UAE Litigation Funding

Litigation funding in Dubai and Abu Dhabi is not governed by a single uniform legal regime. Each emirate has onshore courts operating within the UAE’s civil-law framework, a financial free zone with common-law courts, and a major arbitration institution with its own procedural rules. The practical comparison therefore involves six principal frameworks: The most important difference concerns the degree and form of express regulation. The DIFC Courts rely on a practice direction focused principally on disclosure, costs and the relationship between the funded party and the funder. ADGM has adopted a more detailed regulatory framework addressing funder eligibility, financial capacity and the content of funding agreements. In arbitration, both DIAC and arbitrateAD expressly address third-party funding, but their disclosure requirements are not identical. For proceedings before the onshore courts of Dubai and Abu Dhabi, the available official materials do not establish a single comprehensive federal statute governing all forms of litigation funding. These arrangements must therefore be analysed through contract law, public policy, professional regulation, confidentiality, procedure and the substance of the rights granted to the funder. What Is Litigation Funding? Litigation funding, also known as third-party funding, is an arrangement under which an independent funder provides capital to cover some or all of the costs of pursuing a legal claim in exchange for an agreed return if the dispute produces a recovery. The funding may cover: Commercial litigation funding is commonly structured on a non-recourse basis. The funder expects to recover its capital and return from the proceeds of the dispute rather than from the claimant’s unrelated assets. If the claim fails, the funder ordinarily loses the invested capital, subject to provisions dealing with fraud, breach, misuse of funds or material non-disclosure. The funder does not legally represent the claimant. Counsel remains responsible for advice, advocacy and professional independence, while the claimant should retain appropriate authority over the proceedings and settlement decisions. Litigation Funding in Dubai: Three Distinct Environments Funding Before the Dubai Onshore Courts The Dubai onshore courts operate within the UAE’s civil-law judicial system. The available official sources do not establish a comprehensive third-party funding regime equivalent to the express framework applicable in the DIFC Courts. The absence of a dedicated regime does not mean that every funding arrangement is prohibited or automatically enforceable. The agreement must instead be examined in light of matters including: A funding arrangement should not be used to circumvent restrictions applicable to lawyers’ fees or to grant an unlicensed commercial party powers equivalent to providing legal services. The rules of the DIFC Courts should also not be assumed to apply to the Dubai onshore courts. The DIFC is a separate legal jurisdiction, and its procedural directions are not general rules for every court in the emirate. Funding Before the DIFC Courts Third-party funding in the DIFC Courts is expressly addressed by Practice Direction No. 2 of 2017. The Practice Direction requires a funded party to disclose to the Court and the other parties: It does not require automatic production of the full funding agreement, although the Court may order disclosure of the agreement or relevant terms where appropriate.[1] The DIFC Court of Appeal confirmed in 2025 that disclosure of the existence of funding and the identity of the funder is distinct from disclosure of the complete commercial terms of the agreement.[2] The Practice Direction also addresses the relationship between funding and security for costs. The existence of funding does not, by itself, determine whether security should be ordered, although it may form part of the circumstances considered by the Court. The DIFC framework also recognises the possibility of costs orders against third parties, including funders, where the applicable legal test is satisfied. Claimants and funders should therefore assess possible adverse or non-party costs exposure, not merely the claimant’s own legal expenses. The DIFC approach is principally procedural and focuses on: Funding in DIAC Arbitration The DIAC Arbitration Rules 2022 entered into force on 21 March 2022. Article 22 expressly addresses third-party funding.