STA Law Firm https://www.stalawfirm.com/en.htmlSTA Law Firm - Court Uncourt (Blog) - Law on Cross-border crimeenCopyright 2024 STA Law Firm All Rights Reserved<![CDATA[Dealing with Counterfeits in the UAE]]> Dealing with Counterfeits in the UAE

Introduction

Businesses engaging with counterfeit items in the UAE now risk significantly harsher sanctions, again for legitimate brand owners. The maximum punishment for counterfeiting has been increased from AED 10,000 (about USD 2,700) to AED 1 million (approximately USD 275,000) for pharmaceutical and food items and AED 250,000 (approximately USD 68,000) for other products. Repeat offenses might result in doubled penalties. A new Federal Law on Combating Business Fraud, which repeals the old law combating fraud in commercial transactions from 1979, introduces this long-awaited rise in penalties. Businesses must only deal with authentic merchandise under the UAE's new regulation to prevent counterfeiting (and other forms of economic fraud). Failure to do so will subject those businesses to possible fines and other consequences such as the closing of their business or the revocation of their trading license. To exploit this new law's

Impediment impact, brand proprietors, should ensure that their brand names are enlisted in the UAE.

The following are some of the important attributes of the new law:

  • Importing, exporting, re-exporting, manufacturing, selling, displaying, possessing with the purpose to sell, storing, renting, marketing, or dealing with Counterfeit Products are illegal. It's also unlawful to promote counterfeit goods. 
  • A "Counterfeit Product" bears an identical or similar brand to a registered trademark without permission. This indicates that the law's scope of protection is limited to
  • Disciplines fuse jail (up to two years), fines (up to AED 1 million), the finish of premises, and withdrawal of trade licenses. The hardest punishments are held for forgers of drug and food items and habitual perpetrators. Penalties might even be multiplied for the last option. This expansion in fines is a significant and hotly anticipated turn of events.
  • The importer will be responsible for the costs incurred by the authorities in disposing of counterfeit products.
  • A centralized authority (the Higher Committee) will lead the fight against counterfeiting and oversee the law's implementation at the federal level. However, this authority is not expected to accept complaints, and the new law does not provide a single complaint mechanism.
  •  A framework for settling infringement has been set up for Counterfeit Products other than drug and food items. It is muddled, in any case, if brand proprietors will play any part in this technique.
  •  All documentation and information about Counterfeit Products must be provided to the appropriate authorities. This is the sort of thing worth being appreciative of because it will make it clearer to recognize other stock organization people. It's unclear whether this data will be shared with brand owners.
  • Counterfeiting is the topic of today's notice. The new regulation in the UAE, on the other hand, is intended to tackle commercial fraud in general. Dealing with tainted or tainted goods, as well as announcing fraudulent or fictitious rewards or discounts, falls under this category.

Overall, the new law is a step forward in the UAE's adoption of international standards for detecting and enforcing trademark infringements. The UAE government has established several mechanisms to protect the rights of brand owners.

 1. Customs authorities provide protection.

Brand owners can use customs officials to assert their rights and prevent goods from entering the UAE market that infringes on their trademarks. Rightsholders, in particular, have the option of notifying customs authorities about their trademarks, which are registered with the UAE Trademark Office, so that officials can keep an eye on them. Nonetheless, it ought to be noted that the UAE comes up short on a focal traditions recording framework. Subsequently, every Emirate should direct its recording. The Emirates of Abu Dhabi, Dubai, Sharjah, Ajman, and Ras Al-Khaimah license brand names to be enrolled with their specific customs divisions. Moreover, brand proprietors can and should train cops to acclimate them with the firsts and usual fakes.

2. Prosecution in criminal court

When brand owners discover counterfeit items on the market – for example, through market investigations – they can submit criminal charges with the police or the public prosecutor. The case will be investigated, raids will be conducted, and the case will be forwarded to a criminal court if the allegations are proven. It should be noted that filing a criminal complaint with the police does not require payment of a charge, but the goods must be stored at the complainant's expense until a verdict is rendered. Fines and even prison sentences can be imposed by a criminal court and the confiscation and destruction of infringing items. The UAE Trademark Law (Federal Law No. 37 of 1992, as amended by Federal Law No. 8 of 2002, Art. 37 ff.) and the Anti-Commercial Fraud Law give substantial law establishments to the cures and their degree. The court might additionally arrange for the litigant's premises to be shut and the choice to be distributed at the infringer's cost. When brand owners discover counterfeit items on the market, they can report them to the police or the public prosecutor. It is crucial to understand that filing a criminal complaint with the police does not include paying a fee.

3. Taking civil action

Another choice for brand name owners is to begin a legal contention against the blameworthy party, as indicated by UAE Trademark Law (Federal Law No. 37 of 1992 as changed by Federal Law No. 8 of 2002, Art. 37 ff.). An everyday activity can be dispatched after or without documenting a criminal protest, or it tends to be recorded simultaneously with the criminal procedure. The last option activity benefits from permitting the criminal court to assess proof created in the typical case. If the misdeed, the harms, and the causal connection between the two are demonstrated, the court will grant the freedoms holder's damages. What's more, the infringer may confront a movement boycott.

4. Action was taken by the administration

Administrative actions are a more efficient and cost-effective way to deal with infringements. In Abu Dhabi, Dubai, and Sharjah, they are carried out by the Department of Economic Development (DED). In contrast, in the other Emirates, they are carried out by the Ministry of Economy. Owners of trademarks can register them to ensure that they are tracked. In addition, they can file complaints against infringers. Fines against infringers, as well as confiscation and destruction of property, will be levied for administrative measures, which will include investigations and raids. Repeat violators may face temporary closure of shops, while rights holders in the pharmaceuticals sector may contact the Ministry of Health to report infringements.

Conclusion

The UAE government has given brand proprietors various viable instruments for battling brand name forging. Counterfeit items can be prohibited from entering the UAE market by customs authorities or confiscated and destroyed by courts or administrative actions, with fines for infringers. It is recommended that rights holders and their Intellectual

Property lawyers collaborate with authorities to build a strategy for utilizing the available resources in their case.

 

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Tue, 01 Mar 2022 12:00:00 GMT
<![CDATA[Economic and Fraud Provisions in the Middle East]]> Economic and Fraud Provisions in the Middle East

"There is one and only one social responsibility of business – to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud."

- Milton Friedman

Economic fraud is a term that has been repeated over the years, so much so that the consequences it bears do not have any precedence or impact on the ones that hear it. For many companies and capitalist machinery, this term essentially triggers them to explore options to hide their fraudulent tracks and continue operating in the same manner. To have governments help them cover the tracks in certain jurisdictions ultimately defeats the purpose of the assignment.

Despite the incongruent activities of individuals, companies, and governments from the expected norm of justice in many jurisdictions, other countries are tenacious to implement a regulatory framework that will eradicate such fraudulent activities in the market. This article will discuss the economic and fraud provisions established in the Middle East, their effectiveness, and the scope of reach it possesses about financial crime.

What are the Economic and Fraud provisions in the Middle East?

If one area of the economy has seen a steady increase in the past years, it would be the economic fraud prevalent in society. Regardless of the number of provisions that jurisdictions and international organizations establish to combat financial fraud, none of them seems sufficient. The parties involved in economic fraud and other fraudulent practices are constantly evolving to cover their tracks efficiently.

Infamous scandals like Bernie Madoff and the Ponzi scheme leave one in absolute awe as it remains unclear, what is the culprit: the crime or the criminal? Many innocent parties, including employees and clients, were adversely affected by the ill-doings of these financial schemes. After the outburst of many scandals and its impact on many innocent individuals, jurisdictions are trying to fasten their pace to stay a step ahead of wrongdoers and hopefully eliminate the potential threats in the market.

The introduction of new anti-economic fraud regulations has paved the way for potential investors to feel a sense of security over their investments within the market, along with the ability of the regulations to enforce justice. Over time, people have understood that the formation and establishment of an anti-fraud legal framework are not sufficient to ensure peace and harmony in the market, an iron fist must be imposed on fraudulent parties and companies to deter them from doing such activities in the future and serving it as a lesson for other participants in the market who bear similar intentions.

The types of economic fraud can be quite varied and are spread across different industries and the scope of nature. These could include housing benefit fraud, tenancy fraud, council tax fraud, blue badge fraud, social care fraud, business rates fraud, insurance fraud, bribery, and money laundering. These are just a top layer of economic crimes prevalent in an ocean of fraudulent activities in the market. The crimes that are more coherent to the wrongdoings in the market include not declaring the business location, stating that a property is not in use while it is, dishonestly requesting for an exemption to pay for charges that are owed, or any unauthorized movement of money to make ill-gains.

Often, economic crime is caused not by companies but by customers towards companies. The highest reported crime boost in the Middle East is through customer fraud and procurement fraud, which have proved to be the most disruptive fraud within an economic crime. In a survey conducted on a global platform, the number of customer frauds was comparatively more in the Middle Eastern region.

In an ongoing effort to combat fraud together, many companies in the Middle East began investing in more stringent controls and implementation of the rules to avoid economic crime, while many others conducted a thorough examination into reasons after the occurrence of a crime in the company. Another issue that stands alongside customer fraud about its prominence is procurement fraud. This fraud entails the practice of favoring associates with vendor and supplier contracts.

All these efforts are measures taken to mitigate the risks involved and ensure that proper prevention is taken by instilling the right technology and talent to deviate from any fraudulent prone routes.

However, it is not easy to ensure that accountability will be maintained and transparent feedback is provided. Another limitation of this procedure is that advanced technologies to combat financial crime can be costly, which would further deplete if the company possesses insufficient resources to acquire and install the platform and is not equipped with properly trained employees to manage the technology. The lack of proper expertise to handle the in-place technology could attract various cyber threats, which allows a wrongdoer from any part of the world to infiltrate the company's system.

With this in mind, companies must equip themselves from the arsenal of defenses to protect themself and the financial and reputational facets of the company. The extent of damage that infiltration of the company's system can cause to the operations is quite unfathomable. It would be better for companies to leave their vault of secrets wide open than installing an IT platform that is managed poorly. The necessity of combating such insecurities is proliferating and must be countered at the earliest. One would like to believe that the efforts of the legal jurisdictions in the Middle East to battle economic crime are practical and promptly applied. However, many of the jurisdictions still fail to provide a proper implementation of the provisions established against economic crime.

The readiness of companies in the Middle East to confront the indecisive nature of economic crime and report any issues as they arise is still moving at a stagnant rate. The stark increase in cyberattacks and its potential threats is not a mystery to the companies in these regions. Nevertheless, they decide against preparing themselves in defense of such risks and attacks. The firms in the region and the governmental organizations must understand the types of threats that could arise in the economy and the nature of such economic crimes. Although this would seem like an insignificant step, this particular action could help achieve a more profound revelation of the gaps and vulnerabilities of the economy and its protective framework.

Many would argue that the relationship of the Middle East with economic crime and fraud dates back ages. All the glitz and glamour and the boom of economies are incongruent with the fraudulent activities occurring within the firms and regions. A region's legal systems cannot enforce the regulatory frameworks established to fight against economic crime if the country's government does not implement the rulings.

To know more about Economic and Fraud Provisions in the Middle East in Singapore Click here 

 

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Mon, 27 Dec 2021 03:22:00 GMT
<![CDATA[Inchoate crimes and criminal responsibility]]> Inchoate crimes and criminal responsibility: UAE Law

Introduction 

As a general rule, criminal codes punish all those criminal acts preceding the commission of a crime. The liability hereunder is determined by the intention to commit the crime. It is to be kept in mind that, merely thinking about committing a crime does not amount to criminal liability; when an individual engages in acts that further his intentions, such as preparation of the crime, intentional omission, neglect or any such overt act that furthers the intent of the individual to commit the crime, he becomes criminally liable. Domestic and national laws globally, hold individuals liable for agreeing to engage in a criminal act, soliciting conduct and taking measures that would realize the crime. The seriousness of a crime is determined by a cumulative assessment of all acts committed for the purpose of committing further crimes; this, therefore, elevates the liability that is to be imposed on an individual. For instance, for the purpose of committing burglary, a person may have to first enter a property in an unauthorized manner, amounting to trespass or breaking and entering. Therefore, burglary shall be coupled with trespass or breaking and entering, increasing the severity of the crime. 

Inchoate crimes may also be referred to as incomplete crimes since they do not directly amount to commission of the said crime but constitutes all such overt acts that amount to participation in a crime. There are mainly three acts that constitute inchoate crimes; abetment, conspiracy and attempt to commit a criminal act. 

Criminal attempt 

Attempt to commit a crime is usually separated from actual commission thereof; however, the attempt does constitute some underlying offences. Essentially, inchoate crimes can be scrutinized on the basis of, firstly, intention and secondly, steps that have been taken in order to prepare for it. 

Under US law, offenses of general applicability did not recognize attempt as a crime prior to the 19th century; attempts were later made to include attempt alongside conspiracy and solicitation as inchoate crimes. Upon revision of the United States Code, offenses of general applicability now include; attempt, facilitation, solicitation, conspiracy and regulatory offenses. 

It is important to note that, intent by itself cannot be considered a crime; it needs to be accompanied by a substantial step or significant conduct. 

Such significant conduct need not be penultimate, and it can be a substantial underlying step that leads to an action that would effectively materialize the offence. In order to recognize the criminal attempt, the following requirements must be satisfied:

  • Intention;
  • Substantial act; and
  • Failure to realize the crime.
  • Failure to realize the crime is an essential prerequisite of a crime because, if a crime is realized, there is no question of attempt; the accused shall be then charged for the offense itself and not the attempt thereof. 

    Conspiracy

    A conspiracy involves an agreement between two or more people to commit a crime, the actions taken may not by itself constitute a crime but the acts must indicate that the persons involved in the commission thereof had conspired with the intention of breaking the law. Unlike attempt, in case of an attempt to commit a crime, a conspiracy is punishable regardless of whether the crime was committed or not. 

    For instance, A and B plan to rob a jewelry store. In order to commit the robbery, they first scout the premises of the store to assess the security system, once that is done, they then buy guns for committing the robbery. Now, in this case, if A and B are caught before they even commit robbery, they can be charged with conspiracy regardless of whether they actually completed or attempted to do so. 

    In cases of conspiracy, there is a need for all the persons involved to come to an agreement to commit the crime. This agreement does not necessarily have to be in express terms, and it can be implied from the circumstances that follow. For instance, if A asks B to accompany him to rob the jewelry store, B is not required to expressly say 'I agree to rob the jewelry store', he can merely act towards the furtherance of the crime and actively participate in planning the crime. 

    In some cases, persons who conspire to commit a crime may also be required to commit the actual crime in order to be charged with the commission of the offence. However, charges of conspiracy and commission of the crime are, in most cases, viewed as separate offenses. 

    Aiding and abetting 

    Any individual who assists in a crime regardless of whether he has committed the crime shall be held to be an accessory to the crime. The charges of abetment may vary as per the degree of involvement thereof. There are two factors that need to be considered when assessing aiding and abetment; that is, the existence of a principle and an accessory. 

    The principle is the person who actually commits the crime and is ultimately responsible for the commission thereof. An accessory, on the other hand, is a person who, though does not have any direct involvement in the commission, has assisted the principle to realize actual commission. 

    Therefore, the elements of aiding and abetting are:

  • Existence of a principle that commits the actual crime;
  • Assistance by the accessory; and
  • The accessory's knowledge of the principle's intent to commit the crime.
  • It is to be noted, however, that a person who has accidentally abetted a crime shall not be considered guilty for abetment thereof. For instance, A and B take a hostage in the jewelry store and order him to assist them in filling their bags and escaping, the hostage is, in such a case bound to comply with the direction given by A and B, fearing for his life. 

    With regards to punishment, accessories to a crime generally do not face the same degree of punishment as the principle. As per some national and domestic laws, however, the same charges are levied on an accessory as the principle since the mens rea attached to committing the crime existed therein as well. Further, in the case where the principle is not found or manages to escape, the accessory is still charged with aiding and abetting the crime. 

    A popular defense to this offense is, abandonment or withdrawal. A person accused of abetting a crime may plead that he withdrew his participation from the crime and tried to do everything in his power to prevent it from happening, now to prove his attempts to prevent the crime from happening he could cite instances where he attempted to notify authorities of the crime or any acts of similar nature. 

    Defenses to inchoate crimes 

    A defense attorney in such cases can argue on three main grounds:

  • Entrapment 
  • A defense attorney can plead that the accused was convinced by law enforcement authorities to engage in the crime with a promise that they would not be charged with the crime once the principle is arrested. The accused shall then be required to prove that the idea originated from the authority rather than the accused themselves and that he had no intention to commit the said offense.

  • Abandonment 
  • The second defense that can be pleaded in this case is that of abandonment or withdrawal from the crime. They may argue that the crime was never completed and that they had withdrawn their affiliation with the principle. For most inchoate crimes the argument of abandonment can be used, except in cases of conspiracy. The defendant herein has to establish the fact that prior to the ultimate commission of the act, the defendant had withdrawn from the commission thereof. In order to prove that, the defendant may have to show that they made active efforts to inform the authorities or tried to stop the commission of the crime. A participant in a crime cannot merely argue that they withdrew from the situation by not participating; they need to clearly establish that the withdrawal was effectuated well before the commission thereof. 

  • Impossibility 
  • This defense is basically that of mistake. It can be either mistake of law or fact. Now, it is a well-established rule of law that, a mistake of fact cannot be excused because of the presumption that every person is required to know the law. Therefore, one may rely on a mistake of fact. To argue this, it can be said that, if the ultimate offense is not considered to be a crime, then the prosecution of a participant thereof cannot be prosecuted either. 

    It is imperative to note that the aforementioned arguments are valid; however, they rarely succeed. 

     

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    Thu, 04 Feb 2021 03:21:00 GMT
    <![CDATA[Money Laundering Laws in the UAE]]> Money Laundering Law in the UAE

    "When spider webs unite, they can tie up a lion"

    The above proverb/saying does hold good when it comes to white collar crimes and economic offenses and it goes without saying that continued attempts by criminal organizations to launder money lead to a corrosive effect on a country's economy. Cross border transactions and shipments are a recurring activity that involve exchange of money between the emerging markets almost every day which in turn is increasingly becoming a venue for large-scale money laundering.

    Money laundering in general is the criminal act of acquiring money through illegal means and disguising its principal source. It is the most prevalent form of financial and economic crime and such illicit activities undermine the credibility of the formal financial sector. In order to combat such a crime, cooperation at both the domestic and international level is required and concerted efforts by international bodies have been implemented for the same effect. Some of the international agreements and bodies such as the Vienna Convention, the Financial Action Task Force (FATF), Office of Foreign Assets Control (OFAC), Anti-bribery regulations have laid the groundwork for creating obligations for countries to formulate policies and frameworks to promote effective implementation of legal and regulatory measures for combating money laundering. FATF is the main international body engaged in bringing about comprehensive efforts to promote the adoption of countermeasures against money laundering. The Gulf Cooperation Council is a part of this 1989 Economic Summit which urges member countries to ensure criminalization of money laundering and encourage overall assessment of such illicit activities by the competent authorities.

    In the United Arab Emirates, Federal Decree Law Number (20) of 2018 on Anti-Money Laundering (AML) and Combating the Financing of Terrorism and Financing of Illegal Organizations (the Law) is the principal legislation that governs the act of money laundering and is an amendment to the previous law (law number 4 of 2002 on anti-money laundering in United Arab Emirates).

    Article 2 (1) of the Law mandates that any person who willfully commits any of the following acts or has knowledge that the fund's (assets including the digital and electronic form) received are proceeds (funds generated directly or indirectly from the commitment of any crime) of a felony or misdemeanor, shall be considered a perpetrator of the crime of Money Laundering:

  • conducting the transfer or moving of proceeds;
  • concealing or disguising the true nature, source or location of the proceeds as well as the method involved in their disposition, movement, ownership of or rights with respect to said proceeds;
  • acquiring, possessing or using the proceeds upon receipt; and
  • assisting the perpetrator of the predicate offense to escape punishment.
  • Understanding Money Laundering in the UAE Context

    Various measures have been taken up under the Law including the establishment of a Financial Information Unit (FIU) to investigate suspicious activities, issuance of guidelines by the Central Bank Panel and implementing orders as part of the National Committee to Counter Money Laundering. This requires all financial institutions, businesses and professionals to continuously perform diligence in and analyze the risks associated with each financial transaction. The major points under the Law are covered below:

  • The Law states that money laundering is an independent crime considering that it is a different crime from the main crime (predicate offence), which was the source of the laundered money. Even if the punishment for the predicate offence has been established, an individual could potentially face a separate sentence for the crime of money laundering. This means that in an investigation for a money laundering case, the prosecutor will not have to wait or depend on a judgment of the main crime (predicate offence) to convict the criminal (Article 2 (2) of Law). A predicate offence can be termed as a component of a more serious crime. For example, if 'X' obtains money by selling drugs, then selling drugs is a predicate offence and money laundering in this case would be a more serious offence. Proving the source or conviction of the predicate offence (drug trafficking in this case), will not be a prerequisite for proving the illegality of money obtained via money laundering.
  • Consistent with the provisions laid out in Article 4 of the Law, any legal person shall be criminally responsible for the crime if the same has been committed in their name or for its account intentionally, without prejudice to the personal criminal responsibility of the perpetrator.
  • The Governor of the Central Bank (renewable by order of the public prosecutor) has the right to seize, evaluate or follow any amounts of money (without informing the owner) for a period of 7 days, if such an amount of money was sourced or linked to any crime (Article 5).
  • One of the important provisions that has been introduced in the new Law is under Article 8 of the Act, which sets out that every person has a duty to disclose when he brings into the UAE or takes out from UAE any currency or bearer negotiable instruments or precious metals or stones of value, in accordance with the disclosure system issued by the Central Bank. The failure to comply with the same will impose a penalty and/or imprisonment and in case of conviction of the same, the Court may rule on the confiscation of seized funds (Article 30).
  • The Law also deals with international cooperation and empowers the local authorities in their sole discretion to recognize any foreign court order issues in the country that is relevant to money laundering. Consistent with the provisions laid out in Article 18 of Law, the UAE local judicial authority have discretionary power which will be based on request from the courts of any other country (which has a relevant treaty with the UAE), to cooperate with other judicial authorities and to provide such evidence on investigation and trial processes connected to a crime, which has happened in other countries.
  • A debtor and creditor relationship needs to be established for the crime of money laundering. Money laundering is an offence that will supersede the first offence (the main crime from where such illegal money was obtained) and money laundering will be constituted as the secondary crime. The source of the crime needs to be established to be an illegal source and if it is proven to be so, then it shall lead to the crime of money laundering.

    In this article, we will try and understand the recent development on money laundering regulations in the United Arab Emirates with decisions passed by local and international courts as has been discussed further here. Interestingly, the courts in the UAE have passed a few landmark decisions in relation to money laundering. In one of the decisions, for instance, the courts have held that in cases where money is obtained unlawfully, then the mere 'knowledge' of such act would suffice thereby constituting the crime to be one of money laundering (Court of Cassation in Dubai, Appeal Number 439 of 2006 and decided on 26 February 2007). A brief review of the above decision clearly suggests:

    I. the legislation does not require nor impose any additional burden of proof and mere knowledge is sufficient;

    II. knowledge of facts, knowledge of event and circumstances, or indirect knowledge would be sufficient;

    III. source of money is important to the extent that it should be derived from one of the 7 sources (narcotics, kidnapping, piracy, etcetera) as mentioned in the old law.

    In the Court of Cassation in Dubai (Appeal Number 1224 of 2018), the accused were acquitted on the grounds that the money in possession of such accused was not derived from one of the 7 pillar sources mentioned in the previous statute (Federal law Number 4 of 2002) concerning the Criminalization of Money Laundering and since it was a pre-requisite to prove that the money had been obtained from one of the 7 illegal acts, it could not be shown that the accused were liable for the crime of money laundering. However, under the new Law there is no necessity of proving that the money was obtained from one of the 7 sources mentioned in the old law. Under the old law, It would be easier for an individual to escape punishment under the Act if it was shown that the money was not derived from one of the 7 sources and had instead been obtained from an act outside the purview of this Act. However, the new law fills in the gap by removing the requisition for unlawful money to be obtained from one of these 7 sources and it has been termed as an independent crime irrespective of establishing the source so long as it is proven that it was an illegal source.

    In United States v. Peoni (100 F.2d 401 (2d Cir. 1938)), the defendant argued that the mere knowledge that a crime may occur in the future as a result of one's actions is not sufficient to give rise to accessory liability. The Court ruled in favor of the defendant, holding that the crux of the crime of conspiracy is an agreement to commit a crime and not the knowledge that a crime will eventually be committed.

    In 650 Fifth Avenue v. Alavi Foundation, (830 F.3d 66 (2d Cir. 2016)) addressed the element of 'knowledge' required for a crime of money laundering. It was held in the present matter that the claimants did not necessarily have the requisite knowledge of the unlawful activity or intent to carry out the unlawful activity under the money laundering statutes. All money laundering offenses required that the claimants know that the property involved in the transaction represented the proceeds of some form of unlawful activity and this was an important pre-requisite for establishing the crime of money laundering

    In United States v. Johnson (971 F.2d 562 (Tenth Cir.1992)), it was held that the critical characteristic of the money laundering offense was not the commission of the crime but perpetrator's knowledge of such a crime.

    The Central Bank of UAE

    The Central Bank of UAE passed a decision (Cabinet Resolution Number 10 of 2019) through its Board of Directors, concerning the implementation of regulation of Decree Federal Law Number 20 of 2018 on anti-money laundering and combating the financing of terrorism and illegal organizations. The same have been prescribed in Circular Number 59/4/2019 under Article 1 to 8 and the Central Bank has given authorization to form independent financial units with the power to investigate financial reports of various institutions. The Central Bank shall supervise and examine periodically or unexpectedly (without prior notice to the institution), to verify the institution's compliance with the Decree Federal Law and the executive regulation, relevant instructions and guidelines and notices that are issued by the Central Bank and shall identify any violations occurring, if any .In case of any violation arising from the financial institution, the Central Bank may impose any of the administrative sanctions specified in the Decree Federal Law and the violator shall have the right to appeal against such a decision in accordance with the procedure prescribed by the Central Bank. According to Article 5 of the Law, the Governor or his delegate shall have the right to freeze suspicious funds deposited at financial institutions for no more than seven working days, in accordance with the rules stipulated in the Decree-Law, renewable by order of the public prosecutor or his delegate. In Court of Cassation (Appeal Number 2004/449), the accounts of a company were frozen by the Central Bank and as mentioned in Article 5 and it was held that the Central Bank has the authority to do so for a period of 7 days and further the Public Prosecution shall be informed to take the necessary measures which may include the seizure of the suspected funds.

    Financial Intelligence Unit

    The Central Bank has given authorization to form independent Financial Units (FIU) under Article 9 of the Law, to which suspicious transaction reports, information on all financial institutions and designated nonfinancial businesses and professions shall be sent exclusively for consideration and analysis and referral to the competent authorities, either automatically or upon request. The FIU has the authority to request financial institutions to submit any information or further documentation or reports and other information deemed necessary for FIU to perform its duties on schedule and in the form determined by the Unit. It shall establish a database to record all available information and to implement privacy and data security procedures to protect this information and to make sure that its database and its technology systems are restricted. It shall also be entitled to exchange information with its counterparts in other countries, with respect to Suspicious Transactions Reports (STR) or any other information to which the FIU has exclusive access or is the exclusive recipient according to international agreements to which the State Is a party including bilateral agreements signed by the FIU with its counterparts governing bilateral cooperation.

