UAE Commercial Agencies Law: Penalties for Violations

The UAE Commercial Agencies Law has stipulated the seizure of goods and a fine of up to Dh400,000 for violating the law by any parties.

Penalties Apply to All Parties

Hasan Al Kilany, senior legal counsel, Ministry of Economy, said penalties will be implemented for any wrongdoing, whether by a third party or two contractual parties.

New Disciplinary Cabinet Resolution:

In addition, a new disciplinary Cabinet resolution has also been passed.

“Disciplinary Cabinet resolution speaks to everyone who is jeopardizing the UAE commercial agencies law,” said Al Kilany.

Fines Introduced in the Commercial Agencies Law:

The fines have been introduced in the Commercial Agencies Law, which came into effect on June 16, 2023. Previously, the disputes were referred to civil court.

Graduated Penalties:

He pointed out that this person will be penalized at two levels under the new disciplinary Cabinet resolution. The first attempt is to serve a warning. 

Then, they would be issued a Dh100,000 fine, then Dh200,000 for recurring violations and seizing the items. 

Finally, there is a fine of Dh400,000, Al Kilany said on the sidelines of a press briefing hosted by the Ministry of Economy and Al Tamimi & Co. about the commercial agencies’ law.

Application of the New Law:

The new commercial agencies law was enacted on June 16, 2023, which applied to all sectors. The business of commercial agencies would be exclusive to UAE nationals as well as public joint-stock companies, with at least 51 per cent owned by nationals.

Scope of Penalties:

He added that penalties apply to any wrongdoing, such as an agent in one emirate bypassing the geographical limitation and jumping to another emirate to sell goods.

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