[3] The provision requires disclosure of: After constitution of the tribunal, the Rules also prevent a party from entering into a funding arrangement that will or may create a conflict of interest between the funder and a member of the tribunal. The requirement to disclose whether the funder has accepted adverse-cost liability is commercially significant. It provides information beyond the funder’s identity and may be relevant to applications for security for costs or other procedural decisions. Article 22 does not state that the full agreement must be produced automatically. A tribunal may nevertheless seek disclosure of specific terms where they are relevant to conflicts, costs, security or control. Litigation Funding in Abu Dhabi: Three Separate Frameworks Funding Before the Abu Dhabi Onshore Courts As with the Dubai onshore courts, the available official materials do not establish a comprehensive standalone statute governing every form of litigation funding in ordinary civil and commercial proceedings before the Abu Dhabi onshore courts. A funding agreement may therefore require analysis under: ADGM’s litigation funding rules should not be imported automatically into Abu Dhabi onshore litigation. ADGM is a distinct legal jurisdiction with its own courts, legislation and procedures. The onshore positions in Dubai and Abu Dhabi are similar in that neither appears, from the official sources reviewed, to be governed by an express comprehensive funding code. That does not mean that judicial treatment will necessarily be identical in every case. The result may depend on the nature of the claim, the contract, the applicable professional regime and the governing law. Funding Before the ADGM Courts ADGM provides the most detailed express litigation funding framework in the UAE. The Litigation Funding Rules 2019 were introduced to regulate the funding of proceedings within their scope, and ADGM’s official legislative index records an amendment issued in 2023.[4] Unlike the DIFC Practice Direction, which is principally concerned with procedural disclosure and costs before the Court, the ADGM framework also regulates the funder and the funding agreement. According to ADGM’s official materials, the framework addresses matters including: ADGM therefore goes

Litigation funding in Abu Dhabi cannot be understood through a single legal regime. A commercial dispute connected with the emirate may proceed before the Abu Dhabi onshore courts, the courts of Abu Dhabi Global Market—ADGM—or an arbitral tribunal administered by the Abu Dhabi International Arbitration Centre, known as arbitrateAD. Each framework raises different questions about funding agreements, disclosure, conflicts, costs, confidentiality, and enforcement. The clearest express regulation is found in ADGM. Its Litigation Funding Rules 2019 establish a detailed framework for qualifying funders and funding agreements. arbitrateAD also expressly addresses third-party funding in Article 48 of its Arbitration Rules. By contrast, the available official materials do not establish a dedicated, comprehensive litigation-funding code for ordinary civil and commercial proceedings before the Abu Dhabi onshore courts. The practical conclusion is that litigation funding may be available for an Abu Dhabi dispute, but its legality and structure must be assessed by reference to the precise forum, governing law, professional rules, and terms of the arrangement. ADGM requirements should not be imported automatically into onshore proceedings, and arbitrateAD disclosure rules should not be treated as rules governing every Abu Dhabi arbitration. What Is Litigation Funding? Litigation funding, also called third-party funding or legal finance, is an arrangement under which an independent financier pays some or all of the costs of pursuing a legal claim in exchange for an agreed return if the claim produces a recovery. Funding may cover: Commercial litigation funding is commonly non-recourse. The funder’s return is paid from a judgment, award, or settlement, and the funder ordinarily loses its investment if the claim fails. The precise consequences remain governed by the funding agreement, including any provisions dealing with fraud, breach of warranty, material non-disclosure, or misuse of funds. Funding is distinct from a lawyer’s success fee. The funder provides capital under a financing agreement, while counsel provides legal services under a separate engagement. Counsel remains responsible for independent legal advice and professional conduct. Why Abu Dhabi Requires a Forum-Specific Analysis Abu Dhabi contains legally distinct dispute-resolution systems. Abu Dhabi onshore courts The Abu Dhabi Judicial Department administers the emirate’s ordinary local courts within the UAE’s federal and emirate-level civil-law architecture. Funding questions may therefore engage federal contract law, civil procedure, professional regulation, public policy, confidentiality, evidence, and enforcement rules. ADGM Courts ADGM is a separate common-law jurisdiction with its own courts, legislation, procedural rules, and professional framework. ADGM Courts expressly recognise and regulate litigation funding through the Litigation Funding Rules 2019, as amended. arbitrateAD proceedings arbitrateAD administers arbitration under its own institutional rules. Article 48 of those rules imposes an express disclosure obligation where a non-party funds claims or defences. The WinJustice research framework