Dubai: Executives based in Dubai have welcomed a decree issued yesterday by His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, reducing fines imposed on businesses.
"As per decree No 1 of 2012, discounts will be implemented for fines received prior to the issuance of this decree and its accompanying table," the WAM news agency reported.
It added that according to the decree, fines paid between January 1 and February 29 will receive a discount of up to 40 per cent, fines paid between March 1 and April 30 will receive a discount of up to 30 per cent and there will be a 20 per cent discount on fines paid between May 1 and June 29.
"This move is a great welcome," said Abdul Baset Al Janahi, CEO of Dubai SME, an agency of the Department of Economic Development (DED) mandated to develop small and medium enterprises.
"His Highness always knew the pulse of the market.
"He knows that for all businessmen — with increasing costs of doing business — paying fines for violations is a big concern.
"Such a decree thus makes it easier for them to do business. It's most attractive for existing businesses to expand and for new businesses to flourish."
Al Janahi said the move would "hugely impact" the SME segment as "costs are everything to them".
Terming the move positive, businessman Kamal Kamal Vachani, director of supermarket chain Al Maya Group, told Gulf News: "Though my company has no fines, it's a great step by Dubai's Ruler as this will reduce pressure on businesses."
Sanjay Tolani, director of Goodwill Insurance Brokers, which has no fines, said: "Everyone wants to do business in Dubai.
"Companies were burdened with such fines because of a tough economic climate.
"Hence coming up with such a decree will allow businesses to rectify those mistakes and over the long term, it will be good for the economy.
"Also, businesses will be able to run longer rather than shut down."
The challenging financial climate in the recent past put a number of companies out of business as they struggled to meet financial obligations.
Presenting a different perspective, Tolani pointed out that this decree should not be taken for granted.
"That means businesses should not expect such discounts every time and instead learn to reduce defaulting," he said.
Hailing it as promising move, Mohammad Asif Jabbar, group CEO for Alif Investments, a retail conglomerate with no fines, said: "It shows positive signs that Dubai is coming back.
"These are welcoming statements."
Tolani added: "Given that things moved very fast for some time, this kind of discount comes as a very helpful measure."