UAE businesses can be fined up to Dh1 million under amended consumer protection law

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 said on Thursday.

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, told a media briefing.

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 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 in a statement.

Penalties will be applied, ranging from a warning to fines. In some instances, they could lead to licence cancellation or deregistration in the case of repeat offences, the statement said.

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 grievances submitted against decisions on punitive measures, Mr Al Saleh said.

The new rules were introduced following the decision taken 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.