correctly treats these as separate systems rather than a single Abu Dhabi funding regime. The same framework cautions that express regulation, contractual permissibility, disclosure obligations, and professional requirements must be analysed independently. Litigation Funding Before the Abu Dhabi Onshore Courts The available official sources do not establish a comprehensive statute dedicated specifically to third-party litigation funding in Abu Dhabi onshore civil and commercial proceedings. That absence should not be interpreted in either of two extreme ways. It does not necessarily mean that every funding agreement is prohibited. Nor does it mean that every commercial funding structure will be enforceable. An onshore arrangement may require analysis under several overlapping legal principles. Contractual validity The funding agreement must satisfy applicable requirements governing contract formation, lawful purpose, certainty, performance, and public policy. Particular attention should be given to the method used to calculate the funder’s return and the circumstances in which payment becomes due. The governing-law clause does not end the analysis. Mandatory rules of the forum, professional obligations, procedural law, and public-policy considerations may remain relevant even where the contract selects a foreign law. Professional independence A funder is not the claimant’s advocate or legal representative. The claimant’s lawyer must continue to exercise independent professional judgment and comply with the rules governing legal practice. The agreement should not grant the funder powers that effectively displace the client, direct counsel improperly, or allow a commercial financier to perform regulated legal services. Control and settlement A funder has a legitimate economic interest in the proceedings and may require information and consultation rights. Those rights should be distinguished from ultimate control. A well-structured agreement should specify: Unclear control provisions may create contractual disputes at precisely the stage when the claimant needs stable financing. Confidentiality and professional secrecy Funding due diligence normally requires disclosure of pleadings, evidence, legal advice, budgets, damages analyses, and enforcement information. Parties should not assume that providing sensitive material to a prospective funder will preserve every form of confidentiality or legal protection automatically. Appropriate confidentiality agreements, controlled data access, and legal advice concerning privilege, professional secrecy, and data protection should be obtained before disclosure. Costs and procedural consequences A claimant must assess not only its own costs but also the possible consequences of an adverse judgment, security application, counterclaim, or enforcement dispute. Where no express onshore funding rule answers a particular question, the parties should not assume that the position will mirror ADGM or another common-law court. The procedural response may depend on the specific case and applicable legislation. Litigation Funding in ADGM Courts ADGM provides the most developed express funding framework in Abu Dhabi. The Litigation Funding Rules 2019 were issued to regulate third-party financing of proceedings and provide greater certainty regarding the enforceability and operation of funding agreements. ADGM’s current legislation index records both the original Rules and Amendment No. 1 of 2023. ADGM described the Rules as a comprehensive framework designed to balance access to finance, the commercial interests of funders, and transparency regarding the funder’s role. Which proceedings may be covered? The ADGM framework was designed in relation to funding for dispute-resolution proceedings and has been described by ADGM as applying to court and arbitral proceedings within its scope. The exact application of the Rules must still be tested against the particular proceeding, funding agreement, and relevant definitions. Parties should not assume that

Constitutional Foundations and the Sharia Context The judicial landscape of the United Arab Emirates operates on a dual-tier structure that divides the domestic civil law “onshore” jurisdictions from the common law “offshore” financial free zones1. While the federal civil courts are heavily influenced by Sharia jurisprudence, the Dubai International Financial Centre (DIFC) and the Abu Dhabi Global Market (ADGM) operate as independent, self-contained judicial enclaves4. These offshore centers have established their own civil and commercial laws, procedural rules, and specialized infant judiciaries designed to align with international standards4. Understanding how these two jurisdictions approach third-party litigation funding (TPF) requires an examination of their constitutional foundations and their relationship with both domestic Sharia principles and English common law8. In the onshore UAE courts, TPF is not governed by any