Bounced cheques in the UAE will no longer be considered as a criminal offence starting December.
Under the previous rules, if you issued a cheque when you had insufficient funds in your account, under Article 410 of the UAE Penal Code, you could have faced detainment of up to three years, and/or have had to pay a fine of at least AED 1,000.
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In most countries around the world, bounced cheques are considered a civil offence – a private dispute between people or organisations – and usually result in a fine.
Now, Dubai Public Prosecution has issued a new penal order system that allows minor misdemeanours and offences to be dealt through fines rather than the court system.
Dubai Attorney General Essam Al Humaidan announced that anyone who issues a cheque up to AED 200,000 along with other misdemeanours, such as non-payment of rents and defamation cases, will no longer have to go through the Dubai Court system.
So, how much will you be fined if your cheque bounces? Bounced cheques of up to AED 50,000 will result in a fine of AED 2,000, and those who bounce cheques of AED 50,000 to AED 100,000 will be fined AED 5,000. If a cheque of up to AED 200,000 bounces, you can expect to pay a fine of AED 10,000.
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The new order comes under the purview of Law No. (1) of 2017, which was approved by His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Rules of Dubai, in March.
Ayman Abdul Hakam, Head of Dubai’s One Day Court, a system set up specifically to handle minor cases, estimated that 35% to 45% of cheque-related cases will drop in the first month. “This means that judges will have more time to focus on other major cases like money laundering, assaults and cybercrime,” Hakam said.
In a statement, Dubai Public Prosecution said that the new penal order “builds on success” of the one-day misdemeanour court system.