New about cheque bounce

January 24, 2022

The cheque bounce case is no more a criminal case. It must be noted on priority. As per the latest advancements and the implementations, now the bounce cheque bank receipt will not allow the person to lodge a police complaint against the signatory, nor it will be referred to public prosecution and criminal court. The new rules in 2022 throw the light that a dishonoured cheque due to funds (insufficient funds) will not be treated as a criminal case or criminal offence more. It has been decriminalized by the Law. The Federal Decree # 14 from 2020, which is modifying a few provisions of Federal Law # 18 from 1993, indeed.

The next important question is, if it has been decriminalized then, that would be the remedy for the person who has been deprived of getting his right-back due to bounced cheque? The answer to this is quite simple, he can file an “Execution Case” as per the Law. He has the right to open the Civil Case against the signatory. But it would be a direct execution like the execution which is filled after the final verdict from a court. The best word to describe its remedy that to open the execution directly.

After filling the execution by the person, the court grants only fifteen days to the signatory to pay the funds to the person (who has to receive the funds, the payee). Let’s say if the signatory who is also the defendant in this execution, does not pay then the consequences of normal execution will be applied. We know very well about these consequences which can be traded license cancellation, confiscation of assets, bank accounts etc.

The New Law is particularly about giving relaxation to people doing business. UAE government is continuously attempting, and implementing favourable laws and rules so people could do business here with ease and freedom. Previously justice was also available but the recovery of funds was only possible through filing a civil case. Now a direct execution will save time and people will think twice before daring to issue a cheque having insufficient funds. The Lawyers in UAE can also be booked professionally to get detailed knowledge of this law.