dedicated statutory framework1. While not explicitly prohibited, its validity under onshore law remains a complex question of public policy1. Under Sharia law, financial transactions must avoid riba (usury or unjust interest), gharar (excessive speculation or uncertainty), and maisir (gambling or games of chance)1. Onshore litigation funding arrangements must be carefully structured to avoid these prohibitions1. Legal scholars and practitioners argue that commercial litigation funding does not violate Sharia principles when structured as a non-recourse investment rather than a speculative bet or an interest-bearing loan2. This is supported by the Sharia principle of maslaha (public interest), which recognizes TPF as a tool that provides access to justice for economically disadvantaged claimants2. However, because onshore courts award only nominal legal costs to successful parties, a funder’s return cannot easily be recouped from the losing opponent3. This commercial reality makes onshore litigation funding rare and highly risky3. Conversely, the offshore jurisdictions of the DIFC and the ADGM have established clear rules for TPF1. Both jurisdictions have moved away from the historical English common law doctrines of maintenance and champerty—which once prohibited third-party funding to prevent speculative litigation8. The DIFC and ADGM courts recognize that TPF supports access to justice and allows corporate litigants to manage legal risk off-balance sheet8. However, the legal mechanism through which English law is integrated differs between the two zones4. The ADGM directly imports English common law, including the rules of equity and specific English statutes, “in force in England” via the Application of English Law Regulations 20154. The DIFC, on the other hand, drafts its own independent statutes modeled on English common law principles, using English precedents primarily as persuasive authority4. The UAE litigation funding landscape differs significantly between the onshore UAE courts, the Dubai International Financial Centre, and the Abu Dhabi Global Market. The onshore UAE courts operate under a civil law system influenced by Sharia principles. Third-party litigation funding is not regulated by a dedicated statutory framework, although it is not expressly prohibited. Its validity depends on general contract law, public policy considerations, and careful structuring to avoid issues such as riba, gharar, or maisir. Cost recovery in the onshore courts is generally limited, which makes litigation funding commercially more difficult in practice. The Dubai International Financial Centre, or DIFC, operates as an independent common law jurisdiction with its own courts and procedural rules. Third-party funding is expressly permitted under Practice Direction No. 2 of 2017. The DIFC adopts a disclosure-based and flexible approach, allowing parties to use litigation funding while requiring transparency regarding the existence of the funding arrangement and the identity of the funder. The Abu Dhabi Global Market, or ADGM, also operates as an independent common law jurisdiction, but it directly applies English common law through its own legal framework. Third-party litigation funding is expressly permitted and regulated under the ADGM Litigation Funding Rules 2019. Compared with the DIFC, the ADGM framework is more prescriptive and includes specific requirements relating to funder eligibility, capitalization, mandatory contractual terms, and conflicts management. In practical terms, the DIFC offers greater contractual flexibility, while the ADGM provides a more codified and structured regulatory model. Both jurisdictions are more developed than the onshore UAE courts in their treatment of litigation funding. Funder Eligibility and Capitalization Requirements The regulatory frameworks of the DIFC and the ADGM diverge significantly in their approach to funder eligibility and capitalization requirements14. The DIFC uses a light-touch regulatory model that does not impose net-asset requirements or institutional licensing on third-party funders14. Under Practice Direction No. 2 of 2017 (PD 2/2017), a “Funder” is defined as any person or entity independent from the funded party and their legal representatives that provides funding in exchange for an economic benefit linked to the outcome of the proceedings21. This broad definition permits corporate parents, boutique investment funds, or private individuals to act as funders14. The DIFC court relies on party autonomy and professional legal ethics to manage funder competence and liquidity14. In contrast, the ADGM uses a prescriptive, statutory approach designed to ensure the institutional credibility and solvency of funders operating in its jurisdiction23. Under the ADGM Litigation Funding Rules 2019, a Litigation Funding Agreement (LFA) is valid and enforceable only if the funding entity satisfies strict statutory criteria9: Mandatory Provisions of Litigation