In the UAE receiving a bounced cheque is a common experience, whether you’re a businessperson dealing with clients or an individual receiving payments from companies or others. However, the laws surrounding bounced cheques have evolved, making it essential to understand your rights and the proper steps to take if you find yourself in this situation.
Legal Process For Bounced Cheque
As of 2022, the UAE decriminalized bounced cheques, with the exception of those issued in bad faith. This significant change means that banks are now allowed to make partial payments from any available funds in the issuer’s account, provided the cheque holder doesn’t object. However, if the cheque is issued with fraudulent intent, a criminal case can still be pursued.
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What to do If Cheque Bounced
For beneficiaries, there are two primary courses of action if a cheque bounces:
Police Report:
You can file a report with the police, potentially resolving the issue through mutual consent.
Court Case:
If necessary, the matter can be escalated directly to the courts.
In cases of fraud, legal consequences include fines ranging from Dh20,000 to Dh100,000.
Filing a Report for a Bounced Cheque
If you decide to file a report with the police, here’s a guide to help you through the process.
Eligibility Criteria
To be eligible to file a report, the following conditions must be met:
- The incident must have occurred in Dubai.
- The cheque beneficiary (individual or entity) must visit the police station in the area where the incident happened.
- The incident must have occurred within the last five years.
- The cheque’s validity should not have expired.
- This service is available to individuals (citizens, GCC nationals, residents, visitors), government entities (local, federal, diplomatic), and companies or institutions.
Required Documents
Depending on whether you are an individual or a company, different documents are required.
1- For Individuals:
- Image of the bounced cheque
- Copy of Emirates ID
- Bank notice regarding the bounced cheque
2- For Companies:
- Copy of the bounced cheque
- Copy of the trade license
- Bank notice regarding the bounced cheque
- Complaint letter from the company (in Arabic), directed to the police
- Report issued by the company manager (as mentioned in the trade license) or an authorized legal representative
Additional Documents (if applicable):
- Valid email ID
- Image of legal authority documents along with the originals
- Image of Emirates ID (recipient of the cheque)
- Information to Include in the Report
When filing the report, make sure to include the following details:
- Emirates ID number
- Bounced cheque number
- Amount on the cheque
- Cheque’s merit period
- Recipient’s name
- Amount mentioned on the bounced cheque
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Process Details For Bounced Cheque
Filing a report for a bounced cheque in Dubai is straightforward and free of charge. After submitting the necessary form and documents, applicants will receive a transaction number and receipt via email.
You can file a report through any of these smart channels:
- Dubai Police website
- Dubai Police mobile app
- Smart Police Stations (SPS)
Final Thoughts
Understanding your rights and the legal processes surrounding bounced cheques in the UAE can help you navigate these situations effectively. By following the proper steps, you can ensure that your interests are protected, whether through mutual agreement or legal action.