    Guidelines for Financial Institutions

    Guidelines for Financial Institutions have been passed regarding the Anti-Money Laundering and  Combating the Financing of Terrorism and the Financing of Illegal Organizations. These guidelines have been issued to provide guidance and assistance to supervised institutions like banks, finance companies, insurance companies, securities and commodities brokers, etcetera , in order to assist them to gain a better understanding and implement effective performance of their statutory obligations under the legal and regulatory framework in force and are intended to be read in conjunction with the relevant laws, cabinet decisions, regulations and regulatory rulings which are currently in force in the UAE and their respective Free Zones. The Financial Institutions have an obligation to inform the Central Bank of any such activity or suspicious transactions related to money laundering to the Central Bank (Court of Cassation, Appeal Number 2004/449). These guidelines are meant to guide the respective Supervisory Authorities regarding the factors that should be taken into attention by each of the supervised institutions while identifying, assessing and mitigating the risks of money-laundering. However, these do not replace or supersede any legal or regulatory requirements or statutory obligations and in the event of a discrepancy between these Guidelines for financial institutions and the legal or regulatory frameworks currently in force, the latter will prevail.

    The National Committee for Combating Money Laundering

    A committee chaired by the Governor, called 'National Committee for Combating Money Laundering and the Financing of Terrorism and Illegal Organizations', shall be established by virtue of the Article 11 of Law and such a decision on the formation of the Committee shall be issued by the Minister. The national committee has identified a number of goals under Article 12 of Law.

    The authority of the National Committee for combating money laundering (NCAML) will include, preparing and developing a national strategy to combat crime and proposing related regulations and procedures in coordination with the competent authorities. The monitoring of the implementation of such strategies shall also be pursued by the committee. The committee shall have the duty to assess risks of crimes on a national level and ensure effective coordination between the Financial Intelligence Unit, Law Enforcement Authorities, Supervisory Authorities and other Competent Authorities within the country. It shall facilitate the exchange of information and coordination amongst these various bodies and collect statistics provided by competent authorities to assess their effective compliance with the laws and regulations on combating money laundering. It will also create awareness amongst the financial institutions of the relevant money laundering risks in UAE. The national committee to combat money laundering has the aim of proposing relevant systems, procedures and policies in coordination with the authorities concerned. The main duty of this committee is to follow the implementation of such procedures and identify and assess the risks of crime at the national level.

    Punishment for Money Laundering

    The provisions for awarding punishment and penalty for the offence of money laundering are laid out in the Law (Federal Decree Law Number (20) of 2018) and have been discussed below -:

  • Article 22 provides that any person who commits or attempts to commit money laundering (the acts laid down in Article 2 (1) mentioned above), shall be held liable for an imprisonment of not more than 10 years and/or a fine of no less than AED 100,000 and no more than AED 5,000,000.
  • Any person who abuses his influence or the power granted to him by his profession/professional activities or if the crime is committed through a non-profit organization, an organized crime group or in the case of Recidivism (a convicted felon re-commits to offend), the perpetrator shall be liable for a temporary imprisonment and a fine ranging between a minimum of AED 300,000 to a maximum of AED 10,000,000 (Article 22 (2)).
  • An attempt to commit the offence of money laundering is liable to punishment by the full penalty described for it (Article 22(3)).
  • Anyone using proceeds for terrorist financing will be sentenced to life imprisonment of a minimum of 10 years and a penalty of minimum AED 300,000 to a maximum of AED 10,000,000 (Article 22(4)).
  • Information provided to the Judicial authorities regarding any of the offences in this Act leading to the disclosure, prosecution or arrest of perpetrators can lead to the Court exempting or commuting a sentence imposed on an already convicted offender (Article 22(5)).
  • Article 23 of the Act imposes a penalty of a minimum AED 500,000 to a maximum of AED 50,000,000 on any legal person whose representatives/managers/agents commit for its account or its name any of the crimes laid out in this Act. A conviction of terrorism financing crime will cause the Court to order dissolution and closure of such an office from where the activity was being performed.
  • Article 24 mandates that any person causing a violation on purpose or by gross negligence causing failure to inform any suspicious activity or to disclose reasonable grounds to suspect a transaction resulting from such proceeds shall be liable for an imprisonment of a minimum of AED 100,000 to a maximum of AED 1,000,000.
  • Article 25 dictates an imprisonment of no less than 6 months and/or a penalty of a minimum of AED 100,000 to a maximum of AED 500,000) imposed on any person who notifies or warns a person of any such transaction under review in relation to suspicious transactions being investigated by competent authorities under Article 24.
  • Article 26 elaborates on the confiscation of funds from the proceeds resulting from such a crime, once the crime is verified. Article 28 lays out imprisonment or fine of no less than AED 50,000 to not more than AED 5,000,000 on any person violating instructions issued by competent authority in the UAE.
  • Any person making an entry and exit from UAE has a duty to disclose any such entry and exit from UAE, of any currency or bearer negotiable instruments or precious metals/stones and the failure to comply with the same would impose an imprisonment and/or fine on anyone who intentionally fails to disclose or intentionally refrains from providing additional information upon request from him or conceals such information requested from him in accordance with the disclosure system issued by the Central Bank (Article 30).
  • Article 31 imposes imprisonment of no less than AED 10,000 to no more than AED 100,000 on any person violating any other provisions of the Act.
  • Hence, with the establishment of the national committee for combating money laundering and the Law, various steps have been pursued in order to combat money laundering in the UAE.

     

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    Mon, 16 Mar 2020 02:25:00 GMT
    <![CDATA[United Kingdom: Laws surrounding Counterfeit Goods and Piracy ]]> Laws surrounding Counterfeit Goods and Piracy in the United Kingdom

    The terms "piracy" and "counterfeiting" of goods refer to manufacturing, distributing and selling inferior copies of products which have been made without the permission of the intellectual property rights holder in the said goods. Inferior copies of goods are intended to appear similar to that of the original product and to be passed off as genuine items. However, the scope of goods differs in both violations. Piracy is the sale of unauthorised copies of usually copyrighted information such as music, films, television show etc. and counterfeiting refers to the selling of an inferior copy of a product like clothing items, bags etc. As these unauthorised inferior copies are circulated in the market, they hamper its original creator in more than one way.  It not only tarnishes the name of the creator but also harms them monetarily.

    Piracy and counterfeiting are two concepts, which are generally used to indicate intellectual property rights violations. Under both these violations, certain acts are carried out without the consent of the rights' holder. Pirated and counterfeit products have profoundly contributed to intellectual property theft around the world. Governments across many countries along with international organisations like the World Intellectual Property Organization (WIPO) have been working tirelessly to fight against these violations and to strive for economic independence and progression. Counterfeit and pirated products cover virtually all areas of consumer goods, including pharmaceuticals, food, books, films, music, compact disc, and textile material, and footwear, among others.

    The term 'piracy' is a colloquially used word for copyright infringement. It refers to an unauthorised reproduction or theft of someone's creative work for financial gain. This illegal use results in violation of rights of copyright holder granted to them by law. Individuals and companies who develop new works ensure that they can profit from their creation; therefore, they register for copyright protection. The owner of the copyright may grant permission to other parties to use their work by giving them a license or assignment and charging a fee. However, there are several instances where someone may engage in use/reproduction/distribution/sale of copyrighted work without the creator's permission and engage in copyright infringement. It is important to note that the ethos of copyright law is to protect the value of the creative work of a creator. When a person makes an unauthorised copy of someone's original work, they are taking something of value from the owner without their permission, which is just like taking something tangible from a person without their consent like a pen, car, bag.

    Piracy and illegal file-sharing in the online digital world of music, film, television, video games and book publishing industries have become an increasing problem since the inception of the internet. Online piracy has resulted in a considerable loss in revenue in various economies. As per the Motion Picture Association of America, worldwide study of losses to the film industry and international economies due to piracy, the estimated loss from film piracy was as much as USD6.1 billion in 2005 alone. Due to the developing technological advances, lawmakers have been struggling to keep up with the new ways of piracy evolving. Governments continue to search for ways to shoot down the flow of piracy, as well as to discourage consumers from engaging in piracy in the first place. Piracy and primarily, online piracy creates hurdles in the growth of the creative industry. Illegal downloading/streaming devices grants illegitimate access to people who use the original works without paying and rewarding the creators of the work. Copyright protection varies from country to country, with different recourse and varied amount of protection available. UK copyright law - Copyright, Designs and Patents Act 1988 - belongs to common law/copyright legal traditions, and it focuses on both rewarding the authors for the effort they put in for creating the work and also to incentivise the creator for creation of new works. Hence, the UK law tackles the issue of piracy head-on. The UK lawmakers are set out to make it easier for creative businesses to get their due share.

    In the United Kingdom, copyright is governed by the Copyright, Designs and Patents Act 1988 (CDPA). Among other things, the CDPA aims at protecting the rights of the copyright holder. CDPA states that the author of a work is the first owner of the copyright. It further states that the infringement of copyright occurs by doing any of the acts restricted under the act without authorisation from the relevant copyright owner. Section 16 of CDPA lays down the list of such restricted acts that lead to copyright violation. The section states that making copy of any work without permission of the creator of the work constitutes a violation; renting, lending or issuing copies of the work to the public will result in copyright violation; performing, showing or playing the work in public will amount to copyright violation; broadcasting the work or including the work in a cable program service will be considered a breach of copyright of the authors of the work and making an adaptation of the work or doing any of the above in relation to making an adaptation will lead to copyright violation.

    As the music industry raised several concerns about the growing problem of piracy and illegal-file sharing, the Department of Business Innovation and Skills along with the Department for Culture Media and Sport in 2009 introduced the Digital Economy Bill and eventually in April 2010 The House of Commons passed Digital Economy Act 2010. This statute created a procedure for dealing with online copyright infringement – pirated books, films and, of course, music. The Digital Economy Act 2010 further provided additional solutions to online copyright infringement along with making the copyright protection law in the UK closer in line with technological developments. Sections 3 to 16 of the Digital Economy Act 2010 deals with imposing obligations to Internet Service Providers (ISP) to reduce online infringement of copyright. The copyright protection procedure under the Digital Economy Act 2010 involves identifying infringement, notifying the ISP of infringement along with proof of infringement and the IP address, ISP notifying the alleged infringer and monitoring any future violations. ISP keeps track of how often each alleged infringer is identified, and if they reach a certain threshold of alleged infringements and if the possible infringer meets the set criterion, then their IP address is entered into an anonymous copyright infringement list (CIL). Even though the CIL is anonymous, the copyright owner can seek a court order ­requiring the ISP to identify some or all of the subscribers on the list. If the court grants the order for disclosure, the copyright owners can then commence infringement proceedings against the alleged infringer. Penalty for online copyright infringement is increased as per section 42 of Digital Economy Act 2010, to a maximum of £50,000. It also gives the secretary of state the power to order ISPs to impose technical measures like temporary suspension of an account on users who meet a certain level of infringements.

    Digital Economy Act 2010, whose most provisions largely were not passed into law, was then accompanied by a rather extensive Digital Economy Act 2017, which has introduced a broad range of reforms in the areas of electronic communications networks and services, measures to counter online bullying and protection of IP in broadcast material, data sharing and direct marketing. Digital Economy Act 2017has introduced new developments concerning UK's copyright laws; the new act is primarily focusing on targeting people or groups of people doing business out of selling illegal content and not individuals caught file sharing and people unlawfully sharing content online. Therefore, criminal sanctions under the Digital Economy Act 2017may apply to people hosting copyrighted works and offering the works without the consent of the copyright holder. The offences to which this increased sentence apply are those is primarily making copyright works available to others.  It is therefore unlikely that the new act will extend to end-users who are not communicating the work to the public. Nonetheless, users who stream illegal content may still be infringing copyright by copying and could face action by the copyright owner. These new provisions could, however, arguably apply to those downloading infringing content using the BitTorrent protocol, where the downloader also uploads the content they have downloaded. Sections 107(2A) and 198(1A) of CDPA provide a maximum two-year sentence for a person who infringes copyright in any work. Digital Economy Act 2017has extended the maximum custodial sentence for online copyright infringement from two years to ten years, which puts it in line with the maximum custodial sentence for violation in respect of 'physical goods'. As a result, anyone caught illegally streaming or downloading copyright-protected content can now face a custodial sentence of up to ten years. The ten-year sentence would, however, be reserved for the most serious of criminal circumstances.

    To understand the concept of counterfeit better, it is first essential to understand what is a trademark. A trademark consists of a recognisable sign, design or expression, which helps a consumer in identifying the source of goods/services, for instance, the golden arch of the famous fast-food chain McDonald's.  This recognisable mark is protected by law; however, trademark infringement is said to have taken place when an unauthorised person uses a registered trademark on or in connection with any goods/services in a manner that the use by the unauthorised person is likely to confuse the consumer about the source of the said goods/services. 'Counterfeit' means to imitate something authentic, intending to deceive people into believing that the imitation of the product is of equal value to the genuine thing. Counterfeit goods are often of inferior qualities, which are passed off as goods made by the well-known brand owner. The colloquial term 'knockoff' is often used interchangeably with the term counterfeit. Counterfeiting differs from trademark infringement in its scope. Counterfeiting is narrower in scope and applies only to marks made to look similar to the genuine well-known registered trademark. Counterfeit crimes are associated with crime to trademark infringement.

    Counterfeiting remains a growing problem in the modern world economy. Counterfeit goods primarily hit the apparel industry hard, Louis Vuitton estimates that two to three million counterfeit Louis Vuitton pieces are produced each year around the world, which is twice the number of original products manufactured by the company. Due to counterfeiting apparel and footwear, companies lost 22 per cent of their sales in 1991-1995, which is around USD 2.1 billion according to the International Trademark Association (INTA). Counterfeiting was the most significant criminal enterprise in the world in 2018, according to Forbes. Just like any other IP infringement, counterfeit products are also produced with the intention to take advantage of the superior value of the imitated product.

    In the UK, the legal framework regarding anti-counterfeiting arises out of both UK national laws and European Union legislation. In the UK, the primary piece of legislation concerning the trademarks is the Trademarks Act 1994 (TMA). The act contains provisions covering trademark infringement and provides both civil and criminal remedies in case of any infringement caused by unauthorised use of the mark. The protection granted is for not only identical goods/services but also for goods/services, which are similar to the registered trademark.

    Legislative civil provisions relating to trademark infringement are set out in Section 10 of TMA. Use of an identical/similar trademark in the course of trade and relation to same/similar goods/services will constitute as infringement under the section. Civil remedies provided under TMA are permanent injunctions against future infringement are- offender to pay damages or an account of profits to the trademark owner; infringer to deliver up or destroy the infringing goods; and costs awards in favour of the trademark owner. In case of urgent action, UK courts can grant interim injunctions and search and seizure orders against the infringer.

    Legislative criminal provisions relating to trademark infringement are set out in Section 92 of TMA. As per the section, it is a criminal offence for a person, to act with an intention to cause loss to another and to gain oneself by sale/hire/distribution of goods that bear a sign identical/similar to a registered trademark and the said acts are done without the consent of the trademark owner. The UK Supreme Court has held that the provisions under section 92 could also apply to goods that are manufactured with the trademark owner's consent but sold without their permission. As decided in R v Keane [2001] FSR 7, in cases relating to trademark infringement, the prosecutor does not have to prove mens rea (knowledge) and that the offence is one of "near-absolute liability" - Torbay Council v Satnam Singh (1999) 163 JP 744. For infringement, the sentence is six months imprisonment and/or GBP 5,000 fine. The maximum conviction on indictment is ten years' imprisonment and/or an unlimited fine.

    Trademark Act 1994 was amended, and the Trade Mark Act 2019 came into force. Under the new legislation, the law provides trademark owners right to bring infringement proceedings for preparatory acts. It means that trademark owner can bring proceedings against a person at a mere risk of infringement, like production of packaging labels, tags, authenticity features bearing a trademark which will be used for infringing goods or services. This provides brand owners with an enormous scope to enforce their rights and to take action even before the infringement has occurred. Under the new act along with bringing in, proceedings trademark owners also have the power to prevent counterfeit goods entering the UK, without proving that the products will necessarily put on the market in the UK. The burden of proof is on the person shipping the goods to show that the trademark proprietor has no right to stop them selling in the country of destination. Comparative advertising is also explicitly included as an infringing act if it is contrary to the Business Protection from Misleading Marketing Regulations 2008.

    Other pieces of legislation in the UK dealing with the problem of counterfeiting are The Fraud Act 2006 and the Proceeds of Crime Act 2002. Under the Fraud Act, dishonestly making a false representation with an intention to make a gain for oneself or an intention to cause loss to another and to make or possess articles for use in or in connection with fraud, and to make or supply articles for use in fraud, it is a criminal offence. The Proceeds of Crime Act provides for confiscation of assets and proceeds obtained through crime, including IP crime. It also provides for recovery of proceeds of crime through civil proceedings where a criminal conviction has not been possible.

    Counterfeit goods are increasingly sold and distributed online; it is no longer just auction sites or online marketplaces social media platforms are now increasingly considered to have overtaken the use of outdated online sale platforms. The UK government very well recognises the challenges that online counterfeiting represents in today's time. Therefore, the government has engaged various national agencies dedicated only towards tackling counterfeiting issue along with assisting right holders in enforcing their rights against counterfeiters. These agencies work together and collaborate with international anti-counterfeiting initiatives to increase the effectiveness of their work. For instance, Operation Ashiko was launched in April 2017 by the UK government, a joint initiative with the International Anti-counterfeiting Coalition Rogueblock program. The aim of the program was to suspend '.uk.' domains being used to commit IP crimes.

    Further ISPs through the courts, can be made subject to a blocking order which is available under Section 97 of CDPA, whereby ISPs are ordered to block websites known to host infringing content. Her Majesty's Revenue and Customs (HMRC) and the Border Force are the UK government authorities responsible for protecting the UK borders, including enforcement of IP rights. Border Force practices in dealing with suspect counterfeit, infringing or pirated goods found at the UK border. They identify the counterfeit products, notify the right holder of the infringement; after that, the right holder confirms if the goods are counterfeit; owner of suspected goods must confirm agreement of destruction of products; if the owner of goods resists destruction, then the right holder must commence legal proceedings.

    In addition to the above-discussed provisions, there are several UK government agencies operated initiatives which aim at tackling counterfeiting and infringement issues. There are agencies like Anti-Counterfeiting Group (ACG) working with brands government bodies and enforcement agencies to engage in anti-counterfeiting efforts. The National Markets Group, as part of its Real Deal Campaign, runs a cross-sector initiative to curb the problem of counterfeiting, the group, along with the UK police, the UK Intellectual Property Office (UKIPO) and organisations represent rights holders to tackle the trade of counterfeits at physical markets and works towards increasing consumer awareness and trust. Also, the UKIPO's Intelligence Hub coordinates intelligence into counterfeiting and piracy activity received from enforcement agencies and rights holders to disrupt the supply chain and trade of counterfeits.

    Online piracy and the sale of counterfeit items is a massive industry, which continues to grow. The consequences of piracy and counterfeit market are not only detrimental to IP rights holders but the economy of a nation as well. Pirated and counterfeit goods deprive the right holders of the fruit of their labour and their positive image. It also harms innovation and investment; companies are less inclined to invest in research and development if the results are not efficiently protected. The loss of revenues from piracy and counterfeiting is estimated at hundreds of billions of euros worldwide. An effective way to fight counterfeiting and piracy is therefore of utmost importance. While there seems to be no easy solution to the problem of piracy and sale of counterfeit items, the way of dealing with these problems appears to be to use legal remedies along with increasing education and awareness among the public creation of.

     

     

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    Thu, 27 Feb 2020 06:00:00 GMT
    <![CDATA[Criminal Law: Changes to Penal Code of Singapore]]> Prospective Amendments to Singapore's Penal Code

    (Original Enactment: Ordinance 4 of 1871) Date Commenced: 16 September 1872

    In July 2016, Singapore established a Penal Code review committee intended to perform a comprehensive assessment of the legal provisions currently protecting marginalized communities and members of the adolescent demographic. As of September 2018, the Committee has requested heightened legislative care for topics encircling sexual and violent crimes outlined under the Penal Code. Specifically, authorities have demanded the immunization of rape under marriage and criminalization of attempted suicide be repealed. Additionally, the anticipated Penal Code revisions will include increased repercussions for sexual predators preying on minors, offenses executed against mentally or physically debilitated individuals, and create explicit punishment for acts of voyeurism and consuming pornographic material. The Penal Code review committee has currently tendered 169 recommendations, a significant proposed alteration since its last review in 2007. Although the previous substantial modifications to the Penal Code commenced just over a decade ago, Singapore's Minister for Home Affairs and Law denoted that novel changes are necessary to ensure the 150 - year old Code remains up-to-date with societal interests and development. Although Singapore's proposed amendments are still subject to public feedback, the Ministry for Home Affairs and Minister for Law has released an extensive report on the proposed changes. This article is directed at evaluating these alterations.

    Published on August 2018, the Penal Code Review Report was issued with the objective of performing a thorough evaluation of Singapore's Penal Code and fashioning suggestions to resolve insufficiencies hindering public welfare and criminal liability stemming from moral culpability. According to the Report, the Committee is tasked with reforming the Penal Code so that outdated offenses are omitted, offenses entailing greater specificity are included, crimes already punishable by other legislative regulations are eliminated, and to ensure that the punishment-offense proportionality remains appropriate. The 2018 Report consists of seven chapters, comprising efforts to match advancements in technology and crime trends, to augment the protection of vulnerable persons, modernize the 150-year-old Penal Code, unify preceding Penal Code provisions, and revise incarceration sentencing standards.

    Recommended Changes to Modernizing Technology

    The Committee has suggested two predominant amendments to the Penal Code in relevance to crimes committed within a virtual platform. These recommendations consist of altering sections 22 and 378 of the Penal Code. The Committee has advised creating an extensive "definition of property which will cover intangible and incorporeal property" (s 3.1). Additionally, section 378 is called to be revised "to account for the possibility of theft of incorporeal property" (s 3.1). Under the current Penal Code, the term "property" is broadly defined, to include both immovable and movable assets. While the Penal Code's description of movable property can extend to include virtual assets, the Committee has foreseen necessity to amend the definition to specifically highlight protection over intangible goods such as virtual currency or air miles. When initially enacted, due to the technological restrictions of the era, the Penal Code could not consider misappropriation of incorporeal property. The committee notes that "the narrow historical conception of theft and dishonest misappropriation fails to protect the intangible property which is now part of ordinary life" (s 3.1.6). The Committee has proposed the new Penal Code which redefines "property" to incorporate both movable and immovable, including incorporeal property.

    The Committee has also requested an amendment to be made to section 30 of the Penal Code. This revision will broaden the legal parameters of "valuable security" to comprise electronic archives. Without revision, the technological extent of the word "document" under section 29 of the Penal Code only covers devices containing data (such as a disc), not an electronic form (such as a PDF). Section 3.4 of the Review advises applying new offenses associated with computer programs. The Committee adamantly expresses the necessity of developing "a suitable framework to address the issue of criminal liability for harm caused by computer programs." While the original Penal Code acknowledged the need to reprimand acts of omittances which caused injury through machinery use (s 287), the respective section does not target the eminent dangers computer programs pose to humans. The Committee emphasized an amendment to the Penal Code is needed which criminalizes the deceptive and psychological distress autonomous computer programming can cause. The Report suggests if "mismanaged, computer programs have the same or even greater potential for harm than machinery" (section 3.4.8). Although up to now no legislation worldwide has been passed to criminalize artificial intelligence systems, the Report indicates the Singaporean government must commit to research and pave the way to address such political concerns. According to the Committee, Penal Code reformation criminalizing negligence and risk-creation concerning computer programming could "impose potential criminal liability on (i) those who make and alter computer programs and (ii) those who use them…this offense covers acts and omission which may be merely negligent" (s 3.4.13). Under the revised Penal Code, it is likely a duty of care will be established to mitigate harms which may arise from computer programming.

    Recommended Changes to Addressing Developing Crime Trends

    The Committee also aims to expand the offenses constituting a criminal act of fraudulence. Under the new proposed recommendation, any individual who "fraudulently or dishonestly, (a) makes a representation, (b) fails to disclose information which he is under a legal duty to disclose, or (c) abuses, whether by act or omission, a position he occupies in which he is expected to safeguard, or not to act against, the financial interests of another person" (s 7.6) can be held legally culpable for an act of fraud. This suggestion is intended to parallel the UK Fraud Act 2006. The new fraud provisions will include identical sentencing practices as those currently stipulated for cheating (ss 415-420 of the Penal Code).  Two categories will exist for the new fraud offense. In the event an act of fraudulence causes injury, the offender will be subject to arrest. If fraud does not result in loss or damage, no arrest will occur. These two variants are fashioned with public policy in mind, attempting to curtail the number of fileable police reports.

                    Also relating to fraudulence, the Committee has recommended adding a provision under the Penal Code which criminalizes the obtainment of services fraudulently and deceptively. This offense will entail penalizing acts where

    • Services are obtained without full or partial payment
    • There is no intent on fully or partially pay for a product which is knowingly available on the basis that payment is expected

    The Committee has suggested that the crime of obtaining services fraudulently will be punishable with a fine and or maximum sentencing of 10 years.

    Section 12 of the Report discusses the need for creating detailed offenses for "the observation of a person in circumstances where the person could reasonably expect privacy…[and the] making, distribution, possession and accessing voyeuristic recordings." The current Penal Code does not provide specific provisions criminalizing the act of observing or recording individuals undressing or performing acts of intimacy. With this said, the Penal Code includes provisions such as "Insulting the modesty of a woman" and "Possession of obscene films" which have historically been used to punish voyeurism.  It has been argued that while voyeurism can be chargeable under various Penal Code sections, the existing provisions are ill-suited for handling issues arising from technological advancements. For example, the current law is unable to address content such as "upskirting" videos. The Penal Code recommendation branches beyond criminalizing the physical act of recording or photographing intimate situations, to deem it an offense to observe an individual in a situation where they could expect privacy. The Committee has outlined circumstances where someone could reasonably demand privacy, to include: if an individual is exposed, interacting in sexual activities, or undressing. The new proposed voyeurism rule will punish intentional acts of observation or recording without the other party's consent. Additionally, an offense will be created for the distribution and possession of voyeuristic material. Sentencing will vary via voyeuristic offense, but offenders can be sentenced to a maximum of five years imprisonment.

    Beyond voyeurism, a new offense concerning sexual exposure will be adopted. According to the Report, sexual exposure "refers to situations where an offender displays his genitals intending or knowing it likely that such display would humiliate or cause distress of fear to the observer" (s 14). The current Penal Code contains three provisions (appearing in public nude, obscene songs, and gestures insulting a woman's modesty) which relate to exposure. However, it has been argued such provisions do not fully capture sexual or malicious intent, the prescribed penalties are too little, and the exposure of genitals in a private location is not criminalized. The limitations of the Penal Code in respect to the wrongdoing of sexual motives can be illustrated through PP v Budiman Shah Mohd Noreel Azman. In this case, the defendant had molested a woman on a train and exposed himself in public on seven counts (which included sexual exposure to young adolescents). Upon his sentencing, he was only charged with committing an obscene act and faced nine months incarceration. Under the new sexual exposure provision, any offense committed against an adolescent below the age of 14 will be subject to a maximum prison sentence of two years, a fine, or caning. If the victim is 14 years or older, the offender will be issued a punishment of no more than one year (and/or the other penalties listed previously).

    Recommended Changes to Enhance Victim Protection

    One of the most critical alterations to Singapore's Penal Code involves repealing ss 375(4) and 376A (5) which establish immunity for marital rape. Efforts in 2007 were taken to withdraw marital immunity, but instead, attunement was assumed. As a result, a balance was met which dually preserved "the conjugal rights and expression of intimacy in marriage…[while] protecting women who had signaled a withdrawal of their implicit consent to conjugal relations" (s 15.7 of the Report). The Committee has asserted despite attempting to achieve an equilibrium, women's rights and protections against sexual abuse are still not protected adequately. As a result, the repeal of marital immunity for rape will be repealed in entirety. This outlawing will align Singapore with the UN General Assembly's pronouncement that marital rape is a heinous violation of human rights.

