New UAE consumer protection laws could see businesses handed fines of up to AED1m ($272,000) for violations.

The new regulations outline 43 obligations businesses have towards consumers purchasing products in the UAE.

The Ministry of Economy held a briefing session, during which it reviewed the main developments concerning the legislation and policies for the development of the UAE’s consumer protection system.

UAE consumer protection laws

These include Federal Decree Law No. 5 of 2023 amending the Federal Law No. 15 of 2020 on consumer protection, and its executive regulation issued by Cabinet Decision No. 66 of 2023.

The briefing took place in the presence of Abdullah Al Saleh, Under-Secretary of the Ministry of Economy.

Al Saleh highlighted that the new Consumer Protection Law No. 5 of 2023 incorporates several amendments to certain provisions of Federal Law No. 15 of 2020 on consumer protection in the UAE.

These amendments have significantly enhanced the role of local authorities, strengthened the enforcement of the law, introducing more flexible and efficient mechanisms to advance government policies aimed at strengthening consumer protection at both federal and local levels.

For the first time, the supplier’s obligations regarding necessary spare parts and goods repair are detailed according to the nature of the customer demand.

Furthermore, new mechanisms that regulate the examination of goods at laboratories are specified in case a dispute arises between the customer and the supplier on the quality of goods.

This enhances the deterrent measures that help ensure the supplier’s obligation and consumer’s rights.

For the first time, a seven to 30 days window has been determined to ensure the supplier’s obligation to provide spare parts or substitute goods, if a defect is found in goods provided.

Al Saleh discussed the new detailed list of administrative penalties and fines for consumer protection violations.

It includes a total of 46 types of violations, ranging from a fine of AED100,000 ($27,200) up to AED1m ($272,000).

For example, a fine of AED250,000 ($68,000) will be imposed on the supplier in case of failure to repair, maintain, provide after-sales services, return goods or refund within a certain time limit after a defect is discovered.

A fine of AED200,000 ($54,500) is imposed on the supplier in the event of failure to comply with standard specifications, rules and conditions of safety and health.

In this regard, Al Saleh explained that penalties will be applied, ranging from warning to fines.

In some cases, they could lead to licence cancellation or deregistration in the case of repeated offences.

These penalties also contribute to the protection of consumer rights in the country, reducing the litigation process for consumer protection as they cover all types of violations in this regard.

He said: “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.

“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.”

Al Saleh said: “The new Consumer Protection Law and its executive regulation represent a real milestone in the government’s efforts to develop the country’s consumer protection system in accordance with best practices.

“It has two dimensions: the first is the strengthening of the role of the local authorities in the enforcement of the consumer protection law more effectively by granting them all the necessary legislative powers.

“They have been granted inherent legal competencies in:

  • “i) receiving, following up and acting on consumer complaints
  • “ii) imposition of administrative sanctions and fines for acts committed in violation of the provisions of the law and its executive regulation
  • “iii) acting on grievances submitted against decisions on punitive measures.”

Al Saleh added: “The second focus area is the strengthening of deterrent measures to ensure that the merchants, either retailers, traders or producers meet their legal obligations, to re-balance the contractual relationship between them and the consumers.

“In this context, the merchants’ obligations during the sale of a commodity or providing a service have been more elaborated, better clarified, and broadened to include nearly 43 obligations.

“This is in line with the strategic objectives of the Ministry to promote consumer rights and welfare in order to establish and ensure an enabling and secure environment when purchasing goods or receiving service.”

Al Saleh noted that the majority of the merchants’ obligations under the new law and regulation did not exist in previous legislation.

This confirms a qualitative shift in legislation supporting consumer protection and guaranteeing all consumer rights in the country.

It further contributes to the provision of service or commodity according to the highest quality standards as one of the objectives of the country to improve the quality of life of citizens and residents, and in line with the vision of “We the UAE 2031”.

The Undersecretary said: “Thanks to visionary directives of the UAE leadership, today, the country boasts a cutting-edge legal framework dedicated to safeguarding consumer rights in line with global best practices.

“This comes amidst consecutive legislative advancements within our consumer protection system.”

He underscored the ongoing collaborative efforts between Ministry of Economy and its public-private partners to enhance compliance with national consumer protection regulations, promote ethical business conduct, strengthen market oversight, and uphold top-notch service and product delivery standards.

He said: “The Ministry of Economy is currently collaborating with local government entities to develop a comprehensive system for efficiently managing and promptly addressing complaints.

“This initiative aims to boost consumer confidence and safeguard their rights in the country’s markets”.