loan agreement

Are interest provisions in a loan agreement valid in the Arab Region?

The topics regarding loan interest rates and usury in relation to lending activities in the Middle East Region are in themselves a slippery slope area and must be approached with the necessary caution. Given this delicate issue, one would question: are interests on loans illegal in the Arab Region.

To answer the question, it is best to understand first the belief behind the subject. According to Islamic teachings, interest and usury are based on the concept of “riba”, which literally means “excess or addition”, and the same is outlawed under the Sharia Law as grounded on the principle that profiting from lending money is considered “haram” or forbidden.

In today’s modern society, the prohibition against interest is generally applied to loans between individuals.

On the other hand, lending activities between two companies or between a corporate entity and an individual may not be included in the ambit of the prohibition.

Under UAE Law, the civil courts shall be the final arbiter of controversies regarding the validity or invalidity of interest clauses in a loan agreement. This goes without saying that any creditor may institute a case to collect on a loan agreement but it is within the discretionary powers of the court to accept these provisions relating to interest, surcharges, and penalties.

Noteworthy as well is the fact that a specific UAE Law deals with the obligation to pay interest and penalties. Under UAE Federal Law No. (18) of 1993 or the Commercial Transactions Law: it is stated under “Art. 76: A creditor is entitled to receive interest on a commercial loan as per the rate of interest stipulated in the contract. If such rate is not stated in the contract, it shall be calculated according to the rate of interest currently in the market at the time of dealing, provided that it shall not exceed 12% until full settlement.” and “Art. 88: Where the commercial obligation is a sum of money which was known when the obligation arose and the debtor delays payment thereof, he shall be bound to pay to the creditors as compensation for the delay, the interest fixed in Articles (76) and (77), unless otherwise agreed.”

Given these particular provisions that explicitly provide legal bases for the collection of interest and surcharges, a creditor is assured that he is protected under relevant legislation.

cyber bullying insulting law in dubai uae

Cyberbullying, Insulting, Hurtful comments in Social Media is a crime in Dubai UAE.

Under several UAE statutes, insulting someone, making fun of anyone or commenting hurtful things against somebody in social media is a crime in Dubai UAE that comes with a severe penalty.

As per UAE Federal Law No. 3 of 1987 (Penal Code) and Federal Law No. 5 of 2012 (Cyber Crimes Law) a person found to be liable of defaming another using social media, short messaging services or internet messaging applications may be imprisoned for a period up to two (2) years and can be meted with a fine of up to Three Million Dirhams depending on the gravity of the offense and the aggravating actions made in connection with the crime.

Aside from facing criminal persecution, a person may also be liable for damages especially if the recipient of the damaging comments or insult is a member of good standing in the community and such comments offended one’s reputation and social standing.

In one case, a tenant made some harmful and discriminatory comments against a landlord using the online messaging application WhatsApp, following an argument over the terms and conditions of the leased property. The landlord suffered severe anxiety and sleepless nights because of the comments and his reputation was also put in jeopardy because the message was sent to a third party.

After reviewing the incident, it was adjudged that the tenant is guilty of defamation under the Penal Code in relation to Cyber Crime Law. The tenant was found liable for damages for his discriminatory and insulting statements.

If you ever received similar comments or utterance resembling a crime under the aforementioned statutes, you may contact Al Reyami Advocates and Muhyealdeen International Legal Consultants and we will help you get the justice which you deserve.

Bounced Cheque Law Dubai UAE

Bounced Cheque in Dubai UAE – What you need to know

Rules and Regulations of bounced cheque Law in Dubai UAE.

Bank cheque is a tool used by individuals to secure funds, contract business and pay obligations, but not all of them have the ability to fund these cheques and the volume of bounced cheque cases have sky-rocketed over the years.

To address this ever-growing state of affairs, the UAE Government has established a set of rules to guide both the issuer and the recipient of Bounced Cheque.