    Reviewing the Penal Code's active sexual offenses against minors, the Committee has suggested three primary recommendations: the age of consent is to remain at 16, the age of 14 will be retained as the cut-off for statutory aggression, legal protection in cases of sexual exploitation for minors from 16 to 18 should be heightened. The Committee's rationale for increased protection for this specific age demographic is as follows: the propagation of smart technology has enabled minors to be subject to higher levels of manipulation by predators. This potential for victimization provides justification to increase the minimum age for all sexual offenses involving exploitation.

    Section 17 of the Report specifies an enhancement of the maximum penalties "for offenses committed against children, vulnerable persons, and domestic maids, by up to two times the maximum punishment the offender would otherwise have been liable to." (141) While courts in Singapore typically consider the vulnerability of a victim when issuing their verdicts, current sentencing ranges debatably do not include sufficient maximum penalties for offenders. Therefore, the Committee has advised altering penalties for offenses "deliberately target[ing] vulnerable persons, on account of their vulnerabilities" (s 17.2). One amendment suggestion has encompassed expanding the spectrum of offenses under the Penal Code which relate to child vulnerability (such as crimes causing physical injury). The Committee has declared children under the age of 14 must be provided greater protection as "such young children are generally physically smaller, more naïve and easily exploited" (s 17.7).

    Penal Code s 84 currently outlines the defense of unsoundness of the mind. If an individual qualifies as being mentally unsound, their charges may be acquitted, and the individual sent to a psychiatric institution.  The Committee has acknowledged the value of retaining the provision relating to unsoundness of the mind but has requested the term be modernized. The recommended revision includes incorporating volitional disorders into the defense. The amendment is proposed as the Committee is "of the view that there is no good reason why the criminal law should not account for the fundamental principle that a person is not to be held criminally responsible for involuntary conduct" (s 24.11).

    In total, the Penal Code Review Committee's Report provides 169 amendment recommendations. Through updating and removing outdated offenses, modernizing general principles and substantive crimes, and ensuring proportionality between an offense and its respective punishment, Singapore's Penal Code will be better equipped to protect those most vulnerable and provide greater deterrence for potential offenders.  

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    Thu, 10 Jan 2019 10:57:00 GMT
    <![CDATA[UAE Criminal Law - Crimes Committed Outside UAE]]> The Territorial Applicability of Criminal Law in the UAE

    Introduction

    In may sound odd, but there is a difference between international criminal law and criminal international law. What's more is that the differentiation between these two seemingly similar sounding things is of essential importance.

    The international criminal law is a law which is laid down by the international community through international conventions held between several States. Therefore, it relates to international law subjects rather than municipal law.

    The criminal international law is the law which concerns the rules of the crimes committed under the municipal criminal law, involving a foreign element, such as the venue of the offense, or the nationality of the victim or the offender. In such cases, the criminal law comes into focus to deal with the problems of legal jurisdiction and to solve the conflict of laws that may arise between domestic and foreign criminal rules.

    The United Arab Emirates – territorial applicability

    Federal Law Number 3 of 1987 (also known as the Penal Code) states within Article 16 that the Penal Code will apply to any person who commits a crime inside the territory of the State. The State shall consist of the lands and any place under its sovereignty, including territorial waters and airspace there above. 

    A crime shall is considered to have been committed in the territory of the State if any of its constituent acts occurs therein, or if the result has been, or is intended to be, realized therein.

    Article 17 provides for situations in which crimes are committed on-board warships and military aircraft which bear the flag of the State wherever they may be, such offense will fall within the ambit of the penal code. The applicability of the law will also apply to non-military governmental vessels owned or operated by the State for non-commercial purposes and as such commercial aircraft and ships bearing the flag of the state also fall within the purview of the law.

    Where there has been an incident on a foreign ship which is in any of the ports of the State or its territorial waters, Article 18 of the Law states that the penal code will not apply unless the following circumstances are present:

  • In cases where the effects of the crime extend to the State;
  • If the crime by nature disturbs the peace or violates public morals or good order in its ports or territorial waters;
  • If the shipmaster or consul of the State hoists their flag in an attempt to seek assistance from the local authorities;
  • Should the offender or victim be a citizen of the State;
  • If the vessel carriers materials or objects internationally banned from negotiation, possession or commercialization.
  • Although this provision does not extend to foreign aircraft in the airspace of the UAE Provisions will reach if the aircraft physically touches down in any of the airports after the perpetration of the crime. Also, if the crime by nature disturbs the peace in the State or violates its public policy, or if the offense violates the State navigation rules and regulations, or if the aircraft pilot seeks the assistance of the local authorities, or if the offender or victim is a State citizen.

    There too are cases in which the merchant ships become submitted under the local State jurisdiction. This submission is following the International Seas Convention of 1982. These cases are as follows:

  • The fact that the crime has been perpetrated by or against a person that is not a member of the crew;
  • The case where the offense committed breaches the peace and security of the receiving state, such as in the case of smuggling of drugs; and
  • The case where the ship has asked for intervention or assistance from the local authorities.
  • Where a person has committed a crime outside the State, according to Article 20 of this law, such person will fall within the ambit of the law and will be considered a principal or an accessory when the following crimes have been committed:

  • An offense that violates the internal or external security of the state, its constitutional system or its legally issued financial securities or stamps or that involves forgery or counterfeiting of state instruments or official seals;
  • Copy, falsification or copying of the states' currency, circulating or possessing the same for circulation, whether such acts are carried out within or outside the country;
  • Forgery, falsification or counterfeiting of paper notes or minted coins for the distribution in the state, promoting such currencies and coins therein, or possession the same for circulation.
  • A citizen of the United Arab Emirate, while traveling abroad will not be able to escape liability under the law of the UAE. In accordance with Article 22 if a citizen becomes involved in an act which constitutes a crime as per this law, such person will be sanctioned in accordance with this law when he comes back to the country, provided that such a commission or omission is punishable in accordance with the law of the state within which the perpetration occurs.

    Exceptions

    The provisions of the criminal law are only applied within the States' territory. The internationally accepted definition of territory includes the following:

  • The land – which consists of the earth, whether it is joined or separated (e.g., in the case of islands);
  • Water areas – which comprise of internal areas such as rivers, lakes, and canals, as well as external water areas which include the territorial sea (i.e., 12 miles from the shoreline); and
  • Air and space – which covers up the abovementioned areas of land and water.
  • However, there are two exceptions to the territorial applicability of the criminal law. There is a contrary exception in the form of criminal immunity and a real limitation in the way of the transnational effect.

    Concerning the contrary exception, the following persons will qualify as such:

  • Foreign heads of states – the law provides that the culpable acts committed by the foreign Head of State or by one of his/her family members during their visit to a State, such actions will be covered by criminal immunity, and those persons shall not be accountable for their culpable acts before the national courts of the receiving State. The reason for this is due to the perfect equality and absolute independence of the sovereign state that the municipal courts are incapable of conferring extra-territorial power;
  • Diplomates – this criminal immunity is confined only to the procedural rules of criminal law and not to the substantive provisions as such;
  •  
  • Foreign public and military ships and aircraft - the criminal law of the receiving state is not applicable to such persons as these ships or aircraft represent the sovereignty of the guest State in the host state;
  •  
  • Foreign armed forces.
  • Definite Exceptions to the Territorial Applicability of the Criminal Law

    In this situation, a state will take it upon themselves to punish persons who have committed a crime abroad. Pronouncement of the punishment must occur in the State whose law has been broken and can only require execution if the offenders come within its territory. The UAE Law on this follows upon French principles, with jurisdiction over offenses committed abroad claimed within broad limits.

     

    ]]>
    Sat, 20 Oct 2018 12:23:00 GMT
    <![CDATA[Cryptocurrency– A Magical Bubble or The Future of Currency?]]> Cryptocurrency– A Magical Bubble or The Future of Currency?

    The noise and media surrounding the notion of cryptocurrency have been increasing the curiosity rapidly. Before curiosity kills the cat, let's walk through the story of cryptocurrency.

    Cryptocurrency is an innovative and a virtual currency that utilizes cryptography for security and this matter it is difficult to fake it. A characterizing highlight of a cryptocurrency is its organic nature; it is not issued by any government authority, rendering it hypothetically resistant to government obstruction or control. The mastermind behind cryptocurrency is the blockchain. A blockchain is digitized and decentralized of all cryptographic transactions. It is the process of converting readable data into a relatively uncrackable code, to track purchases and exchanges. Over the years, blockchain and cryptocurrencies have grown exponentially that uses as a financial service tool to improve transparency and efficiency.

    Not many know that digital currencies rose as a side result of another innovation. Satoshi Nakamoto, the obscure innovator of Bitcoin, the first and still most critical cryptocurrency, never proposed to invent a currency in the first place. In his declaration of Bitcoin in late 2008, Satoshi said he built up "A Peer-to-Peer Electronic Cash System." The primary cryptographic currency was bitcoin, and since then there are currently more than 1,000 different types of cryptocurrency accessible on the web with over 200 Bitcoin ATM's installed around the world.

    The creation of Bitcoin is via a mining process where miners receive compensation for newly issues bitcoins. There is a limitation on the production of the number of bitcoins which is limited to 21 Million. Once the limit has surpassed, the miners will receive transaction fees instead of bitcoin. Individuals contend to "mine" bitcoins utilizing a computer to settle complicated math confounds. There is no curtailment on who can become a miner, all you need is a computer and accessible internet. Bitcoin transactions are not confidential as it is published to the public network to be verified by the system on miners. Therefore, it is possible to trace bitcoin between bitcoin wallets. The storage of Bitcoins is in a 'digital wallet' that exists either in the cloud or on the user's computer that acts as a virtual bank account that allows users to exchange, trade or make transactions. FDIC does not insure bitcoin wallets like bank accounts. The operations are public, the owners of the portfolios can be anonymous. It is the most attractive feature of bitcoin as miners effectually vote on the legitimacy of each transaction as part of the mining process.

    In this modern era of economics, where societies no longer have to rely on banks and other centralized institutions to keep track of their payments and guarantee the financial system. Blockchain technology frees people from this centralized trust. Cryptocurrency makes it less demanding to exchange finances between two parties in a transaction; these exchanges are encouraged using public and private keys for security purposes. These operations are done with minimal fees, enabling clients to maintain a strategic distance from the high expenses charged by most banks and financial organizations for wire transfers.  Cryptocurrency is digital and doesn't have a local repository since its digital it can be wiped out by a computer crash if a backup of the possessions does not exist. Since costs depend on free market activity, the trade rates of cryptocurrency can vary broadly.

    The support of cryptocurrency is only by the trust of users rather than the authority of the state. Money is based on confidence and trust regardless of a nation's currency; whether it is dollars or dirhams, people accept it because it is recognizable as trade. Some argue that Blockchain today has a high potential to become a disruptive technology mainly for its ability to offer decentralized and public but highly secure ledger transactions while others claim that Bitcoin and cryptocurrency in general has zero intrinsic value given that its merely speculative with underlying asset value being zero.Those defending this theory (that Cryptocurrency has no underlying value) defend themselves on subjective theories of value and quantum theories which suggest that a mouse inside a box can be considered alive and/or dead only until the box is opened and observer looks inside. All said, one strong argument against cryptocurrency is that 1) paper currencies are fiat currencies, 2) they are backed by gold or any other hard asset, 3) they have central banks who monitor and endeavor to stabilize their value, all of which does not apply to bitcoin. Does that make bitcoin a riskier investment? If yes, how must risk does it pose?

    Paper vs. Electronic vs. Crypto?

    Individuals have a variety of options when making a transaction from cash, debit, credit, crypto, etc. The massive multinational tech company, Microsoft recently added Bitcoin as a payment option on its online portal to purchase games, movies, and apps in the Windows and Xbox stores. Regardless of whether it is Pound, Dollar or Euros; All necessary cash monetary forms have lost enormously over the last year against the central five cryptocurrencies. Meanwhile, more than the US $ 90 billion has been put worldwide in crypto, and the pattern keeps on rising. The most striking contrast between cryptocurrency and paper money is that crypto is accessible virtually, while paper money exists in tangible form. Paper money accounts in the banking system via account numbers; digital currencies use addresses and cryptography that encrypt private data and mathematically verifies identities. European Central Bank defines virtual currency as an unregulated, digital fund which is issued and controlled by developer and utilized and acknowledged among the individuals from a particular virtual group. Through the use of cryptography, digital currencies are usually safer and more challenging to manipulate compared to the paper money. The transparency on the blockchain minimizes the risk of corruption. Therefore, some states are now considering the use of blockchain in the public sector.

    Credit card transactions are the dominant payment method used across the web. If you have ever bought anything with your credit card from an online seller, you know the drill. Online seller takes the credit card details, and then sends it to a financial system with processors, banks, credit card companies, and other mediators. If you use PayPal or Venmo to carry out your online transactions, a third party takes your bank account details and approves the purchase and notifies the seller. Approaching the third-party system, you can keep the privacy and make a payment through a secure network, but you lose the simplicity of directly dealing with the online seller.  However, cash minimizes the possibility of buyer defaulting his debt. Money has some advantages as it has better anonymity whereas purchasing with credit card requires you to disclose your account details and it is easily traceable. Consequently, cash is not identifiable.

    On the other hand, bitcoin doesn't protect the status of anonymity as much as cash. Bitcoin doesn't require you to reveal your real identity, but there is a connection with a public ledger of transactions and where the invasion can happen in the worst case scenario. It doesn't require a central server but relies on peer to peer network. The disadvantage is that if the Internet fails or the user does not have access to the internet, one cannot execute the transactions. Another drawback is that if the crypto owner loses his key or accidentally wipes his wallet than that's a threat to security. Cryptography is more suitable for tech-savvy users, the acceptance in the traditional trade is still low.

    Crypto Theft

    The murkiness around the subject of cryptocurrency often makes it seem dodgy or a scheme to sucker fools out of their money. Crypto users can be inclined to theft, fraud, and cons, which some contend is made less demanding on account of Bitcoin's structure and absence of control. The very idea of Bitcoin makes prevention of theft difficult, one of the most significant components being there is no real way to recover Bitcoin that has been stolen or conned, and no real way to return the transaction. Cryptocurrencies are not insusceptible to hacking. In Bitcoin's history, we have acknowledged so far at least 40 thefts that exceed US Dollars one (1) million.  The recent breaking news in the crypto world is featuring One of Asia's most significant advanced money trades – Coin check that is known as the 'world's biggest ever cryptocurrency hack.'  Hackers have stolen £380m worth of cryptographic money from one of Japan's biggest advanced trades. Coin check, situated in Tokyo, said that there was a wrongful transfer of around 523 million of the trade's NEM coins to another record. The trade has suspended stores and withdrawals for all digital forms of money except for Bitcoin. In 2014, known to be the single greatest hack ever. At the time of the hack, Mt. Gox (Magic the Gathering Online Exchange) was the biggest Bitcoin trade in the world and took care of 70% of the world's Bitcoin trades. The trade was under a cyber-attack, and the programmer exchanged a large number of Bitcoin from the business to his record prompting the theft of $473 million in Bitcoin.

    Cryptocurrency for Illicit Activities

    Bitcoin is anonymous and flexible, which means its popular among criminals. The record of Bitcoin exchange is in an open log, names of purchasers and sellers that are out in public – just their wallet IDs. There is no bank or central authority, like a government or a state to control this information. It keeps bitcoin users' transaction private and additionally gives them a chance to purchase or offer anything without effortlessly being traceable. That is the reason it's a favorite choice for individuals to purchase drugs or other unlawful exercises on the web. It enables law requirement to track exchanges and have the capacity to make it less demanding to follow Bitcoin back to its proprietor, as was done in 2013 to capture one of the most prominent medication advertises that utilized Bitcoin. Bitcoin also became a conventional method for making payments when a computer system is taken over by ransomware. It has helped ransomware assaults. However, the degree of reprimanding Bitcoin is far from being naturally correct. Web security is considerably fragile, while programmers have been getting substantially more modern, so it would bode well that assaults would rise.

    Despite the fact that Bitcoin can make it simpler for criminals and scammers to play out their devious deeds, regardless it is impeccably respectable and great speculation to invest. Any money has unlawful users; Bitcoin is the same in such a manner. By far most of the clients do utilize it legitimately, similarly as most utilize US dollars or any other currency lawfully. That doesn't mean one shouldn't be observant when using Bitcoin, likewise as you ought to be cautious on the web or to make any other transaction.

    Cryptos Future

    Cryptocurrency gives billions of people access to financial services that otherwise have no bank account. In developing countries, in particular, almost 60% of adults are excluded from the banking system because they do not meet the minimum requirements to open a bank account.  In countries where the currency is not stable like Zimbabwe or Venezuela etc. it serves as means of exchange and conservation. 

    On the other hand, Crypto-related issues are also on the upsurge in companies and banks. At IBM, an estimate that by the end of 2017, around 15% of banks will use blockchain techniques, as these financial transactions are more efficient and less expensive.

    However, no one knows what the future holds for Bitcoin. It is unregulated. A few nations like Japan, China, and Australia have started measuring controls. Governments are worried about tax collection and their absence of control over the money. Be that as it may, you cannot pay the rent utilizing Bitcoin or purchase insurance. There is yet to see what the future holds for cryptocurrencies.  

    ]]>
    Wed, 15 Aug 2018 11:54:00 GMT
    <![CDATA[Territorial Jurisdiction Part-1]]>  

    THE REACH OF TERRITORIAL JURISDICTION

    PART I

    Introduction

    The UAE follows Civil Law in their legal system and the primary laws governing the jurisdiction of courts is regulated by Federal Law Number 11 of 1992 the Civil Procedural Law (the Civil Procedures Law) and Federal Law Number 35 of 1992 regarding the Criminal Procedural Law (the Criminal Procedure Law).

    The court's jurisdiction means that the courts' competency to consider any dispute may be submitted to it. Thus, the court that has no jurisdiction will not be competent to decide on a specific dispute.  The jurisdiction of a court is divided into four (4) major parts as follows:

    The First Part

    The international jurisdiction of the courts, for which the law shows when the courts shall have jurisdiction to consider the lawsuits filed against the foreigner that has not any known domicile. Also, these courts shall have jurisdiction to consider that don't fall within their jurisdiction, but they are required as per the proper administration of justice. Also, these courts shall have jurisdiction to consider the summary and provisional actions that are connected with an execution inside the territories of the state even if these courts have no jurisdiction to consider the original lawsuit.

    The Second Part

    The qualitative jurisdiction in which the law shows distribution of jurisdiction among the partial departments and the plenary departments according to the type of the case submitted to the court, the distribution of the jurisdiction between the ordinary courts and summary courts, as well as the distribution of the jurisdiction on the different stages of litigation (Court of First Instance, Court of Appeal, and Court of Cassation)

    The Third Part

    The value jurisdiction in which the law determines the jurisdiction among the partial deportments and plenary departments according to the value of the case.

    The Fourth Part

    The local or territorial jurisdiction of the courts which is the subject matter of this article means the distribution of the jurisdiction on the state courts from the same type and degree within the limits of its jurisdiction area. And the territorial jurisdiction of the courts shall be determined according to the domicile of the defendant or the place of the disputed property or the choice of the plaintiff in some personal status cases.

    The Territorial Jurisdiction

    The general rule put by the federal law in connection with the territorial jurisdiction of the state courts, that the jurisdiction shall be for the court whose jurisdiction area includes the domicile of the defendant. The law also affirms the same as under Article 31 (1) of the Civil Procedure Law it is mentioned that "the jurisdiction shall be for the court whose jurisdiction area includes the domicile of the defendant unless the law decided otherwise. And if the defendant has no domicile inside the country, the jurisdiction shall be for the court whose jurisdiction includes his residence address or work address."

    Ergo, the territorial jurisdiction, according to the aforesaid Article, shall be granted to the courts whose jurisdiction area includes the domicile of the defendant, namely the permanent and continued residence of the defendant. And the word "domicile" means the home i.e. the notification shall be forwarded to the place in which he lives.

    In cases where the defendant does not have a domicile, the jurisdiction shall be granted to the court whose jurisdiction area includes his residence address contrary to the domicile. As the man may live in a palace for a limited period then he left it to be without a domicile. Also, it is allowed to file the lawsuit before the court whose jurisdiction area includes the work address of the defendant. And the plaintiff shall have the right to file the lawsuit to the court whose jurisdiction area includes the residence address or the work address of the defendant, as both of them shall be valid in case there was not any determined and known domicile of the defendant. 

    Exceptions to the General Rule

    The rule mentioned above includes several exceptions, and these exceptions shall be stemmed either from the conditions of the plaintiff or the type and subject matter of this case.

    Therefore the exceptions with regards to the conditions of the plaintiff are as follows:

  • The court which within its jurisdiction area the damage has occurred shall have territorial jurisdiction to consider the lawsuits relating to compensation either this damage occurred to the properties or the persons. Thus, the plaintiff in the lawsuits relating to compensation may file its lawsuit either before the court whose jurisdiction area includes the domicile of the defendant or the court which within its jurisdiction area the damage has occurred.
  • The law has permitted in the commercial disputes that the court which the parties have agreed on its jurisdiction area, shall have the territorial jurisdiction to consider these disputes or the court which this agreement was executed either in whole or in part within its jurisdiction area or the court which the agreement should be executed within its jurisdiction area. Thus, the plaintiff shall have the right to file its lawsuit either before the court whose jurisdiction area includes the domicile of the defendant or the court at which the agreement (subject of lawsuit) was concluded or it was executed in whole or in part or the court in which the agreement should be executed in the commercial disputes.
  • In case there was more than one defendant, the jurisdiction shall be for the court whose jurisdiction area includes the domicile of one of them, thus the plaintiff may choose the court whose jurisdiction area includes the domicile of one of the defendants to file its lawsuit before it.
  • The Civil or Criminal Procedures Law has also clarified the territorial jurisdiction of the courts according to the subject matter of the lawsuit, as it has made exceptions in the cases mentioned hereunder from the above-mentioned general rule as follows: 

  • In the in-kind real estate lawsuits and the possessory lawsuits, the territorial jurisdiction shall be for the courts whose jurisdiction area includes the property or any part thereof. It is meant by the in-kind real estate lawsuits, any lawsuit in which the dispute is raised over one of the in-kind real estate rights such as the right of ownership as in the lawsuits relating to confirmation of ownership or the request for expropriation or recovering possession of the property. The reason, in this case, is the proper administration of justice. As it's better than the court considering this dispute to be near the property (the subject of dispute or lawsuit).
  • In case of the personal real estate lawsuit, the plaintiff may file its lawsuit either before the court whose jurisdiction area includes the domicile of the defendant or the court whose jurisdiction area includes the disputed property. It is meant by the personal real estate lawsuit, any lawsuit in which the dispute is raised over personal rights related to the property like the lawsuits relating to terminating the sale contract of the property.
  • In the lawsuits relating to moral rights (in case of companies and establishments), as the territorial jurisdiction shall be granted to the court whose jurisdiction area includes the head office of the company, except for the lawsuit relating to one of the branches of this company, as the jurisdiction shall be granted to the court whose jurisdiction area includes this branch.
  • The Bankruptcy Cases

    In the lawsuits relating to bankruptcy, the jurisdiction shall be granted to the court whose jurisdiction area includes the shop (company or private establishment) of the bankrupt. In case the bankrupt owns several shops, the jurisdiction shall be granted to the court whose jurisdiction area includes the head office of the works of the bankrupt. The same shall be applied to the lawsuits relating to bankruptcy, as the jurisdiction shall be granted to the same court i.e. the court issued the judgment to declare the bankruptcy. But if the trader left trading, we shall return to the general rule relating to the territorial jurisdiction, as the court that will have the territorial jurisdiction is the court whose jurisdiction includes the domicile of the defendant.

  • In the lawsuit relating to legacies, the jurisdiction shall be granted to the court whose jurisdiction area includes the last domicile of the deceased, the same shall be applied in case of lawsuits relating to custodianship and determining heirs.
  • In the lawsuit relating to supply contracts or contracting agreements or wages of workers, craftsmen and employees, in this case, the plaintiff may file its lawsuit either before the court whose jurisdiction area includes the domicile of the defendant or the court which the agreement was made or executed within its jurisdiction area.
  • In the lawsuit relating to claim for the insurance amount, the plaintiff may file its lawsuit either before the court whose jurisdiction area includes the domicile of the beneficiary or the court whose jurisdiction area includes the insured property.\
  • In the summary lawsuits and temporary requests, the jurisdiction shall be granted to the court whose jurisdiction area includes the domicile of the defendant or the court which the action has been requested to be executed with its jurisdiction area. But if the matter is related to taking a summary action in connection with an execution of a foreign judgment, the jurisdiction shall be granted to the court which this judgment shall be executed within its jurisdiction area.\
  • Concerning the contracts and obligations which it has been agreed to be executed within a specific domicile, the court that has territorial jurisdiction to consider these lawsuits and obligations is the court whose jurisdiction area includes that domicile.
  • Exceptions to the Law

    The law has also made two more exceptions in the general rule which are not mentioned in the aforesaid circumstances, and these are as follows:

    First case:

    If the defendant has no domicile or residence address in the country or we were unable to determine the competent court according to the aforesaid cases, the jurisdiction shall be granted to the court whose jurisdiction area includes the domicile of the defendant or his residence address. And if the defendant has no domicile or residence address, the territorial jurisdiction in the lawsuit shall be granted to Abu Dhabi Court.

    Second case:

    In personal status cases (alimony, guardianship, seeing, dowry, trousseau, gifts, divorce, abdicative divorce, clearance, separation between spouses of any kinds), in this case the plaintiff may file its lawsuit either before the court whose jurisdiction area includes the domicile of the defendant of the defendant or the court includes his domicile.

    What if?

    A question is raised from the situations mentioned above is that whether the contracting parties entered into a contract or any transaction, agree to contradict with the rules of the territorial jurisdiction of the court according to the aforesaid regulation? The answer seems to be affirmative as the law has permitted the contracting parties netted into any contract to agree on the rules of the territorial jurisdiction of the state courts in special cases.

    As under Article 31 (5) of the law of Civil ProceduresLaw, "it is stated that except the cases set forth in articles 32 and from 34 to 39, it is allowed to agree on the jurisdiction of a specific court to consider the dispute. In this case, the jurisdiction shall be granted to this court or to the court whose jurisdiction area includes the domicile or the residence address or the work address of the defendant."

    According to the aforesaid provision, any contracting parties under any relation, over which a dispute could be raised, shall have the right to agree to determine the court that shall have the jurisdiction to consider the dispute that may be raised over this relation. For example, two parties may be entered into a sale contract in Dubai, as the execution and handover shall be done in Dubai, then the two parties shall agree that Abu Dhabi Courts of Fujairah Courts shall have the right to consider this dispute.

    Whereas the law has not excluded from that only some cases stated by it exclusively, which are the in-kind real estate lawsuits, the lawsuits relating to legacies, the lawsuits relating to bankruptcy, the lawsuits relating to claim for the insurance  amount, the summary lawsuits and taking summary actions, the lawsuits relating to supplies, contracting, houses rents, wages of workers, craftsmen and employees, interlocutory requests connected with the lawsuits considered before the court actually. Any party in these relations or those lawsuits shall have the right to not abide by the above-mentioned rules of the territorial jurisdiction of the courts. In the next article, we will discuss the practical aspect of the territorial jurisdiction of local courts and how the court has interpreted the laws in different cases.

     

    ]]>
    Tue, 17 Apr 2018 12:00:00 GMT
    <![CDATA[The UAE Anti Fraud Law]]> Anti Fraud Law in the UAE 

    The United Arab Emirates recently enacted Federal Law Number 19 of 2016 concerning Combating Commercial Fraud (the Anti-Fraud Law or the Law) has replaced the erstwhile Federal Law Number 4 of 1979 dealing with the Concealment of Fraud and Deception in Transactions commercial in nature (the Old Anti-Fraud Law).

