UAE is among the hardest nations in the world to recover debt, per the 2018 World Ranking on Debt Collection. Considering this, it’s more important than ever to monitor your cash flow and expenses!
Dubai’s laws associated with debt recovery
The UAE Shariah law dominates in debt recovery procedure. The Islamic legal system allows for multiple approaches to debt collection. However, Dubai’s debt collection procedure is also governed by corporate and civil regulations.
Among the primary legal tools for debt collection is the Commercial Transactions Law. One of the options this law offers creditors seeking to recoup unpaid debts is the ability to file a lawsuit in court. Beyond the Commercial Transactions Law, there are additional regulations that govern debt collection in Dubai, such as:
- The Civil Transactions Law, which establishes the obligations and privileges of creditors and debtors and offers legal recourse for debt collection;
- The UAE Penal Code: this code deals with the criminal penalties for debtors who mislead creditors or refuse to pay their bills;
- The UAE Commercial Transactions Law, which provides more legal possibilities for debt collection and governs commercial debt collection.
Besides these, the Central Bank and the Ministry of Economic Development have legislation that serves legal recourse in Dubai’s debt recovery processes. These include fair debt-collecting practices, the use of credit reporting firms, and regulations governing debt-collection companies.
Guidelines for using digital payment methods and guidelines for settling disputes between debtors and creditors are among the rules regulating debt collection operations that have been released by the Ministry of Economy.
Is it lawful to begin the debt recovery process in Dubai by using a debt collection agency? Yes, however, once the diplomatic channels are closed, it’s best to contact a Dubai law firm. If you wish to submit an application for a freelancing visa for Dubai, AL Helali Legal can help with immigration.
Recovery procedure
In order to settle any outstanding issues and work out a payment plan, the debtor must be able to speak clearly before engaging in debt collection procedures in Dubai. The recovery process in Dubai includes the following steps:
- First, a friendly notice for payment is sent to the debtor as part of the debt collection process.
- The following action is a call from one of our debt-collecting representatives;
- Throughout the process to ensure a proper recovery, there will be open contact between the debtor and the creditor;
- In order for businesses to get their money back, our team of experts will adhere to the legislation;
- In order to prevent lawsuits, we will attempt to resolve any recovery through cooperative means.
