Legislation Details
- Full Title: Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party
- Law Type: Cabinet Resolution
- Law Number: No. (25) of 2023
- Issued Date: 27 Mar 2023
- Effective Date: 30 Apr 2023
- Official Gazette: No. 748
- Sector: Labour, Residency and Professions
- Status: Active
- Number of Articles: 15
- Chapters/Parts: 0
- Amendments: 1
Summary
This Cabinet Resolution establishes the mechanism for the Ministry of Human Resources and Emiratisation (the "Ministry") to collect administrative fines through a third-party debt collection company. The resolution outlines a step-by-step process, including grace periods, bank guarantee liquidation, and ultimately referral to a third party for collection. The purpose is to streamline the collection of fines owed to the Ministry, which is important for ensuring compliance with UAE labour laws and regulations. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023) This resolution is significant for businesses operating in the UAE, as it provides clarity on the consequences of failing to pay administrative fines to the Ministry. Establishments that do not settle their debts in a timely manner may face escalating penalties, including the suspension of new work permit services and the involvement of third-party debt collectors. Understanding these collection procedures is crucial for companies to maintain compliance and avoid disruptions to their operations. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023)
What is the scope and purpose of this law?
The scope of this Cabinet Resolution is to establish the mechanism for collecting administrative fines owed to the Ministry of Human Resources and Emiratisation. The purpose is to streamline the collection process and ensure the timely payment of fines by establishments in the UAE. The resolution applies to all administrative fines imposed by the Ministry, regardless of the specific violation or sector. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 2)
What are the key definitions under this law?
The key definitions provided in this resolution are:
- State: United Arab Emirates
- Ministry: Ministry of Human Resources and Emiratization
- Minister: Minister of Human Resources and Emiratization
- Third Party: Debt collection companies operating in the State
(Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 1)
What are the main obligations and requirements?
The main obligations and requirements under this resolution are: 1. Establishments must pay administrative fines imposed by the Ministry within the specified grace period of two months. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 2) 2. If fines are not paid within the grace period, the Ministry will stop issuing new work permits for the establishment and continue sending electronic notifications urging payment. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 2) 3. After six months, the Ministry will liquidate the establishment's bank guarantee (if any) to settle the outstanding fine. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 2) 4. After eighteen months, the Ministry will stop issuing new work permits to all sole proprietorships or establishments owned exclusively by the owners of the violating establishment. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 2) 5. After twenty-four months, the Ministry will refer the debt file to a third-party debt collection company. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 2)
What are the penalties for non-compliance?
The key penalties for non-compliance with this resolution are: 1. Stopping the service of new work permits for the establishment after two months of the grace period. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 2) 2. Liquidation of the establishment's bank guarantee (if any) and settlement of the fine after six months of the grace period. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 2) 3. Stopping the granting of new work permits to all sole proprietorships or establishments owned exclusively by the owners of the violating establishment after eighteen months of the grace period. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 2) 4. Referring the debt file to a third-party debt collection company after twenty-four months of the grace period. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 2) 5. Interest added to the unpaid fine at the EIBOR rate if not paid within one year. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 2)
What exemptions or exceptions apply?
The Minister may exclude some establishments from the collection procedures outlined in this resolution by issuing a decision specifying the conditions and controls for the exclusion, in coordination with the Minister of Finance. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 3) Additionally, the Minister or an authorized person may suspend the collection procedures if a judicial case has been submitted to the court concerning the imposed fine, until the court issues a final judgment. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 3)
What fees, charges, or financial provisions are specified?
The Cabinet shall issue a resolution to determine the percentages of fees for the third-party debt collection company from the proceeds of the administrative fines collected, based on the proposal of the Minister of Finance and after coordination with the Minister. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 4) The resolution also states that the amounts of the administrative fines collected by the third party shall be deposited in the unified account of the State treasury. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 5)
When did this law come into effect?
This Cabinet Resolution shall be published in the Official Gazette and shall enter into force thirty (30) days after the date of its publication, which was on 31 March 2023. Therefore, the effective date of this resolution is 30 April 2023. (Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party, 2023, Art. 7)
Source Documents
This article analyses Cabinet Resolution Approving the Mechanism for Collecting Administrative Fines Due to the Ministry of Human Resources and Emiratisation Through a Third Party for legal research and educational purposes. For the purpose of interpretation and application, reference must be made to the original Arabic text. In case of conflict, the Arabic text prevails. This does not constitute legal advice.