Legislation Details
- Full Title: Federal Decree-Law on the Collection of Debts of Federal Entities
- Law Type: Federal Decree-Law
- Law Number: (15) of 2024
- Issued Date: 30 Sep 2024
- Effective Date: 30 Dec 2024
- Official Gazette: No. 784
- Sector: Finance and Banking
- Status: Active
- Number of Articles: 65
- Chapters/Parts: 0
- Amendments: 0
Summary
This Federal Decree-Law regulates the collection of debts owed to federal government entities in the United Arab Emirates. Its purpose is to organize and govern the measures for collecting these debts on their due dates, enable federal entities to effectively carry out debt collection, and achieve sustainable development and growth for public services and facilities. (Federal Decree-Law No. (15) of 2024, Art. 2)
The law is significant for businesses and individuals in the UAE as it establishes a clear and transparent system for federal debt collection, including notification procedures, enforcement mechanisms, and exemptions from certain fees and guarantees. It empowers federal entities to efficiently recover outstanding amounts owed to them, which supports the government's financial sustainability and ability to provide public services. (Federal Decree-Law No. (15) of 2024, Art. 2)
What is the scope and purpose of this law?
The scope of this Federal Decree-Law is to regulate the collection of debts owed to federal government entities in the UAE, including taxes, duties, royalties, administrative fines, fees for services provided, and financial obligations from lease agreements. (Federal Decree-Law No. (15) of 2024, Art. 3)
The law's purpose is threefold: 1) to organize and govern the measures for collecting debts of federal entities on their due dates, 2) to enable federal entities to effectively carry out their debt collection functions, and 3) to achieve sustainable development and growth for public services and facilities. (Federal Decree-Law No. (15) of 2024, Art. 2)
What are the key definitions under this law?
- State/UAE: The United Arab Emirates
- Ministry: The Ministry of Finance
- Minister: The Minister of Finance
- Federal Government: The UAE Government
- Federal Entity: The ministries and the federal public authorities and institutions
- Creditor: The Federal Entity that is owed a debt by the Debtor
- Director of the Creditor: The minister in-charge, the Creditor's board chairman or director or the like
- Debt Collection Follow-up Unit: An organizational unit at the Ministry in charge of monitoring and supervising the collection of debts
- Debt: Any of the debts set forth in Article 3
- Debtor: A natural or legal person that owes a debt to the Creditor and delays or refuses to settle it
- Competent Court: The federal court within the jurisdiction of the Debtor's domicile, place of residence or headquarters
- Enforcement Judge: An enforcement judge of the Competent Court
- Writ of Execution: The collection decision as set out in Article 9 or Clause 4 of Article 16
- Business Day: A normal business day of the Federal Government
(Federal Decree-Law No. (15) of 2024, Art. 1)
What are the main obligations and requirements?
The key obligations under this law include:
- Debtors must repay their debts on the due dates without delay or the need for a claim by the Creditor. (Federal Decree-Law No. (15) of 2024, Art. 4(1))
- Debts collected in the UAE must be repaid in UAE Dirhams into the account designated by the Creditor, unless otherwise stipulated. Debts collected outside the UAE must be repaid into the Creditor's account in the currency of the state where the collection takes place. (Federal Decree-Law No. (15) of 2024, Art. 4(2-3))
- Debtors must pay all expenses incurred by the Creditor for collecting the debt. (Federal Decree-Law No. (15) of 2024, Art. 4(4))
- If a debt is paid to the Competent Court, the court must notify the Creditor and deposit the amount within 7 business days. (Federal Decree-Law No. (15) of 2024, Art. 4(5))
What licensing, registration, or approval requirements exist?
The legislation does not specify any licensing, registration, or approval requirements under this law.
What rights and protections does this law provide?