    The much-anticipated Anti-Fraud Law has been in the news since the draft of the aforesaid law was introduced and circulated in the year 2013. As the United Arab Emirates grew into a commercial hub for trade and business between different jurisdictions, the requirements of a stricter regime and policies became increasingly essential to safeguard and protect the market from fake and counterfeit goods. As a result, the Anti-Fraud Law purports to regulate the framework and robust more policies towards a legal regime necessary to curb and combat fraudulent commercial activities to provide an efficient mechanism to counter infringement of intellectual property.

    The Definitions

    The Anti-Fraud Law sets out more extensive definitions, explicit penalties and broadens the scope to deal with commercial frauds, mainly dealing with intellectual property.

    The definition of Commercial Fraud states that 'Deception of one of the customers by any means whether by changing or altering the goods or their amount or nature or price or their material description or origin or source or fitness or any other matter related thereto, or presenting untrue or misleading trading information on the promoted products, which include fraud, limitation and cheating by doing service which does not conform with the applicable laws or may include false and misleading statement.'

    Importantly, the Anti-Fraud Law explicitly sets out the definition of Counterfeit Goods as 'the goods which bear, without permission, a trademark which is identical or similar to a legally registered trademark.' The preceding definition significantly extends the scope of the Law by ruling out any ambiguity relating to nature of goods falling under the ambit of this Law, in as much as, the Law shall cover unauthorized use of goods and products with identical as well as deceptively similar or lookalike trademarks.

    Also, the Law also provides for more clarity by clearly defining and categorizing goods into Goods, Fraudulent Goods, Corrupt Goods, and Counterfeit Goods.

    Important Provisions

    A noteworthy feature is the applicability of this Law within UAE. Article 2 of the Law explicitly provides for the provisions of the Anti-Fraud Law applies to whosoever commits the very act of commercial fraud including the free zones in the UAE. In most scenarios, the discrepancy in the procedures and regulations between mainland and free zones has to lead to uncertainties in the enforcement of rights and entitlements. However, this Law addresses the concerns and extends its scope explicitly to the free zones.

    Pertinently, Article 2 further explains what falls under the purview of commercial fraud and includes Importation, export, re-exportation, manufacture, sale, offer for sale, possession with the intent to sell, storage, rent, marketing or circulation/trading of fraudulent, corrupt or counterfeit goods. Importantly, the expansive definition mentioned above regulates the manner in which possession, importation, and re-exportation undertaken in the UAE including the free zones.

    Further, the law also provides recourse towards the use and possession of corrupt and fraudulent good as even counterfeit goods. Article 3 of the Law among other things ensures that regardless of the criminal liability on the offender, the relevant ministry will issue an order to import the corrupt of fraudulent goods to their source within a stipulated period. However, if the importer failed to abide by the order passed and did not return the goods to the source, the relevant authority also has the right to destroy the products or will give away the permission for usage of goods for any other appropriate purpose. The law further mentions that the usage of counterfeit goods should be in accordance with the rules and regulations outlined in the law.

    In the manner, as provided aforesaid, the law makes a distinction in the way in which corrupt/fraudulent goods and counterfeit goods may be dealt with.

    Another provision of the Law which is step up towards adequate safeguard mechanism is Article 4 of the Law which imposes an obligation upon the traders to provide all necessary and relevant information including trade books and financial statements concerning the goods owned and possessed including to any evidence towards details and documents to that effect.

    Articles 5 to 8 of the Anti-Fraud Law also provides for a regulatory framework to be developed for this Law. In this regard, The Ministry of Economy shall form a Higher Committee which will inter alia be responsible for proposing strategies and policies, identify obstacles and advise on a mechanism to tackles issues, to carry out necessary activities assigned by the Ministry of Economy. Having a federal committee in this manner shall ensure integrated policies and mechanism in place to safeguard the interest of bona fide traders and brand owners. Article 6 further provides for establishment of sub-committees at each Emirate level and shall be assigned with the task of issuing warnings to the traders and businesses violating the Law, close down traders and businesses in violation of the Law, for a maximum of 2 years, follow up on the destruction or returning to source of the fraudulent/corrupt or counterfeit goods and provide the Ministry with periodical reports regarding its day to day activates in relation to the Law.

    Role of the Committee

    Importantly, the Anti-Fraud Law confers the sub-committee with the responsibility of undertaking matters of conciliation and settlements concerning violations of the Law. In this regard, Article 8 provides that upon a request for conciliation by the offender, the sub-committee may set an amount of fine payable in lieu of the conciliation which shall not be less than twice the minimum limit of fine prescribed under the Law. In the event the offender rejects/refuses the conciliation, the offense shall be referred to the Public Prosecutor for further prosecution. The Law provides limited opportunities to appeal against the decision of the sub-committee, particularly in the case where the conciliation is rejected by the sub-committee or against the decision of the sub-committee to close down a business. In both the situations as mentioned above, the businesses can object to the closing down an appeal against the rejection of conciliation before the Higher Committee.

    It is understood that the Law provides that a set of implementing regulations shall prescribe relating to the manner and guidelines in which the said Law is to be implemented, for instance, setting out the process of the conciliation or determining the types of warnings that may be issued by the sub-committee. However, such implementing regulations are yet to be published.

    Penalties under the Law

    The essential provisions prescribed under the Law in relation to heavy penalties imposed on violators, which is a welcome change from the Old Anti-Fraud Law, is necessary to deter offenders and curb commercial frauds. The Old Anti-Fraud Law provided for a maximum penalty of jail term for two years and a maximum fine of AED10,000 (UAE Dirham ten thousand) for cheating a customer by delivering goods that are different to what was ordered. In contrast, Article 12 under the Law imposes a harsher penalty for the violators such as an imprisonment of almost two (2) years or some fine which ranges from AED 50,000 (UAE Dirham fifty thousand) to AED 250,000 (UAE Dirham two hundred fifty thousand) or both of the above. In addition, anyone who attempts to commit a commercial fraud under the Law shall face a punishment of imprisonment of up to 1 (one) year or a fine of an amount between AED10, 000 (UAE Dirham ten thousand) to AED100,000 (UAE dirham one hundred thousand), or both of the above.

    As an exception, Article 14 imposes a higher penalty of imprisonment for a period of up to two years or a fine of AED 250,000 (UAE Dirham two hundred fifty thousand) to AED 1,000,000 (UAE Dirham one million) or both, where the fraud or offense is in relation to human foods, animal foods, medical drugs, agricultural crops or organic products. Additionally, in case of conviction in the offenses as listed in Article 14 above, the court shall order close down of the accused for up to six months, in addition to the prescribed punishment. In addition, in the event of repeating violation for the aforesaid offenses, the court shall be at a liberty to order more severe punishment or cancellation of the license.

    It is pertinent to note that the Law imposes an astringent obligation upon the offender/violator of the Law, in as much as, Article 16 provides that the trader shall not be exempted from any punishment prescribed under the Law, even where the buyer is aware that the goods are fraudulent, corrupt or counterfeit.

    Conclusion

    The new Anti-Fraud Law is another progressive legislation, which is in tandem with the recently changing legal climate in UAE. This Law has made positive advancements towards formulating a robust legal framework to safeguard and protect the interest of registered brand owners and bona fide businesses. While the Anti-Fraud Law is indeed a welcome change, it still is at a nascent stage, where the success of the framework shall be heavily dependent upon the smooth operation of the Higher Committee and sub-committee and the manner in which the administrative processes assigned to them are carried out. Importantly, the regulatory framework and policies will be clearer once the implementing regulations are enacted. In any event, the heavy penalties provided for shall act as a deterrent against commercial frauds and crimes and shall bridge the lacuna created by the Old Anti-Fraud Law towards an effective measure to combat intellectual property crimes and other commercial frauds.

    ]]>
    Thu, 15 Mar 2018 04:27:00 GMT
    <![CDATA[The UN Convention on Contracts for International Sale of Goods]]> An Overview of the UN Convention on Contracts
    for the International Sale of Goods

    If a company in the United Arab Emirates wanted to buy authentic leather abroad, most likely they would start looking for sellers in Italy. Considering that they find such an Italian company, the first step in this process would be to negotiate the contract of sales and to understand each other's requirements. However, if there are no prerequisite standards of international sales, the UAE company would expect an outcome from the contract that may be completely different from the expectation of the Italian company. If not addressed to adequately, these misunderstandings may lead to potential disputes arising and the two groups would find themselves in front of the Court over the sale of leather. While this obviously undesirable to the parties, it is also highly inefficient of their time.

    This topic divides itself into five articles. The first section will address the agreements by UNIDROIT that have paved the way for its creation-the ULF Convention and the ULIS Convention. The second article will examine the development process of the CISG Convention. The third section will address the mechanisms available to prevent disputes from arising; the basis of analysis is on the provisions of the Convention as well as other in several potential international contracts, including the World Trade Organization (the WTO). The fourth article will discuss relevant case laws to examine the flaws of the convention. The fifth section will assess the applicability of the CISG convention and the potential lack of its enforceability.

    On the global scale, there have been constant efforts to promote free trade in the international system. Since free business is understood to be beneficial in most cases, states have already begun adopting it by initiating bilateral or multilateral agreements with each other that facilitate and promote diverse types of trade interactions. However, these arrangements often exclude the necessary uniformity of these interactions. It is vital to consider unifying the understanding and expectations of the sale of goods in the international context. Without this consistency, parties to a transactional agreement are unable to trade as their expectations often contrast efficiently. Therefore, states have signed off to Conventions in the past with regards to this matter. One of the most recent ones, and arguably one of the most successful, is the UN Convention concerning Contracts for the International Sale of Goods (the CISG Convention).

    The CISG Convention is one of the most recent efforts to unify the overall components of and expectations for international trade law. As of right now, it has been the most successful attempt at achieving this goal. The CISG Convention is the most ratified convention concerning the international sales of goods, with more than 85 states adopting the Articles. Preceding it, and supporting its development, were two other agreements attempted by the international community regarding the matter of trade. These two conventions were put together by the International Institute for the Unification of Private Law (the UNIDROIT) to create an internationally recognized protocol for the sale of goods. UNIDROIT was able to compile and develop the ULF and ULIS Conventions in three decades-having it finalized by 1964 and enforced by 1972 amongst nine states. The CISG Convention, signed first in 1980, was the final product of the effort to unify standards of sales and prevent disputes from arising between states. It represents a compromise made following lengthy discussions between representatives of countries with different legal systems and backgrounds. These differences, though outside agreements and conventions may prevent their existence, are addressed further and more directly within the articles of the CISG Convention. Still, despite the available prevention mechanisms, past cases have arisen due to the inability of states to cooperate regardless of the provisions of the article. Their enforceability, as well as the applicability of case laws, is put under debate.

    Development of the Convention

    Since the year 1930, UNIDROIT has been engaging in efforts to establish a universal protocol for the process of trade.[i]{C}{C}{C}{C}{C} These efforts lead to the establishment of two separate conventions for different aspects of the business: The Convention regarding a Uniform Law on the International Sale of Goods (the ULIS Convention) and the Convention concerning a Uniform Law on the Formation of Contracts for the International Sale of Goods (the ULF Convention). While the initiation of the ULIS Convention preceded that of the ULF Convention, the commencement of both of them was in April 1964 through a diplomatic conference held at The Hague. Since then, there has been a constant attempt to get all concerned States on board with the overall cooperation.

    ULIS Convention

    The ULIS Convention introduces the concept of establishing a single process of selling goods internationally. It proposes the fundamental responsibilities and obligations of states that are parties to sale contracts.  The Convention sets a protocol for delivering the products of sale, adapting the agreement, paying the determined price, and more. Further, the Convention includes a particular remedy in the case of a party breaching its provisions.

    As aforementioned, UNIDROIT began work on this Convention starting in 1930-during the time that the League of Nations (the League) still stood as the competent intergovernmental organization. The League organized for a committee of experts to begin preparing a draft of the Convention and simultaneously the communication to the member states of the League in the year 1935 was done. Based on the comments and critiques of the rules, the draft was revised in the next few years and was on the agenda at a diplomatic conference hosted by the League in 1951 at The Hague. Another revision was completed by 1956, recirculated to the governments, and led to the third overhaul in 1983. Eventually, the submission of the final draft of the ULIS Convention was in the year 1964 to the diplomatic conference at The Hague, where it was officially prepared to be signed by interested governments.

    ULF Convention

    Much similar to the ULIS Convention, the concept of the ULF Convention was under construction for an extended period before its final official preparation. The provisions of the Convention are related to more general rules of international trade. It discusses protocols for accepting offers of business, potentially revoking suggestions, and overall forming a standard contract for future transactions.

    The ULF Convention came into existence during the process of constructing the ULIS Convention. In the 1951 diplomatic conference at The Hague, where during the process of approving the first revised draft of the ULIS Convention, member states suggested the creation of a separate convention that deals more specifically with international sales contracts. The idea for this agreement was to shed light on the difficulties of contract formation that commonly occurs during international transactions. A separate draft from that of the UILS Convention was handed over to the League's member states in 1958, and revisions followed until the official finalization of the Convention in the 1964 conference as mentioned above at The Hague. The subsequent article on this topic will explore how the ULIS and ULF conventions have led to the development of the CISG convention.


    [i] United Nations, 2008, United Nations Convention on Contracts for the International Sale of Goods (United Nations Audiovisual Library of International Law)

    This article was initially authored by Sara Al Harfan with additional inputs from other attorneys.

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    Thu, 15 Feb 2018 10:50:00 GMT
    <![CDATA[Diplomacy and International Court of Justice: An Analysis]]> DIPLOMACY AND INTERNATIONAL COURT OF JUSTICE: AN ANALYSIS

    (Part I of II)

    'Peace comes at a price. And that price is diplomacy. We may all know who is paying the price, but sometimes, we cannot comprehend the amplitude of the price paid.'

    {C}-        International Relations Department, STA Law Firm

    The oldest evidence of diplomatic relations dates back to 1259 BC between the Pharaohs of Egypt and the rulers of the Hittite Empire (part of present-day Turkey). The Egyptian-Hittite Peace Treaty is perceived to be the evidence to this ancient diplomatic treaty that was drafted to end the war between the two kingdoms over the jurisdiction of eastern Mediterranean. The treaty was the result of war at the city of Kadesh due to the attempted invasion by Egyptian warriors to gain control over the lands. However, the mighty Hittite army resisted the attack, and the two empires fought for the years to come. Noting that the pen is mightier than the sword, intermediaries (diplomats of today) of both the empires starting negotiating the possibility of peace between the monarchs. Hence, the world's first diplomatic treaty came into force between the empires even without a personal meeting of both the monarchs. Centuries later, nations still employ intermediaries (diplomats) to negotiate and implement treaties with the view of securing peace.

    Therefore, various nations ratified the Vienna Convention on Diplomatic Relations of 1961 (the Diplomatic Relations Treaty) and the Vienna Convention on Consular Relations of 1963 (the Consular Relations Treaty) with the view of ensuring that these intermediaries obtain a higher level of protection while negotiating with other countries. And with the same intention (of attaining peace), the United Nations established the International Court of Justice (the ICJ) in 1945 to adjudicate legal issues between nations of the modern world. But over the course of time, both, the Treaty and the ICJ, has faced uncertain predicaments regarding the validity of the former over domestic legislation and the jurisdiction of the latter.

    From Around the World

    The world wars and the subsequent cold war taught the governments around the world about war and diplomacy more than ever before. Yes, I just used war and diplomacy on the same line. Although countries have used their techniques of diplomacy as a means to end the conflict(s) from as far as 1259 BC, they tend to perceive diplomacy from other nation(s) as a weapon to obtain an advantage. But does this permit them to implement their domestic legislation on foreign diplomats? Hopefully, the reader would able to form an opinion to this rhetorical question with more than just prejudiced personal or cultural influence at the end of this article.

    In 1979, the United States (US) Embassy in Tehran, Iran was attacked by armed Iranian mob who detained the diplomats and seized the offices of the diplomatic mission. Subsequently, the US Department of State instituted legal action against the Islamic Republic of Iran at the ICJ.  The primary contentions of the US, in this case, was that Iran was in violation of the Diplomatic Relations Treaty and the Consular Relations Treaty and that the Iranian Government has an obligation to secure the release of all detained US nationals, inter-alia. Further, the support provided by the Iranian Government to the accused militants was also globally scrutinized due to the former's failure to safeguard the US diplomatic mission and the diplomats.   

    Therefore, after carefully studying the issues in question, the learned court ruled that: (i) Iran is in clear violation of its obligations towards the US; (ii) Iran is responsible for these violations; (iii) the Government of Iran should release the US nationals who are detained and pass on the possession of the seized US Embassy to the protecting power; (iv) US diplomats or consular should not be subjected to any judicial proceedings in Iran; and (v) Iran should repatriate the US for all the injury and damage caused to the latter. This issue was in the global limelight primarily due to two (2) reasons: (i) over sixty (60) US diplomats were unlawfully detained for over 444 days by militants; and (ii) the Iranian government (that had the obligation to protect the embassy) did not even file their pleadings (through their lawyers) before the ICJ.

    As seen in the above case, frequently nations try to retaliate with other nation(s) regarding issues between them by imposing biased domestic legislation or by failing to protect the citizens of the latter who are assigned to diplomatic missions in the former.

    Therefore, the primary question that arises in this regard is about the validity of public international law over the domestic regime of a state. That is the extent of authority that a state can exercise over the diplomats or consular of a foreign country while on official duty of the home state. However, domestic courts have the responsibility of prosecuting those who violate these international norms. Hence, a conflict of interest may arise between the nation (that is looking to enforce their domestic laws onto the diplomat) and the international community since international customary law envisages national courts of the state(s) with the obligation to enforce these laws. Although, this platform (local courts) often neglect international laws and fail to prosecute those in violation of international laws or human rights abuse since the defendant(s) in these cases are the governments of those states themselves. Therefore, it is evident that these domestic courts may apply their local statutes to escape the jurisdictional ambit of international law by finding a loophole and rejecting the applicability of international law.

    However, official diplomatic agents are not the only parties who have this level of protection. Since, if that were the case, a government would be permitted to exercise any form of undue jurisdiction on a foreign national who is residing in their jurisdiction. To this end, the Diallo Case[iii] was a landmark ruling of the ICJ regarding the extent and ambit of diplomatic immunity that can be conferred onto non-diplomats and consular. In this case, Mr. Ahmadou Sadio Diallo was a Guinean national who was the shareholder of a limited liability company (the Company) in the Democratic Republic of Congo (Congo). Further, in the 1980s, the Company initiated legal action against various local public and private enterprises that owed substantial amounts to the Company in the course of business. However, within a few years, the Government of Zaire ordered Mr. Diallo to be deported from the country due to violation and infringement of public order in the economic, financial and monetary sectors. After that, he was arrested and detained by the authorities for sixty-six days (without due process of law) before being deported to Guinea. Further, the Government of Congo misappropriated Mr. Diallo's property and denied his future entry into the state (which is a non-appealable order by Congo's domestic statutes).

    Subsequently, the aggrieved Mr. Diallo informed of these unfortunate events to the Guinean authorities who later instituted legal action against Congo since states have the discretionary right to safeguard their citizens against undue injury from foreign countries by providing diplomatic protection to them. Therefore, the representatives of the Republic of Guinea instituted an action against the Congo in the ICJ. This globally aggravated the already existing issue of the extending the arms of diplomatic protection onto shareholders and legal entities as seen in the ruling by the ICJ in the case of Barcelona Traction[v]. Guinea contended that Mr. Diallo should be provided with diplomatic protection stating that he is: (i) an individual who was victimized by detainment and undue expulsion; (ii) a shareholder with the right to protect his interests of the companies; and (iii) a shareholder and manager who has the duty to protect the rights of the companies (by substitution). The Republic of Guinea demanded the restitution of all the damages suffered by Mr. Diallo and the Guinea. However, the defendants took the stand that the Republic of Guinea could not confer Mr. Diallo with diplomatic immunity since the companies were not established in Guinea. They also stated that Mr. Diallo had not exhausted all the remedies that were available to him in Congo itself. After comprehending the facts and disputes of the case, the ICJ stated in its preliminary judgment that the burden of proof for establishing that Mr. Diallo had not exhausted the domestic remedies available to him. However, they failed to prove the same after analyzing that the notice of expulsion given to Mr. Diallo was not appealable. Further, the ICJ also stated that the companies in question were of Congolese nationality and therefore, Guinea could not invoke diplomatic protection by substitution. However, the court upheld Guinea's claim to invoke diplomatic protection on Mr. Diallo as an individual and his direct right as a shareholder.

    In 2010, the ICJ ruled on the merits of the case and stated that Congo was in violation of the International Covenant on Civil and Political Rights (articles 9 and 13), Consular Relations Treaty and African Charter on Human and Peoples' Rights (Articles 6 and 12(4)). However, the court ruled that Congo had not directly violated Mr. Diallo's rights as a shareholder since he was entitled to attend general meetings and control the management of the companies. Further, in the judgment by the ICJ on 19 June 2012, the court observed that Guinea was not able to substantiate their claims with proof regarding the loss of tangible and intangible assets due to the expulsion. Therefore, the court awarded an amount of USD 85,000 regarding the detention and expulsion of Mr. Diallo from the country. This case is considered as a landmark judgment since it provides us with an idea about the extent of diplomatic protection that a country can provide its citizens.

    Conclusion

    The International Court of Justice has been set up to allow protection of people, whether diplomats or natural persons, in countries where they are foreigners. However, it is understandable that in the battle of national and international law the struggle to implement justly can be of issue. It is not possible to provide an equal degree of protection to the parties when a differing law is more advantageous for each. The tricky nature of the subject matter has seemingly resulted in an array of instances where international law is disregarded in a plot to protect the stronger hand. Nevertheless, our analysis does not end here; part II of this article will examine the procedural aspects of cases in the International Court of Justice and other relevant processes.


    [i] United States of America v. Iran; [1980] ICJ 1

    [ii] Reports of Judgments, Advisory Opinions and Orders, 24 May 1980 (found at http://www.icj-cij.org/docket/files/64/6291.pdf)

    [iii] Republic of Guinea v. Democratic Republic of Congo, ICJ, 2007

    [iv] Also, known as Congo (between 1960 to 1971) and Zaire (between 1971 to 1997).

    [v] [1970] ICJ 1

    [vi] Judgment on Preliminary Objections on 24 May 2007

     

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    Fri, 29 Sep 2017 12:00:00 GMT
    <![CDATA[Tackling Post Dated Cheques in Bahrain]]> Tackling Post-dated Cheques in Bahrain

    Can an instrument of payment be offered that ensures complete safety? The reality of the latter statement is an unlikely one. The law, however, does attempt to provide security where a payment transaction fails to do so. The nooks and crevices of such law must be understood to avoid any misguided reliance's on it.

    Post-dated cheques are considered to be an instrument of security to guarantee future payments. They, however, are also used as a tool of secured future payment. As can be understood, a post-dated cheque promises payment of a specific amount at a future date, and the party can only cash the said amount on the future date. In Bahrain, there are criminal implications for issuing a post-dated cheque from an account with insufficient funds. The Criminal Court of Appeal in Bahrain has issued several judgments clarifying the risks associated when doing so.

    Law-Binding Spell

    Due to both the social and legal implications of the 'bouncing' of a post-dated cheque, beneficiaries find it favorable to rely on this type of payment transaction.  Of course, one cannot automatically assume a criminal offense will arise upon the dishonoring of a cheque, but rather one can rely on court judgments for protection as the likelihood of criminal implication is high.

    The Bahraini Criminal Court of Appeal has elucidated as to the matter of intention as seen below:

     I.          Criminal Appeal Number 5 of 2005, in session dated 17 October 2005 found that regardless of whether the cheque was issued as a security measure only, it remains a transaction of certainty that the issuer must adhere to.

    II.          Criminal Appeal Number 77 of 2006, in session dated 26 July 2006 states that assuming the cheque issuance follows the legalities of doing so, the crime of issuing a bounced post-dated cheque occurs even if the issuer is aware of the insufficient funds in their account and issues the cheque as a security method only.

    Denoting that the issuer of a post-dated cheque automatically assumes a risk and an intention to provide the money promised in the cheque regardless of whether that was their real intention.

      I.     Criminal Appeal Number 5 of 2005, in session dated 17 October 2005 states if the account of the issuer does not contain sufficient funds the crime is considered to be committed regardless of the reasoning behind it.

      II.         Criminal Appeal Number 77 of 2005, in session dated 26 July 2006 follows that an issuer of a cheque automatically assumes 'bad intention' by merely knowingly or unknowingly issuing a cheque to an account with insufficient funds.

    The decisions highlighted above follow a similar pattern of automatic risk of criminal liability regardless of intention or awareness of the crime being committed. It is enough to perform the action of issuing a post-dated cheque that will not be fulfilled at a future date to acquire liability.

    The Criminal Court of Appeal has also shed light on which instances do not qualify an issuer of a post-dated cheque safety from liability:

                 I.          Criminal Appeal Number. 59 of 2005, in session dated 15 May 2010 elucidates that a crime is still committed where there are insufficient funds in the account when the beneficiary attempts to cash the post-dated cheque even if the issuer provides the beneficiary with cash of the amount prescribed in the post-dated cheque before they cash the cheque.

                  II.          Criminal Appeal Number 77 of 2006, in session dated 26 July 2006 follows the above line of reasoning stating that if the issuer does not take back the post-dated cheque after providing the beneficiary with the prescribed amount, then they are still liable for the crime if the beneficiary attempts to cash the post-dated cheque.

    As such, these judgments provide that a defendant cannot escape liability by giving the beneficiary the amount prescribed within the cheque before the promise date. To do so, they must return the post-dated cheque to avoid liability. Otherwise, the issuer takes the risk in procuring liability regardless of the fact they had fulfilled their promise in a different manner.

                 I.          Criminal Appeal Number 59 of 2005, in session dated 15 May 2010 states that even if the date of the post-dated cheque has passed and the beneficiary raises a claim to the police after the said date, the crime will still have been committed and the issuer liable.

             II.          Criminal Appeal Number 93 of 2005, in session dated 03 July 2006 lists that an account with no funds, insufficient funds, or a frozen account that does possess sufficient funds are all types of accounts that result in the crime of a 'bounced' cheque.

    Deduction of the above follows that the law offers a wider scope of protection to a beneficiary of a post-dated cheque than it does for the issuer of one. As such although a beneficiary cannot be ensured complete safety it is fair to say that they are guaranteed sufficient safety.

    The Bahraini Court of Appeal has also issued stricter judgments in comparison to those of the UAE, such as:

    Criminal Appeal Number 59 of 2005, in session dated 15 May 2010 and Criminal Appeal Number 9 of 2006, in session dated 25 December 2006 both make clear that the law does not automatically repeal liability if the issuer of the cheque pays the promised funds to the beneficiary after the claim has been raised.

    Unlike UAE law, the waiver of the criminal complaint is not offered by Bahraini law. A claimant must choose to waive their right to the criminal complaint once payment of indebted amount occurs. If they (or; their appointed lawyers) do not decide to do so, then the right to continue the criminal complaint remains within the bounds of the law. The action of issuing a post-dated cheque with the use of an account that contains insufficient funds remains an active crime.

    Once a judgment has been issued, Article 393 of the Penal Code (Decree Number 15 of 1973) mandates a fine or a prison sentence on the accused. Social stigma and punishment are also followed as per the Law of Commerce (Decree Number 7 of 1987) in Article 491, where it states that once bad faith and crime is found, the court will order the publication of the judgments summary in one of the local newspapers. The publication will include their name, occupation, and the punishment they will endure.

    Conclusion

    What can be construed from the above judgments is the reach of the Bahraini law and its intent to implicate those who issue post-dated cheques with cash consideration. Although payment transactions are tricky, the ability to prove bad faith and ill-intention require the mere existence of an account with insufficient funds and the rest of the dominoes follow.