Funding Agreements The contractual freedom of parties to draft LFAs is structured differently in each jurisdiction14. In the DIFC, the court does not mandate specific contractual clauses or regulate risk allocation, termination rights, or settlement vetoes14. Under PD 2/2017, these elements are left to commercial negotiation and professional judgment14. While this provides flexibility, it places a higher drafting burden on legal practitioners to ensure that the LFA remains enforceable and does not trigger common law objections14. The ADGM Litigation Funding Rules 2019 reject this laissez-faire model, requiring specific mandatory provisions to be included in the text of any LFA23. If these statutory terms are omitted, the agreement may be declared unenforceable9. An ADGM-compliant LFA must be in writing and contain clear provisions addressing the following elements: The DIFC and ADGM take different approaches to funder eligibility and capitalization. In the DIFC, there is no prescribed minimum capitalization requirement for litigation funders. Practice Direction No. 2 of 2017 defines a funder broadly as an independent person or

The legal and financial ecosystem of the United Arab Emirates (UAE) is currently undergoing a structural transformation that positions it as a global frontier for third-party arbitration funding (TPF). Historically characterized by a cautious approach to external litigation finance, the jurisdiction has rapidly modernized its regulatory, institutional, and judicial frameworks to accommodate the complexities of international commercial disputes.1 This evolution is driven by a convergence of legislative reform, such as the Federal Arbitration Law of 2018, and the proactive adoption of sophisticated funding rules by the Dubai International Arbitration Centre (DIAC) and the Abu Dhabi International Arbitration Centre (arbitrateAD).3 For businesses operating in capital-intensive sectors like construction, energy, and real estate, understanding the nuances of this landscape is no longer optional but a strategic imperative for risk management and liquidity optimization.1 The Jurisdictional Triality: Mapping the UAE Arbitration Landscape The UAE presents a unique “tri-partite” legal architecture consisting of the onshore civil law system and two offshore common law jurisdictions: the Dubai International Financial Centre (DIFC) and the Abu Dhabi Global Market (ADGM).6 Each of these jurisdictions maintains distinct rules regarding third-party funding, creating a dynamic environment where the choice of the arbitral seat fundamentally dictates the enforceability and disclosure requirements of a funding arrangement.5 Onshore Civil Law Framework and Federal Law No. 6 of 2018 Onshore arbitration is governed by Federal Decree Law No. 6 of 2018 (the Federal Arbitration Law), which serves as the default procedural law for any arbitration conducted in the UAE, provided the parties have not agreed to a different set of laws.9 While the law does not explicitly regulate third-party funding, its silence is widely interpreted as permissive, provided the funding agreement does not contravene public policy or morals.11 The law emphasizes party autonomy, particularly in Article 4(3), which allows parties to authorize a third party to select arbitral procedures.9 This procedural flexibility suggests that as long as the funder does not exercise “undue control” over the legal process, the funding relationship remains valid under general contract principles.7 The Common Law Enclaves: DIFC and ADGM The DIFC and ADGM have emerged as the primary engines for TPF growth due to their alignment with international common law standards.8 The DIFC Courts, through Practice Direction No. 2 of 2017, provided a structured definition of “Funding” and “Funded Parties,” emphasizing transparency through mandatory disclosure of the funder’s identity.17 In contrast, the ADGM’s Litigation Funding Rules of 2019 are more prescriptive, requiring funders to possess qualifying assets of at least $5 million and mandating that funding agreements be in writing.6 These offshore regulations provide the predictability required by institutional funders such as Burford Capital and Omni Bridgeway, who seek to mitigate the “uncertainty risk” historically associated with regional courts.6 Jurisdictional Feature Onshore UAE (Civil Law) DIFC (Common Law) ADGM (Common Law) Governing Arbitration Statute Federal Law No. 6 of 2018 DIFC Arbitration Law No. 1 of 2008 ADGM Arbitration Regulations 2015 Primary TPF Regulation None (Permitted by Practice) Practice Direction No. 2 of 2017 Litigation Funding Rules 2019 Mandatory Disclosure Case-by-case basis Existence and Funder Identity Existence and Funder Identity Funder Financial Threshold No statutory limit No statutory limit Minimum $5 Million in Assets Default Seat (Rules-based) Dubai (per DIAC 2007) DIFC (per DIAC 2022) ADGM (per arbitrateAD) 3 Institutional Maturation: Analyzing DIAC 2022 and