bonkers M&A: Oracle boss Larry Ellison is pledging USD 40 bn of his own money to backstop Paramount’s USD 108 bn hostile bid for WarnerBros Discovery.
  • A pill form of Wegovy, the GLP-1 drug for weight loss, got signoff in America overnight.

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