Evolution of e-commerce legislation in UAE

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Lawyer
Abdulaziz Abdullah Alhusainan

The United Arab Emirates (UAE) has witnessed a remarkable economic transformation over the past two decades, driven by a burgeoning market and substantial investments. This growth has necessitated a proactive legislative approach to keep pace with the dynamic trajectory of economic advancement. In this context, the introduction of the new e-commerce law signifies a pivotal step towards aligning the legal framework with the evolving landscape of electronic transactions and trust services.

The e-commerce sector in the UAE has experienced significant progress, fueled by investments, strategic acquisitions, and collaborations with global entities. Central to this evolution is the modernization of payment methodologies, which has stimulated and facilitated purchasing and trading activities in the country’s burgeoning e-commerce market. The enactment of Federal Decree-Law No. (46) of 2021 regarding Electronic Transactions and Trust Services (ETTS) and its subsequent Executive Regulations (Cabinet Resolution No. 28 of 2023) represent concerted efforts to enhance confidence, encourage, and simplify electronic transactions while safeguarding consumer rights.

The new e-commerce law introduces several key changes aimed at regulating electronic transactions and ensuring the security and legality of online commerce. The establishment of the Telecommunications and Digital Government Regulatory Authority (TDRA) as the regulatory authority for e-commerce activities signifies a significant shift. Trust Service Providers are required to obtain a license from TDRA, which maintains a publicly disclosed “Trust List” of approved licensees and their authorized services. Additionally, the Federal Authority for Identity and Citizenship issues controls in specific cases, emphasizing the importance of governmental oversight in maintaining trust and security in electronic transactions.

One of the significant provisions of the new e-commerce law is the validation of electronic transactions and signatures, emphasizing their equivalence to handwritten signatures. The law categorizes electronic signatures into three types—electronic signatures, qualified electronic signatures, and approved electronic signatures—each with varying levels of validity.

Moreover, individuals with valid digital IDs can use any electronic signature to conclude transactions with government entities, streamlining administrative processes and enhancing accessibility.

Furthermore, the new law extends the privileges of Qualified Trust Service Providers to facilitate cross-border electronic transactions, provided that the quality of services meets UAE standards.

This provision aims to promote international trade while maintaining the integrity and security of electronic transactions. However, it also imposes heightened responsibilities on E-signatories and Digital ID Holders to prevent unauthorized use of electronic signatures and seals, reflecting a shift towards more stringent compliance measures.

In terms of enforcement, the new e-commerce law stipulates penalties for violations, including fines and imprisonment for forgery and misuse of trust services.

The legislation aims to deter fraudulent activities and ensure the integrity of electronic transactions, underscoring the UAE’s commitment to fostering a secure and trustworthy e-commerce environment.

Before engaging in e-commerce activities, businesses must familiarize themselves with the legal requirements outlined in the new e-commerce law and its Executive Regulations. Compliance entails obtaining licenses from TDRA, adhering to prescribed standards, and providing accurate information to users.

Moreover, retailers must implement measures to protect consumer privacy and safeguard against unauthorized disclosure of confidential information.

In addition to the e-commerce law, businesses operating in the UAE must comply with other relevant legislation, including consumer protection laws, data protection regulations, and laws combating cybercrime and copyright infringement.

These regulations aim to uphold consumer rights, protect personal data, and maintain the integrity of electronic transactions.

In conclusion, the enactment of the new e-commerce law represents a significant milestone in the UAE’s journey towards fostering a secure and transparent digital economy. By aligning with international standards and embracing technological advancements, the UAE aims to sustain its leadership position in the global e-commerce landscape. Moving forward, continued vigilance and adaptability will be essential to address emerging challenges and opportunities in the ever-evolving realm of electronic commerce.

www.avocatabdulaziz.com

By Abdulaziz Abdullah Alhusainan

Lawyer

This news has been read 1741 times!

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