On April 10, 2025, the United Arab Emirates (UAE) and European Union (EU) officially announced the launch of negotiations for a Free Trade Agreement (FTA) —or what the UAE typically refers to as a Comprehensive Economic Partnership Agreement (CEPA), a significant development that reflects the deepening ties between two of the world’s most dynamic economic regions.
The announcement followed a high-level phone call between UAE President HH Sheikh Mohamed bin Zayed Al Nahyan and European Commission President Ursula von der Leyen, as part of a broader agenda to expand cooperation in trade, investment, and sustainability.
This decision to move forward bilaterally aligns with the UAE’s strategic shift towards independent trade agreements beyond the traditional GCC framework. At the same time, it fits within the EU's broader Global Gateway initiative, aimed at fostering resilient and sustainable economic partnerships worldwide.
A Strategic Pivot for Both Regions
While the EU has historically engaged the GCC as a bloc, negotiations for a collective trade deal have stalled for over a decade. The UAE’s call for a separate bilateral agreement underscores its ambition to fast-track access to European markets, while the EU seeks a trusted partner in the Gulf to secure green hydrogen, critical raw materials, and energy transition investments.
According to official EU data, the bloc is the second-largest trading partner for the UAE, representing 8.3% of the UAE’s non-oil trade, while the UAE stands as the EU’s most important export market and investment partner in the MENA region.
What Will the FTA Likely Cover?
While negotiations are still at an early stage, both sides have expressed interest in concluding a broad and forward-looking agreement. Although the specific scope is yet to be determined, key areas likely to be addressed include:
- Elimination or reduction of tariffs and non-tariff barriers on goods and services
- Strengthened provisions on investment protection and market access
- Customs facilitation and digital trade cooperation
- Commitments to sustainability and climate goals, including green energy transition frameworks
- Enhanced legal certainty for cross-border dispute resolution
The agreement could particularly benefit sectors such as logistics, renewable energy, digital infrastructure, artificial intelligence, financial services, and advanced manufacturing.
Legal and Regulatory Outlook: A Dual-Jurisdiction Approach
From a legal perspective, this emerging partnership presents multiple opportunities—but also calls for careful cross-jurisdictional analysis. As the UAE continues to sign Comprehensive Economic Partnership Agreements (CEPAs) globally, and the EU reinforces its global trade networks, legal practitioners must guide clients through increasingly sophisticated international regulatory environments.
At Al Safar & Partners, we anticipate significant developments in:
- Trade and investment compliance across EU and UAE standards
- Structuring and protecting foreign direct investments
- Advising on dispute prevention and arbitration strategies under international trade frameworks
- Preparing companies to meet new ESG and sustainability-linked obligations that may be built into the FTA
As part of our strategic alliance in Romania, our firm is uniquely positioned to support clients across Europe and the Gulf in understanding both the regulatory divergence and convergence expected under the FTA.
Opportunities and Next Steps for Business and Industry
For companies operating in both regions—or looking to enter them—this agreement offers a framework for:
- Expedited market access and supply chain resilience
- Legal harmonization and reduced compliance complexity
- Long-term investment security with a trusted regulatory counterpart
- Greater participation in government-backed sustainability projects and innovation partnerships
While technical negotiations will unfold over the coming months, businesses are advised to start preparing now, by identifying opportunities and addressing regulatory gaps.
Conclusion
The EU–UAE Free Trade Agreement signals a new era of strategic economic cooperation—one that will likely reshape trade patterns and regulatory ecosystems between Europe and the Gulf.
At Al Safar & Partners, we are fully committed to assisting our clients in navigating this evolving legal landscape, and in leveraging the opportunities that such a transformative agreement will bring.
For more information or legal assistance, contact Al Safar and Partners today on +971.4.4221944 - reception@alsafarpartners.com - https://www.alsafarpartners.com/
Written By:
Mr. Paul George Căta - Partner & Senior Legal Consultant at Al Safar and Partners Law Firm.