What Federal Decree-Law No. 11 means for your business in the UAE

The UAE has long been leading the agenda for sustainability reporting and carbon reduction. It was the first country within the Middle East to commit to a net zero target, and was the host to COP28. The next step in the country’s environmental mission will bring in new greenhouse gas regulations for businesses. This regulation comes into force on 30th May 2025: Federal Decree-Law No. 11 of 2024 on the Reduction of Climate Change Effects.

This new decree shares responsibility for the country’s greenhouse gas (GHG) emissions with companies in the public and private sector, including those in free zones. Starting in May 2025, local authorities will join with the Ministry of Climate Change and Environment to plan GHG reduction targets for various sectors. Then, potentially as soon as 30th August 2025, companies will need to start sustainability reporting, including GHG emissions. Local authorities will then bring in standards for emission monitoring, reporting and verification (MRV).

These changes will have a clear and immediate impact on businesses in the UAE, where sustainability reporting will need to quickly become standard practice. Blue Marble are expert environmental consultants, ideally placed to help you understand what this decree means for your company. Crucially, we can help you can get ahead of the incoming legislation.

Who is affected by the decree?

The goal of the new legislation is to accelerate action to reduce environmental impact across all sectors within the UAE. After all, it’s only by wide-scale regulation and co-operation that the UAE can meet their net zero goal of 2050.

All sectors will need to report emissions. In addition, the new legislation has a particular focus on subsequent adaptation plans for the Health, Insurance, Infrastructure, Energy and Environment sectors. This may be because these sectors comprise some of the biggest emitters of greenhouse gases. But even small companies within these sectors have a vital role to play in helping the UAE as a whole reduce emissions and reach carbon neutrality. We can expect to see sector-specific trajectory plans and targets for these sectors and others, following the enforcement of the law in May 2025.

It’s also worth recognising that even companies in free zones will need to report on emissions and implement a decarbonization plan. Despite companies in these free zones previously having had more lenience in application of local legislation.

What sustainability reporting is required from businesses within the new legislation?

The first step within the new legislation is for the UAE’s local authorities to join with the Ministry of Climate Change and Environment. Together they will make a plan for GHG reduction targets. Their plans should then apply to all sources of emissions, and could roll out as early as 30th August 2025. This move will share responsibility for Nationally Determined Contributions (NDCs) amongst businesses across the Emirates.

Businesses will report their carbon footprint data. There are standards that local authorities will implement within their monitoring, reporting and verification (MRV) plans. It’s not clear yet what those standards will be. But the law does call for this data to be shared, reported and recorded before targets are then set for the future.

This could mean that in the very near future, businesses in Dubai, Abu Dhabi, Ajman, Fujairah, Ras Al Khaimah, Sharjah and Umm Al Quwain will need to gather data on their carbon footprints. Then be ready to report this to local authorities and bodies.

Looking further forward, carbon reduction goals for specific sectors are likely to be set. These goals will guide the decarbonization plans which businesses will need to put into effect. These may be overseen by the creation of new climate action boards or committees, to ensure compliance. On top of mandatory emissions reporting, reduction mechanisms, adaptation plans and the creation of a national carbon credit registry are all included as provisions within the new climate law.

Blue Marble’s team of sustainability and law experts can help guide your action plan, ensuring early compliance with the new regulations. You can get in touch with us here to discuss your requirements.

Do you need to start your sustainability reporting now?

There are notes within the decree to suggest that companies found not to comply with the new regulations could face penalties from AED 50,000 to AED 2 million. It is clear that collaboration across sectors is necessary ensure the sustainable future of the UAE. But also the avoidance of fines is a clear reason why businesses should act as soon as possible to begin their sustainability reporting and decarbonization plans.

We know that local authorities have plans to incentivise the use of innovative technology, when recording emissions and planning how your company will adapt to a more sustainable future. There may be incentives for carbon offsetting and emissions trading systems. Acting early can ensure you’re on the front foot to transition to new regulations, and able to benefit from those incentives.

There is also a reputational benefit to addressing emissions reporting early. The market is clearly experiencing a shift towards sustainability, and environmental data is more and more commonplace as a request from clients. Acting early can bolster your company’s reputation as an environmental leader, whichever sector you’re in. You can also win business from forward-thinking customers, even before the law is comes into effect.

How can Blue Marble help?

Blue Marble are a team of expert environmental consultants. We help dozens of companies and manufacturers with their greenhouse gas inventories, life cycle assessments, and further sustainability services.

We combine our expert guidance with the latest software for reporting on greenhouse gas emissions. Therefore building a customised approach which efficiently guides your team and arms you with the data you need for reporting and for building your decarbonization plan.

Scoping calls throughout the process ensure the project moves as quickly as possible, and involves the lightest lift for your team. You then receive access to your own dashboard containing your emissions data.

The first step towards compliance with the new law is the measurement of your business’ carbon footprint, which Blue Marble can help you get started with today.