The UAE is growing so fast into a digital economy that e-commerce will need to be an indispensable part of it. To that end, the UAE has set out broad legal frameworks to regulate electronic transactions and protect consumers. The law explores the key elements of Federal Law No. 15/2020 on Consumer Protection and Federal Decree-Law No. 46/2021 on Electronic Transactions and Trust Services, and their potential impact on conducting e-commerce in the UAE.
Federal Law No. 15/2020 on Consumer Protection
Federal Law No. 15/2020 was developed to protect the rights of consumers in the UAE concerning fair trade and to preserve consumers from fraud and cheating in the marketplace. The scope of this law includes all business dealings conducted within the UAE, whether through traditional commerce or electronic commerce portals. According to this aforementioned law, it assures some of the consumer rights such as the right to information: consumers shall have the right to be correctly informed about products and services, their prices, conditions of sale, and guarantees, provided by Article 4.Â
The right to safety: The goods and services provided shall not present a hazard to the health or life of consumers and, when the case requires so, to protect consumers against such risks, in accordance with Article 5.
The right to choice: Consumers have to be assured a free choice among various products and services that enable them to make their choices according to Article 6. And right to privacy under Article 7, which stated that, personal data collected from the consumer should not be used without authorization or against their interest. Â
E-commerce businesses have particular responsibilities under this legislation. Article 8 stipulates that they should not hide any relevant information from the public and must show in detail all the particulars of the products they deal in, along with the price lists. Article 9 dictates policies on returns, refunds, and cancellation. Article 10 demands adherence to advertising standards to ensure that the advertisements are truthful and not misleading. Article 11 ensures timely and amicable dispute resolution through an effective complaint-handling process. Article 12 provides that the law will supervise and deal with violations through the Consumer Protection Department.
Federal Decree-Law No. 46/2021 on Electronic Transactions and Trust Services
Federal Decree-Law No. 46/2021 on electronic transactions establishes a legal framework for the secure and efficient use of electronic signatures, records, and other trust services. This is one of the most important laws related to e-commerce, as it provides the ability to make secure online transactions.Â
Article 3 sanctions the legal status of electronic signature and records, having the same legal effect as that of physical records; hence, this builds confidence in digital dealings. Electronic signature services may only be provided by an approved trust service provider who ensures a high level of security and reliability under Article 4.
Article 28 requires that digital identities issued by approved providers be used for access to government e-services and any secure electronic transactions. According to Article 34, authentication certificates may be issued by a trust service provider to prove identity and authorization of persons in an electronic transaction. Article 35 requires businesses to adopt efficient security measures to protect electronic records and signatures against access, use or altering by unauthorized persons. Under Article 38, providers of electronic trust services shall be liable in damages for their failure to meet standards of security and reliability.
The electronic transactions and trust services law may impose penalties for such violations. Forgery or fraudulent usage of any electronic document and signature is punishable by imprisonment and fine. According to Article 39, the penalties may extend to temporary imprisonment and fines from AED 100,000 to AED 300,000, depending on the intensity of the crime. Participating electronic trust services without authorization has been made punishable under Article 45, with penalties of temporary imprisonment and fines between AED 150,000 to AED 750,000.
These aforementioned laws collectively ensure that e-commerce platforms operate transparently, protect consumer rights, and maintain the security and integrity of electronic transactions. Businesses engaged in e-commerce must comply with both sets of regulations to promote trust and confidence among consumers, thereby contributing to the sustainable growth of the digital economy in the UAE.