arbitrateAD 2024 The institutionalization of TPF in the UAE reached a pivotal moment with the overhaul of arbitral rules in Dubai and Abu Dhabi. These changes reflect a desire to position the UAE as a leading global hub, competitive with Singapore and Hong Kong.4 The Dubai International Arbitration Centre (DIAC) Rules 2022 Article 22 of the DIAC Rules 2022 represents one of the most significant codifications of TPF practice in the region.3 The rule requires a party to “promptly disclose” the existence of a third-party funding arrangement to all other parties and the Centre.25 A nuanced requirement within Article 22.1 is the obligation to disclose whether the funder has committed to an “adverse costs liability”.25 This provides tribunals with critical information for potential security for costs applications, as a funder’s commitment to pay adverse costs can serve as a substitute for a bank guarantee or escrow payment.6 Furthermore, Article 22.2 introduces a safeguard against conflicts of interest.25 It prohibits parties from entering into a funding arrangement after the tribunal’s constitution if the arrangement would create a conflict between the funder and any member of the tribunal.25 This mirrors the IBA Guidelines on Conflicts of Interest and ensures that the eventual award remains insulated from challenges based on arbitrator impartiality.26 The Emergence of arbitrateAD in Abu Dhabi The transition from the Abu Dhabi Commercial Conciliation and Arbitration Centre (ADCCAC) to the new Abu Dhabi International Arbitration Centre (arbitrateAD) in early 2024 has further clarified the funding landscape.4 Under Article 48 of the arbitrateAD Rules, the duty to disclose funding is ongoing throughout the life of the proceedings.4 This institutional shift is supported by a default seat in the ADGM, which grants parties access to the ADGM’s comprehensive litigation funding framework and its evergreen application of English common law.7 The Strategic Shift: TPF as a Corporate Financial Instrument For modern businesses, third-party funding has evolved from a “distressed” financing tool into a sophisticated method for managing corporate balance sheets.1 The use of external capital allows companies to pursue high-value claims without diverting funds from their core operations, effectively turning a legal dispute from an expense into a potential revenue-generating asset.1 Access to Justice for SMEs Small and medium-sized enterprises (SMEs) in the UAE often find themselves in disputes with much larger, better-capitalized entities, such as sovereign-linked developers or global conglomerates.2 The costs of a major arbitration, including tribunal fees, expert costs, and legal representation, can be prohibitive.34 TPF levels the playing field by providing the financial muscle necessary to sustain a long-term legal battle.2 This is increasingly seen as a “strategic value” by boards of directors, who can now evaluate litigation through the same lens as any other investment opportunity.5 Judicial Evolution: The Recoverability

The landscape of litigation funding in the United Arab Emirates has undergone a profound transformation as of 2026, shifting from a nascent financial practice to a cornerstone of the regional dispute resolution ecosystem. This evolution is inextricably linked to the UAE’s strategic objective of establishing itself as a premier global hub for commerce, a goal that has necessitated a sophisticated, predictable, and transparent legal framework capable of supporting high-value, complex litigation and arbitration. The current year, 2026, marks the convergence of several major legislative cycles, most notably the implementation of the new Civil Transactions Act, significant amendments to the Federal Civil Procedures Law, and a refined maturity within the common law courts of the Dubai International Financial Centre and the Abu Dhabi Global Market. As international capital continues to flow into the region’s infrastructure, energy, and technology sectors, the role of third-party litigation funding has transcended simple capital provision, becoming an essential risk-management tool for global corporations and a vital mechanism for ensuring access to justice for individual litigants. The Tripartite Judicial Architecture as a Foundation for Finance The legal framework of the UAE in 2026 is defined by its unique tripartite structure, which offers three distinct but increasingly integrated avenues for dispute resolution. This structure consists of the “onshore” or mainland civil law courts and the two “offshore” common law financial free zones. For a litigation funder, understanding the nuances of these jurisdictions is the primary step in evaluating any investment opportunity, as each forum presents different rules regarding disclosure, cost recoverability, and procedural speed.1 The onshore system, which applies to the vast majority of civil and commercial activities outside the financial free zones, is rooted