The key rights and protections provided by this law include:
- Creditors are exempt from paying any fees to federal government authorities related to the collection of debts under this law. (Federal Decree-Law No. (15) of 2024, Art. 11(1))
- Creditors are not required to provide any guarantees or safeguards when initiating summary or precautionary measures or the writ of execution. (Federal Decree-Law No. (15) of 2024, Art. 11(2))
- Debtors have the right to appeal decisions on summary and precautionary measures taken against them before the Court of Appeal. (Federal Decree-Law No. (15) of 2024, Art. 12(3))
Which authorities or bodies are responsible for enforcement?
The key authorities and bodies responsible for enforcement under this law include:
- The Creditor must designate an organizational unit within its departments to carry out debt collection procedures. (Federal Decree-Law No. (15) of 2024, Art. 8)
- The Debt Collection Follow-up Unit at the Ministry of Finance is responsible for monitoring and supervising the collection of debts by federal entities. (Federal Decree-Law No. (15) of 2024, Art. 1)
- The Enforcement Judge of the Competent Court is responsible for enforcing the writ of execution and carrying out any required judicial intervention or assistance. (Federal Decree-Law No. (15) of 2024, Art. 9, 10)
What are the penalties for non-compliance?
The legislation does not specify any penalties for non-compliance with this law.
What fees, charges, or financial provisions are specified?
The key financial provisions under this law include:
- Debts collected in the UAE must be repaid in UAE Dirhams into the account designated by the Creditor, unless otherwise stipulated. Debts collected outside the UAE must be repaid into the Creditor's account in the currency of the state where the collection takes place. (Federal Decree-Law No. (15) of 2024, Art. 4(2-3))
- Debtors must pay all expenses incurred by the Creditor for collecting the debt. (Federal Decree-Law No. (15) of 2024, Art. 4(4))
- Creditors are exempt from paying any fees to federal government authorities related to the collection of debts under this law. (Federal Decree-Law No. (15) of 2024, Art. 11(1))
What exemptions or exceptions apply?
The legislation does not specify any exemptions or exceptions under this law.
How are disputes resolved under this law?
The law provides the following dispute resolution mechanisms:
- Decisions issued by the Competent Court on summary and precautionary measures are appealable before the Court of Appeal. (Federal Decree-Law No. (15) of 2024, Art. 12(3))
- If a substantive claim is instituted before the Competent Court and ruled in favor of the Debtor, the summary and precautionary measures taken against the Debtor shall cease. (Federal Decree-Law No. (15) of 2024, Art. 12(4))
What are the key deadlines and time limits?
The key deadlines and time limits under this law include:
- If the Debtor fails to repay the debt on the due date, the Creditor must notify the Debtor of the repayment within 10 business days. (Federal Decree-Law No. (15) of 2024, Art. 6(1))
- The Debtor must repay the debt within 20 business days from the date of notification, unless otherwise provided by applicable legislation or agreement. (Federal Decree-Law No. (15) of 2024, Art. 6(3))
- If the Debtor fails to repay the debt within the 20 business day time limit, the Creditor must issue a decision against them to collect the debt. (Federal Decree-Law No. (15) of 2024, Art. 6(2))
- If the Debtor repays the debt after the writ of execution is submitted to the Enforcement Judge, the Debtor must deposit the outstanding debt in the treasury of the Competent Court for the benefit of the Creditor. (Federal Decree-Law No. (15) of 2024, Art. 13)
How does this law interact with other UAE legislation?
This Federal Decree-Law interacts with the following other UAE legislation:
- Federal Law No. (1) of 1972, On the Competences of Ministries and the Powers of Ministers, as amended
- Federal Decree-Law No. (15) of 2018, On the Collection of Public Revenues and Funds, as amended
- Federal Decree-Law No. (26) of 2019, On the Public Finance, as amended
- Federal Decree-Law No. (42) of 2022, Promulgating the Civil Procedures Code
(Federal Decree-Law No. (15) of 2024, Preamble)
When did this law come into effect?
This Federal Decree-Law No. (15) of 2024 on the Collection of Debts of Federal Entities came into effect on 30 December 2024, 90 days after its issuance on 30 September 2024. (Federal Decree-Law No. (15) of 2024, Art. 27)
Source Documents
This article analyses Federal Decree-Law on the Collection of Debts of Federal Entities 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.