UAE Energy / Oil & Gas LawLaw No. (6) of 2011 Regulating Participation of the Private Sector in Electricity and Water Production in the Emirate of Dubai

Article (2) The following words and expressions, wherever mentioned in this Law, will have the meaning indicated opposite each of them unless the context implies otherwise: Emirate: The Emirate of Dubai. SCE: The Supreme Council of Energy. DEWA: The Dubai Electricity and Water Authority. Bureau: The Regulation and Supervision Bureau for the Electricity and Water Sector in the Emirate of Dubai. Regulated Activity: Any of the activities related to the production of electricity and/ or the desalination and remineralisation of water for the purpose of supplying the Transmission System with the produced Electricity and/ or Water. Licence: A document issued by the Bureau authorising a Licensee to conduct any of the Regulated Activities specified therein. This includes the terms and conditions contained in this document. Licensee: Any entity licensed by the Bureau to produce Electricity and/ or Water in the Emirate in accordance with the provisions of this Law. This includes, a Project Company. Exemption: A document issued by the Bureau exempting a Licensee from compliance with all or any of the requirements for obtaining a Licence to conduct any of the Regulated Activities. Project Company: A company established in accordance with the provisions of this Law to conduct any of the Regulated Activities in the Emirate. Conditions: The technical, financial, and regulatory requirements specified by the Bureau in a Licence; and the grounds and cases based on which an Exemption is issued to a Licensee by the Bureau; as the case may be. Principal Assets: Movable and immovable assets allocated by a Licensee to conducting Regulated Activities. These include, everything provided to enable the operation of power plants and/ or desalination plants owned by, or allocated

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Law No. (6) of 2011 Regulating Participation of the Private Sector in Electricity and Water Production in the Emirate of Dubai Page 3 of 15 by the RTA to, the Licensee, together with any real rights related to the land on which such assets exist. Transmission System: The system of DEWA which is entirely or mainly comprised of: 1. water pipelines, and water storage and transportation facilities and installations, that are used for transporting water from one or more desalination plant(s) to a pumping station or storage facilities; or for transporting water between pumping stations; and 2. high voltage cables and power facilities and installations owned or operated by DEWA and used for transmission of power from a power plant to a power sub-station or to another power plant. Scope of Application

Article (4) For the purposes of this Law, the Bureau will have the duties and powers to: 1. develop, in coordination with the concerned Government Entities, the standards and rules for conducting the Regulated Activities, including those related to the technical, health, environmental, and safety aspects; regularly review and update such standards and rules; and submit the same to the SCE for approval; 2. receive and consider applications for Licences and Exemptions related to conducting the Regulated Activities; and determine such applications upon obtaining the approval of the SCE; 3. verify, as per the relevant regulations and procedures prescribed by the SCE, compliance by the Licensees with this Law, the terms of the issued License or Exemption, and the adopted rules and requirements for conducting the Regulated Activities; 4. develop the rules and standards related to the operation of the transmission and connection system between the power generation facilities and/ or desalination facilities of the Licensee, to the Regulated Activities, and to the Transmission System;

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Law No. (6) of 2011 Regulating Participation of the Private Sector in Electricity and Water Production in the Emirate of Dubai Page 4 of 15 5. prepare the required studies and research on conducting the Regulated Activities in the Emirate by the Licensees; and make the necessary proposals for developing their activities; 6. take the necessary actions and measures stipulated in this Law against violating Licensees and against any other entity that violates the provisions hereof; 7. keep and regulate records containing all the data and information of Licensees; 8. seek assistance from experts and specialists who have the qualifications and experience required to enable the Bureau to perform its duties under this Law; 9. represent the Emirate in regional and international conferences, forums, meetings, and organisations in all matters related to Regulated Activities; 10. give opinions and advice on all cases and issues presented to it by the SCE and other concerned Government Entities; 11. form the necessary committees and work teams and determine their duties and powers; and delegate any of the powers vested in the Bureau under this Law to such committees and work teams; and 12. perform any other duties assigned to it by the SCE. Conducting Regulated Activities

Article (5) a. No public or private entity may conduct the Regulated Activities in the Emirate without first obtaining a Licence from the Bureau. The Licence will be granted in accordance with the provisions of this Law and the resolutions issued in pursuance hereof. b. Notwithstanding the provisions of paragraph (a) of this Article, DEWA will be exempt from obtaining the Licence referred to herein as it is the entity having the exclusive authority, under the above- mentioned Decree No. (1) of 1992, to implement electricity and water production projects in the Emirate.

