“Central”: It helps in facilitating and regulating commercial and banking transactions

Implementation of the amendments to decriminalize the check without balance in early January

Khaled Balama: "The new amendments limit the negatives revealed by the practical reality of dealing with checks."

The Central Bank announced that the new amendments to the Commercial Transactions Law, regarding the decriminalization of the check without a balance and the amendments related to the partial payment of the check, and the tightening of administrative penalties for issuing the check without a balance issued under Federal Decree-Law No. (14) of 2020, which will enter into force as of 2 January 2022, which is in line with the government’s plan and its main strategic initiatives to support the economic sector and build a sustainable national economy based on the best international standards and practices, which contributes to raising international competitiveness indicators in this field.

The Governor of the Central Bank, Khaled Muhammad Balama, said that “these amendments are also in line with the bank’s strategic initiatives and plans to continuously upgrade banking laws and regulations to keep pace with developments and fill legal gaps and deficiencies to achieve the vision of the Central Bank in line with the best international practices in this field.”

He added that "these amendments would help in facilitating and organizing commercial and banking transactions, simplifying the procedures for collecting and honoring the value of the check, and making it more flexible."

Balama explained that “the new amendments limit the negatives revealed by the practical reality of dealing with the check compared to the best and most successful international practices, and consolidate the principles of justice by achieving a balance between the interest of the beneficiary / bearer of the check in fulfilling his right in the fastest possible way and the interest of the drawer in the expiry of the criminal case. filed against him in the event of payment.

With these amendments, the criminalization framework for a bounced check without balance has been narrowed and limited to cases related to bad faith and some check crimes, in order to ensure the achievement of the desired goals of decriminalization and replacing it with preventive measures, with the development of penalties and deterrent alternatives to limit the bad use of the check.

These amendments also aim to guarantee the rights of check recipients and holders, in addition to obtaining the value of the check faster and in a more effective manner determined by the Central Bank, at the same time encouraging the public to use modern technological and digital means instead of traditional paper checks.

Partial payment of the value of the check has also become mandatory, and if the consideration for payment is less than the amount of the check, the drawee must partially fulfill the amount in his possession, unless the bearer refuses to do so.

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