Construction sector gets major regulatory overhaul in Abu Dhabi

Abu Dhabi: Abu Dhabi’s Department of Municipalities and Transport has issued a new administrative decision introducing a broad set of regulatory amendments aimed at strengthening the emirate’s construction and engineering sector, Emirates News Agency (WAM) reported.

Under the updated rules, local and international firms will find it easier to meet required standards, enabling them to contribute more effectively to infrastructure and urban development projects.

One of the key changes is the removal of the previous requirement for companies to hold two separate activity licences to qualify for top-tier classification. The adjustment is designed to widen the number of eligible firms and bring more diversity to the market.

The department will also allow companies to transfer expertise from branches operating in other emirates to Abu Dhabi. In addition, local entities and branches from other GCC countries will now be able to apply directly for higher classification levels based on their capabilities.

To support continuity of operations, firms can now rely on the qualifications of a local corporate partner or a partner from another emirate.

The department has further reduced the required project values for classification renewal for locally owned engineering contractors, a move aimed at supporting Emirati-owned companies while maintaining quality standards.

Companies will also be able to upgrade their classification before the expiry of their professional licence, allowing them to move into higher categories that reflect their true capacity and enabling more competitive bidding across the engineering sector.

Another amendment extends the validity of annual financial reports used for classification to one year and six months.

The measures aim to ease procedural hurdles for contractors and engineering firms, boost competitiveness, and support the delivery of major urban development projects to higher standards of quality and sustainability.

The department said the reforms form part of its commitment to improving the engineering business environment and increasing the emirate’s appeal to investors. The efforts align with Abu Dhabi’s strategy to promote sustainable development and strengthen its position as a leading hub for urban planning and infrastructure.

Abdulla Al Blooshi, Acting Director General of the Urban Planning and Licensing Center, said the package “falls within the department’s strategy to enhance market competitiveness and streamline regulatory requirements for companies, in ways that ultimately improve project quality and elevate overall sector performance.”

The reforms aim to simplify classification criteria for engineering establishments in Abu Dhabi. According to the department, the changes are intended to support business continuity and reduce delays linked to project execution complaints.

The decision follows a series of consultations with local and international engineering and contracting firms, during which the department gathered feedback on sector challenges and explored practical ways to improve performance and project delivery.

The department also considers financial indicators — including liquidity, innovation performance and operational efficiency — as well as compliance with engineering activity regulations, to ensure the highest standards of service for residents and businesses across Abu Dhabi.