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Law No. (6) of 2011 Regulating Participation of the Private Sector in Electricity and Water Production in the Emirate of Dubai Page 5 of 15 Restricted Regulated Activities

Article (10) The Bureau is the sole entity in the Emirate assigned with the duty to issue Licences and Exemptions under this Law. Such Licences and Exemptions, as the case may be, will be issued subject to the technical, financial, and regulatory conditions and requirements prescribed by the SCE in this respect. For this purpose, the Bureau will: 1. evaluate Licence applications in accordance with the criteria stipulated in Article (12) of this Law and with the requirements adopted by the SCE in this respect; and

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Law No. (6) of 2011 Regulating Participation of the Private Sector in Electricity and Water Production in the Emirate of Dubai Page 6 of 15 2. coordinate with the concerned entities in the Emirate to issue Licences and Exemptions. Applications for Licences

Article (14) a. The Bureau may exempt a Licensee, upon its request, from compliance with all or any of the terms of its Licence, in accordance with the relevant rules adopted by the SCE. b. An Exemption granted pursuant to this Article will be in the form of a document issued by the Bureau stating the terms and conditions that ensure that the exempted Licensee will conduct the Regulated Activities for which the Licence is issued. Where a Licensee fails to comply with the terms of the Exemption, the Bureau may, based on the exigencies of public interest and subject to a written notice, fully or partially revoke such an Exemption.

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Law No. (6) of 2011 Regulating Participation of the Private Sector in Electricity and Water Production in the Emirate of Dubai Page 7 of 15 In issuing an Exemption, the Bureau must: 1. request the Licensee to provide the data and information required for supporting the Exemption application; and 2. coordinate with the concerned Government Entities. Term of Licences and Exemptions

Article (17) a. A Licensee is prohibited from subcontracting any entity to perform any work related in whole or in part to the Regulated Activities, unless this is disclosed upon applying for the Licence. Such a disclosure must include the details of that entity, the Regulated Activity it will conduct, and any other information requested by the Bureau. b. Notwithstanding the provisions of paragraph (a) of this Article, where a Licensee wishes, after obtaining the Licence, to subcontract any entity, or replace any subcontracted entity, the Licensee must obtain the prior approval of the Bureau, whereupon the Licensee must amend its Licence to reflect the subcontracting or replacement.

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Law No. (6) of 2011 Regulating Participation of the Private Sector in Electricity and Water Production in the Emirate of Dubai Page 8 of 15 Amending Terms of Licences or Exemptions

Article (18) The Bureau may, for reasons relating to public interest, amend the terms of a Licence or Exemption issued to a Licensee. In this case, the Bureau must notify the Licensee of such an amendment and of the details and reasons for the amendment. Upon receiving the proposed amendment, the Licensee must inform the Bureau in writing of its approval of the proposed amendment or object to the same as per the procedures and within the time frame prescribed in Article (19) of this Law. Where a Licensee fails to inform the Bureau of its approval or objection within thirty (30) days from the date of being notified of the amendment, the amendment will become binding on the Licensee. Objection to Licence Terms Amendment

