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Up to Dh1 million fine: UAE introduces 46 new offences in consumer protection law

Official says some penalties can lead to licence cancellation or deregistration of the business in case of repeated offences

The UAE’s Ministry of Economy on Thursday announced the introduction of 46 new violations, which include fines going up to Dh1 million, in the Federal Decree Law No. 5 of 2023 to better protect the rights of the consumers.

This is the first time that the UAE has introduced such a big number of offences in an amendment.

The law also placed more than 43 commitments on goods providers and introduced integrated regulatory mechanisms and procedures to enable sound business practices and to enhance consumer satisfaction, happiness and well-being.

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Abdullah Al Saleh, undersecretary of the Ministry of Economy, revealed that a total of 46 types of violations have been introduced, ranging from a fine of Dh100,000 to Dh1 million.

“For example, a fine of Dh250,000 will be imposed on the supplier if they fail to repair, maintain, provide after-sales services, return goods or refund within a certain time limit after a defect is discovered. A fine of Dh200,000 is imposed on the supplier in the event of failure to comply with standard specifications, rules and conditions of safety and health,” he said.

He elaborated that some penalties could lead to licence cancellation or deregistration of the business in the case of repeated offences. These penalties also contribute to reducing the litigation process for consumer protection as they cover all types of violations.

The new regulations expedite dispute resolution, which saves the consumer from going to the judiciary in every case. It also enhances transparency and prohibits the inclusion of any clause that could harm the consumer; and prohibits monopolistic practices since around 14 examples of conditions or provisions that the provider is prohibited from including in contract forms, invoices or other documents in consumer contracting.

“The Ministry of Economy is currently collaborating with local government entities to develop a comprehensive system for efficiently managing and promptly addressing complaints. This initiative aims to boost consumer confidence and safeguard their rights in the country’s markets,” he added.

Explaining the new regulations, Al Saleh said a new provision has been inserted under which merchants shall not only put a selling price on goods but rather price products by unit.

“This ensures the highest levels of transparency in setting prices, thus avoiding any misleading offers. It also enables consumers to choose from a range of alternative goods, and compare prices effortlessly.”

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The under-secretary urged consumers to be fully aware of one’s legal rights specified in the new legislation.

“The consumer should learn about mechanisms for claiming rights, as well as submitting claims and following it up. The ministry also urges sellers, whether a manufacturer, merchant, distributor or a service provider, to consider the consumers’ rights and to be fully aware of their obligations towards them.”

Al Saleh said that the role of the local authorities has been strengthened in the enforcement of the consumer protection law more effectively by granting them all the necessary legislative powers. They have been granted inherent legal competencies such as receiving, following up and acting on consumer complaints, imposition of administrative sanctions and fines for acts committed in violation of the provisions of the law and it's implementing regulation, and acting on grievances submitted against decisions on punitive measures.