Member Article

Below is a summary of new developments and key new measures that have been implemented by various UAE authorities since 19 April 2020 and the time of this inBrief, 6:00 p.m. on Saturday, 25 April 2020.

I. First Phase of Easing of Lockdown and Movement Restrictions in Dubai

The Supreme Committee of Crisis and Disaster Management has announced a partial reduction in the restrictions on movement in Dubai starting from Friday 24 April 2020.

All individuals must follow preventive measures including ensuring two-metre distance from other individuals and wearing face masks. Those who do not wear a mask will be subject to a fine of AED 1,000.

A. Movement of the general public

• Individuals will be able to leave their homes between 6:00 a.m. and 10:00 p.m. without a permit.
• Exercising outside the home: Members of the public are allowed to exercise outside their homes provided they do not leave their area of residence. They can undertake activities such as walking, running or cycling for one to two hours each time. Only a maximum of three persons can exercise at the same time.
• Members of the public are also permitted to visit first and second-degree relatives. Gatherings should be restricted to not more than five people. However, visiting high-risk individuals (individuals above 60 years and those with underlying medical conditions) should be avoided. It is prohibited to hold gatherings in public or private places.
• Ramadan tents and Majlises are not allowed within homes and in public places.

B. Shopping malls and commercial outlets

• Shopping malls, markets and commercial outlets will be open daily to the public from 12:00 p.m. to 10:00 p.m. Furthermore, restaurants and shops are allowed to operate at a maximum of 30 percent capacity at the shopping malls.
• Malls and retail outlets are not allowed to hold entertainment events to avoid congestion and crowding.
• There will be no valet parking at malls and restaurants. The first hour of parking in shopping malls will be free.
• Only 25 percent of the parking spaces will be open in order to reduce overcrowding in malls. The public should visit a mall only when absolutely necessary.

C. Restaurants and cafés

• Restaurants and cafés are allowed to operate normally but are not permitted to serve shisha and buffet. Dine-in customers are allowed but should occupy only a maximum of 30 percent of the outlet’s capacity.

D. Public transport

• Public transport services, including Dubai metro services, will be resumed from Sunday 26 April 2020. The normal tariff system will be reintroduced.
• Red and green line metro services will operate between 7:00 a.m. and 11:00 p.m.
• Preventive measures should be strictly followed by all passengers and staff in metros, taxis and buses and at public transport stations including maintaining physical distance and wearing face masks.
• Only two passengers are allowed in one taxi.
• Water transport, tram, limousine, and car sharing services will continue to be suspended.

E. Administrative offices for companies and institutions

• A maximum of 30 percent of the workforce of all organisations will be allowed to work from their offices while the rest will be required to work from home.
• Meetings should be held at the office only if it is absolutely necessary. Attendees should not exceed five people and each person should maintain a two-metre physical distance from others.
• Daily sterilisation of the workplace is mandatory and employees and visitors should be provided with sanitisers at all times. Everyone is required to wear face masks when at the workplace.

F. Re-opening guidelines in Abu Dhabi

The Abu Dhabi Department of Economic Development issued Circular 26 of 2020 on 22 April 2020 concerning guidelines and precautionary measures for re-opening of malls and shopping centres in Abu Dhabi. Those guidelines are similar to those of shopping malls in Dubai except opening hours will be from 12:00 p.m. to 9:00 p.m.

II. Economic Relief Measures

A. Dubai World Trade Centre Authority (DWTCA) releases COVID-19 measures to assist with financial sustainability and operational continuity

On 22 April 2020 the DWTCA unveiled a series of measures aimed at supporting enterprises within DWTCA to better manage their fixed operating costs and liquidity during COVID-19. These measures include:

1. Meetings Incentives Conferences and Exhibitions Business

1. for organisers - no cancellation and/or rescheduling fees; no penalties for late payments; allow carry forward of pre-paid fees as credit to 2021; and
2. for exhibitors (DWTC-owned exhibitions) - full refund on cancelled events and where new schedule is not feasible for participants.

2. Retail Tenants

Up to six-months rent-free on base rent (1 April 2020 – 30 September 2020) for retail tenants in the Dubai International Convention and Exhibition Centre and One Central, impacted by mandatory public lock-down restrictions (e.g., Government enforced cancellations, and/or temporary facility closures).

3. SMEs and Start-up Tenants

Up to three-months base rent deferment for DWTCA commercial tenants (1 April 2020 – 30 June 2020).

4. Free Zone Businesses (effective for three months starting April to June 2020)

• seventy percent rebate on annual fees for all category-specific business registrations and licenses (new and renewal);
• fifty percent rebate on annual fees for general trade licenses and registrations; and
• zero percent administration fee on all visas - new, transfer and renewals.

