top of page

Reality check on the new bounced cheque law

Updated: Apr 22, 2021

The #UAE has modified Federal bounced cheque Law, law No. 18 of 1993. The new law is set to come into play in 2022, intensifying the validity of cheques as a form of secure payment.

bounced cheque dubai

The law on bounced #cheques remains passably indifferent where bounced cheques are still considered a criminal offense if it falls under certain parameters. The amended law profiles that the misdemeanours that accounts for a criminal penalty as;

  • Forging of cheques

  • Unlawful use of cheques, by ordering the bank not to pay the amount

  • Pulling out the amount before the date stated on the cheque to hinder payment

  • Intentionally befouling a cheque to block the collection

With this roll out, a bounced cheque can also be used as evidence in the court of law in the UAE where the court will see to the payee shall pay the cheque, have assets seizures, face fines, jail time and will not be permitted to issue a cheque for 5 years along with all commercial and professional ventures halted.

It is important for businesses and individuals alike to familiarize themselves with the new law set for 2022 and issues and cash cheques accordingly.

Interested in Company Formation in the UAE?

Synergy Gulf prides itself on providing impartial, efficient and exceptional service levels to ensure secure structures that match clients’ exact requirements are delivered quickly and efficiently. We specialise in the following service areas:

Limited Liability Company (LLC)

Free Zone Entity

Branch Office

Representative Trade Office

Commercial Agency

Professional Service License

Government/PRO services

Initial Approvals

Company Licensing

Labour Department Registration

Immigration Departure Procedures

Partner Visa

Identity Cards

Staff & Family Visas

Maids Visa

One of the most frequently incorporated commercial entities in the UAE is a Limited Liability Company (LLC). Under the law a limited liability company must have one or more local partners (shareholders) who must be a UAE national or a UAE company. The local partners are required to possess a minimum of 51% shareholding in the LLC.


bottom of page