The Federal Decree-Law No. (5) of 2023 has amended Federal Law No. (15) of 2020 on Consumer Protection to enhance the protection of consumer rights. Furthermore, the UAE’s Ministry of Economy has passed a Cabinet Decision (66) of 2023, which relates to the executive regulation of the aforementioned Consumer Protection law, outlining a detailed list of offenses and their corresponding administrative and financial penalties.
Important Amendments Under Consumer Protection Law
The Supreme Committee for Consumer Protection: The amended Article 5 establishes the formation of the Supreme Committee for Consumer Protection by a Cabinet decision based on the Minister’s proposal. This Committee reports to the Ministry, is managed by the Minister, and includes various members whose competencies and rules of procedure are determined by the decision.
Commercial Agencies: In accordance with the amended Article 16 of the consumer protection law governing commercial agencies, agents or distributors are required to:
- Implement all warranties provided by the manufacturer or principal regarding the good or service.
- Provide a similar good for the consumer to use without charge if the warranty exceeds seven days, until warranties are completed.
- Comply with all obligations of the supplier as stipulated in the Consumer Protection Law if the service or good is provided through the agent.
Role of the Ministry and Competent Authority in Protecting Consumer Rights: According to the amended Article 22, the Ministry, in cooperation with competent authorities, will supervise the execution of the general policy for consumer protection, focusing on:
- Educating and raising consumer awareness about risks associated with certain goods and services, including e-commerce.
- Publishing decisions and recommendations to increase consumer awareness.
- Monitoring price movements and working to limit increases.
- Promoting competition and combating misleading advertisements and monopoly.
- Receiving consumer complaints and taking necessary measures, with the Implementing Regulation detailing the system for complaint handling and coordination.
- The administrative penalties and fines that the Ministry or competent authority may impose on suppliers will be issued by a Cabinet decision.
Grievance Procedure: Amended Article 35 states that interested parties can file a grievance in writing with the Minister or the head of the competent authority regarding decisions and measures taken against them under the Consumer Protection Law within 15 working days of notification.
All supporting documentation must be included with the grievance, which will be decided within 30 days and the decision will be declared final. Failure to respond within the specified period will be considered a rejection of the grievance.
The Ministry of Economy may impose one or more administrative penalties on suppliers for violations of Consumer Protection law which is stipulated under the Cabinet Decision No. 66 of 2023. These sanctions include:
- Notice: An initial warning was issued to the supplier.
- Administrative Fine: A financial penalty, with doubled amounts for repeated violations.
- Temporary Administrative Closure: Closure lasting between 24 hours and 90 days.
- Suspension of Activity: Full or partial suspension for 24 hours to 90 days.
- Cancellation of License: Withdrawal of license and removal from the commercial registry.
Significant Penalties
- According to Article 8/4 of the new consumer law, if the supplier fails to issue the invoice in the Arabic language, the supplier may face a fine of AED 100,000.
- Under Article 11, failure of the supplier to provide the consumer with the warranty document may result in a fine of AED 100,000.
- Article 20 stipulates that failure to advise both the concerned body and the consumer of potential harm and protection measures may lead to a fine of AED 500,000.
- Article 24/2 states that closing the return file without obtaining permission from the concerned body could result in a fine of AED 1,000,000.
- Failure to provide an alternative commodity in case of a supplier-responsible failure, according to Article 27/2, may lead to a fine of AED 500,000.
- By Article 28/1, failure to provide a new alternative product or its value in case of a recurrent failure during the warranty period may result in a fine of AED 500,000.
- Article 18 outlines that failure to provide periodical maintenance services for the warranted product could result in a fine of AED 300,000.
- Article 32/d specifies that selling products or services at prices lower than the cost price to produce a monopolistic condition may result in a fine of AED 100,000.
- Under Article 32/a, discrimination between consumers in the sale of commodities or utilization of services could lead to a fine of AED 100,000.
- Article 32/b mentions that hiding or abstaining from selling a commodity, imposing conditions irrelevant to the original dealing, may result in a fine of AED 200,000.
- In accordance with Article 32(h), purchasing competing products or services from the market to control prices may lead to a fine of AED 100,000.
