Banned workers must leave UAE:Ministry of Labour

Pvt sector staff must exit even if they hold valid residence visa; Dh50,000 fine for firms hiring banned workers.Private sector workers who get a one-year ban by their employers must leave the country even if their residence visa has not expired, according to the Ministry of Labour.

Clarifying rules governing expatriate workers who are not exempted from the job ban, the ministry said those who stay in the UAE after they get the ban are considered violators of the immigration law.

“Those workers who get a ban and stay in the UAE are violating immigration laws as this means they are staying without a job,” said Humaid bin Dimas Al Suwaidi, Assistant Undersecretary.

“Expatriate workers who come to the UAE enter on a work visa, which allows them to get residence…any violation by the worker of the job contract means he will be banned from work and this will deprive him from residence even if it still valid.”

Quoted by the semi-official daily 'Al Ittihad', Suwaidi said companies which employ a banned worker would be fined Dh50,000.

During the ministry’s weekly “open-day” on Thursday, Suwaidi said he had rejected a request by a company to hire a banned expatriate labourer, adding that worker is now offending immigration laws and must leave the UAE.

UAE Central Bank issued regulations to streamline High service fees charged by banks

High service fees charged by banks and excessive lending practices are affected as part of a host of retail banking rules issued yesterday by the Central Bank.

The new rules cover personal and car loans, with limits capping the amount banks can lend to customers at 20 times their salary. They also set the period of loan repayment at 48 months.In addition, the rules restrict service fees lenders can impose for personal accounts, cheques and debit cards.

Some of the new fees for bank transactions are as follows:

For opening new account – none

If balance is less than the minimum “monthly” - Dh25

Non-arrival of salary - none

Closure of account (if closed within one year of opening) - Dh100

Lack of sufficient credit in the account - Dh25

Issuing certificate of account balance - Dh50

Issuing clearance certificate - Dh50

Non-moving accounts - no charges

Teller transactions at branch (6 transactions monthly free) - Dh10 for each additional transactions

For cash withdrawal or deposit - none

Postpone the payment of the loan – Dh100 for each time

Loan restructuring - Dh250

Bounced cheques - Dh100

Periodic statement of account - Dh25 outside period agreed on

Previously there was a Dh250,000 (US$68,066) ceiling on personal loans but few other limits on service fees. As a result, banks were able to extend huge loans to consumers.

"We have compared fees in the region and put them slightly above regional fees, but not as high as banks wanted," said Suwaidi.

Under the rules, banks will be limited to charging a maximum of Dh25 for replacing lost or stolen ATM cards.

Closing an account within a year of opening will cost customers no more than Dh100. The cost of issuing a chequebook will be capped at Dh30.

Fees for loans will also be regulated. Processing fees for personal loans will be capped at 1 per cent of the loan amount.

Penalties for early payment of a loan will also be curbed. Banks will not be allowed to charge more than 1 per cent of the remaining loan balance if a customer settles a loan early.Those not complying with the rules will face fines

UAE Central Bank has issued regulations to streamline personal loan -will be applied on the current loans

UAE Central Bank has issued regulations to streamline personal loan services of banks in the Emirates.

According to the Central Bank, the new regulations, effective May 1, 2011, will be applied on the current loans in terms of fees only. They will not be applied on current loans in terms of term and payment and the size of clients' salaries. Therefore, there is no need to modify the terms of current loans, reported 'Al Khaleej' newspaper.

The apex bank will review points proposed by a group of Islamic banks. For instance, their suggestion to replace the word 'interest' with 'profit' would be studied. The bank will then work on preparing appropriate terminology to be used in Islamic banks.

Regarding credit card fees the Central Bank confirmed that it is not included in these instructions and banks can follow their own policies.

The Central Bank emphasised that the fees specified in the instructions should be applied as is. They can be modified only after the banking association takes up the matter with the Central Bank.Similarly, pension loans must be equivalent to 30 per cent of client's salary at the time of retirement.

Service fees and commissions charged by banks should not exceed the figures specified by the Central Bank in its regulations. Any revision will be possible only after the Banking Association takes up the matter with the Central Bank.

Personal loan regulations enforced from May 1

Central Bank says new regulations are published in the official Gazette.A new retail loan system announced by the Central Bank early this year to regulate personal lending will be enforced on May 1 after it was published in the official 'Gazette', a newspaper reported on Saturday. The central bank has notified the country’s 23 national banks and 28 foreign units that the new system had been published in the official Gazette on March 31, which means they must adhere to the new rules on May 1.

