The UAE's Federal Decree-Law No. 11 of 2024 on the Reduction of Climate Change Effects came into force on 30 May 2025, with full compliance required by 30 May 2026. It moves sustainability reporting from a largely voluntary exercise into a mandatory framework covering public and private legal persons and individual enterprises whose operations produce greenhouse gas emissions, including entities in free zones.
Companies that fail to meet emissions measurement, reporting and reduction obligations face administrative fines ranging from Dh50,000 to Dh2 million, with steeper penalties for repeat violations within two years. The initial compliance phase covers Scope 1 (direct operational) and Scope 2 (purchased electricity and energy) emissions; Scope 3 reporting is widely expected to become mandatory from 2027.
Reporting coverage by Khaleej Times found the transition uneven: oil and gas, petrochemicals, utilities, metals and financial services were generally ahead of the deadline, while real estate, retail, hospitality, logistics and mid-market manufacturing — along with SMEs generally — were still building the data-collection capability the law requires. Non-compliance risk extends beyond fines: loss of government contracts, higher borrowing costs and exclusion from supply chains were all cited as consequences for lagging companies.