New Rules for Car Rentals in Dubai: Clear Guidelines on Security Deposits and Fees

Protecting Consumer Rights: Car Rental Companies Must Adhere to the Latest Payment Policies

Dubai’s Latest Circular for Car Rentals

In an effort to safeguard consumer rights and ensure transparency, the Dubai Corporation for Consumer Protection and Fair Trade, under the Department of Economy and Tourism, has introduced new regulations for car rental companies. These rules set clear guidelines regarding security deposits and prohibited practices in the industry.

Refunding Security Deposits: A 30-Day Window

According to Circular No. (1) for 2024, all car rental firms in Dubai are now required to refund security deposits, whether paid via credit card, debit card, or in cash; within 30 days after the vehicle has been returned. Importantly, if a deposit is held on a credit card, it must not be processed as a purchase transaction.

No Hidden Charges for Credit Card Transactions

The new rules prohibit rental companies from charging any additional fees or surcharges for payments made through credit cards or payment apps. Only standard administrative fees, along with legitimate charges such as traffic fines or vehicle damage costs, can be deducted from the security deposit.

Cash Deposits and Transfer Fees

For customers who pay their security deposit in cash or with a debit card, car rental companies must refund the amount in cash or via a bank transfer. The rental company will also bear any transaction fees associated with transferring the deposit back to the customer’s account.

Reasonable Administrative Charges Allowed

Car rental firms may charge a reasonable fee for specific services such as vehicle cleaning (approximately Dh50-60) and toll charges. However, they are not permitted to impose extra fees without justification.

The Bottom Line

These new rules aim to create a more transparent and consumer-friendly environment for renting vehicles in Dubai. Car rental companies are reminded to comply with these regulations to promote fairness and protect both their business interests and consumer rights.