Dubai: The upcoming ‘Executive Regulations’ will add further layers to UAE’s consumer rights protection in ecommerce transactions. At the same time, the regulations should also list out the penalties that businesses in ecommerce and digital trade could face if found guilty of violations.
These form part of the UAE’s ambitiously designed Federal Decree No. 14 of 2023, issued last December, which oversees all ‘commerce through modern means of technology’. According to a top official at the Ministry of Economy, the UAE ecommerce law has been one of the most impact of new legislations that it had issued in the last 3 years.
“It also represents one of the earliest attempts by any country to regulate the digital world,” said Abdulla bin Touq Al Marri, the Minister of Economy, at an event in Dubai that took up the law and the various aspects governing it. “The Law seeks to place consumers at the heart of it with the right protections being provided.”
A timeframe for the passing of the Executive Regulations has not been announced. (These regulations are a subordinate legislative instrument that go on to provide greater detail for the provisions of the law.)
In its scale, the Ecommerce Law goes well beyond business-to-consumer transactions done through online channels. Instead it seeks to cover the whole gamut of digital-based trade that will form part and parcel of the UAE’s developing digital economy. (That of course includes blockchain elements too.)
Also covered under its ambit is a much tougher consumer data protection mechanism built into it. This gives them additional guarantees on how and where their data can be used, and if they don’t care for that to happen, protect their info.
The UAE is moving to being a $6.5 billion ecommerce market in 2024 and $9.2 billion 2026. What the market also needs is protection of consumer confidence in online transactions. This Law does that
What the new UAE Ecommerce Law provides for
- It emphasises specifically the role of entities and authorities responsible for the licensing and regulating of e-commerce. They will also have oversight of associated logistic services and digital payment gateways.
- Then there is the protection of consumer interests, in terms of safeguarding IP rights regarding the purchase of goods or services. As well as the provision of sufficient tech-based protection to enable consumers to safely purchase goods and services, as well as regulate the refund and exchange of goods and services.
Then there is the protection of consumer interests, in terms of safeguarding IP rights regarding the purchase of goods or services. As well as the provision of sufficient tech-based protection to enable consumers to safely purchase goods and services, as well as regulate the refund and exchange of goods and services.
Over and above, the Law specifically authorises ecommerce based trade – and all aspects related to it - to be treated similar to that conducted physically and conventional means.
The Law does place additional requirements on digital merchants/vendors, which they should understand. Consumer protection is a key part of the Law.
According to David Yates, Head of Digital Data at the law firm Al Tamimi & Company, “Traditional ecommerce legislative regimes were focused on transmission of data and the electronic signature on the contract. It was a big thing, yes, but the UAE Ecommerce Law goes well beyond that in terms of the (consumer’s) identity.
“Also, the traditional version of commerce was based on the technology that was available in the 1990s, and with limited updates beyond that. These days, there are so many ways where digital trade can be done, including through digital payment gateways and social media platforms.
“These don’t neatly fold into the traditional concepts of ecommerce. But that’s how it is, and that’s why the Ecommerce Law had to take all such changes into account.”
The Ecommerce Law will weigh on contracts too:
- Organises the relationship between merchants (B2B) and those between digital merchant and the consumer (B2C).
- It is applicable to digital transactions conducted from UAE's free zones, including financial free zones. (In the case of the latter, it is about activities that are not related to their core financial services.)
- Organises the relationship between all parties who have entered the digital contracts. It protects online rights of consumers and relevant parties.
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