News & insights

Introduction of Consumer Protection Law (Federal Decree Law No. (15) of 2020) in the UAE

February 1, 2021

As part of the ongoing national campaign to maintain the highest level of consumer protection, the United Arab Emirates (UAE) issued Federal Law No. 15 of 2020, colloquially known as the Consumer Protection Law, on November 10, 2020.

The new Consumer Protection Law, which repeals the outgoing Federal Law No. 24 of 2006, covers all goods and services within the national borders of the seven Emirates that comprise the UAE, including the free trade zones and all related operations carried out by suppliers, advertisers or trade agents—including electronic commerce (e-commerce) transactions if the supplier is registered in the UAE.

As stated in Article 33 of the Consumer Protection Law, companies will have a one year transition period to comply with the provisions of new Law from the date it enters into force. We expect that the authorities concerned in the UAE will be issuing the Implementing Regulations, and accordingly, the Law is expected to come into force in May 2021.

The main three key provisions of the Consumer Protection Law are listed below.

Consumer Privacy

According to Article 4 of the Consumer Protection Law, suppliers and businesses now have an obligation to safeguard their consumers’ data. As such, suppliers and businesses are prohibited from using consumer data and information for marketing and promotional purposes. Furthermore, the consumers’ religious views, customs, and traditions must be protected when providing a commodity or receiving any service.

E-Commerce

Pursuant to the provisions listed in Article 25 of the aforementioned Law, all e-commerce providers registered that are within the UAE have the obligation to provide the consumers and competent authorities with their names, legal status, address, licensing authorities, and all the sufficient information in Arabic on the services they provide, specifications, terms of contracting, payment and warranty terms. Moreover, according to the provisions stipulated in Article 8, all the information made available to consumers, data, advertisements, contracts and invoices must be in Arabic. It is worth noting that other languages may also be used alongside the main language, which as stated above is Arabic, at the supplier’s discretion.

Penalties

A much welcomed addition to the new Consumer Protection Law is the inclusion of tougher provisions that impose much heftier penalties on suppliers who falsely advertise their products or services in order to deceive unsuspecting consumers. Such deceiving parties can face imprisonment of up to two years and a fine not exceeding AED 2 million (around USD 545,000).

It is worth noting that the penalties will be doubled for second time offenders. The aim of imposing such substantial fines and penalties is an effort in order to insure a better protection to consumers and reduce the number of repeat offenders.

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