B. Dubai Silicon Oasis Authority (DSOA) stimulus packages

The DSOA announced on 19 April 2020 that it would be implementing exemptions, incentives and flexible payment plans for companies, commercial tenants, and residents occupying buildings owned by the Authority.

1. Residential Projects

1. up to two months deferral on rent payments which can be rescheduled based on a payment plan over the remainder of the lease duration;
2. waiver of late payment fines until 31 August 2020;
3. monthly rental payment plans for existing and new tenants;
4. up to 10 percent discount on rental value upon renewal; and
5. additional discount of AED 2,000 for apartments and AED 5,000 for villas if annual rent is paid on time and in one instalment.

2. Retail Sector

1. rent waiver from 15 March 2020 for restaurants, shops, and gyms impacted by the closure until work is resumed;
2. postponement of rental payments for a three-month period;
3. waiving late payment fines until 31 August 2020;
4. reducing marketing fees by 25 percent;
5. up to 10 percent discount on rental value upon renewal for existing and new retailers;
6. additional 5 percent discount on the annual rent if paid on time and in one instalment; and
7. offering flexible payment plans.

3. Companies

1. postponement of rental payments for a three-month period;
2. waiving late payment fines until 31 August 2020;
3. extending grace period until end of May 2020 for new companies;
4. up to 10 percent discount on rental value upon renewal for existing and new companies;
5. additional 5 percent discount on the annual rent if paid on time and in one instalment; and
6. offering flexible payment plans.

4. Dubai Technology Entrepreneur Campus

1. postponement of rental payments for a three-month period;
2. waiving late payment fines until 31 August 2020;
3. flexi desk and fixed desk tenants can pay rent in up to six instalments; and
4. additional five percent discount on the annual rent if paid on time and in one instalment.

C. Implementation guidelines of the Targeted Economic Support Scheme (TESS)

On 19 April 2020 the UAE Central Bank (CBUAE) released an announcement outlining regulations and guidelines in relation to TESS. Some of these guidelines include the following:

• Banks are urged to process more applications from individuals, corporations and SMEs whose business operations are affected by the implications of COVID-19.
• Banks are expected to retain sound lending standards and are required to treat all their customers fairly.
• During the validity of TESS, which runs up to year end 2020, banks are expected to postpone the payments of interest and/-or principal of loans for customers/individuals/SMEs and other private sector companies affected by the repercussions of the COVID-19 pandemic.

In addition, TESS includes a liquidity relief tool of AED 50 billion offered by the CBUAE through banks to eligible customers who wish to apply for a deferment.

• The CBUAE has mandated banks to accelerate the account opening time to a maximum of two days for SMEs, unless banks identify the customer as high risk from an anti-money laundering perspective.
• Banks shall not be allowed to require their SME customers to have a minimum account balance amounting to over AED 10,000. This measure is aimed at providing banks’ customers with economic relief and to facilitate the continuation of business operations in the UAE.
• Measures taken by CBUAE include the decrease of the minimum required down payment, to increase the affordability of real estate.

D. Service fee reduction by the Ministry of Economy

According to Cabinet Resolution No. 20 of 2020, on 21 April 2020 the Ministry of Economy published on its website a list of services whose fees have been reduced by 17 percent to 98 percent.

Click here for the updated list which is available in full on the ministry's website.

III.Operations of the Courts

A. Dubai Courts

The Dubai Courts released Resolution No. 33 of 2020 concerning Remote Litigation Procedures and Continuity of Court Services (Resolution) which came into effect on 19 April 2020. Lawyers or customers wishing to benefit from court services shall use electronic systems of Dubai Courts Department to log into the smart application system. Natural persons would register in the “Al Salifa” system with a verified user account.

The following is an overview of the procedures outlined for various legal matters under the Resolution.

B. Abu Dhabi Court of First Instance

Further to our inBrief dated 7 April 2020 where we reported on Circular No. 7 of 2020 with regard to continuity of the Abu Dhabi Courts judicial process during the COVID-19 period, the Abu Dhabi Judicial Department announced on 22 April 2020 that the Abu Dhabi Court of First Instance had reinforced its remote litigation system through audio-visual technology, to include all civil, personal status, rental, urgent lawsuits, and inheritance circuits.

C. DIFC Courts

The DIFC Courts issued a notice on 23 April 2020 stating that the Registry’s physical return to the office will not be on 26 April 2020 as initially planned. It reported that over the past five weeks it has largely been business as usual with approximately 90 percent of hearings being conducted over telephone conference, or where possible, over video conference. The remaining 10 percent of hearings which have had to be postponed due to technicalities such as the swearing in of witnesses, will be listed in the first week after the Registry resumes work from the DIFC Courts’ offices.