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    Thu, 28 Sep 2017 04:00:00 GMT
    <![CDATA[Da Ta Da - Fair Dealings & Copyright Laws]]> Da Ta Da - Fair Dealings & Copyright Laws

    Have you ever bumped into someone when walking on the street because you were using your phone? Or maybe you tried to stifle your laughter when you saw someone else hit a pole or a glass window because they were so occupied staring at the screen of their phone. I have. I have run into a pole a few times too. The bump on my head proves it. Our daily dose of data has increased tremendously in the last decade, and any decline in the imminent future appears unlikely. Our demand, especially of mobile data through the use of smartphones and tablets drives our society to be online and updated at any time.

    Most of us commonly use our smartphones as the primary source of data. Others may still prefer computers. The instant our alarm wakes us up in the morning to the moment we have our lunch, and on our way back home on the bus or train from work, we satisfy our appetite for data by reading news, communicating online or by updating our social media to share our lives with our friends.

    However, using data nowadays is not only to read the breaking news or share a text online. We have developed an appetite for data increasingly due to the availability of visual content. Animated pictures attract more attention than long boring messages. Consequently, a high number of online providers now offer an online visual experience.

    Of course, it is not surprising that newspaper companies now follow this market demand as well and provide a more visual experience to present news with videos and animations. More often than not, newspapers and other providers will only have a following if they publish a certain amount of these visual experiences. Several clips are used to gather information about an interesting matter to make a short video which takes only about 20 seconds or less to satisfy the needs of their followers and readers. These clips are short extracts from films, television or other videos, compressed and cut to show notable moments, for example, a goal in a football match, a hurricane, short quotes from celebrities on the red carpet and anything in a nutshell that can yield some publicity for the provider. Usually, the clips used are from third-party footage. Providers may take the footage from news companies, such as the BBC or CNN or from sports channels. In this scenario, the news company or the sports channel still owns the copyright of the material in the video. Taking and using the clip without authorization and any legal justification would be copyright infringement.

    Nonetheless, the provider could still use this particular clip if it can trust on a so-called rule of exception to copyright. One of these exceptions is called fair dealing. In this article, attorneys of our intellectual property team would discuss the applicability of fair dealing concerning United Kingdom's Copyright Design and Patents Act of 1988 (the Act).

    Fair Dealing

    One way to define fair dealing is a defense to copyright infringement. It permits a provider to copy parts of copyright work designed and produced by third parties without the obligation to obtain prior permission from the third party for publishing purposes. For example, a provider could use a quote from a book for his online postings or the use of a short video sequence, by cutting out a movie from a third party. In these cases, the copyright owner requires neither payment nor any other service. The online provider does not need to inform the copyright owning party about what he is doing. It is irrelevant whether the provider acts commercially or not.

    The Act gives authors the ability to control the means in which their work is used. Chapter III of the Act introduces the fair dealing defense, giving numerous exceptions to whom or when copyright law cannot protect creators with the use of the defense, such as libraries and for educational purposes.

    Wider application

    However, some parts of the fair dealing defense are of a broader nature; for instance:-

         i.          Fair dealing for the intention of reporting current events defense is a particularly useful argument for media companies. It permits an extract from a copyrighted work, which is not an exact one to be used to report an event simultaneously or to report an event which took place some time ago in the past, but which remains newsworthy. An example of this would be when a provider uses a clip from TV footage to report contemporaneously terrorist attacks in the Middle East or another part of the world;

    ii.         The fair dealing for criticism or review defense permits to take and use a visual part from a copyright-protected work and offer critics or give a review of the extract itself, or a different copyright work. That sometimes occurs when a provider uses a short clip from a film to state a comment of the level of violence included in the movie itself;

    iii.           The fair dealing for a quotation defense not only permits extracts from copyright works to be used to provide a so-called "quote" in the conventional sense of the word itself but also to refer to something that has already taken place. A short example of this is when clips from several films could be used to illustrate the fact that an actor prefers roles in action movies;

     iv.          The fair dealing for caricature, parody or pastiche defence permits the provider to extract a part from any copyrighted work and build on it to create a separate so-called "mashed-up" work, usually for comedic or entertainment purposes. The comedian could use some lines from a movie or a song for a sketch. Additionally, a cartoon artist could work out a well-liked artwork or illustration for caricature purposes, or an artist shall use parts from a range of films to form a larger artwork.

    Conclusion

    The United Arab Emirates has implemented a similar copyright defense termed fair use under Articles 22 to 24 of the Federal Law Number 7 of 2002 regarding Copyrights and Related Rights. This defense can be used as long as prejudicing of the rights of the creator does not occur, and the works are already lawfully published.

    With the UK law in mind, of course, one cannot use the argument of fair dealing without any consequences or else the idea of copyright would become useless. Therefore, in any case, any utilization must be of fair dealing, in general. Accordingly, in every case, one has to act as any fair-minded and honest person in the same situation. As a result, commercial use, which would compete with the original copyright or a copy of a tremendously long part of the original, certainly seems to be unnecessary and will of course not be seen as fair dealing and must be actionable by the copyright owner.

    The utilization of the original copyright work must be performed by sufficient acknowledgment, by stating the name of the original work and author. An exception is allowed only when the reasons are practical and reasonable. To be defended by fair dealing, the provider has to focus on following the accurately described procedure so as not to be sued by the copyright owner. The fair dealing rule is vital in today's times, where the use of data becomes more and more important to people around the world. However, the current law states a too general statement about the use and its borders and should be specific with precise details, so a provider does not cross the red line of fair dealing. Nonetheless, a beginning was set, and the details shall occur rapidly.

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    Thu, 28 Sep 2017 01:00:00 GMT
    <![CDATA[Att(H)ack - Anti Cyber Crime Law in Saudi Arabia]]> ATT(H)ack- Anti-Cyber Crime Law in Saudi Arabia

    "Cyberterrorism could also become more attractive as the real and virtual worlds become (tightly) coupled, with automobiles, apps, and other devices attached to the Internet."

    Dorothy Denning

    The clandestine and privacy advantages, the information superhighway, and the possibility to buy your plane ticket last minute, comparing airfares - the certitude of Internet today has made it easier for individuals to e-socialize, access information, and conduct business.

    We Eat. Sleep. Live the World Wide Web. With spellbound raise of the technology, evil minds keep themselves updated with indefinite and unethical routes through which they can trespass the ambit of privacy of an individual or entity. With this malignant issue fast rising, the legislature across the World have codified laws to tackle the menace of cyber crimes. The international community, governments, and commercial enterprises are yet adjusting to an unprecedented array of challenges posed by hackers, cyber criminals and those who resort to cyber espionage.

    In this article, we discuss the Anti Cyber Law in Saudi Arabia with particular emphasis on criminal acts and punishments.

    Taking the dictionary reference for the term Cyber, which is a combining form meaning Computer, computer network or virtual reality used in the development of compound words (cyber talk, cyber art, cyberspace) and by extension i.e. expressing future visions.  A more precise definition is of, relating to, or involving computers or computer networks (as the Internet) and the cyber marketplace. Looking into what a cybercrime is, a crime that involves a computer and a network or when a computer used in the commission of a crime, or it may be the target, the person is said to have committed the Cybercrime. Cybercrimes are broadly categorized into three categories namely, 

    Cybercrime against Individual

    Cybercrime against Property

    Crime against Government

    Email Spoofing

    Credit Card Skimming

    Hacking

    Spamming

    Intellectual Property Crimes

    Denial of service attack (Dos)

    Phishing

    Software Piracy

    E-mail Bombing

    Cyber Stalking

    Domain name disputes

    Logic Bomb

    Cyber Defamation

    Identity Theft

    Data Diddling

    Voyeurism

     

    Sale of Illegal Articles

    Cyber Pornography

     

    Cyber terrorism

    Albeit different from the other two categories, crimes against the government get categorized as cyber terrorism. If successful, this type of the offense can wreak havoc and cause panic amongst the civilian population. In this category, criminals hack government portals, military websites or circulate propaganda. The perpetrators can be terrorist outfits, or unfriendly governments of other nations and the Kingdom of Saudi Arabia has been vulnerable to two such attacks in 2013 and 2016. According to Gulf News Journal, nearly 65 percent of the country's population already has access to the internet, and the state ranks seventh globally concerning individual social media accounts, and it has more than 40 percent of the Middle East and North Africa region's Twitter users. Saudi Arabia tops the list of countries impacted by the advanced targeted cyber attack in META (Middle East, Africa, and Turkey). It also has a significant share in computer networks, accounting for 30.1 percent of the total cyber attacks in the region during the first half of this year, said a report issued by Fire Eye, a leader in cyber security.

    'The Internet is an excellent tool, But technology is increasing faster than the safety message is'

     -         Pam Weaver                      

    The Legal System in Saudi Arabia

    Shariah principles protect individual's right to privacy and prohibit any invasions thereof. Shariah policies prohibit disclosure of secrets except in cases where the owner of the sensitive information accepts to disclosure or is a matter of public interest. The Holy Quran and the Sunnah do not stipulate a penalty for disclosure of secrets, however, as explained earlier, divulgence of sensitive information may be punishable by a fine that a judge, in his discretion, deems appropriate and equitable.  Such penalty may attract a fine, charge the offender with imprisonment or deprivation of specific rights such as suspension of a practicing license. In determining the severity of penal acts or action(s), the judge will take into consideration the damage sustained by a victim and also consider whether such loss is actual or consequential.

    Combating the Enemy: Cybercrime Law in Saudi Arabia

     Saudi Anti-Cybercrimes Law (the Law) was issued by Royal Decree Number M/17, dated 26th March 2007. This law consists of sixteen (16) provisions. Broadly, the sixteen articles set out the key definitions, scope and objective, sentences, and fines. The law aims at combating cyber crimes by identifying such crimes and determining their punishments to ensure information security, safeguard rights on the legitimate use of computers and information networks, protection of public interest, public morals, and common practices and values, protection of national economy. Additionally, Arab Cybercrime Agreement Number 126 of 2012 (the Agreement) enacted and approved in the year 2012 introduced sweeping changes. The Agreement primarily addresses the rise in electronic crime which embraces such crimes as credit card frauds, internet crimes, cyber terrorism, creation and distribution of viruses, hacking, system interference, illegal access and interception, and so on. The Agreement also aims at strengthening cooperation between Arab countries in combating cyber crimes. The Agreement further signifies the importance of enforcing the Copyrights Law. The Agreement imposes Penalties on those in violation of the Agreement terms and conditions. The proposed amendment to Article 6 of the Law that could allow offenders to be publicly named and shamed. The additional powers granted to the judiciary under the amended provision will allow the publication of a summary of the decision one or more local newspapers or any other medium deemed suitable by the court in the connection of the type of the crime, its severity, and its impact. The publication release only happens once the verdict gains the status of the final ruling and the offender may also incur the costs of publication. Cyber crime attracts severe punishment by the Saudi Ministry of Interior and the Communications and Information Technology Commission, and penalties exacted for identity theft, defamation, electronic piracy, email theft and other unlawful activities.

    Revisiting the penal features of the Royal decree on March 26, 2007

    Crime

    Fines

    Imprisonment

    §   Acquisition of moveable property or bonds for oneself or others or signing such bonds through fraud or use of false name or identity.

    Up to 2 million Riyals

    Not exceeding 3 Years

    §  illegally accessing bank or credit card data or data as to ownership of securities with the intention of obtaining data, information, the position of funds or type of services offered.    

     

     

    §  Unlawful access to computers with the intention to delete, erase, destroy, leak, damage, alter or redistribute private data.

    §  Causing the information network to halt or failure or destroying, removing, leaking, or modifying or reconstructing existing or stored programs or data.

    §  Obstruction of access to, distortion and causing interruption or cessation of any form of services and by any means. Fine of up to three (3) million Saudi Riyals

    Up to 3 million Riyals

    Not exceeding 4 years

    §  Production, preparation, transmission, or storage of material impinging on public order, religious values, public morals, and privacy, through the information network or computers,

    §  the construction or publicizing of a website on the information or data of any type), the IT system(s) or computer (in general) to promote or facilitate human trafficking.

    §  the preparation, publication, and promotion of material for pornographic or gambling sites which violates public morals.

    §  the construction or publicizing of a website on the information network(s) or computer linked data to act, deal or trade in, distribute, a demonstrated method of use or facilitate dealing in narcotic and psychotropic drugs.

    Up to 3 million riyals

    Not exceeding 5 years

     

     

    §  Spying on, interception or reception of data transmitted from an information network or a computer without lawful authorization.

    §  Unlawful access to computers with the intention to threaten or blackmailing a person to accept, or asking him/her from refraining from taking action, be it lawful or unlawful.

    §  Illegal access to a website, or hacking a website with the intention to change its design, destroy or modify it, or occupy its URL.

    §  Invasion of privacy by employing camera-equipped cellular or mobile devices and the like.

    §  Defamation and infliction of damage upon others through the use of various information technology tools and devices.

    Uo to 5 hundred thousand riyals

    Not exceeding 1 year

    §  the construction or publicizing of a website on the information network or on a computer for terrorist organizations to facilitate communication with leaders or members of such organizations, finance them, promote their ideologies, publicize methods of making incendiary devices or explosives or any other means used in terrorist activities.

    §  Unlawful access to a website or an information system directly or through the data network or any computer with the intention of obtaining data jeopardizing the internal or external security of the State or its national economy.

    Up to 5 million riyals

    Not exceeding ten years.

    §  The crime is committed through organized crime.

    §  The offender holds a public office and the crime performed relates to that facility or where the crime stems from employing one's undue influence, or authority.

    §  The luring and exploiting of minors and related offenses.

    §  The offender has a prior conviction of similar crimes within or outside the Kingdom.   

    The fine may not be less than fifty percent (50%) of the maximum if the wrong combines with one of the mentioned crimes.

    The imprisonment may not be less than half of the maximum if the offense links with one of the said crimes

     

    Further, the Saudi Anti-Cyber Crime Law aims to secure the safe exchange of data, protect the rights of users of the computers and the internet, and to protect the public interest and morals as well as people's privacy. In recognizing the position and urgency, the Saudi authorities are reviewing the Anti-Cybercrime Law to amend it so as to initiate legal proceedings against social networking sites such as Twitter for allowing accounts which aim at posting or in general dealing with adultery, and the acts of homosexuality, or atheism.

    Known Cases of Cyber Crimes And Cyber Attacks in Saudi

           i.          The unethical and illegal cyber attack on Aramco Company in August 2012 by a group calling itself "Cutting Sword of Justice" claimed responsibility.  Aramco is one of the well-known oil companies owned by the Saudi Arabian government. In a matter of hours, 30,000 computers got partially wiped or wholly destroyed by a virus resulting in the deletion of data on the company's hard-drives. Saudi Aramco's ability to supply 10% of the world's oil was suddenly at risk.

          ii.          Multiple attacks from outside the country targeted Saudi Arabia's government websites, crippling these websites for quite some time until they were disabled. These attacks were discovered to belong to hundreds of IP addresses from different parts of the world.

         iii.          In January 2012, the official Website of King Saud University (KSU) got hacked by some unknown Hacker, and a database of 812 Users got exposed included phone numbers, addresses, and passwords.

        iv.          Saudi hacker, 0XOMAR, published over 400,000 credit cards online and threatened Israel to release 1 million credit cards in the future. In response to that incident, an Israeli hacker published over 200 Saudi's credit cards online.

          v.          In December 2016, cyber criminals attacked various departments of Saudi Government. These included the Saudi's General Authority of Civil Aviation. Thousands of computers got destroyed in the Saudi air office in the so-called "digital bomb" detonation which leads systems of several agencies to wipe out at once.

    Conclusion

    The Internet has taken the world to altogether a new level. As they say, A coin has two sides! The unknown 'side advocates' threat and terror without boundaries and with no proof. The placement and recruitment of young, influenced and innocent individuals or persons by terror groups is a stance of Cyber exploitation.  The Internet can be used to make things as well as break things! It is used to address social issues while some use it as a prime platform to express freedom of Speech and religious views. With this level of cyber threat, stronger defense systems are the need of the hour.

    The only thing that can stop a bad guy on the internet is a Good chap on the Internet!

     

     

     

     

     

    ]]>
    Wed, 23 Aug 2017 12:00:00 GMT
    <![CDATA[Are You App Safe?]]> Are You App Safe?

    "People have forgotten this truth," the fox said. "But you mustn't forget it. You become responsible forever for what you've tamed. You're responsible for your rose." 

    - Antoine de Saint-Exupéry

    It was in the land of far away, and serenity paraded green landscapes, flowers, dew, rain showers and lakes. Not long ago, far away was just an abstract thought; however, the phrase 'the world is a small place' holds more truth to it now than one could have ever anticipated. A lot of this accredits to the multitude of technological advances. While the debate revolving whether technology is an opportunity or an obstacle is endless, its influence in developing communication platforms is undisputed.   The revolution from carving pictures on stone walls to writing letters and posting them has taken its due course but with the technical advances coming into play, every other decade now brings with it a new medium of communication. Laptop, the compact version of a desktop is now considered sizeable as compared to sleek, smartphones and tablets which these days come along with the new 'in thing' – applications or as commonly referred to as apps.    Apps, by default, have become a necessary and indispensable part of every user's routine ranging from waking up to your choice of alarm tone in the morning, calculating total steps walked in a day, shopping online for groceries or spending hours crushing colorful candies. Dependency has overshadowed convenience.    Harmonizing law and technology isn't always a smooth process since new technical advances not only make the old methods obsolete but also outdated the law regulating it. Hence, it wouldn't be wrong to state that legal amendments need to be in order to be consistent with the rapid pace of the technology.     Doctrine of Caveat Emptor    The doctrine of caveat emptor is a legal maxim that clothes the warning 'Buyer Beware.' It has seeped in and permeated every legal and judicial structure acting as a guideline pointing towards the liability of a customer and reasonable use of his rationality before using a particular article or service.    The concept of Caveat Emptor has been in use over the centuries and has undergone its fair share of changes. Traditionally, courts distinguished between the sale of specific goods, capable of physical examination being by the buyer and also; sale of unascertained goods where the buyer was compelled to rely on the seller's description. While the former enquired into the purchaser's onus strictly, the latter was the exempted from it. This categorization was acceptable in an age where the commodities were relatively simple. However, over the past few decades the economic relationship of buying and selling has been reformed, and presently the strict liability of the buyers has been done away with by restricting it with the specified exceptions:   o    Implied conditions imposed on quality or fitness o    Sale of goods by description o    Usage of trade o    Consent by fraud o    Sale under a patent or trade name o    Sale by sample o    Misrepresentation   Mobile Apps and the concept of Caveat Emptor    "Do you trust this app?"   "Please permit the app to access audio and camera."   "Please enable the location services."   Homo sapiens may have invented everything required for their survival, but even they don't possess the ability to add a 25th hour in a day. There is always a shortage of time for anyone and everyone and amidst this shortage spending a few minutes to read conditions before permitting an app to use all our confidential information seems like a Herculean task.    Apps like Facebook and Snapchat are primarily based on making the location of its user's public clothed with fancy terms like status updates and check-in. Moreover, the world is now inhabited by animals called pokémons; some fly in the air while some breathe fire owing to the latest vogue Pokémon go which went on to become the most popularly downloaded app in the world within a few days of its launch but at what price? It not only tracks user's location but also their email and browsing history. A person can now order anything from clothes, books, kitchen appliances to furnishings without so much as raising their head from their smartphone. Health apps are readily available not only for lifestyle tips but also to diagnose symptoms, measure heart rate, blood glucose level, sleeping pattern, etc.    With easy access to technology and rapid increase in innovations, creating apps and making them available to the masses is a bed of roses but roses are invariably accompanied by thorns. Mobile apps can be considered an extension of offered goods and services. Higher the use of apps, higher is the chance of negligence.   It's not uncommon these days to find headlines reporting delivery of faulty products bought online, thefts based on knowledge derived from check-ins, wrong diagnosis and disclosing confidential information of an app user to other marketing companies which raise the question of whom would the ultimate responsibility fall upon? Are app users covered within the ambit of the doctrine of caveat emptor?   The important aspects in determining this answer lie in analyzing:   o    The purpose of the app o    The guidelines provided in the app o    The permissions granted by the user o    The nexus between cause and effect leading to negligence.   App development today is relatively easy, but a robust App platform that can keep pace with future developments, comply with international guidelines (including App Store guidelines) is imperative. App developers are also required to submit documents stating the purpose of the app, version information, and details regarding its interface along with obtaining certified permissions.    However, these regulations are not exhaustive and are completely controlled by private smartphone companies. Therefore, despite these regulations, the Apple's App Store alone boasts close to over 2 million Apps designed for the iPhone and iPad whereas Google's Google Play has nearly more than 2.2 million Apps making the app market a billion dollar industry.    In a recent case, Maynard v. McGee & Snapchat Inc. it was alleged that when a distracted driver caused an accident in order take his selfies with the speed filter, Snapchat Inc. was accountable as it encouraged its users to drive at excessive speeds. An analysis of this case suggests that Snapchat could devolve its responsibility by merely affixing a warning with the speed filter.   App creators of 'Pokémon Go' have repeatedly been blamed for the rising death toll and for placing Pokémons in dangerous milieus, and as a consequence, a warning pops up the minute a user opens the app asking them to be careful of their surroundings thereby shifting the responsibility to the players. They have publically defended themselves by comparing their application to automobiles which once transferred would abolish them from any liability in the instance of negligent driving. So, the next time a person falls off the cliff while catching a magical creature, it would be his fault.    Third-party responsibility   Ordered something online and then regretted it?    Digital Platforms like Amazon and ShopStyle pride themselves in being a handy tool that enables a user to shop varied products on the go from any place at any time by putting in the effort so much as moving a few fingers. However, what one fails to realize is that in the case of a defect these apps are indifferent and the blame game swings between the third party retailers listed on the app and buyers.    These platforms ensure their safety from any liability. The terms and conditions for Apps set out precise information by providing all information, content, materials, and products (collectively the Data) available on the Apps. They further clarify that such Data is 'classified' on the basis of "as is" and "as available basis" and any material or service accessible to the user by accessing the app would expressly be at the sole risk and consequence of the user. These apps, therefore, advantage from a blanket protection while the third parties become liable.   The provision of third-party responsibility has opened doors to numerous lawsuits regarding the extent of accountability of the retailers advertising and selling their merchandise with the help of these apps as the retailers contend that apps fail to specify the details of their products accurately consequently harming the consumers.    Guidelines and regulations   The provisions of the Universal Declaration of Human Rights have influenced various national Constitutions which have been amended to recognize the responsibility of the State in protecting and safeguarding the interests of the consumers. Different countries have established their regulatory departments like the FDA that overlook the quality and standards of the products made available to the masses.   These departments lay down the guidelines that govern health apps which diagnose symptoms of its users and provide consequent medical consultation. However everyday apps offering services like online shopping, gaming and transportation remain widely unregulated and unconfined. Hence, creators of health and fitness apps, have higher responsibility owing to the sensitive matters they deal with as compared to other apps.    Conclusion                   The modern free society is built on principles of liberty, and personal liability and every individual prefer to be accountable only for his or her action. Humankind has over the centuries struggled to gain independence but the flip side of freedom is responsibility, and such accountability in no circumstance can be eluded.    The evolution of phones from basic devices used for making and receiving calls to being 'smart' has been considerably accredited to apps which now are considered nothing short of a man's extended personality. Gone are the days when playing was used in the context of outdoor sport, people of every age today are engaged in collecting cards to clash, crushing candies or surfing the subway with the help of user interface. These apps are on their way replace local markets, dictionaries, and even the weatherman!    Since buyers and sellers are now more closely related than ever, people need to be aware of the good and services they access, and hence the doctrine of 'caveat emptor' retains significant importance.  However, a shift has been observed in the judicial thought from caveat emptor to caveat venditor which literally translates to "let the seller beware". It directs responsibility towards the sellers keeping in sync with this age of consumer protection, but it can only be justified when there is a disproportion of power between the contracting parties as it completely contradicts the principle of laissez faire.   Unfortunately, modern legislation continues to remain highly ambiguous regarding the applicability of both caveat emptor and caveat venditor in the case of apps despite them transforming us into digital denizens. As a consequence, there is no straight jacket formula or a particular platform except filing suits in a court of law for settling disputes regarding transactions between parties over these apps.   It's high time that lawmakers caught up with the creative heads of the world as I sit and ponder how Romeo and Juliet's fate would have turned out if they could what's app each other while dismissing another reminder on my phone to drink water.    This article was principally authored by Aashima Sawhney with help of others in STA's Technology, Media and Entertainment Team       ]]>
    Mon, 31 Jul 2017 08:00:00 GMT
    <![CDATA[Too Much of FATCA]]> Too Much of FATCA!

    Renowned author and entrepreneur, Mark Twain, once said, 'tax is a fine for doing well; whereas, a fine is a tax for doing wrong.' Now, the question on hand is which one of the two the Foreign Account Tax Compliance Act (the FATCA) would get unseated! Is it a tax or a fine? Let's read further to find out.

    The FATCA promulgated on March 18, 2010. It was introduced in line with the Hiring Incentives to Restore Employment (HIRE) Act, and the then President Barack Obama signed FATCA into law to help the United States Government, through the Internal Revenue Service (IRS), curb tax avoidance by US citizens and entities on assets held in offshore accounts. FATCA is a comprehensive, and complex arrangement of tenets intended to impose tax compliance upon American citizen regarding assets outside the United States and such citizens are required to report such assets to IRS. Importantly, also, foreign financial institutions are also obliged to comply with the reporting requirements under which these financial institutions have to provide information and details to IRS about the accounts held by such US citizens or non-US entities in which US citizens hold significant ownership.

    The Why

    As outlined above, the intention of the US government to enact FATCA was to increase transparency for IRS to counter tax evasion by U.S. persons holding investments in offshore accounts. FATCA is a tool to keep a check on US persons who may be investing and earning income through non-US financial entities. FATCA mandates U.S. 'persons' holding foreign financial assets with an aggregate value exceeding US$ 50,000 (US Dollars fifty thousand) to report essential information about those assets on Form 8938. This Form 8938 will be attached and annexed to the taxpayer's annual tax return.  The disclosure requirement mandates taxpayers to report assets held in taxable years commencing after 18 March 2010.  For a majority of taxpayers, this disclosure will be the year 2011 tax return which they file in the 2012 tax filing year.  Failure by taxpayers to report foreign financial assets on Form 8938 will attract a penalty of $10,000 (and this may be raised up to $50,000 for continued noncompliance after IRS issues notification to the defaulting taxpayer(s)).  In cases where IRS notices any underpayment of tax payable on non-disclosed financial assets held by taxpayer overseas, an additional penalty of 40 percent will trigger.[i]

    Importantly, the term 'U.S. Persons' is a broad category which includes citizens of United States, those residing within the US, holders of US green cards and trusts that are controlled by US Persons. IRS has also set extensive norms, and criteria for banks (domestically as well as overseas) wherein the banking machinery will be required to screen each and all client(s) to determine whether such person(s) falls within the definition of US Person. Foreign entities will get classified as either Foreign Financial Institutions (FFI) or Non-Financial Foreign Entities, and such entities will have to comply with FATCA reporting rules.[ii]

    FATCA mandates compliance by US citizens and entities in the following methods:

           i.          Direct Agreements – agreements between the parties and IRS for compliance purposes; or

          ii.          Inter-Governmental Agreements (IGAs) – agreements between various jurisdictions and the US.

    In the case of the latter, financial institutions in the jurisdictions that have an underlying IGA with the US are mandated to submit the disclosure information to the tax authorities of their respective jurisdictions. The domestic tax authorities would then send the information to the US Treasury to comply with the provisions of their IGA.

    However, it's easier said than done! The demanding role of FATCA compliance primarily revolves around the sanctions that would apply on FFIs that are in breach of compliance with the reporting requirements and disclosures of FATCA. Non-compliant FFIs would have to pay a penalty of 30% of withholding tax on all US-sourced payments.

