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Dubai Courts apply the amended Commercial Transactions Law on decriminalization of bounced cheques

26 Dec 2021


Dubai Courts apply the amended Commercial Transactions Law on decriminalization of bounced cheques


 .Dubai Courts has announced the application of the new amendments to the commercial transactions law, regarding decriminalization of issuing a cheque with insufficient funds and the amendments related to partial payment of the cheque. The court applied also harsher administrative penalties on issuing a cheque with insufficient funds. Those amendments were issued as per the federal law No. 14 of 2020. Such amendments are consistent with the plan and strategic initiatives of Government of Dubai that support economic sector and build national sustainable economy. The economy will be based on best criteria and international practices, thus contributing to raise the international competitiveness indicators. .Judge Khalid Almansouri, Chief Judge of Enforcement Court at Dubai Courts, explained that the new amendments are in line with the initiatives and strategic plans of Dubai. Such plans aim to achieve justice in accurate and fast way, provide judicial services to all, keep peace, independence, transparency, and teamwork which represent the vision of Dubai Courts of becoming distinct courts globally. . .The Chief Judge of Enforcement Court indicated also that the new amendments have decriminalized bounced cheques and limited criminalization to cases of fraud in issuing the cheque or in cases where there were sufficient funds but were withdrawn by the issuer. In this way we achieve the objectives of decriminalization and replace it with faster and easier procedures that give the beneficiary his right and protect him. Additionally, in this way the cheque value is collected faster with encouraging the public to use modern technology instead of old-fashioned cheques. Also partial payment of the cheque value is now mandatory. If the funds were less than the cheque value, the bank should pay the available part unless the beneficiary disagrees. .Article No. 635, repeated, of the Commercial Transactions law promulgated in the decree of federal law No. 14 of 2020 gave the cheque the power of enforcement deed. The cheque is considered as enforcement deed that allow the beneficiary to directly contact the judge to order payment of the cheque value or remaining part without the need to file any case or any further legal action. .Dr. Abdull Saif Alshamsi, head of Criminal Court, indicated that bounced cheques crime was decriminalized and limited to certain cases only. Alternatives and mechanisms were in place to collect the cheque value in fast and simple way. In this way the customers' satisfaction and trust is increased in recovering the cheque value in easy and simple way without taking legal action, whether civil or criminal. The only way to enhance the trust in the cheque is by supporting the beneficiary's right and supporting the guarantees that affirm such right. Accordingly, the banks should pay the available part of the cheque value in the account of the issuer. The bounced cheques are now considered as executive deed and the judge shall issue direct orders to recover the cheque value without the need to take legal action of any kind. This will increase the trust in cheques as being commercial bill with guaranteed recoverable value. .The Decree decriminalized issuing cheques with insufficient funds; accordingly there is no criminal part in bounced cheques. After this big amendment, the cheque beneficiary may not file a criminal report at police station on grounds of bounced cheque because the new law assigned this matter to the enforcement judge. . . ​.