The following e-mail addresses and contact details for various queries have been provided in the notice. Urgent queries and applications should first be addressed by contacting the Registry switchboard number on +971 4 427 3333 between 8:00 a.m. and 4:00 p.m., Sunday to Thursday.

IV. Logistics and Technology

A. TraceCovid

Abu Dhabi Department of Health has recently launched an innovative mobile app called TraceCovid. The app can be downloaded and installed by anyone in the UAE using a Bluetooth-enabled smartphone operating on Android or iOS. The app will identify people who have been in close contact with those infected with the virus. The health authorities will be better placed better to quickly start the contact tracing consequently reducing the spread of the COVID-19 virus.

To operate, the app requires only two steps - installation and keeping the Bluetooth of the phone turned on constantly. The app relies on Bluetooth signals to detect and identify another device with the same installed app.

When two or more app users (with the app installed and running on the mobile phone) come in close proximity/contact, the app will exchange a unique code called the Secure Tracing Identifier (STI). This happens automatically without requiring any action from the user. STIs get stored on respective phones automatically and locally (i.e., not on the servers). When one app user gets infected with the COVID-19 virus the user must, as a normal process, contact a medical centre who will in turn inform the health authorities about the infected user. The health authorities will contact the infected user to request access and upload the user’s “TraceCovid data” i.e., list of STIs. The health authority will request the user’s consent before doing so. The contact tracers from the health authorities will then have the STIs of all the users who were in contact or close proximity with the COVID-19 patient.

The shared list of STIs will give health authorities a good starting point to start tracing, identifying, contacting and giving medical guidance to all those people who were in close proximity to the COVID-19 patient.

The app works irrespective of users knowing each other. This makes the app versatile and apt for safe community contact tracing to reduce the spread of COVID-19.

B. DP World’s online logistics tools

DP World has launched cutting-edge online logistics tools and services, covering sea, land and air shipping around the world. The connected ecosystem of platforms will enable freight forwarders and any business, to book shipments of cargo from and to anywhere in the world, by any combination of sea, land and air. DP World has accelerated the already planned roll-out of the platforms to help companies meet the challenge of the COVID-19 crisis and keep trade flowing including vital food and medical supplies.

V. Visa-Related Matters

Extension of DIFC residency visa validity

In line with the recent announcement made by the Federal Authority for Identity and Citizenship concerning the extension of residency visa validity until 31 December 2020, the DIFC Authority announced the following measures and guidelines with respect to DIFC residency visas:

• All employees and their dependents (inside or outside the UAE) as well as all individuals inside the UAE with visas expiring after 1 March 2020 will have their entry permit validity extended until 31 December 2020.
• Employers wishing to submit applications for visa renewal can still apply on the DIFC Portal. The visa will be valid from the renewal date up to three years and medical fitness test will not be required. Individuals with expired visas who are eligible for the extension and need to exit the UAE are required to renew the visa before exiting the country.
• Employees with cancelled visas that could not exit the UAE due to the current travel restrictions will be able to have their overstay fines waived at the airport at the time of exit.
• Employees with cancelled visas or visit visa that are in the process of obtaining a new visa with a new employer must complete the change of status within the permitted grace period to avoid fines. Fines will still be applicable for this category.
• Entity establishment cards must be renewed on time. Late fines will still be applicable for delay in renewal of establishment cards. Entities must ensure that the DIFC license is renewed to be able to apply for establishment card renewal. The penalty for each month of delay is AED 100.
• The residency visa of individuals (with valid visa) who completed six months outside the UAE after 1 March 2020 will not be blocked until 31 December 2020.
• Individuals with cancelled visas who are applying for a new visa while they are inside the UAE (given that no overstay fines are issued to them) will be allowed to complete the new visa process without the medical fitness test. However, the visa will be issued for one year only. Visas issued for three years will still require a medical fitness test to be completed.
• The Federal Authority for Identity and Citizenship have started issuing electronic visa stamping and the same will be available under the service request documents list upon completing the visa process.

VI. VAT-Related Matters

Deadline to submit VAT returns extended to 28 May 2020

On 21 April 2020 the Federal Tax Authority issued a directive, on an exceptional basis, for an alternative deadline to file VAT tax returns and pay due taxes on 28 May 2020, for tax periods that ended on 31 March 2020.

This exceptional directive pertains only to VAT returns for the tax periods that ended on 31 March 2020, for both monthly and quarterly tax periods, and does not affect any other tax periods where the deadline for filing tax returns and settling of payable taxes does not fall in April 2020. ■

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Please visit our COVID-19 Resource Centre for copies of our COVID-19 inBriefs and Legal Alerts.