    Further, taxpayers benefitted from IGA during the period in which their government tries to implement the same with the US government. However, this policy of the IRS got revoked on 29 July 2016 on the basis that the Department of Treasury would implement a new list of jurisdictions that had valid IGAs with the US and subsequently, discard jurisdictions that had not yet implemented the same. Therefore, governments can avoid removal from the list by submitting an explanation as to the reasons why they have not implemented the IGA along with a process detailing how the jurisdiction will enforce the IGA in this regard. Subsequently, the Department of Treasury will not strike out the name of that particular country if convinced that the particular jurisdiction has demonstrated a 'firm resolve' to implement the IGA. Although, notably, the name of the country may, later on, be removed from the list if they fail to adhere to the norms and timeline which was set out in its explanatory submission to the Treasury.[iii]

    Hence, any FFI failing to comply with the above-said provisions of the FATCA will result in FFI paying a withholding tax of 30% of its payments received from a US source. The next cardinal question that arises in this subject is regarding the ambit of the 'US-source payments.' This scope gets further elucidated with the help of the following instance: US-source payments is set to cover all payments to the non-compliant FFI from a US source such as principal amounts that mature from corporate or government bonds, dividend received from US entities and the like. This element is considered to be a bane in the financial industry since US stocks and bonds have a significant part to plan in the globe's financial sector.

    The When, Where and How

    The sanction of imposing a withholding tax amounting to 30% of all US-source payments came into effect on January 1, 2014. To the awe of global economy, gross proceeds that arose from the sale of a US security also came under the scrutiny of this worldwide tax imposition in January 2015. However, the withholding of tax on foreign pass-through payments by FFIs was delayed to 1 January 2017.[iv]

    The implementation of the FATCA has proved to be an effective method to suppress the actions of US person who yearned to evade their tax liability by transferring or using financial institutions located outside the US. However, it has also given rise to various issues regarding the implementation procedures that ought to be followed by the US.

    The primary concern with the implementation of FATCA surrounds the compliance issues of domestic financial institutions in a broad range of matters including data and consumer protection, anti-discrimination statutes and the earlier withholding tax law of the US. Numerous countries had explicitly made their concern regarding FATCA compliance to be in direct conflict with the data protection and privacy laws that are already in place either in their domestic jurisdictions or in the US itself.

    However, this is only the commencement of the large list of issues that pose to oppose the implementation of FATCA. The overall cost of implementing the law is also expected to outrun the anticipated revenue that it is likely to rise.  Further, the rationale behind compelling foreign institutions and governments to gather information regarding US citizens and entities solely to transmit them back to the US Government resulted in reactions from financial pundits, some of whom cited this as a 'decisive' action.  This rationale may also give rise to a predicament whereby foreign institutions and banks may deny US citizens and entities from opening banks accounts at their respective establishments.  Another crucial aspect of this issue is the increase in the number of US citizens who are willing to surrender their citizenship due to the mandatory compliance conferred upon them.[v]

    Further, the model IGA also mandates a mutual transfer of information from the US Government to the governments of other jurisdictions. However, the significant concern with this provision arises because there does not exist a specific US statute or regulation that permits such reciprocity. The rise in scrutiny regarding the legal validity of FATCA has also stirred controversies and questions in countries such as Canada and Israel; however, the high court of the latter jurisdiction confirmed and permitted the compliance requirements of FATCA subsequently.

    Conclusion

    The implementation of FATCA is considered to be advancing expediently, although, numerous nations have contended the global impact of the compliance requirements that arise due to FATCA. Certain jurisdictions such as the United Arab Emirates which have been generic tax havens have also conformed to the requirements of FATCA due to the financial havoc that non-compliance of the statute may create on a domestic level. This conformity is because a 30% withholding tax by the US Government is a fatal step than conforming themselves to the statute.

    The FATCA is expected to close the loopholes and tax evasion schemes used by US citizens and entities with the view of substantially increasing the tax receipts over time since; the implementation is only a one-time process; whereas, the revenue receipts may not stop flowing in!


    [i] https://www.irs.gov/businesses/corporations/summary-of-key-fatca-provisions

    [ii] David Kuenzi, "What is FATCA? What do American Investors need to know?", Thun Financial Advisors, 2017.

    [iii] Ramon Camacho, Ben Wasmuth, "Intergovernmental agreements must be in force by Jan. 1, 2017", Tax Alert, August 2, 2016.

    [iv] S. Bruce Hiran, "Overview of FATCA," Tax analysts, August 29, 2016.

    [v] "5.5 Million Americans Eye Giving Up U.S. Citizenship, Survey Reveals", Wood., Forbes, October 27, 2014.

     

      ]]>
    Wed, 19 Jul 2017 07:00:00 GMT
    <![CDATA[Cyber Crimes & Courts]]> Cyber Crimes & Courts

    Jurisdiction (by default) is the practical and ultimate authority within the legal society to administer, review and to execute laws and regulations within a well-defined area of region and responsibility. Therefore, immediately following the commission of a crime within a particular state, the judicial body in that province would have the jurisdiction to hear the matter. However, which court will have the authority and seat to settle and listen to a crime that occurred on the web? The question we raise here is how does one determine and find the right venue and court that has the authority to adjudicate and decide on internet crimes? Now let's take this a step further. What happens in cases where a crime is committed by a corporate entity that has practically no physical office anywhere on the planet? Is a globally accepted IT Law practically possible?  

    An abundance of confidential data gets stored in a dark fluorescent room of every office. This sensitive data may be simple log files worth nothing or sensitive trade secrets worth millions. It is hence crucial for corporates and multinationals to recognize cyber crimes and identify the courts that would have the jurisdiction to settle and hear their rightful claims. The virtual world of internet seamlessly connects parties from one part of the world to the other. Someone based in remote part of Northern Asia may well be in a position to hack and gather information from a computer system owned by a multi-national in the United States.

    In general matters, court's jurisdiction depends on: i) defendant's place of residence, or ii) the states where the cause of action arose. Now, speaking specifically of cyber crimes, such crimes occur within the virtual network using electronic means. Every corporate, small or big is today prevalent with technology and deploy primary to state of the art infrastructure including servers that serve the evolving requirements for robust, agile and heavy workloads through flexibility, modularity, and ease of operation. That said, the location of the company and its server need not be within the same vicinity or for that matter - even within the same country. A company based in Singapore may deploy its servers in Romania, for instance. Also, web users do not wear an invisible cloak to conduct their activities online. Online users are subject to domestic laws of their own country of residence. However, for matters on cyber crimes, such users may be tried and sued in another country where anyone alleges the individual of having committed an internet related crime. For these reasons, jurisdictional aspect has a large role in internet related crimes. The important question about internet jurisdiction is to determine whether to regard cyberspace as a possible physical location or whether to pretend that the web is a unique world altogether! Till date, there is no unified legislation on internet accorded and accepted by countries globally. The terms and conditions for a website in one country are till date different from that of the other. 

    The American View 

    The due process clause under the Fourteenth (14th) Amendment to the US Constitution has prescribed the validity of personal jurisdiction. The US courts often resort to personal jurisdiction as a tool to determine the seat and power to adjudicate. Accordingly, action cannot be brought against someone overseas unless an underlying relation exists that would allow the defendant to expect that matter is being instituted against him in a particular forum. For instance, the US lower courts have held that an individual act of creating a hosting a domain available on world-wide-web does not by default confer internet users to general jurisdiction all across the country. That said, the US Supreme Court has held that courts can confer personal jurisdiction over non-residents where the only source of contact with the country was the internet. The Supreme Court, however, did not evaluate any technological impacts on personal jurisdictional aspects. 

    The above findings of Supreme Court elucidated in the infamous matter of Zippo Manufacturing vs. Zippo Dot Com, Inc. where the Plaintiff leveled trademark infringement violation against the Defendant on the premise that Defendant provided online services using their distinct name Zippo. The Defendant in the present case was a non-US person. The Courts while deciding on the matter had taken into consideration that Defendant had knowingly dealt with and conducted business with residents of California where Plaintiff's headquarters were based. The Court passed the decision in favor of Plaintiff. The California District Court also adopted a similar resolution in the case of Panavision International, L.P. v. Toeppen where Defendant had designed a website with the sole intention of making Plaintiff purchase the domain from Defendant. The Defendant in the present matter was based in the US state of Illinois and had no direct, or known contact with the State of California. This would mean that the District Court in California did not have a direct jurisdiction over the Defendant. Regardless, the court held that it had particular jurisdiction given the actions of Defendant which had adversely affected the rights and actions of Plaintiff regardless of physical presence within the jurisdiction of the court.

    The California (District Court) in  McDonough vs. Fallon McElligott, Inc.[i]  had a differing view. In this matter, Plaintiff brought an action against the Defendant on the grounds of copyright violation and resorting to unfair competition laws. The Defendant posted Plaintiff's photographs without consent. The Court refused Plaintiff's claim and held that residents of the State were using Defendant's website and the Internet is a gateway to unrestricted access to information and posted material.

    A Look at Europe's Legal Position

    The European Union Regulation 1215 introduced in 2012 (the Regulations) provides a broad framework for the jurisdiction of EU courts in civil as well as commercial claims. The Regulations spell out the golden rule that EU courts can assume jurisdiction based purely on the premise of the domicile of the defendant. However, this imposes an impediment in several matters as determining the actual domicile of a party gets complicated even in circumstances where the victim is in effect able to identify the location. That said, the domicile of the defendant does not get determined by his/her IP (internet protocol address). The internet protocol link/address or the "IP address" of a machine only points the location of the computer and the user surfing the web on that PC. The Defendant's domicile, on the other hand, is determined by his actual place where he/she conduct business. The European Commission's Directive on Electronic Commerce dealing with internet laws does not set out express provision concerning court's jurisdiction in deciding on matters related to cybercrime. Also, the United Nations Convention(the Convention) on the use of Electronic Communications in International Contracts has clarified by defining the location of party or parties (domicile) as their place of business.

    In cases where parties explicitly agree to submit their disputes to individual court, such court would inevitably assume jurisdiction in the event of any conflict. The only exception to this general rule occurs in cases where a software company is a party to claim and has executed an agreement with other. Cases where corporates, government, and individual undertakings suffer substantial damage on account of hacking or cyber-crime, malicious attack, DDOS attempt or attack due to the acts of the attacker, the state where victim entity or individual is based, the courts within such state could assume jurisdiction and decide on the matter. Likewise, consumers and online buyers also get afforded the right to sue the other in the member state of the domicile. It is fair to mention that the courts within EU have a well-regarded framework to determine the jurisdiction of courts in matters involving cybercrimes. Internet transactions may require and cross many political borders. The legalities involved in cybercrime may differ from one country to other. 

    Conclusion 

    The rise in cyber crimes and online attacks, phishing frauds and related criminal acts have and continue to affect individuals, corporate entities, governments, and politicians. Is a global IT law truly possible? Would it be possible to ensure enforcement, impose criminal sanctions and set out clear procedures? Would it at least be possible to identify some broad areas that could cover and address on a global scale? If so, how would the Global IT law impact other domestic legislation(s)? If such law were enacted, would it be possible to raise claims electronically and whether decisions will be rendered online? The Digital Millennium Copyright Act (the DMCA) which is a United States copyright legislation implements two (2) 1996 treaties of the World Intellectual Property Organization (the WIPO) and has made concerted efforts on global copyright violations by allowing individuals and entities to enforce website takedown using its online service. Microsoft has recently taken steps towards receiving requests for copyright violations. A concerted effort would be required to introduce a one piece legislation that could put several questions at rest.


    [i] 952 F. Supp. 1119

    [ii] 141 F.3d 1316 (1998)

    [iii] 40 U.S.P.Q. (2d) 1826 (S.D. Cal. 1996)

     

     

        ]]>
    Sat, 24 Jun 2017 04:00:00 GMT
    <![CDATA[Spotting the Fake: Forgery Under UAE Law (Part 2 of 2)]]> Spotting the Fake: Forgery Under UAE Law 

    Part 2 of 2

    In the previous issue, we discussed material aspects relating to forgery under UAE Criminal Laws and other statutes. We discussed broadly – the definition of forgery, types of forgery (material and moral), legal implications of denial in light of the law of evidence and finally we referred to some relevant court decisions on the matter. Mr. Ghany continues with part 2 of this two-paper series and discusses other broader aspects relating to challenging a claim based on the forgery, procedures for the challenge, and relevant court precedents on the matter.

    Everyone should have enjoyed the thrill in forging their parent's signature on a sick-leave note for school or in watching the tales of the celebrated forger, Frank Abagnale, in the 2002 thriller 'Catch Me If You Can'. However, what if someone forges your signature on a cheque amounting to millions? Or in a document relating to the fraudulent sale of your apartment? Yes, doomed is the right word! It is, therefore, significant to envisage about the procedures that have to be followed in a predicament of forgery. Federal Law No. 10 of 1992 regarding the Evidence in Civil and Commercial Transactions (the Law) deals with the provisions that govern the hornet's nest of forgery in the Arab nation.

    The 'curtain-raiser'

    The provisions of the Law and the pronouncements of the courts in the country has manifested that a defendant cannot dispute the authenticity of an official document by his mere denial. Rather, the defendant is required to challenge the document on the grounds of forgery which was attributed to him by his handwriting or signature, stamp or finger-print. Similarly, a party will have to challenge the document on the grounds of forgery if he has admitted the validity of the stamp but has denied the impressions or the particulars contained in the same document. This can be elucidated with the help of the following illustration: Suppose, the director D of company A has disputed the authenticity of the particulars of a document after accepting that the stamp on the letterhead of a document belongs to company A. In this instance, D would be required to challenge the document rather than simply denying its authenticity.

    Help Yourself!

    The Law has provided that a party who challenges the authenticity of a document is placed with the burden to prove the subject matter of his challenge and supplement the same with a memorandum. The judgments of the court have also aided in providing an undisputed interpretation of articles 23 of the Law regarding the subject matter of a party's challenge of a document. However, the court does not have the obligation to verify the document if the party claiming the forgery has not provided any substantial evidence or if he has not requested for an investigation of the same. Further, the authenticity of a document can be challenged on the grounds of forgery at any stage of an ongoing litigation. Provisions from articles 28 to 32 of the Law has provided for the procedures to be followed in an event of forgery. The Law provides that a memorandum, challenging an allegedly forged document, should be submitted to the court with following particulars:

    ·        the points of the alleged forgery;

    ·        his evidence; and

    ·        the process of investigation which should be followed in order to prove the forgery.

    However, it is not necessary for a party to defer until a forged document has been brought against him as the nation believes in the policy 'prevention is better than cure'. Hence, article 33 of the Law entitles a party in an informal document to institute a suit in order to pursue the other party to admit that the underlying document has been imprinted in the handwriting, signature, seal or fingerprint of the latter party. Further, the document would be considered to have been imprinted by the defendant if he does not deny it. However, an investigation would be initiated if the defendant has denied his role in the execution of the document in question. The 2010 judgment[1] of the Dubai Court of Cassation had relied on this provision and provided that any party who apprehends the future use of a document has the right to challenge the same on the grounds of forgery.

    In cases where Mr. A submits a document (say, a receipt) before the court against Mr. B and upon review of the receipt, Mr. B invokes a claim for forgery, in such cases – Mr. A can request the court to suspend and cancel the proceedings on the premise that he will not rely on the said receipt. The courts in such instance demand custody of the receipt (and; other documents if any) if Mr. B requests the courts to do so to maintain B's interest. That said, it is imperative to mention that the courts in their absolute discretion may reject Mr. A's request if in the opinion of the court – the receipt is in fact forged.

    Furthermore, a party who apprehends to be confronted with a forged document is also entitled to institute a suit against the holder of that document under article 34 of the Law. The Dubai Court of Cassation has taken the view that the scope of article 34 is to be provided for those who fear or apprehend the use of a forged document. Furthermore, the court has stated that the authenticity of a document cannot be challenged if it has been used or relied upon by the parties. Therefore, it is imperative to percept that a suit for forgery must be instituted immediately after the forgery has been apprehended by the party. A separate suit, however, need not be filed by a party if the forger of a document has relied on the same for instituting an existing suit.

    Further, in an infamous case that was disputed before the Dubai Court of Cassation, a person disputed his signature on a guarantee and consecutively, the court ordered in its remitting judgment that the document be passed to the crime laboratory for a comparison to be made between the true signature of the person alleging the forgery and the signature appearing on the document, in order to establish whether he was, in fact, the guarantor of the debt the subject matter of the action.  Instead of sending the document to the crime laboratory, the appeal court to which the case was remitted instructed an expert to express an opinion on whether the genuine handwriting and the handwriting in the document were the same and to state whether writing had been subsequently placed on a document signed in blank.  The expert was not able to express a conclusive opinion as to whether the signatures were the same; however, he did express the view that the document was signed in blank and that the terms of the document were filled in later. Further, the court of appeal took the view that this invalidated the document.  However, this judgment was wrong at law, as there is nothing to prevent a document being signed in blank and then becoming a valid document when further particulars are filled in, provided that the person who has signed in blank has authorized this to be done, and there is no fraud involved.  Further, the Court of Cassation had specifically ordered that the document is sent to a crime laboratory for a comparison between the true signature and the allegedly forged signature.  The court of appeal did not abide by that order, whereby the judgment of the court of appeal was deemed defective and was consequently set aside.

    In another case, the Cassation Court of Dubai observed that the ratification of a document does not prevent a challenge for forgery as the same can be made against any documents whether formal or customary or issued outside the country[2]. The suit for forgery would be maintainable even if the document has been attested by the official authorities of the country in which the documents were issued.

    The Judiciary

    The Law has conferred the court with the authority to order for an investigation if the same is not convinced with the facts and evidence regarding the veracity of a document; or if the court deems that the investigation requested by the party could produce a justifiable outcome. Such an investigation would be carried out by verifying the documents or obtaining testimonies of witnesses or both. Further, the investigation process would stand suspended if the party challenging the authenticity of the document relinquishes his claim. However, the court would subsequently seize the document if the challenging party has abandoned his claim at any stage of the investigation. The Law has also conferred the courts with the authority to reject a document on the grounds of forgery, even if the parties have not challenged the authenticity of the same. However, the court is required to explicitly state the circumstances and the evidence which proved the fraudulent fabrication of the document. Further, the courts can order for an investigation into the issue of forgery if the appointed forensic laboratory is not convinced with the scope of evidence that has been provided to it[3]. Therefore, it is evident that the Law has provided for effectual provisions regarding the protection against forgeries in the nation. However, one should invariably conduct due diligence about legally binding documents before authorizing or signing them.

    This concludes the two-part series on forgery law. STA's team of criminal lawyers in Dubai and other offices will continue to deliver bespoke legal information that will lay your curiosity to rest. Court Uncourt is now available on Apple iOS and Google Play. Thankfully, Apps cannot be forged at least as of now!


    [1] Commercial Appeal No. 260 of 2010

    [2] Ruling of the Dubai Court of Cassation in the Civil Appeal No. 228 of 2009

    [3] Ruling of the Dubai Court of Cassation in Commercial Appeal No. 3 of 2010

     

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    Mon, 01 Aug 2016 08:07:00 GMT
    <![CDATA[Life of Debt: India's SARFAESI Act on Non Performing Assets]]> Life of Debt

    'If I owe you a pound, I have a problem; but if I owe you a million, the problem is yours!'

    -John Maynard Keynes

    Graffiti had set its tone loud and clear; just no one acknowledged it. The bad loan episode that recently gripped India's banking sector certainly did not trigger overnight. The timing of this article also could not be better – the recent Vijay Mallya (now a proclaimed offender) fallout and its aftermath is one story that has been hitting the news headlines on one hand and Subrata Roy of Sahara Group who is out on interim bail (but; not released) also happens to be in news. So, why is the timing perfect, you may ask? In the former case, Mallya managed to escape prosecution in India by evading his homeland whilst the latter was arrested and this resulted in (and; continues to) disposal of his assets domestically within India as well as overseas. 

    Banks, after all, play a fiduciary role in acting as trustees or custodians in the distribution of domestic currency. Mobilizing deposits is crucial and vital for any developing country. Domestic funds, on one hand, promote the economic growth by controlling the flow of currency and paves way for development on the other. Banking institutions employ a great deal of infrastructure, manpower, time and strategies in mobilizing the deposits. Banks' lend and invest based on deposits, reserves, and borrowings.

    The asset quality held by banks reflects the quantity of existing and potential credit risk associated with the loan and investment portfolios, other real properties owned, and other fixed or current assets, as well as off-balance sheet transactions. Critically deficient asset quality or credit administration process can be detrimental to banking business and can result in a severe negative effect on the bank, its business, its performance indicators such as credit rating, liquidity, revenue generation, and operation and control of the bank. Critically deficient asset quality results in accumulation of non-performing assets (the NPAs)

    So, what are Non-Performing Assets really?

    In a bank's purview, all loans and advances that it issues to its borrowers are considered as assets as it results in revenue generation for the bank by collecting interest. However, these institutions do not undertake a coherent due diligence and investigations to scrutinize the authenticity of the underlying collateral or the capability of the borrowers to repay their debts. In essence, the bank's revenue stream, it is standing, and creditworthiness will be in jeopardy; should the debtors' default in their payments.

    The Indian parliament realizing that turning a blind eye won't help decided and passed the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (the SARFAESI Act) with a view to safeguarding the interests of the secured creditors against defaulting debtors. Section 2(1) (o) of the SARFAESI Act dealing with non-performing assets (an NPA) provides that 'NPA is a loan which has been classified by a bank or financial institution as sub-standard, doubtful or loss asset'. Further, a circular released by the Reserve Bank of India (the RBI) in 2014 states that a loan can be classified as sub-standard, doubtful or loss asset if the debtor has not paid its interest within 90 (ninety) days from the due date. This means that a loan account would be categorized as an NPA if its interest remains due for more than 90 days.

    Earlier, a secured creditor's sole recourse to realize an unpaid loan was to initiate a suit in a court of law to execute the underlying collateral property. The creditors were at a comparatively weaker position in this scenario as the judicial process was lengthy and exorbitant. Therefore, the main objective of the SARFAESI Act was to curtail the delay in the process of adjudication by empowering secured creditors to realize the underlying collateral without instituting a suit. Section 13 of the SARFAESI Act provides that the secured creditor of an NPA could send a written notice to the borrower requiring him to repay all his liabilities. Subsequently, the secured creditor would be authorized to undertake any of the following measures without the intervention of the court if the borrower has failed to repay his liabilities within 60 (sixty) days from the date of notice:

    •  to acquire the possession and the right to transfer the secured asset of the borrower;
    • to take over the management of the borrower's business which is the underlying collateral of the secured loan;
    • to appoint a person to manage the secured asset of the borrower;
    • to send a written notice to any person who has acquired the secured asset from the borrower or from whom any money is due to the borrower.

    The Muddle in the Financial Industry

    The SARFAESI Act has provided for lucid provisions regarding the power of a secured creditor to acquire the collateral of an NPA. However, the detrimental competition in the financial sector has adversely transformed the de rigueur of banks in order to increase the net value of their assets. Hence, they provide loans and other credit facilities without conducting an efficacious due diligence process regarding the borrower and their secured assets. Banks and financial institutions line up in order to provide large corporations with immense amounts of loans as this would substantially increase the asset value of the former. These institutions issue immense amount of loans to corporate giants without conducting thorough appraisals on the authenticity of the borrower. Further, these institutions are forced to reduce the minimum collateral required for corporate debts due to the goodwill of the large corporations and the enormity of the value of these debts. Therefore, banks are lured into issuing loans without obtaining adequate tangible collateral securities on the same.

    Further, banks and financial institutions do not inquire about the corporations' strategy to administer and discharge the loans. This implies that the banks do not exercise any kind of control over the debts once they have been issued. Therefore, top executives of the borrowing corporations are at the liberty of diverting these loans to other unrelated businesses or for their personal benefits. The borrower corporations cite a lack in profits or unfriendly governmental policies when they fail to meet the due dates of payments. The infamous case of the forlorn Kingfisher Airlines manifested this drawback in the financial system of the country when its CMD, Vijay Mallya, used the finances of United Breweries Limited in order to fund the working of the airline company. Further, the corporate governance standards of the country are also defeated when top executives of corporate giants exercise ultra vires acts to appropriate the company's debts in order to meet their own whims and fancies. This substantially increases the possibility of borrowing corporations to manipulate the loan amounts in order to finance other entities without the bank's knowledge. However, banks do not have the necessary framework to scrutinize the loan applications based on the authenticity of the borrower and the underlying secured collateral. Hence, the borrowing corporations take undue advantage of the bank's failure to effectively monitor the appropriation of the loan amounts before and after its disbursement.

    Securitization: The Antidote?

    Earlier, banks were the primary intermediaries of the financial sector of the country. However, other types of financial intermediaries came into existence with the introduction of various financial products that aided in stabilizing the financial industry. Banks and other financial institutions require excessive amounts of liquid cash in order to facilitate their daily operations. However, the assets of these institutions are blocked in various assets such as loans, advances, overdrafts etc. Therefore, their debt-equity ratio and capital requirement are adversely affected due to this blockage of funds. This impediment is eliminated by the application of financial products such as securitization which succors the financial institutions in obtaining funds through the sale of existing financial assets. In the primary stage, the financial assets of banks and other financial institutions are combined and transformed into marketable securities. Subsequently, these marketable securities are sold to third-party investors in the form of bonds or collateralized debt obligations (CDOs). Therefore, securitization is the financial practice of converting the financial assets of banks and other financial institutions, into marketable securities in order to sell them to third-party investors.

    A major drawback in the Indian securitization market is the lack of a substantial legislation to exercise and administer the transactions regarding securitization as the country is a relatively new player the market. However, the RBI has issued guidelines regarding the governance of securitization since the banks and financial institutions are the key participants in this market. Further, the parliament introduced the Finance Act of 2016 with the primary objective of amending the taxation laws relating to the securitization market in order to strengthen and expand the same.

    The SARFAESI Act has provided for the institution of securitization companies and asset reconstruction companies in order to facilitate the process of securitization in the country. These companies are permitted to acquire the right arising from loan assets of banks and other financial institutions for the purpose of selling them to other investors. Section 5 of the SARFAESI Act provides that securitization and reconstruction companies can acquire the financial assets of banks and other financial institutions by entering into an agreement with the latter or by issuing debentures, bonds or securities.

    Prevention is Better than Cure

    Banks and financial institutions in the country have been tormented due to the pressure of the amplifying number of loan defaults affecting their credibility and overall financial condition. Hence, these financial institutions should strive to develop an effective monitoring process in order to determine the actual credibility of the borrowers prior to issuing loans and advances. Banks should conduct scrupulous periodic surveys on its debtors in order to defeat plight of the dying banking industry in the country. Frequently, the borrowers provide the banks with unidentified and marginalized collaterals in order to obtain high-value loans. Therefore, the risk of nonpayment by the borrowers could be narrowed by scrutinizing the veracity of the collaterals which are provided by the borrowers. The financial institutions should also overview the application of the funds' post disbursement of the loans in order to corroborate that the funds are not utilized by the borrowers for any fraudulent or illegal purposes. In essence, these financial institutions should implement a streamlined appraisal process to contemplate the meticulous employment of the loan amounts. Spasmodic internal and external audits by banks and the RBI could aid in identifying the obscure NPAs in the books of accounts.

    Banks and financial institutions should be urged to disclose their NPAs on a regular basis to ensure that the deliberate defaulters are not issued loans elsewhere. Substantial legislation to counter red-tapism in the industry should be enacted by the parliament as the quintessential financial industry is the principal catalyst of a rapidly developing country. Therefore, it is essential to maintain utmost transparency to apprehend any corrupt or fraudulent activities in the industry.

    Further, the RBI should endeavor to enforce effective regulations in order to elevate the transparency in the financial sector. The latter should take necessary precautionary measures to avoid another recession as it is the central regulator of the country's financial and banking sector. A recent report that the RBI had submitted to the Supreme Court of India has caused widespread panic in the financial sector as it revealed the details regarding the extent of bad debts that were borne by the banks in the country. Further, the inefficiency of the authorities to curb the issue of the NPAs could result in a serious impediment in the banking sector. The sour truth is that such impediments are the cardinal reasons that crash the economy of a rapidly developing country.

