Rule-breaking businesses face fines of up to Dh1 million
▶ Regulation sets out 43 obligations aimed at ‘reinforcing consumer rights’
Businesses that break rules on the supply of goods and services to consumers face fines of up to Dh1 million ($272,000) under an amended UAE consumer protection law that has come into force.
There are 43 obligations for businesses listed in the updated law, relating to the warranty of a product, prices, invoices and replacement of products, the Ministry of Economy said on Thursday.
The amended consumer law applies to companies trading in shops, as well as to online businesses.
It lists 46 administrative sanctions that can be imposed either by the ministry or the local authority against the supplier “if there is any inconsistency in the terms of his agreement with the consumer”, said Abdullah Al Saleh, undersecretary at the Ministry of Economy.
Fines start at Dh100,000 and rise to Dh1 million.
A fine of Dh250,000 will be imposed on the supplier in cases of failure to repair, maintain, provide after-sales services, return goods or offer a refund within a certain time limit after a defect is discovered.
A Dh200,000 fine will be imposed on the supplier in the event of failure to comply with standard specifications, rules and conditions of safety and health, the ministry said.
The new protection rules were introduced following the decision by the UAE Cabinet last year concerning the executive regulation of Federal Law No 15 of 2020 on consumer protection.
“According to the new law, a new provision has been inserted, which mainly highlights that merchants shall not only put a selling price on goods, but rather price products by the unit,” said Mr Al Saleh.
Federal Law No 15 of 2020 on consumer protection aims to protect the consumer’s rights, including the right to a standard quality of goods and services and the right to obtain them at the declared price.
The law covers all goods and services sold or provided by suppliers, advertisers and commercial agents across the UAE’s mainland and its free zones.
The amended consumer protection legislation also covers goods that are sold through e-commerce platforms registered in the UAE.
The amended UAE consumer protection law has come into force, with businesses that break rules on the supply of goods and services to consumers liable for fines of up to Dh1 million ($272,000), the Ministry of Economy has said.
There are 43 obligations for businesses listed in the updated law, relating to the warranty of a product, prices, invoices and replacement of products. The law applies to companies trading in physical stores, as well as online businesses.
It also lists 46 administrative sanctions that can be imposed either by the ministry or the local authority against the supplier “if there is any inconsistency in the terms of his agreement with the consumer”, Abdullah Al Saleh, undersecretary of the Ministry of Economy, said.
The fines start from Dh100,000 and rise to Dh1 million. A fine of Dh250,000 will be imposed on the supplier in case of failure to repair, maintain, provide after-sales services, return goods or offer a refund within a specific time frame after a defect is discovered.
A Dh200,000 fine will be imposed on the supplier in the event of failure to comply with standard specifications, rules and conditions of safety and health, the ministry said.
Punitive actions could include licence cancellation or deregistration in the case of repeat offences.
Local authorities have been granted legal powers to receive, follow up and act on consumer complaints, to impose administrative sanctions and fines for acts committed in breach of the provisions of the law, as well as acting on complaints submitted against punitive measures, Mr Al Saleh said.
The new rules were introduced following the decision made by the UAE Cabinet last year concerning the executive regulation of Federal Law No 15 of 2020 on consumer protection.
“According to the new law, a new provision has been inserted, which mainly highlights that merchants shall not only put a selling price on goods, but rather price products by unit,” Mr Al Saleh said.
“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.”
The Federal Law No 15 of 2020 on consumer protection aims to protect consumer rights, including the right to a standard quality of goods and services and the right to obtain them at the declared price.
The law covers all goods and services sold or provided by suppliers, advertisers and commercial agents across the UAE’s mainland and free zones. It also covers goods sold through e-commerce platforms registered in the UAE.
Retailer Landmark Group said it supports the principles aimed at enhancing transparency and accountability in the provision of goods and services.
“This legislative update reinforces consumer rights and encourages fair business practices,” Gaurav Mediratta, general counsel (legal) at Landmark Group, told The National. “We believe these measures will benefit consumers directly.”
Alexandra Lester, partner at Clyde & Co UAE, said the law and the new executive regulations aim to “protect consumer rights and health and safety by introducing stringent penalties for breach of regulations”.
“There are also penalties for misleading advertising and anti-competitive practices,” she told The National.
The UAE has introduced several regulations as it aims to attract more investment and boost its economic competitiveness. Last year, the Emirates issued a new e-commerce law to help boost its digital economy amid a sharp rise in the number of online transactions.
The new law is a “continuation of the efforts the UAE is making to enhance consumer protections”, said Hani Naja, a partner in corporate and commercial at Baker & McKenzie.