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Economic Relief For UAE Businesses

The UAE government has introduced certain measures that will offer economic relief to UAE businesses suffering under the strain of COVID-19 ramifications.

Although the United Arab Emirates has not announced any direct relief from tax payment obligations similar to those introduced in KSA, the governments of both the Emirates of Dubai and Abu Dhabi have introduced financial assistance measures due to the current COVID-19 crisis.

The Emirate of Dubai

In the Emirate of Dubai, the government has introduced the following measures:

  • An AED1,5 billion business stimulation package involving the reduction in fees payable by businesses for three months
  • Dubai Customs introduced the following measures which will be in place from 15 March 2020 till 30 June 2020
  • A refund of 20% of all Customs Duty paid on goods at 5% which have been sold locally
  • The revocation of the AED50,000 cash or bank guarantees required to conduct customs broker activities and the refund of existing guarantees held to these brokers and clearing companies
  • The exemption from berthing fees as well as direct and indirect loading fees for boats that qualify as traditional wooden commercial boats registered in the UAE at either Dubai Creek or Hamriyah Port

The Emirate of Abu Dhabi

In the Emirate of Abu Dhabi, the government has introduced:

  • With effect from 16 March 2020, a 16 point stimulus plan involving fee exemptions, fine waivers, SME support initiatives
  • An AED 5 billion water and electricity subsidy scheme
  • An AED 3 billion SME credit guarantee programme
  • The establishment of a AED 1 billion market maker fund to sustain a balanced supply and demand balance for stocks
  • The suspension of performance bonds for bidding procedures
  • A 25% reduction on new industrial land leasing fees
  • The waiver of industrial and commercial penalties
  • Cancellation of individual and commercial real estate registration fees
  • The payment of government approved invoices within 15 days
  • The suspension of Tourism and Municipality Fees for the tourism and entertainment sectors for 2020
  • Waiver of performance guarantees for start-ups for projects up till AED 50 million

In addition to the government’s measures the private sector has also stepped up to the plate and numerous of the large property leasing companies have offered reduced and even exemptions from rental payments for commercial tenants that have had to shut down their businesses due to COVID-19.

Various banks, property developers and even utility suppliers have also offered payment holidays and have deferred evictions and legal collections in the light of the current situation in the United Arab Emirates relating to COVID-19.

Attorney General Announces COVID-19 Regulations

In most common law jurisdictions, the attorney general or attorney-general is the main legal advisor to the government. The plural is attorneys general. In some jurisdictions, attorneys general also have executive responsibility for law enforcement, prosecutions or even responsibility for legal affairs generally.

The UAE Attorney General has issued resolution of 2020 following Cabinet Decision No. 17 of 2020 regarding the implementation of regulations for spreading communicable diseases.

The resolution covers 15 penalties, ranging from AED 500 to AED 50,000, which aim to curb the spread of the novel coronavirus in the United Arab Emirates.

The Attorney General has clarified that the fine for not wearing medical masks in closed places can only be imposed on patients suffering from chronic diseases and on people who are suffering from symptoms of flu and cold and fail to maintain social distancing while among other people.

The following are the violations and associated fines as issued under the Attorney General’s resolution:

  • Fine for not complying with instructions of home quarantine and/or not following the guidelines under the Home Quarantine Guide– AED 50,000
  • Fine for patients who refuse mandatory hospitalisation or fail to take the prescribed medicines despite being alerted – AED 50,000
  • Fine for violating administrative closure of public places like shopping centres, malls, outdoor markets, gyms, public swimming pools, cinemas, clubs, parks and restaurants – AED 50,000
  • Fine for organising social gatherings, meetings and public celebrations – AED 10,000
  • Fine for not conducting a medical test upon request – AED 5,000
  • Fine for violating precautionary measures set by the UAE Ministry of Health and Prevention by people coming from nations affected by communicable diseases – AED 2,000
  • Fine for failure to observe health measures regarding regulation of roads, markets and other public places exempted from temporary closure – AED 3,000
  • Fine for failure to dispose of clothes, luggage or any temporary structures proved to be contaminated, which can’t be disinfected by the standard established methods – AED 3,000
  • Fine for unnecessary visits to hospitals and other health facilities – AED 1,000
  • Fine for exceeding the maximum number of allowed persons in a car – AED 1,000
  • Fine for not wearing medical masks indoors and failure to maintain social distancing by persons suffering from chronic disease or having symptoms of flu and cold – AED 1,000
  • Fine for leaving home unnecessarily and without reason, except for important work or a genuine reason – AED 2,000
  • Fine for violating provisions of the law when burying or transporting the body of a person who died from a communicable disease – AED 3,000
  • Fine for drivers failing to maintain hygiene and following sterilisation procedures in public transportation – AED 5,000
  • Fine for failure to take precautionary measures, failure for the crew of ships from the captain or shipping agent, as the case may be – AED 10,000

The National Emergency, Crisis and Disasters Federal Prosecution has been entrusted with the task of implementation of the resolution and may seek assistance from local and public authorities as required.

The penalties shall be doubled in amount for repeat violators and if the violator commits a third offence, he will be referred to the National Emergency, Crisis and Disasters Federal Prosecution for appropriate action. Further, the violator must also bear the costs of any repairs for damages occurring due to the violation.

The resolution is a part of the government’s measures to combat the spread of coronavirus and to protect the health of citizens and residents of the United Arab Emirates by curbing unnecessary gathering and outings.