     

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    Mon, 01 Aug 2016 08:04:00 GMT
    <![CDATA[Corporate Liability: UK Bribery Act]]> Corporate Liability: The UK Bribery Act

    If you can shift your thinking away from merely selling and into building trust instead, even if it costs you a few bucks in profit, you'll begin to see opportunities you never imagined once you understand what it means to 'wow' that customer by giving them more than they expected!  

    Chris Zane

     

    Promising an incentive to stevedores to discharge a vessel in a timely manner, giving a bottle of whiskey to a customs official to avoid delays, or offering a large box of cigarettes to a port agent so as to receive special treatment. Activities such as these have always run the risk of falling foul of the criminal laws.

    In this article, we discuss corporate liability and how the United Kingdom has drawn the boundaries to prevent the executors. Who can these executors be? The US law once held that "a corporation cannot commit treason, or felony, or other crime, in its corporate capacity through its members may, in their distinct individual capacities"{C}{C}{C}{C}{C}{C}{C}{C}[i]{C}{C}{C}{C}{C}{C}{C}{C}. That perception has been changed over time. First, it was agreed that a corporation might be held criminally liable for its failure to honor certain legal obligations (nonfeasance) then for the inadequate manner in which it performed certain legal obligations (malfeasance). In the UK context, Lord Reid held:

    "Where a limited company is an employer difficult questions do arise in a wide variety of circumstances in deciding which of its officers or servants is to be identified with the company so that his guilt is the guilt of the company…. A living person has a mind which can have knowledge or intention or be negligent and he has hands to carry out his intentions. A corporation has none of these: it must act through living persons, though not always one or the same person. Then the person who acts is not speaking or acting for the company. He is acting as the company and his mind which directs his acts is the mind of the company.

    The concept of corporate criminality has always been complex as it forges a link of the criminal law and the corporate forms, where the latter was developed in the context of natural person and to punish their acts and the former can only be served by the actions of human within the matrix of hierarchies, structures, policies and attitudes. Legally, it is intractable as to what degree the crime has been committed and what shall constitute a crime committed by the corporation. However, in the recent past the approach to admeasure a relation between the corporation and its employees and agents, has developed a legal fiction that the state of mind of employees and agents can be said to be the state of mind of the corporate entity."{3}_4}

     

    Introduction

    The United Kingdom (UK) has clear regulations in place dealing with corporate misdemeanors. The two statues which play the most crucial role to neck this are the Corporate Manslaughter and Corporate Homicide Act 2007 (CMCHA) and the Bribery Act 2010 (Bribery Act) - both of which focus attention on the management systems and controls of a corporate entity. It has been said by one of the jurists that "It doesn't matter who you are, what you do, if you break the law there will be consequences."

    In particular the Bribery Act, which imposes liability for failure to prevent an act of bribery unless the entity demonstrates that it had adequate procedures in place to prevent such an act occurring, is a considerable change in the approach towards corporate criminal liability. An important feature of the new Bribery Act is its extra-territorial reach and its application to non-UK companies. A foreign company which carries on any "part of a business" in the UK could be prosecuted under the Bribery Act for failing to prevent bribery committed by any of its employees, agents or other representatives, even if the bribery takes place outside the UK and involves non-UK persons.

    What Constitutes Bribery

    A bribe is paid or received where one person provides a benefit to another person with the aim of inducing another person to do something which is improper in the eyes of a reasonable person in the United Kingdom. An offense will be committed even where the bribe is only offered or solicited, but not actually transferred. For a person to commit the active bribery offense, there has to be intention, knowledge or belief on the part of that person in addition to the giving of the bribe. Both the active and passive offenses incorporate the notion of "improper performance", or "wrongfulness element" as it is described in the Prosecution Guidance. The key to whether an offense has been committed is the connection between the bribe and this "wrongfulness element"; without the connection, no offense is committed.

    The Bribery Act – Quick Overview

    The Bribery Act 2010 received Royal Assent on 8 April 2010. The Bribery Act creates a new offense under section 7 which can be committed by commercial organizations which fail to prevent persons associated with them from committing bribery on their behalf. It is a full defense for an organization to prove that despite a particular case of bribery it nevertheless had adequate procedures in place to prevent persons associated with it from bribing. Section 9 of the Bribery Act requires the Secretary of State to publish guidance about procedures which commercial organizations can put in place to prevent persons associated with them from bribing. This guidance sets out the common approach of the Director of Public Prosecutions, the Director of the Serious Fraud Office (SFO) and the Director of the Revenue and Customs Prosecutions Office to the prosecution in England and Wales of corporate offending other than offenses of corporate manslaughter. Offenses under the CMCHA are prosecuted by the CPS, which has issued separate guidance on those offenses.

    In order to determine the liability of the corporate, there are mainly two principles which are relied upon as:

    1.      {C}{C}{C}{C}{C}{C}{C}{C}The first technique is the "identification principle" whereby, subject to some limited exceptions, a corporate may be indicted and convicted for the criminal acts of the directors and managers who represent the directing mind and will and who control what it does. This concept has developed over decades and in the case of an offence involving proof of a mental element (mens rea), such as many corruption offences, it is possible to combine proof of the act itself (the actus reus), on the part of an employee or representative of the company who would not form part of the controlling mind with proof of mens rea on the part of a person who does form part of the controlling mind.

    2.      {C}{C}{C}{C}{C}{C}{C}{C}The second technique of vicarious liability was used from as early as the nineteenth century. Although, in general a corporate entity may not be convicted for the criminal acts of its inferior employees or agents, there are some exceptions, the most important of which concerns statutory offences that impose an absolute duty on the employer, even where the employer has not authorised or consented to the act. Wherever a duty is imposed by statute in such a way that a breach of the duty amounts to a disobedience of the law.

    Insight to the Office of Serious Fraud Office  

    The SFO was created and given its powers under the Criminal Justice Act 1987 and was established in 1988. The SFO investigates and prosecutes serious and complex fraud, bribery and corruption. The SFO encourage companies to self-report (on 1 November 2011 the SFO introduced a new service, "SFO Confidential", in order to make the process of reporting corrupt practices easier)  their wrongdoing and the promotion of such behaviour was one motive behind the introduction into UK law, in February 2014, of deferred prosecution agreements ("DPAs"). These agreements provide a procedure by which commercial organizations that uncover financial wrongdoing within their enterprise can agree with the SFO to a series of civil penalties (such as a fine, payment of compensation, review and monitoring), in return for which the SFO agrees not to pursue a criminal prosecution.

    The SFO works with other law enforcement partners to handle the challenges faced by serious and organized crime in accordance with the Government's Serious and Organised Crime Strategy. In particular the SFO work closely with: (i). The National Crime Agency's Economic Crime Command, International Corruption Unit and Bribery and Corruption Intelligence Unit; (ii). The City of London Police, including its Economic Crime Directorate, Action Fraud, and the National Fraud Intelligence Bureau; (iii). UK police forces and Regional Organised Crime Units, Regional Asset Recovery Teams, and Regional Fraud Teams; (iv). HM Revenue & Customs; (v). The Financial Conduct Authority;

    The SFO also works collaboratively with UK Government departments, including our superintending department, the Attorney General's Office, the Home Office and Ministry of Justice, and with overseas partners, such as the US Department of Justice, on matters where there is a common interest.

    Recently the SFO has opened an investigation into Tata Steel Ltd over allegations related to certificates used to verify the composition of products. Mumbai-based Tata Steel, which is seeking to sell its UK businesses, referred itself to the fraud office after an internal audit that suggested inappropriate testing and certification.

    The Legal Position in the United Arab Emirates

    In theory, a corporate entity may be subject to any crime committed in the circumstances described by Article 65 of the Federal Penal Code such as i). fraud and breach of trust; (ii). bribery & corruption;  (iii). embezzlement of public funds; (iv). money laundering; (v).forgery; (vi). dishonored cheques; (vii). director & officer liability for mismanagement or stating false information in company records; (viii). cyber crimes; (ix). labour issues and violations of safety regulations which cause the death of one or more employees; (x). criminal cases against employees for theft, breach of trust or disclosing confidential information. However, UAE is hunting to curb the incessant pace of corruption in its governance, which may hit by a spate of large-scale corporate scandals. So in order to fix liability for corruption and bribery offenses, it becomes relevant to examine criminal liability, not just of individual directors or agents of a corporation, but also of the company itself.  Although considerable debate surrounds society's increasing reliance on criminal liability to regulate corporate conduct, few have questioned in depth the fundamental basis for imposing criminal liability on corporations. There are no bodies like SFO are established in the UAE and the government should ponder over this concept to bring and address more transparency in the legal system.

    Conclusion

    The recent past has seen various offenses enacted, or proposed, which have either abandoned or eroded the identification principle. However the criteria for establishing the criminal liability of the company for these offenses are different, but they share the presumption that a company should be prosecuted if its organizational faults or failings are such that others associated with the company have committed crimes. The SFO brings further charges, and the introduction of DPAs, for the offense of failing to prevent bribery, the impetus will inevitably return for expanding the "failure to prevent" and "gross breach of duty" models into new types of corporate crime.


    [i] See, New York Central Hudson River Railroad Company v. United States ( 212 U.S. 481, 492, 494)

    [ii] Tesco Supermarkets Ltd -V- Nattrass; HL 31 MAR 1971, [1971] CLY 10538

     

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    Sun, 03 Jul 2016 12:00:00 GMT
    <![CDATA[Spotting the Fake: Forgery Under UAE Law]]> Spotting the Fake: Forgery under UAE Law  (Part 1 of 2)

    The creation of an idea, a work of art involves persistence and a visionary acumen, to say the least. Such is the allurement surrounding element of individuality that it has continued to lure the less privileged into forgery from time immemorial. Economies have implemented sophisticated legislations to counter forgery and have been reported with more sophisticated means of forgery time and again. Abdel Ghany from STA's litigation team discusses the legal implication on forgery in the context of UAE Law (UAE Law of Evidence in Commercial Transactions (Federal Law Number 10 of 1982) and UAE Federal Law Number 3 of 1987 on Issuance of the Penal Code). Part 2 of this article will be published in the next issue.

    According to the Law of Evidence in Civil and Commercial Transactions Federal Law Number 10 of 1992 (the Law), the burden of proof is on the claimant which is an established principle and also stated under Article 1 of the Law. The law provides that the claimant or person claiming the fact is duty bound to prove his claim and the defendant shall have the right of denial.

    The first proofs of evidence to substantiate the facts are the official and/or customary documents. It is also established in law that official or public documents, being created by a public official are deemed to be a proof against all litigants, including what is proved unless falsified by methods stipulated by law. The customary document, being the document created by parties, is a proof among the parties only, but for others, it shall not be deemed evidence, except for certain conditions. For instance, the official document may create right in rem and a customary document may create only right in personam.

    The basic principle of evidence is that the customary document shall be deemed to be issued by those who signed the same unless the person expressly denies his/her handwriting, signature, stamp or fingerprint. However, if the person cites the document in court or replies to it without any objection or relies on such document in court, he will be considered to have acknowledged the authenticity of a document and cannot deny the admissibility of the document per se. Further, in the event the document is forged, such person must challenge the document. Similarly, if opponent declared authenticity of the stamp used in the customary document but denied impress, he shall have the right to challenge for forgery.

    It is imperative to note that customary document's origin being general and not official it is sufficient to just deny for excluding the effect of a customary document, but it may not be sufficient in all or certain cases. In such cases, the challenge for forgery to deny such forged document is essential and one must prove forgery in the documents.

    First - The Definition of Forgery in Documents

    Forgery is defined under Article 216 of the Federal Penal Code (UAE Federal Law Number 3 of 1987 on Issuance of the Penal Code):

    "The forgery of a written instrument is to alter its reality in one of the manners described herein below,     so as to cause prejudice, with the intention of substituting the false for the genuine instrument."  The seven methods stated to be considered as committing the crime of forgery is:

    1.      "To alter a genuine instrument, whether by adding, or removing or changing any of its written parts, numbers, marks or pictures.

    2.      To falsely sign or place a forged seal, or to alter a genuine signature, seal or imprint.

    3.      To obtain by surprise or by fraud the signature, seal or imprint of a person who ignores the contents of the instrument or who has not validly given his consent thereon.

    4.      To make falsely or imitate an instrument and attribute it to another person.

    5.      To fill a blank paper which is signed, sealed or imprinted, without the approval of the person who has signed, sealed or imprinted it.

    6.      To assume the name of another person or to substitute it in a document which has been prepared specifically to prove the identity of such other person.

    7.      A material alteration of writing with a deceitful and fraudulent intent, preventing, therefore, the genuine intent of the instrument from being achieved."

    In the above context it can be concluded that there are two types of forgery namely material forgery and moral forgery which are explained below:

    Material forgery:  A material forgery takes effect when a material change in the document is made by the forger that can be comprehended by sense such as eyes, whether by way of addition, deletion or modification in the existing original document or by way of creating the new document(s).

    Moral forgery: A moral forgery is said to be conducted when a forger creates a change in the meaning, content, and circumstances at the time of editing but not in material or form as editing articles or statements other than those made by the contractual parties. For instance, someone impersonating someone else in the contract or employee makes statements about a person in a document contrary to what he said or, stating that he took bribes or money while he has not received any money.

    Let us consider this example: To prove false statements as true or to say that person knows about the facts which are not recognized or with which he is not acquainted with. For instance: A woman (Fatima) declares falsely that she is a real person i.e. a person she claims (Afreen) before official bailiff or a notary public and her statement is registered and the transaction is made on that factual basis, however in real circumstances she is pretending to be (Afreen) another woman. Further, while pretending to be another woman (Afreen) Fatima says that I am Afreen and receives an amount and signs as if she is Afreen. If Fatima says she is Afreen it will be an oral forgery but if she also signs pretending she is Afreen it will be oral as well as material forgery.

    Material forgery can be easily exposed and proven as contrary to the moral forgery, which may be tricky to perceive and at the same time difficult to prove.

    Any material and moral forgery made by the forger whether used or not used by forger can be attributed to the person who created the document. To exclude the impact of such document, several methods can be employed including denial which is sufficient in certain cases to exclude the impact of forged document, but in other cases, denial may not be completely useful unless challenge for forgery is also filed. The Courts have held that 'the criminal intent in the forgery offense is realized by the intention to change the truth in a document.[i]'

    This article now proceeds to discuss matters involving denial in forgery claims and challenging claims based on the forgery.

    Denial

    Pursuant to Article 11 and 23 (1) of the Law of Evidence (UAE Federal Law Number 10 on Evidence in Civil and Commercial Transaction (Issued on 15 January 1992) and amended by Federal Number 36 of 2006 dated 9 October 2006, mere denial of a person is enough in the case of the customary document which may be challenged for forgery while contesting the writing, seal, signature or fingerprint. Hence, it is for the other party relying on the document to prove its authenticity and thereby the onus of proof shifts to the person relying on the document.

    The Court of Cassation in Dubai adjudicated the following in this regard: It is established in the judgment of this court that Article 11 and 23 (1) of the law of evidence that mere denial by a person is enough and the official or customary document, may both be challenged for forgery, while contesting the writing, seal, signature or fingerprint which applies only to informal documents until proven by opponent who holds onto its authenticity of signing the document. As the opponent is the one who is responsible for the burden of proof in this case and there is no necessity to take the person who denies challenging for forgery on what was attributed to him as his signature[ii].

    On 19 November 2012, in Appeal Number 93 of 2012 of the Court of Cassation ruled that a person who denies what is attributed to him by signing the forfeit authentic document then the other party has to prove the signed document that is - the party who seeks to rely on such document must prove its authenticity.

    The second sequence of this two-part article will focus on matters involving Challenging Claim for Forgery, Procedures for Challenging Forgery under UAE Law, and some interesting court precedents passed on forgery laws by Dubai Courts of Cassation, Abu Dhabi courts, and the Union Supreme Court.


    [i] Union Supreme Court - Case 409 of 2007 decided on 16 July 2007

    [ii] See also, Union Supreme Court in Case Number 633 of 2005 heard on 14 November 2005 where it was held  "It is settled law pursuant to article 11 of the Law of Proof that a customary document will be deemed to have been issued by the person signing it, unless he expressly denies the handwriting or signature or seal or thumbprint ascribed to him.  As for an heir or successor, a denial will not be required of him.  It is enough for him to deny his knowledge of the handwriting or signature or seal or thumbprint as being that of the person from whom he derives his right.  Nevertheless, it is not open to a person who disputes the contents of a document to deny the handwriting or signature or seal or thumbprint ascribed to him, or to rely on his lack of knowledge of it, on the grounds that any of the above have been issued by a person deriving his right from him".

     

    ]]>
    Wed, 08 Jun 2016 12:00:00 GMT
    <![CDATA[US Sanctions-an Overview ]]>

    If you do not buy the coffee I sell, I shall forbid you from buying coffee anywhere else… 

      Many years ago, a Superman flick had the bad guy delineating monopoly in a trade as coffee mafia. Today, sophisticated legal developments recognize these practices as unfair trade practices. But the watchdogs of global lawmaking agencies have refrained from commenting on the criticisms arising out of the concept of economic sanctions. Historically, sanctions have evolved from the times of Ancient Greeks. Sanctions came into existence when the state of Megara, a trade port, was subject to sanction from placing its goods on the Athenian marketplace and denied access to the harbor. Targeted sanction programs encourage isolation of recalcitrant countries by imposing strict compliance measures.    In 2006, the UN Security Council imposed the first sanctions on Iran which followed a series of sanctions against the nation. With the historic July 2015 accord between the P5+1 at Vienna and Resolution Number 2231 passed by the United Nations Security Council for suspension and ultimately uplifting of the sanctions against Iran in accordance with the Joint Comprehensive Plan of Action (JCPOA)-  the global pundits now anticipate a sooner 'implementation day' which would lead to relaxation of major embargoes or trade sanctions against Iran- notably the world's fourth-largest oil reserve which currently witnesses a crippled economy due to trade restrictions.    For US operations, the restrictions imposed on Iran are largely governed by the US Treasury Office of Foreign Security and Assets Control (OFAC). The nation faces EU sanctions on oil trade pursuant the United National Council's Resolution Number 1696 and series of resolutions passed by the Council thereafter. Collectively, these trade sanctions on the Persian Gulf resulted in a global economic slowdown with rising oil prices which inevitably are linked to the reduced pumping of oil in the economy.    Sanctions are defined as the measures taken by a state to coerce another to conform to an international agreement or norms of conduct. While 'sanction' is a blanket term that can include diplomatic, economic, military and sport sanctions- 'embargoes' relate to ban on trade and commerce and imposed against specific state or group of nations. In that sense, embargoes are another name for economic sanctions.   This article provide limited overview on compliance with OFAC sanctions. United States is the world's largest economy representing 17% of the World's GDP. Inevitably, decisions by the US Treasury have a larger impact on the companies doing business with targeted nations.   US Sanctions applicability and scope   While suspension of sanctions against Iran will be welcome news, many trade sanctions remain in place against countries like Syria, Cuba and recently Russia which are regulated by the OFAC.   Businesses across Asian and Middle East countries have continued to express interest in dealing with restricted countries despite the sanctions. The notion behind continued dealings with these countries is an ingenious comprehension about the non applicability of the sanctions due to territorial restraints. In addition to this, economists around the world have often discussed the ineffectiveness of sanctions in achieving the envisaged goals.   That said, the scope of OFAC sanctions is exhaustive and does not negate by jurisdictional presence per se. OFAC administers and enforces economic and trade sanctions based on US foreign policy and national security goals against  targeted  foreign countries and regimes, terrorists, international narcotics traffickers, those engaged in activities related to the proliferation of weapons of mass destruction, and other threats to the national security, foreign policy or economy of the United States.1 All US Persons are required to comply with the compliance procedures set out by the OFAC. The definition of US Persons in accordance with the IRC Sec 7701 (a) (30) includes –   1. a citizen or resident of the United States, 2. a domestic partnership, 3. a domestic corporation, 4. any estate (other than a foreign estate, within the meaning of paragraph (31)), and 5. any trust if- 1. a court within the United States is able to exercise primary   supervision over the administration of the trust, and 2. one or more United States persons have the authority to control all substantial decisions of the trust. 6. Holders of US residence visa "Green Card" (until canceled with the Internal Revenue Service)   In view of above, US Persons shall not indulge in direct or indirectly promoting dealings with sanctioned countries particularly with Special Designated Nationals and Blocked Person List (the SDN list) published by the OFAC. The SDN List includes more than 6000 individuals and firms connected with the sanctions program.  OFAC guidelines as to determining whether or not an entity is an SDN by operation of law have been altered after the Russian sanctions came into existence, the last of such update relating to aggregate ownership published on August 13, 2014. Broadly, if an entity is owned in excess of 50 percent in aggregate by an SDN, such entity shall itself be considered an SDN whether or not it is in the SDN list.    OFAC sanctions against Iran, Syria, and Russia    The requirements for compliance with OFAC regulations are broad and their applicability is defined per transaction.    Broadly speaking Iranian sanctions extend to investment into energy sector, petroleum resources including import and exports, financial investments in the form of JVs, trade in coal, metals, software for ownership, control or insuring of vessels bearing Iranian flags and underwriting services to SDN list members in particular the National Iranian Oil Company and Iranian Tanker Company.   Article 219 of the Iran Threat Reduction and Syria Human Rights Act 2012 requires all companies whose stock (including American Depository Receipts) is traded on US stock exchanges to disclose whether they or their affiliates have 'knowingly' engaged in certain activities involving Iran, Syria or SDNs identified in connection with terrorism or the proliferation of weapons of mass destruction. Section 219 also mandates the public disclosure of any such information by the US Securities and Exchange Commission (SEC), such provisions being effective from 2013, meaning that all annual or quarterly reports filed with the SEC on or after that date are subject to Section 219's reporting requirements.   Under the provisions of the Iranian Transactions and Sanctions Regulations (ITSR), OFAC prohibitions become applicable to non-US entities that are owned or controlled by a US entity by virtue of Section 218 of ITRSHRA and Executive Order 13628. Among the new provisions added to the ITSR are (1) expanded blocking provisions on the government of Iran and Iranian financial institutions that were previously in place only by executive order and statute, as well as (2) a new general license that authorize the export or re-export of "medicine" and "basic medical supplies".   E.O. 13582 relating to sanctions against Syria prohibits the following: 1. any new investment in Syria by a US  person, wherever located; 2. The direct or indirect exportation, reexportation, sale, or supply of any services to Syria from the United States or by a US person, wherever located; 3. The importation into the United States of petroleum or petroleum products of Syrian origin; 4. Any transaction or dealing by a US person, wherever located, in or related to petroleum or petroleum products of Syrian origin; 5. Any approval, financing, facilitation, or guarantee from a U.S. person, wherever located, of a transaction by a foreign person where the transaction by that foreign person would be prohibited if performed by a US  person or within the United States.   Executive Order 13660 authorizes sanctions on individuals and entities responsible for violating the sovereignty and territorial integrity of Ukraine or for stealing assets of the Ukrainian people. Subsequently, the scope was extended by E.O 13661 for Blocking Property of Additional Persons Contributing to Situation in Ukraine on 17 March 2014. As part of subsequent developments, OFAC has published the Sectoral Sanctions Identification List (SSI) for identifying persons operating in Russian Economy that are subject to OFAC sanctions. Companies are required to carefully screen their Russian and Ukrainian business partners and not conduct any transactions against applicable directives.   
  • Directive 1, issued on July 16, 2014, prohibits transacting in, providing financing for, or otherwise dealing in debt with a maturity of longer than 90 days or equity if that debt or equity is issued on or after the sanctions effective date ("new debt" or "new equity") by, on behalf of, or for the benefit of the persons operating in Russia's financial sector named under Directive 1, their property, or their interests in property. On September 12, 2014, OFAC amended Directive 1, reducing the tenor of prohibited debt from longer than 90 days to longer than 30 days.
  • Directive 2 separately prohibits transacting in, providing financing for, or otherwise dealing in new debt of greater than 90 days maturity if that debt is issued on or after the sanctions effective date by, on behalf of, or for the benefit of the persons operating in Russia's energy sector named under the Directive 2, their property, or their interests in property.
  • Directive 3 prohibits US persons from transacting in, providing financing for, or otherwise dealing in new debt of longer than 30 days maturity of persons listed on the SSI List under Directive 3 (such as Rostec State Corporation).
  • Directive 4 prohibits the provision, exportation, or re-exportation, directly or indirectly, of goods, services (except for financial services), or technology in support of exploration or production for deep-water, Arctic offshore, or shale projects that have the potential to produce oil in Russia, or in maritime areas claimed by Russia and extending from its territory, and that involve any person listed on the SSI List under Directive 4 (such as Gazprom, Lukoil).
  •   On July 30, 2015, US updated the Russian and Ukranian Sanctions list. Among the newly included firms are affiliate companies of Russian oil giant Rosneft, as well as several organizations linked to one of the country's major banks – Vnesheconombank, which were already subject to sectoral sanctions under the 50% rule.   Compliance and Due Diligence    OFAC compliance programs are required to be carefully designed and implemented. A list of activities prohibited under the sanctions program has been set out by OFAC vide several guidelines and executive orders. OFAC also publishes FAQs on its sanctions regime.    OFAC permits 'General Licenses' in specific cases for authorization of certain transactions which may otherwise be prohibited by virtue of the SDN list of the SSI list. In view of the updates and developments for regulation of sanctions and frequently updates SDN, SSI and Foreign Sanctions Evaders (FSE) List, companies are required to implement a due diligence procedure to circumvent the risk of being in non-compliance with the US Sanctions.  While EU sanctions will be completing uplifted against Iran following the reports from the IAEA, primary sanctions by OFAC will continue to operate until such time as the State confirms. In particular, US will maintain sanctions on Iran for terrorism, human rights abuses, missile proliferation and the destabilization of countries such as Syria and other reasons.   This means that companies who choose to open business doors with Iran need to undertake stringent compliance measures. Secondary sanctions will continue to operate against major Iranian entities, those linked to the Iranian Revolutionary Guards Corps directly or indirectly. The burden of compliance including 'know your client' policies will be a major challenge for corporates entering the Iranian markets.  Furthermore, following the JCPOA, not all financial institutions will be exempted from US sanctions. While most banks will be removed from SDN list in case of successful implementation, the sanctions will remain in place under the ITSR regime. Payment transfers to by US depository institutions may be authorized in cases where approvals or license have been issued by OFAC pursuant to ITSR and does not involve debiting or crediting an Iranian account. Previously compliant companies may have to update their internal audits relating to sanctions and implement sophisticated screening measures.   Conclusion    On November 4 2015, the Deutsche Bank has been asked to pay USD 258 M by the New York Department of Financial Services2  for violation of OFAC sanction regime and processing payments against sanctioned countries. Although recent, this is not a standalone incident where a bank has been fined for violations of sanctions regime.    In wake of the new developments in diplomatic corridors, the changes in business practices relating to transactions transcending national boundaries will be an interesting monitor. In all cases, such transactions will remain a source of careful compliance and due diligence until the final report from the International Atomic Energy Agency with as far as dealing relating to Iran are concerned.  STA attorneys offer compliance advisory on matters related to sanctions. For more information you may get in touch with Zisha@stalawfirm.com       ]]>
    Wed, 10 Feb 2016 12:00:00 GMT
    <![CDATA[Enforcing Foreign Judgments in UAE- Part II ]]>