Article (19) a. A licensee may submit a written appeal to the Bureau against the amendment of the terms of the Licence within thirty (30) days from the date of being notified of the same. The appeal must be accompanied by the relevant supporting documents. b. The Bureau must consider the appeal referred to in paragraph (a) of this Article within (30) days from the date of its submission, and must issue its decision to uphold or cancel the amendment. Where the Bureau dismisses a request made by the Licensee under the appeal for cancellation of an amendment, the Licensee may submit a grievance in respect of the dismissal to the SCE within twenty (20) days from the date of the dismissal. The grievance will be determined by a committee formed by the SCE for this purpose. Criteria for Conducting Regulated Activities

Article (22) a. Under the pain of nullity, a Licensee may not dispose of any of its Principal Assets, in any manner whatsoever, without first obtaining the written approval of the Bureau. In particular, these dispositions include: 1. selling or transferring the ownership of such assets or leasing them out to third parties with or without consideration; 2. granting or consenting to granting security rights in, or mortgaging, such assets; 3. forfeiting, or causing the forfeiture of, any real rights attached to such assets; and 4. creating, or consenting to creating, any real right in such assets. b. Notwithstanding the provisions of paragraph (a) of this Article, the Bureau may, subject to requirements it prescribes, approve creating any security rights in, or mortgaging, any Principal Assets of the Licensee to the extent required for facilitating financing of electricity and water production operations. Sale of Electricity and Water

Article (26) a. If it is established to the Bureau that a Licensee has violated any of the terms of its Licence or Exemption, the Bureau must notify the Licensee of such a violation taking into consideration the following: 1. The notice must state the nature of violation. 2. The notice must determine the deadline for remedying the violation. 3. The notice must determine the actions and penalties that the Bureau will take in case of failure to remedy the violation within the set deadline. 4. The violating Licensee must keep the Bureau informed of the measures to remedy the violation and provide it with any other information the Bureau deems necessary. b. The Licensee must comply with the requirements stipulated in the notice it receives from the Bureau, failing which a fine of no less than one thousand Dirhams (AED 1,000.00) and no more than three million Dirhams (AED 3,000,000.00) will be imposed on it.

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Law No. (6) of 2011 Regulating Participation of the Private Sector in Electricity and Water Production in the Emirate of Dubai Page 11 of 15 c. In addition to the penalty of a fine, the Bureau may, subject to the approval of the SCE, take any of the following measures against a violating entity: 1. suspension of the Licence for a period not exceeding three (3) months; or 2. revocation of the Licence or Exemption of the Licensee. The penalties and measures stipulated in this Article will not preclude from claiming any damages from the violating entity for the harm resulting from the committed violation. Objection to Notices or Penalties

Article (27) a. A Licensee may file a written appeal against the notice of non-compliance served on, or the penalty imposed against, it within thirty (30) days from the date of receiving the notice or being notified of the penalty. The appeal must be accompanied by the supporting documents. b. The Bureau must consider the appeal referred to in paragraph (a) of this Article within (30) days from the date on which the appeal is filed. Where the Bureau dismisses a request made by the Licensee under the appeal for withdrawal of the notice or cancel the penalty, the Licensee may submit a grievance to the SCE within twenty (20) days from the date of dismissal. The grievance will be determined by a committee formed by the SCE for this purpose. Announcement of Non-Compliance Notices

Article (31) Without prejudice to any stricter penalty stipulated in any other law, a person who commits any of the following violations will be punished by imprisonment for not more than one (1) year and/ or a fine of no more than three million Dirhams (AED 3,000,000.00): 1. Conducting any of the Regulated Activities without a Licence issued by the Bureau; 2. providing false or misleading statements or information to obtain the Licence or Exemption; 3. refraining, without a valid reason, from providing the documents or information requested by the Bureau within the prescribed time frame; 4. deliberately altering, destroying, or concealing any document or information requested pursuant to this Law; or 5. performing by himself or in partnership with others any act that may restrict, impact, or prevent competition in any of the Regulated Activities; or any other act that may harm the interests of electricity and water consumers or may harm in any way whatsoever .

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Law No. (6) of 2011 Regulating Participation of the Private Sector in Electricity and Water Production in the Emirate of Dubai Page 13 of 15 Law Enforcement