in the civil law tradition. Historically, this system was influenced by the Egyptian model, which was itself derived from the French Napoleonic Code. By 2026, the onshore courts have achieved a high degree of modernization, characterized by the comprehensive digitization of proceedings and a pragmatic acceptance of litigation funding, provided such arrangements do not violate public policy or professional ethics.1 While third-party funding is not expressly governed by a single statute onshore, it is permitted under the broader principles of contractual freedom, provided that the funder does not exert excessive control over the proceedings in a manner that would resemble the common law prohibitions of champerty or maintenance.1 In contrast, the DIFC and ADGM offer common law environments that are specifically designed to be familiar to international investors. The DIFC has developed its own body of case law and legislation, based on English common law principles but tailored to the local environment.5 The ADGM, meanwhile, takes a more direct approach by adopting English common law as its foundational law, supplemented by its own specific regulations.5 These offshore jurisdictions have been proactive in regulating litigation funding, providing the explicit guidance that the onshore system currently lacks.2 Judicial Forum Legal Origin Procedural Language Role of Third-Party Funding (2026) Onshore UAE Civil Law / Sharia Arabic Permitted if compliant with public policy 1 DIFC Common Law (Autonomous) English Regulated via Practice Directions 2 ADGM English Common Law (Direct) English Formally regulated via 2019/2023 Rules 6   Onshore Legislative Reforms: The 2025 and 2026 Paradigm Shift The year 2026 represents a landmark in the evolution of the onshore judiciary, driven by the implementation of Federal Decree-Law No. 22 of 2025, which introduced sweeping amendments to the Civil Procedures Law (Federal Decree-Law No. 42 of 2022).8 These reforms reflect a deliberate move toward procedural discipline, judicial specialization, and a reduction in the “serial appeals” that previously characterized mainland litigation.8 For litigation funders, these changes significantly enhance the “predictability factor,” which is a core component of their internal rate of return calculations. One of the most significant developments is the establishment of specialized judicial chambers for technically complex disputes, such as those involving inheritance, construction, or high-value commercial transactions.8 Under Article 32 of the amended framework, the President of the Federal Judicial Council or the head of a local judicial authority can constitute these chambers, which are empowered to appoint international experts and direct more rigorous evidentiary reviews.8 Crucially, judgments issued by these specialized chambers are, in many instances, not subject to ordinary avenues of appeal, marking a shift toward the finality of first-instance decisions when technical rigor is applied from the outset.8 Furthermore, the 2026 reforms have heightened the thresholds for initiating appeals. Article 164 now requires that any appeal filed must include a clear statement of the grounds and the relief sought at the time of submission.8 This has effectively abolished the previous practice where appellants could file a “placeholder” appeal and supplement the grounds at the first hearing.8 For a funder, this reduces the risk of unmeritorious, delay-tactic appeals that erode the value of an award over time. The expansion of cassation review under Article 175 and 176 to include interlocutory decisions also allows for the early correction of procedural errors, potentially saving years of litigation time in complex cases.8 The Role of Court-Appointed Experts in Onshore Litigation A defining feature of the onshore system remains the decisive influence of court-appointed experts. In technical matters—which comprise the majority of funded claims—the court-appointed expert acts as a quasi-judicial figure, conducting investigations, reviewing documentary evidence, and meeting with the parties to the dispute.1 By 2026, the governance of these experts has been strengthened by Federal Decree Law No. 21 of 2022, ensuring professional accountability.1 While the expert’s findings are technically not binding on the judge, they are followed in the vast majority of cases.1 This has led to a sophisticated practice where litigation funders employ “shadow experts” or private consultants to assist the funded party in managing the interface with the court expert.9 The 2026 landscape is defined by the integration of technology into this process, with experts utilizing AI-assisted translation and digital filings to manage the voluminous documentation typical of construction or banking disputes.1 Procedural Aspect Onshore Practice (2026) Significance for Funders Expert Witnesses Court-appointed from a registry 1 High impact on outcome; requires “shadow” expert