There are several UAE Laws that can be utilized to protect the recipient of Bounced Cheque and they can be done either in the criminal or civil court. The recipient can file a complaint in the police station against the issuer and the case will be forwarded to the public prosecution and then to the criminal court (under the new rules, the public prosecution, in an effort to adjust with the volume of cases with low-value claims, can now issue criminal orders to sentence offenders of low-value bounced cheque to pay fines rather than endure jail time).

According to a recent study, the UAE Public Prosecution categorized low-value cases like the ones where the bounced cheque amounts less than AED 200,000 hence the only issuer of cheques with an amount more than AED 200,000 are doomed to be sentenced with a jail term.

The recipient can also institute a civil action against the issuer for the amount of the bounced cheque and if the issuer cannot pay the amount, he can be imprisoned for a period corresponding to the unpaid amount.

As for the issuers, particularly for low-value cheques, they can avoid imprisonment by simply paying the fine corresponding to the cheque amount; however, this does not absolve them from paying the obligation when the recipient opted to institute a civil action to collect the amount due.

For more detailed discussion of the intricacies of the Bounced Cheque Law in the UAE, you may contact Al Reyami Advocates and Muhyealdeen International Legal Consultants.

credit card fraud dubai uae lawyers

What is Credit Card Fraud and how to deal with it in Dubai UAE?

Credit card fraud is a white-collar crime in Dubai.  It is a type of theft or fraud involving another individual’s credit card, which is oftentimes stolen.  The stolen card is used to purchase items without the knowledge or approval of the rightful owner. It deprives businesses of billions of dollars per year. The law in the UAE looks to protect victims of credit card fraud, whether it is an individual, a corporation or a business. Dubai and UAE laws are specific and if convicted you can expect to receive very severe penalties.

Credit card fraud penalties may include a jail or prison sentence, fines, probation, and a mark on your criminal record for life. If you are being investigated, charged with or have been arrested for credit card fraud, it is important to contact a criminal defense lawyer immediately who has the knowledge and experience in handling credit card fraud cases in Dubai and throughout the UAE.

At Al Riyami Advocates and Muhyealdeen International Legal Consultants our criminal defense lawyers are extremely professional and committed when it comes to representing our clients. They have the skills and qualifications needed to represent your credit card fraud case.

We understand the seriousness of a credit card fraud charge. Contact The Al Riyami Advocates and Muhyealdeen International Legal Consultants today and let our criminal defense lawyers protect your rights and maintain your freedom.  Our lawyers and advocates will fight aggressively for you and will look to have the charges dismissed completely.

Contact us today to schedule your free initial consultation for your credit card fraud case. Our criminal defense lawyers will provide you with excellent representation and winning results.

Cyber Crime Law Dubai UAE

Internet Activities that are Cyber Crimes in Dubai UAE

Cyber Crimes in Dubai UAE

Internet Activities that are Cyber Crimes in Dubai UAE

In an effort to prevent the proliferation of internet crimes, UAE President His Highness Shaikh Khalifa bin Zayed Al Nahyan issued UAE Cybercrime Law No. 5 of 2012, detailing the country’s strict stand against computer-oriented crimes. According to the law, offenders will face hefty penalties such as long-term imprisonment or Dh 50,000 worth of fines, at the least. Severe offenses can be given a monetary penalty of up to Dh 3 million

The Cybercrime Law is implemented through a close monitoring of all internet activity in the UAE. This means that all activities are done through the internet, such as searching for, sharing, or downloading information, are all watched. Furthermore, content retrieval makes the deletion of files basically ineffective at erasing the existence of a certain content. Federal agencies have the capacity to recover deleted content and will definitely do so should that be required for cybercrime investigations. Warrants to take computers for investigative purposes can also be issued.

