Business | Automotives

Car dealers face Dh1m fine for contract breach

New regulation on buying and selling of vehicles will come into force on October 1

  • By Zaher Bitar, Staff Reporter
  • Published: 00:00 September 16, 2011
  • Gulf News

Clean and transparent
  • Image Credit: Gulf News Archive
  • A car showroom on Shaikh Zayed Road. The unified contract will energise the automobile sector and make buying and selling more transparent, to the benefit of customers.

Dubai: Car dealers who fail to issue new government contracts to buyers could be fined up to Dh1 million and taken to court, the Ministry of Economy said Thursday.

Hashim Al Nuaimi, Director of the Consumer Protection Department in the Ministry of Economy, told Gulf News that the new contracts — which will be compulsory from October 1 — will clarify consumer rights and guarantee five years of service, maintenance and spare parts to customers from dealerships.

He added that if a car dealer violates the new regulation he will face strict penalties and heavy fines.

"The Ministry of Economy is going to implement the unified contract for purchase, maintenance and spare parts and all car dealers in the Emirates should abide by it from October 1; if not, then they will face a Dh1 million fine," Al Nuaimi said.

He also said that the form for the unified contract should be available for all car dealers in the UAE in both Arabic and English.

Al Nuaimi said he met with senior representatives from 40 automobile dealerships yesterday and they have approved the forms for the unified contract.

"This new rule attempts to facilitate procedures and protect consumers' rights. The unified contract will energise the automobile sector and make buying and selling more transparent, to the benefit of customers," he said.

With the new regulation due to come into force next month, the Ministry of Economy will make regular inspections of dealerships to monitor its correct implementation.

"In case of violation, the Ministry will issue a warning letter to the car dealer. In [the case of] a repeat violation, the violators will be fined up to Dh1 million while a third time the case might go to court," Al Nuaimi said.

"The main benefit from the unified contract is that it will create a sort of balance between the rights of the consumer and traders."

According to the new regulation, he added, consumers will be more aware of the products he/she is going to buy as all details and specifications as well as further guarantees will be laid out.

Al Nuaimi stressed that consumers should be aware of the new terms and conditions of the contract before signing and can report violations to the Ministry via the hotline — 600522225.

Comments (1)

  1. Added 11:19 September 16, 2011

    Isn't this going to increase the prices of new cars in UAE, and it's already too high compared to other countries.

    Mike, Abu Dhabi, United Arab Emirates

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