When Can a Hotel Owner Terminate the Hotel Management Agreement? A UAE Law Perspective

Analysis

The standard terms and conditions of a hotel management agreement (“HMA”) usually provide the hotel owner (“Owner”) with very limited possibilities to terminate, while the hotel operator (“Operator”), on the other hand, has a wider entitlement to do so, sometimes even for defaults which may not be considered material.

In order to ensure that whatever is provided in the HMA as a ground for unilateral termination by the Owner is enforceable under UAE law, thorough consideration should be given at the outset of negotiations of the HMA.

This article examines the options available to an Owner to terminate the HMA prematurely, where the HMA is governed by UAE law.

Unilateral termination in the event of Operator breach