Some of the internet activities that can lead to legal proceedings are the following;

  • Illegal collection of information from or through the use of computers
  • Fraud – including Ponzi schemes, the illegal use of another person’s credit card, identity or other information, or falsification of information for investment purposes
  • Cyber threats
  • Pornography procurement, consumption, ownership, and dissemination

It is important to note that while the mandatory sentence for crimes related to pornography is only the minimum jail term, violators will have a lifetime label of “sex offender” which can affect their public reputation.

Finance, Property & Assets in UAE for a Husband & Wife

In terms of financial gains there are no laws with respect to divorce settlement the property assets will remain in the name of their respective owners and co-owned property will be dealt under general civil laws.

The finances and maintenance of spouses under UAE laws cannot be claimed by husband to his wife even when he holds custody of the children but a wife may do so even if she has wealth.

An application has to be made to evaluate the financial position of a couple that is planning separation. If the parties are muslim and are married to enforce it an application has to be made by the receiving party and not the giving party which can either be husband or wife who is going to divorce cannot enforce a settlement.

Any party can apply to the court for sale of their jointly owned property or for someone else to buy out shares. The basic assumption is that both parties made equal payments in property purchase but if they one party made higher investment then capital share will be large. However UAE courts have jurisdiction over property owned within UAE and not abroad otherwise jointly owned bank accounts and some other assets will be dealt the same.

The claims that can be made by the wife are as follows,

1- The first claim can be made for not supporting her during the last year
2- Second claim can be made for the supporting her during the waiting period called “Nafket Eda”.
3- To cover moral damage of the wife after being divorced by her husband against her will a claim can be made by her covering 25% to 40% of husbands salary or income called “Nafket Motaa”.

As per child maintenance rules for a divorce in UAE implies that either a claim for a carer’s allowance be made depending on the husbands income or the standard of living for a child would be equal to what he already had which includes schooling, medical, rent and other expenses.

COMPENSATION CLAIM BY VICTIMS OF CRIME IN DUBAI UAE

Compensation Claim by Victims of Crime in Dubai UAE

A person who files a criminal case against another person or party is seeking justice in terms of the crime having been committed. This will not, however lead to a payment of compensation being made to them without further action. Even in the event the accused is found guilty and made to pay a fine, that fine is paid to the court and not to the person who made the complaint (in essence, the person was found guilty of committing a crime against the law of the UAE). To make a claim for compensation, a case must be filed in the civil court.

With the case filed in civil court, it is possible for the judge in the criminal case to make the award of compensation at the time of judgement in the criminal matter, provided there is not an onerous burden placed on the criminal court in terms of determining the weight or validity of the damages claimed. If this is the case, the criminal judge will insist the claim for compensation is pursued in the civil court.

Even if the defendant is found not guilty of the criminal proceedings, the case for compensation may still have merit if there are elements such as breach of contract to consider (which are not covered by the criminal proceedings).

If during the crime, damage was done with financial consequence to an insurer, the insurer can make a claim for compensation at any time during the criminal proceedings.

How to start a Law Firm in Dubai

There are four basic procedures which must be followed for a person to start a law firm in Dubai,

a- Local Lawyer
To start operating in Dubai the very first thing anyone would need is to collaborate with a local lawyer having a law license which has to be valid in first instance court at least.

b- Acquire License
The person needs to acquire an establishment license from the Ministry of Justice to open a law firm from where he will get papers and card

c- License Submission
Documents which you receive from the Ministry of Justice as part of the license which later you will have to submit to the economics department.

d- Location
The ideal location would not be in JAFZA or Freezone because it is cheap and the area must be at least 40ft for the law firm to begin its operations

Things you need to know:

e- Professional Ethics
Lawyers must refrain from committing any criminal or deviant acts. There is a set of principles which have to be adhered to.

f- Charge Reasonable Amount
Whatever the case is and no matter how big the law firm is, the chargeable price for a disputed case should always be reasonable.

g- Dual Courts System
There are federal and local courts which are the dual courts in Dubai with Supreme Court based in Abu Dhabi covering different parts of the law. There are three stages to the Dubai court system, court of first instance, court of appeal and court of cassation.

h- UAE Laws Source
UAE law is mainly based on Sharia and International law. It is a civil law jurisdiction with reliance on French, Roman and Egyptian laws.

i- Rules of Law
As per rules & regulations the lawyers and advocates have to register with Ministry of Justice to practice in federal courts or other emirati courts.

j- Compliance to License & Regulations
To provide legal services outside the court lawyers & law firms need to get licensed with registration documents from Department of Legal Affairs.