“When it announced the new loan regulations, the central bank gave the country’s banks one month to enforce them after they are published in the official Gazette,” 'Emarat Al Youm' Arabic language daily reported. “The new rules were published on March 31 and this means banks must enforce them on May 1.”

The new lending regulations capped personal loans at 20 times a borrower’s monthly salary and stipulated the loan must be repaid within 48 months.

The regulations cover all retail loans including personal, car, housing loans and credit credits. They are intended to control lending activity and excessive charges by banks following public complaints about a surge in bank fees.

Personal loans in the UAE, which has the largest Arab banking sector, had surged by at least 35 per cent during 2006-2008 before they sharply slowed down over the past two years following the 2008 global fiscal crisis and regional debt default problems, according to the Central Bank.

From around Dh109 billion at the end of 2006, personal loans jumped by nearly 39 per cent to Dh148bn at the end of 2007 and by about 54 per cent to Dh228bn at the end of 2008. Growth plunged to only around 3.9 per cent through 2009, when personal loans ended the year at 237bn.In 2010, personal loan growth slowed down further to nearly 3.7 per cent as they stood at around Dh246bn at the end of the year.

Total credit also slackened to just around one-three per cent through 2009-2010 compared with more than 30 per cent during 2007-2008 because of those crises and poor borrowing appetite by the private sector.

The figures showed credit to the private sector in the first 10 months of 2010 dipped by four per cent to extend a downward trend since the onset of the crisis.

While loans to the government and other public sector establishments continued to grow slightly, those to he private sector remained dormant as both sides appeared less enthusiastic to engage in lending activity.

the private business and industrial sector was hit hardest by the credit slowdown, plunging by nearly 8.1 per cent in the first 10 months of last year.

From around Dh607bn at the end of 2009, total bank credit to the private sector receded to nearly Dh582.9bn at the end of October

Etisalat and Du limit access to BlackBerry service Next week

DUBAI, United Arab Emirates (AP) — Emirati authorities seeking greater control over smartphone data are pushing ahead with plans to impose tighter restrictions on the most tough-to-monitor BlackBerry service next week, according to a senior telecom executive.

The proposed new rules, outlined earlier this month, have renewed questions about how far the United Arab Emirates is willing to go in allowing highly secure communications within its borders.The Gulf Arab federation threatened a far more sweeping ban on BlackBerry email and other services last year, but reversed that decision shortly before it would have taken effect.

Osman Sultan, chief executive of the telecommunications firm Du, told reporters Monday the latest policy ordered by regulators will go into effect May 1. He said he doesn't expect the shift to cause problems for customers, who will still have access to email, Web browsing and instant messaging.

Under the new policies, Du and its rival Etisalat — both majority owned by the government — are required to limit access to the Blackberry Enterprise Server to companies with 20 user accounts or more. That system provides the most secure communication on the handheld devices and is used by many international companies and government agencies.

Other users would need to rely on a less-secure system known as the BlackBerry Internet Service that experts say could be easier for authorities to monitor. Unlike the more secure BES system, which routes encrypted data through company servers abroad, the BIS system runs over the regular Internet.

"I don't see any reason for frustration for customers," Sultan said. "You can still access your corporate email via BIS. ... I don't see what really is the issue."

Shortly after details of its latest planned restrictions became public, the Telecommunications Regulatory Authority issued a brief statement reassuring BlackBerry users that all services would continue for both individuals and business customers. That prompted speculation it might roll back plans to limit the higher-security service.

It has not commented further on the matter since. It did not respond to a request for clarification Monday.But Sultan's comments suggest the restrictions are still moving ahead."The rule is still this rule," he said.

Research in Motion Ltd., the Canadian company that makes BlackBerrys, has previously said it is in contact with the regulator and understands that the rules could apply to other smartphone makers but aim to avoid affecting "legitimate enterprise customers." A spokeswoman said the company had nothing more to add Monday.

The UAE's smartphone policies have been closely watched since last summer when it threatened to shut off BlackBerry data services partly because of security concerns. It backed off the plan in October.

Critics saw the effort as a way to more closely monitor political activism in the federation. Although the UAE has seen none of the widespread unrest roiling other parts of the Arab world, authorities have detained at least four activists calling for democratic reforms in recent weeks.

In 2009, Du's rival Etisalat was caught instructing unwitting BlackBerry customers to download spy software that could allow outsiders to peer inside. It misled users by describing the software as a required service upgrade.