The Ministry of UAE has taken a new step for bounced cheque punishments by allotting fine rather than prison sentences. The professionals in legal matters associated with monetary problems have categorized this decision as an exceptionally vital step
The government has made amendments in its laws, especially linked with the business and, economy to help people who are in debt. Due to the pandemic, the majority of the world has faced losses in business, and the countries observed a gradual drop in the economy.
There are a few situations in which the cheque is bounced and the legal proceeding will be faced:
Bounced cheque Issues on behalf of Issuer
If the criminal case is proven, then it is possible to make judgments entirely based on evidence provided via legislation. A person who issues the cheque needs to be aware in case it is bounced because of a typing mistake or no available money in the account. A bounced check can be resolved at any stage of a legal procedure going on based on the decision of a court. A drawer needs to recover the cheque that is bounced along with clearance paper given by the debtor while negotiating the case.
Bounced cheque issues on Behalf of the Drawer
The same is applied for the cheque withdrawer as he needs to fill the cheque carefully or provide the defaulted money or, he will face legal proceedings. No lawful proceedings will be held against a person, and the person will be free to move around the country. In a case, the cheque is filled properly by an issuer, but he withdrawal all the amount from the account because of a sudden emergency. An emergency could be anything from a medical issue to losing a job.
Because of this condition, a cheque is bounced, then the court will consider this reason into an account. If a payee can provide evidence for an emergency and show a willingness to pay the owed amount, then he will only face a fine, and a grace period is granted for that.
Alterations in the UAE Corporate Transactions Law
A bounced cheque is a decision-making document that can be presented in the court directly according to the new declaration. This decree will suggest alternatives to civil techniques to assist different procedures, dodging lawsuits related to criminal acts.Changes in the corporate and transaction laws made by the government of the UAE will appreciate the resolution of the bounced cheques values as a base to avoid unlawful cases. This decree will be going to be implementing in 2022 and still needs more clarification about the new laws.
Need for Change in the pre-existing Rules
According to these amendments, banks and other companies are obliged to make deductions from the funds available in the debtor’s account. The amount will be deducted only after paying a partial amount.This will ensure multiple options to make sure that bad debts are collected most quickly via cheques. These alterations in the laws will benefit the recipients and the cheque issuers. By existing laws, banks also have authority in implementing the amount from cheques.
Latest Amendments in the Corporate Law
Amendments in the corporate laws will allow the issuers and the recipients to settle the debt issues as soon as possible before the initiation of a criminal case. This will leave a positive impact on the economy within the business community.
The amendments in the laws will be a positive and prosperous pathway towards the business world. Breaking of local rules and regulations are never taken casually in the UAE. That is why it is important to take legal advice related to doubtful laws.
After the changes in the laws, a wide range of violations, such as delaying the payment for rents or bounced cheques, will not be considered a criminal act. These offenses will subject to monetary penalties now instead of involving court and prison. This will be a relief for residents.
The lawyers will evaluate the intensity of a crime or a case of their clients deeply and then provide expert advice related to find out the possible solution. These pieces of advice will act as the steps to deal with the situation and fulfill the requirements.