The law firm based in DIFC has to obtain a commercial license from the authority and register itself with Dubai Financial Services Authority. Department of Economic Development has also major role to play as the formalities are to be fulfilled by the law firm.

Only local lawyers can attend court whereas foreign lawyers can practice law. For litigation and federal supreme courts only registered lawyers can attend and appear.

For practicing law in the country lawyers need an individual office in each emirate of UAE whereas main Dubai has freedom of the Rulers court.

k- Arab Gulf Cooperation Council
As a member lawyer of Arab Gulf Cooperation Council countries, you may obtain license to practice in Dubai & UAE courts. Expat Arab lawyers could practice in federal courts before but it is restricted to only Emirati nationals only.

l- License
There was a law passed in 2011, making compulsory for lawyers to get a license (requires a law degree) to offer their services legally adhering to the strict standards set by the government.

child abduction case dubai uae

Child Abduction by Parents in UAE

There are increasing numbers of child abduction cases in UAE due to broken marriages where it is common for one parent to take custody of the child.

For abduction cases where the father is a Muslim and mother is a non-muslim importance will be given to the Muslim father because UAE is an Islamic state whereas in case of both being non-muslim and non-nationals then laws of their land will be given preference. In case there is a UAE resident involved then local courts will favour the resident by applying local laws thus making the foreign laws non-applicable.

UAE is very strict when it comes to child abduction making it impossible for the abducted child in UAE to return.

To return abducted children to their country of residence or to the uniform child custody jurisdiction and enforcement act, for which the UAE is not a part of 1980 Hague Convention of the Civil Aspects of International Child Abduction.

For the welfare of children, UAE follows its own federal laws even though they have bilateral ties with other countries.

These child abduction cases are viewed as enforcing child custody whereas serious abduction cases are to be dealt with as criminal cases. For the return of the abducted child to the parent, one must make an application through the UAE courts.

Setting up a business in Dubai

There are six legal procedures which have to be fulfilled for every individual who seek to start a business in Dubai which lasts a week or eight days. Below are some required components which are as follows,

1- Name of Company: Your trade name being an important component must clearly indicate the company’s nature of business unless a branch of company.

2- Type of Business: The type of your business will determine the kind of license you require may it be professional, industrial or commercial. Furthermore you need to get higher authority approvals for legal consultantcy and more

3- Local Partner: It is required to have a local partner for DED license which is a good support for expats however it is not mandatory.

4- Owning the Company: As an expat, to get 100% ownership of your company, you will have to choose one of the free zones in UAE. Each free zone is unique catering to specific kind of activities.
For local ownership you need to get a license from Department of Economic Development (DED), however there are certain restrictions on share of ownership.

5- Legal Formation: There are some rules on forming a company that is based on the type of business and location. Furthermore there are restrictions for companies relating to company structure in each freezone.
For example to open a law firm in UAE, it has to be a branch of a company or a stand-alone company and not a sole proprietor.

6- Minimum Share Capital: The memorandum of association has to mention minimum share capital for the upcoming company, while setting up a company you don’t need to pay in most cases.

7- Office Premises: It would be best now to shortlist few offices on the basis of rent, area and location. You may select a free zone as well to get assistance on selection of a suitable place.

8- Hiring Employees: While setting up a business you may need to hire a manager to get your registration approved and in most cases like Intelaq license holders, they cannot hire staff but are able to hire contractors.