    INTERNATIONAL AGREEMENTS GOVERNING THE ENFORCEMENT OF FOREIGN JUDGMENTS IN THE UAE 

      To continue with our previous article, the second part deals with the various agreements in place between the United Arab Emirates and various countries and how they are enforced. We have looked at multilateral and bilateral agreements separately for ease of reference.   Multilateral Agreements   1) Agreement on the Enforcement of Sanctions between the UAE and other Arab League countries (1952) such as Kingdom of Jordan, Iraq, Lebanon, Yemen, Syria, KSA, and Egypt (the 'Agreement'). Federal Decree No 93 of 1972, summarizes the most important provisions on final judgments for civil or commercial cases; provision of compensation  for criminal courts or relates to civil status issued by a judicial authority in one of the Arab League countries, shall be enforceable in all member states in accordance with the provisions of such Agreement.    A competent UAE court where the foreign judgment is required to be enforced shall reject the enforcement of the foreign judgment in the following cases:   
    • a. if the foreign court, which rendered the judgment was lacking absolute competence or due to the international rules of jurisdiction, it was not competent to consider the matter.
    • if the parties to the proceedings were not duly informed.
    • if the foreign judgment was contrary to the public order or public morality in the state, where the judgment is required to be applied; or it was contrary to international public laws.
    • if the foreign judgment was rendered between the same parties to the proceedings, on the same civil or criminal matter from one of the competent courts in the state; or if such courts have another lawsuit being considered for the    same adversaries concerning the same subject which was filed before submitting the lawsuit to the court that issued the judgment required to be enforced.
      With regard to foreign arbitration decisions, the Agreement states that the competent authority who shall enforce the foreign arbitration decision, issued in one of the Arab League States, shall not have the power to re-examine the subject of the lawsuit, for which the judgment of arbitrators was issued, but can reject the request for enforcing such a judgment in the following cases:
    • if the law of the state requiring the enforcement of the arbitration decision does not permit the subject of the lawsuit to be settled by arbitration.
    • if the judgment of arbitrators was not rendered in accordance with the arbitration rules and regulations of that state.
    • if the arbitrator was not competent under the arbitration rules or pursuant to the law upon which the judgment of the arbitrator was rendered.
    • if the parties to the proceedings were not duly informed for attendance to the relevant tribunal.
    • if the judgment rendered by the arbitrator violates moral codes or public laws of the state, requesting enforcement of the arbitration decision. The UAE competent authority has to determine the existence of such violation and shall not enforce the part which is contrary to public orders or public morals.
    • if the arbitration decision was not final in the state where the judgment was rendered.
    The Agreement will not apply on any foreign judgments rendered against the government of that state who requested to enforce the judgment; as well as on the foreign judgments that are incompatible with international treaties and Agreements that are in full force in the foreign country requested to enforce such a judgment.    Article 5 of this Agreement deals with the enforcement procedure. It stipulates a list of documents that shall be attached to the request of enforcement: • An original copy of the judgment, written in an executive format, approved by the competent authority of the foreign state.    • An original copy of the judgment or official certificate indicating that the judgment was duly rendered.  • A Certificate issued by a competent authority, indicating that the judgment is irrevocable and enforceable. • A Certificate indicating that the litigants were duly summoned to appear before the competent court or jury.   2) The 1995 Protocol on the Enforcement of Judgments, Letters Rogatory, and Judicial Notices issued by the Courts of the Member States of the Arab Gulf Co-operation Council ('GCC Protocol') has provided similar conditions as per the above Agreement. The GCC Protocol states that foreign judgments shall not be wholly or partially enforced in the following cases: a) If the foreign judgment to be enforced conflicts with the provisions of the Islamic Sharia, constitution or regulations applicable in the UAE. b) If the judgment was issued in the absence of the defendant to the proceeding and he/she was not duly notified of the lawsuit or judgment. c) If a dispute has risen for which the judgment has been issued is the subject matter of previous judgment issued in dispute between the same litigants with the same right in terms of place and reason having the powers of judged matters with the court where the judgment is to be enforced or any other member country in this agreement.  d) If the dispute for which the foreign judgment has been rendered is the subject matter of the proceeding considered already before any court of the country where the judgment is to be enforced. Having the same right in terms of place and reason and such lawsuit was filed before offering the dispute to the court of the country where the judgment has been issued. e) If the enforcement of the foreign judgment conflicts with the International treaties and Agreements applicable in the country, where it is to be enforced.   Bilateral Agreements    It is imperative to note that the provisions of any Bilateral Agreements will not enforce foreign judgments that conflict with the provisions of Islamic Sharia or the general system of laws in the UAE.   II.  Courts' decisions regarding the execution of foreign judgments   The Dubai Court of Cassation has concluded to separate between executing a foreign judgment rendered by a country involved in a bilateral or multilateral Agreement with the UAE, and a foreign judgment rendered by a country that is not involved in the same. This is to make sure that the conditions provided for in Article 235 of the Civil Procedures Law are met and that the law of the foreign country, where the judgment has been rendered, is considered by the Court of Merit.    Hence, where there is a cooperation agreement in place between the UAE and a foreign state, the provisions of Article 238 of the Civil Procedures Law shall stipulate as per the resolution of such court that the provisions of treaties concluded by and between the UAE and the other foreign states or International treaties approved by the UAE shall be applied regarding the enforcement of foreign judgments, even if the conditions contained in chapter four of the Federal Code of Civil Procedure No. 11, as discussed above.   In addition, the Abu Dhabi Court of Cassation has issued several principles regarding the enforcement of foreign judgments. Among the principles is the principle that the subject matter of foreign judgments issued in foreign states shall not be considered according to the Civil Procedures Law, instead they should be considered in form and the parties to the proceedings should duly appear before the relevant Court. In addition, the Abu Dhabi Court has confirmed in its decision that a foreign judgment shall not be enforced if such a judgment conflicts with the previous UAE Court judgments or Islamic Sharia or general laws of the UAE.   For example, a plaintiff has filed a lawsuit before the Abu Dhabi Court of First Instance in relation to her divorce, requesting the Court to enforce the judgment rendered by the London Court, which provided for a monthly support payment of GBP 1, 712 (equivalent to about AED10, 500) to her from the date of rendering the said judgment, until she gets married or the issuance of another judgment by the same Court.   The Court of First Instance has rejected the case and supported the appealed judgment which led the plaintiff to challenge the rendered judgment by the London Court before the Court of Cassation (which rejected the submitted case as the appellant was divorced from the defendant by virtue of a previous judgment issued by the Abu Dhabi Sharia Court of Appeal, and which led to the divorcing of the plaintiff from the defendant for damages, taken into consideration that it was not proven that the defendant has returned to the plaintiff which means that the judgment for the divorce was still valid.) Although the plaintiff has obtained a foreign judgment after her divorce, enforcing that foreign judgment (support for life) was incompatible with the provisions of Islamic Sharia and the UAE law on divorce (that binds the husband to spend on his woman during the period of her waiting period (Iddah)). Thus, the Court of Appeal refused to enforce the London judgment so that it complies with both the Sharia and the UAE applicable laws.   Based on the above, it becomes clear that the enforcement of foreign judgments inside the country does not prejudice the principle of state sovereignty. A foreign judgment shall be enforced only when it has been duly rendered as per the applicable procedures provided and duly notifying the parties of the proceedings. In addition, such a judgment shall not be in conflict with the Islamic Sharia or general system of the UAE laws; and shall be irrevocable. Recognizing and enforcing foreign judgments in this way by the UAE courts shows a sign of respect to litigation procedures in general, the doctrine of judicial supremacy and thus establishing justice internationally and achieving international judicial cooperation.    ]]>
    Tue, 29 Dec 2015 12:00:00 GMT
    <![CDATA[Cross-Border Crime and Extradition (Part II)]]>FCPA) in 1977, was considered as a global authority in anti-bribery legislation, it is now acknowledged that bribery as an offence is not confined to dealings with public officials exclusively. The fact that individuals (natural and juridical persons) are equally as culpable in involvement in bribery as commercial organizations and foreign public officials are is therefore paid due consideration in more recent legislation, and particularly in the UK Bribery Act 2010 (UKBA).   Effective as of July 2011, the UKBA is now considered by many as being the most rigorous anti-corruption legislation in the world, superseding the FCPA and its various contemporaries. Unlike most pieces of legislation in force in the UK, the UKBA is applicable across all three jurisdictions therein, namely Scotland, Northern Ireland and England/ Wales. However, it additionally has such international trans-jurisdictional enforceability that those charged with acts criminalized thereunder may be prosecuted by the specified authorities no matter where in the world the crime was actually committed, so long as they are connected to the UK in any manner outlined by UKBA Section 12   As previously discussed, the UKBA has extensive scope not only in terms of jurisdiction but also by way of the variety of offenses incorporated. Whereas the FCPA focusses primarily on the bribery of foreign officials, the UKBA establishes the far more basic offenses of 1) bribery and 2) accepting a bribe. Pursuant to Section 1, the straightforward premise is that a person  shall  be guilty of an offence if he offers a financial (or alternative) advantage to another with the intention of inducing or rewarding him for improperly performing a relevant function or activity, with the offence of receiving a bribe defined at Section 2 as being the receiving or requesting of the same. Under Section 3, a "relevant function or activity" may be:   (a) Any function of a public nature;  (b) Any activity connected with a business; (c) Any activity performed in the course of a person's employment; or (d) Any activity performed by or on behalf of a body of persons   (whether corporate or unincorporated),     if the person performing the function or activity is expected to perform it in good faith; the person performing the function or activity is expected to perform it impartially; and/or the person performing the function or activity is in a position of trust by virtue of performing it.   It seems reasonable to assert, then, that although the act of the aforementioned mischievous teenager looking to pay for his brother's silence does not fall within the remit of the UKBA, the "ordinary man" is far more likely to run afoul of these provisions than those contained within the FCPA. Yet in addition to introducing every-day bribery offenses, the UKPA has preserved the principal function of the FCPA by also considering the bribery of a public foreign official. In simple terms and pursuant to Section 6(5), a "public foreign official" may be defined as a person holding a legislative, administrative or judicial position of any kind, (either appointed or elected), in a country or territory outside of the UK, or acting as an official or agent of a public international organization. Of course, such a definition is plagued with ambiguity, with "administrative position" in particular having an unidentifiable large scope. What would happen, then, if there is irrefutable evidence to suggest that a person has committed an offense in bribing or attempting to bribe a public foreign official, where the "public foreign official's" role may be defined in such a way that it falls outside the remit of section 6(5)? Fortunately, the Act pays due consideration to this potential scenario, and would allow for prosecution under Section 1 PROVIDED THAT the element of "improper performance" by the official can be demonstrated.   The three provisions discussed thus far create the impression that the perpetrators of bribery offenses are rogue individuals acting of their own volition. Although it does not go so far as to introduce a separate provision under which a commercial entity may be prosecuted for actively pursuing acts of corruption, the Bribery Act does create criminal liability for entities failing to implement measures to prevent bribery amongst its members. Under Section 7, a commercial organization may be found guilty of such an offense if an associated person bribes a third party with the intention of procuring or retaining business or advantage for the said organization. Pursuant to Section 8(3), an "associated person" may be an employee, subsidiary or agent of the commercial entity in question, although Section 8(1) provides that such definitions are without limitation, and any person performing services for the entity in any respect may be considered as "associated". In order for the entity to be prosecuted, there must be sufficient evidence to suggest that the associated person would themselves be convicted under Section 1 (bribing) or Section 6 (bribing a public foreign official), however there is no requirement necessitating that the associated person must be subject to prosecution or readily-convicted in order for the entity to become liable to proceedings. That said, the two different parties to the instance of bribery (namely the associated person and the entity) may each be prosecuted simultaneously – the associated person for the bribery, and the entity for failing to prevent it. Moreover, if there is evidence to suggest that a person representing the corporate 'directing mind' bribes/encourages or assists someone in giving or receiving a bribe, then the company may also be charged with a Section 1 or Section 6 offense in addition to that provided under Section 7. It is also worth noting that Section 7 does not require the associated person to have any connection to the UK whatsoever (as per Section 7(3)(b)) – the entity will still be liable so long as it was incorporated in the UK or carries out any of its business therein. It, therefore, seems reasonable to assert that the UKBA has placed commercial organizations under a tremendous amount of pressure to implement stringent procedures to control corruption.   Generally speaking, a person suspected of an offence within a UK jurisdiction will be investigated by the relevant police force and, further to permission from the relevant charging authority (usually either the CPS or the police via an Evidential Review Officer), will be charged and committed to the criminal court under the prosecuting authority of the Crown Prosecution Service (CPS). For those suspected of offenses under the UKBA, however, the process is somewhat more complex. In the first instance, the allocation of investigative responsibility will be dependent on the location in which the offense was committed. As we have discussed, an offence occurring overseas may be prosecuted under the UKBA, so long as the perpetrator is connected to the UK in any manner prescribed by Section 12 – however the responsibility for investigating such an offence will fall upon the Serious Fraud Office (SFO), as opposed to any UK police force (although the police may assist). If the SFO has investigated a case and permission to prosecute is awarded pursuant to the foregoing, then it shall also be responsible for prosecuting the same – in other words, a matter will not be referred to the CPS. Accordingly, the CPS shall prosecute any matters investigated by the police, whether within the UK or overseas. Yet it is a distinguishing feature of the UKBA that, as per Section 10, the initiation of proceedings thereunder requires the personal express consent of the respective authority (namely the Director of Public Prosecutions (DPP) for offenses prosecuted by the CPS or the Director of the SFO)2 . This differs greatly from the prosecution of the very vast majority of offenses under UK law, whereby consent may be delegated to a Crown Prosecutor. Each case is therefore afforded a significant amount of individual attention, and the various considerations of UK prosecutions (such as the sufficiency of the evidence and whether the prosecution of the matter at hand is in the interests of the general public) are considered fully.   As "either-way" offenses, individuals charged pursuant to Sections 1, 2 and/or 6 may be dealt with in either the Magistrates' or the Crown Courts, with the range of penalties varying accordingly. It is of note that the UKBA is one of the very few statues enforceable in England/Wales which specifically provides for a 12 month custodial sentence for an either-way offence on summary conviction, with the majority of criminal laws capping summary sentence at 6 months (despite the 12 month allowance prescribed by the Criminal Justice Act 2003). On indictment, a custodial sentence may extend as far as 10 years, subject to the discretion of the presiding judge and in keeping with Sentencing Guidelines. Individuals are also liable to fines, with the mode of trial/venue of sentence determining the upper limit. Of course, companies, commercial organizations and other entities convicted of such offenses may not be sentenced to terms of imprisonment, therefore fines are the only available option in the event that the convicted party is anything but an individual. Likewise, commercial organizations convicted under Section 7 are liable to a fine, BUT such matters are indictable only and are therefore reserved to the Crown Court exclusively. Notwithstanding the imposition of any financial penalty upon an individual, commercial entity or organization, the proceeds of any alleged incident of bribery may additionally be subject to confiscation and eventual forfeiture under the Proceeds of Crime Act 2002.   It is undeniable that the UKBA is an internal triumph when considering the UK's own jurisdictions, as it supersedes dated and inadequate statutes whilst leaving the common law offense of bribery in force. In doing this it provides an instrument via which significant offenses of bribery – particularly those committed at the expense of corporate, commercial or public justice – may be given due weight (it is of note that the first person prosecuted under the UKBA was a Magistrates' Court clerk). But what of its international effects? Although acknowledged as a rigorous and thorough law, the UKBA's reputation is not necessarily advantageous. The absence of the element of "dishonesty" in any UKBA offense, for example, has the effect that acts which are acceptable elsewhere in the world become criminalized thereunder. It has been argued that this places the UK at a competitive disadvantage, as it acts as a deterrent to investors who would have to alter their otherwise-acceptable practices in order to avoid criminal liability.   Yet returning to the words of Mr. Clarke, any investor will surely acknowledge that bribery is an offense which causes repercussions on a global scale, with individuals, companies, and societies as eventual victims. Despite the fact that various practices may need amending to ensure compliance, it is undoubtedly the case that tough legislation such as the UKBA is, overall, in the best interests of all parties.   Unless you are a "Crown body" of course. In which case, you're exempt…

     

    ]]>
    Fri, 10 Jul 2015 12:00:00 GMT
    <![CDATA[Bail Fail? Liabilities of Bail Guarantor under the UAE Criminal Law]]> Liabilities of the Bail Guarantor under the UAE Criminal Law

    We've all seen the images of prisoners arriving at court for their hearings, seated in high-security vehicles with small circular windows, with photographers clamoring for a prime position in order to take photographs through the glass. However, not all defendants are required to arrive at court in such a manner. Although several are held in custody during proceedings and are transported to court as and when required, others are granted bail and are not confined, often subject to conditions set by the judge or public prosecution. As approximately ninety (90) percent of the UAE's population consists of expatriates and due to the additional fact that the UAE enjoys an unprecedented level of tourism, it follows that a major concern of the courts when considering whether to grant a defendant bail is the risk that the defendant may abscond – in other words, that he may leave the UAE in order to avoid facing the justice system. This is obviously a far greater risk when a defendant is a foreign national, as he is less likely to have any community ties discouraging him from leaving the UAE for long-term. In such cases, one condition that the judge may consider imposing in order to alleviate risk is the appointment of a Guarantor.

    A Guarantor is a person who guarantees the conduct of the defendant upon being released by the public prosecution or the judge. The obligations of a Guarantor are entirely different to those of a work sponsor or residence sponsor, and regularly give rise to complicated issues that may have severe consequences.This is often due to Guarantor's ignorance of his liabilities and may lead to a situation whereby Guarantor finds himself in a worse position than the defendant should the defendant abscond. In this article, we shall discuss most significant liabilities of the Guarantor, and consider the factors a person may wish to contemplate before taking on such a role.

    When may a defendant require a Guarantor?

    in reality, the UAE law appears to provide relatively little guidance on the subject of bail, with a defendant's status and any conditions of bail being at the discretion of the presiding judge. However, it is often the case that bail is awarded in instances where there seems to be a lack of sufficient evidence against the defendant. Pursuant to Article 106 of Federal Law Number 3 of 1987 (the Penal Code) a person's previous criminal convictions (where the convicted crime or felony was punished by any measure other than a financial penalty) must be also be taken into consideration. The public prosecution, either voluntarily or upon the application of the defendant, may release the latter on bail if the prescribed penalty for the crime of which he is accused is neither the death penalty nor life imprisonment. In most cases, the defendant's remand status will be re-assessed on the expiry of the preventative detention period set by the public prosecution, which shall usually be either 21 days, or upon consideration by the court.   Further to the provisions of Article 122 of the Penal Code, one condition of bail commonly utilized in the UAE is the submission of a personal or financial guarantee as determined by the public prosecutor or the judge, on the specific terms set forth by the same.

    What are Personal Guarantees and Financial Guarantees? What is the position under UAE Criminal Laws?

    UAE law does not define the concrete meaning of Personal Guarantee, and as such the terms of the definition are subject to the discretion of the bail order. The concept allows for the defendant to issue guarantee on his own behalf, or to be guaranteed by a third party, by surrendering the relevant passport to the court (this will be the defendant's passport where he is acting as a self-guarantor, and both the third party's and the defendant's passport when a third party is the guarantor). In rare cases and under certain conditions the guarantor may be an entity or legal person, for example, a company or the defendant's consulate. A Financial Guarantee is, as the name suggests, monetary funds paid into the court, to be returned to the guarantor on the issuing of the judgment in the defendant's case, or forfeited in the event that the defendant fails to abide by his bail conditions. A Financial Guarantee can be paid in three ways: it may be deposited in cash in the court treasury, submitted vide a bank guarantee pursuant to conditions determined in the release order, or to be retained by the guarantor, on the condition that it is surrendered to the court through one of the aforementioned methods in the event that the defendant breaches bail.

    Can the courts request both a Personal Guarantee and a Financial Guarantee?

    Dubai prosecution and the courts regularly set both Personal Guarantees and Financial Guarantees as joint conditions of bail. Almost without exception, in cases in which the defendant is a foreign national the surrender of his own passport will be an inevitable prerequisite of his release, with the presiding authorities often requesting an additional Personal Guarantee and Financial Guarantee of an amount set at the tribunal's discretion. The reasoning behind this may well be that although the seizure of the defendant's passport may prevent him from leaving the UAE, it cannot ensure that he will attend court as directed or be of good behavior in the interim. Ordering a third party Personal Guarantee and a Financial Guarantee in addition to this may, therefore, create an incentive for the defendant to remain compliant throughout proceedings.

    What is a Guarantee (bail) Bond?

    The Guarantee/Bail Bond is the form issued by the court and signed by the Guarantor under which the Guarantor guarantees that the defendant will act in accordance with the terms of bail set forth by the court. There is no precedent form that the Guarantee Bond must take, but it is likely to include (without limitation) the defendant's charge, personal details of both the defendant and the Guarantor, the undertaking content, and the penalty due in the event of a violation. As per Article 113 of the Penal Code, the Guarantee Bond may be deemed as an executive deed and any monies due thereunder may be perused through the civil courts in keeping with the Civil Procedures Law.

    What does being a Guarantor involve?

    On signing the Guarantee Bond the Guarantor becomes liable for an attendance of the defendant upon being summoned by the investigative body or the court, and for the execution, the judgment issued against the defendant. The Guarantor's liability ends only on the execution of the determined sentence as passed by the court, or in the event that the defendant is irrevocably exonerated. In the majority of cases, the Guarantee Bond will include an undertaking by the Guarantor to accept liability with regards to the aggrieved party, including any penalties, compensations, or subsequent civil action.

    To what extent is the Guarantor liable?

    The liability of the Guarantor may not appear to be excessively broad when considering that the defendant might breach bail by failing to attend an investigative or court session, as the likely consequence is that the Guarantor will forfeit all or some of the Financial Guarantee. However, a Guarantor should also consider the consequences in the event that the defendant does not comply with the requirements of any judgment issued against him. In such an instance, the Guarantor must be aware that he personally shall fall financially liable for any fines or cost orders made against the defendant up to any amount as is prescribed by law. In some cases, this may amount to hundreds and thousands of dirhams.

    Problems will inevitably arise if the Guarantor is unable to meet the financial liabilities he has incurred under the Guarantee Bond. In such cases, the Personal Guarantee (namely the passport) of the Guarantor may remain under seizure for years on account of his failure to ensure the compliance of the defendant and/or pay such funds so as to allow for the execution of judgment. Therefore anyone considering acting as Guarantor should be fully aware of the content of the Guarantee Bond and the extent of any financial fine available in law for the relevant offence. In addition to this, the prospective Guarantor should have sufficient confidence that the defendant will attend court as required and not abscond whilst on bail. 

    In matters where there is a request for extradition and where prosecution deems expedient to cancel the bail, the prosecutor may close the ongoing investigation and the accused in such event will be extradited to requesting country.

    ]]>
    Thu, 21 May 2015 12:00:00 GMT
    <![CDATA[Cross Border Crime and Extradition]]> Cooperation in International Financial Investigations

    Apparently "money talks" but "crime doesn't pay".

    It, therefore, follows that financial crime is rife, yet the methods in place to control and reduce it are effective.  The evolution of banking means that there are now more ways than ever conduct the financial activity, with online systems, payment technologies, and bitcoins all assisting us in our transactions. But along with new methods come new offences, with money laundering, tax evasion, online fraud and the funding of terrorism featuring regularly on court lists across the continents. And given that global communication and transport have had the effect that the world is now a relatively small place, it is of no great surprise that these crimes have taken on an international dimension.
     

    So what systems are in place to police transnational financial crime and bring any perpetrators to justice? In this second installment of our international criminal law series, we shall discuss the ways in which the UAE cooperates with nations requesting assistance in conducting financial investigations. In the present article Zisha Rizvi, Partner at STA Law Firm discusses cross-border crime and extradition in the context of UAE Criminal Law, International Treaties, DTAAs and UAE Central Bank Regulations.

    1–  Is Dubai party to any international agreements regarding the exchange of information in cases of tax and criminal investigation?

    As we are all aware, one of the major benefits of living in the UAE is that our UAE-generated income is not taxed. However, it is not unusual for expats to have an additional source of income in their home countries, which may well be subject to tax in accordance with the local law. And elsewhere in the world, an expat may find that not only must they pay tax on their income at home, but they may also have to declare this income in their country of residence,

    where it could again be subject to taxes or charges. This has the effect that the same income is taxed twice – once in the home jurisdiction and once in the country of residence. In order to avoid this, many nations enter into double tax avoidance agreements (DTAAs). DTAAs aim at taxing revenue earned from the sale of shares, dividends, royalty payments and fees in the state where income is earned, subject to terms mutually agreed between two member countries.


    Taxation law is jurisdictionally-specific – that is to say, it is not international. The taxation law of a country is applicable to citizens and residents of that country alone, and cannot be extended to other jurisdictions. Yet a similar feature in the majority of the national tax law is the way in which avoidance is criminalized, with persons convicted of tax evasion often liable to fines and/or imprisonment.

    It is worth noting that DTAAs are not considered as tax avoidance – the obvious reason being that they are not a method through which an individual or corporation may avoid tax, but merely a sanctuary under which the entity may seek relief from making two payments in relation to the same asset. DTAA participation, therefore, does not incur any criminal liability, and the main objective is to foster economic growth between the parties who have signed the same.


    UAE Federal Law Number 39 of 2006, which relates to International Judicial Cooperation in Criminal Matters (Law 39), provides for the extradition of criminal suspects in cases where the individual in question is subject to criminal investigation overseas. As we discussed in Part I of this series, the UAE has signed extradition treaties with several countries, and these treaties impose additional requirements on respective member states. It is possible for foreign countries (including countries that have not signed a criminal treaty) to request extradition of a person residing in the UAE for interrogation, prosecution or enforcement of criminal awards, although it is of note that the police, prosecution authorities, and courts in the UAE have absolute discretion to refuse extradition on certain grounds. Additionally, in relation to awards or judgments from countries with which the UAE does not have a bilateral treaty, the provisions of the UAE Civil Procedure Code must be satisfied.

    2– When and how is Dubai required to disclose such information?

    UAE follows internal procedures and acts in accordance with the requirements of the UAE Civil Code, UAE Commercial Transaction Law, and the UAE Penal Code.


    As the UAE is party to several international conventions and bilateral treaties, acting in conformity with several DTAAs and Mutual Legal Assistance Treaties (MLAs) the UAE Government can cooperate with foreign authorities in the process of investigation and prosecution of criminal offences. Although tax evasion is not specifically addressed in most MLAs, the treaties refer to assistance being provided "for the purpose of proceedings". This implies that the exchange of confidential bank information may be permissible under the provisions of an MLA, particularly where a criminal tax implication has arisen in the foreign country.


    No bank account can be frozen unless by an order of the court or in accordance with the anti-money laundering law and the law pertaining to the financing of terrorism, namely UAE Federal Law Number 1 of 2004. The UAE permanent mission at the United Nations sends a list of 'suspected' individuals to the National Committee for Combating Terrorism (NCFCT) which then send this list to the Central Bank. From the Central Bank, orders for the necessary information are served on the list of 'suspected' individuals.
     

    3–What is meant by "bank secrecy" under the law of Dubai? In what cases is the bank obliged to disclose information? If there are such cases, what is the nature of the disclosure procedure: criminal or administrative? Is the right to receive such information limited to the police, prosecutors, and the criminal courts, or are the tax authorities and municipality also entitled? Is any special order required for disclosure?

    The term 'bank secrecy' per se is acknowledged generally under the prevailing laws of the UAE. For the purpose of this article, we limit the scope of our response to wider UAE and exclude the DIFC legislation, details whereof can be obtained from STA's website (www.stalawfirm.com). All bankers, traders and other professionals who are in a position to collect and store data from the public are bound by the duty of confidentiality – the breach of which is an offence under Article 379 of UAE Penal Code (Federal Law number 3 of 1987, as amended). Article 379 reads as under:-
     

    "Punishment by detention for a period of not less than one year and by a fine of not less than twenty thousand Dirhams or by either of these two penalties, shall apply to anyone who is entrusted with a secret by virtue of his profession, trade, position, or art and who discloses it in cases other than those lawfully permitted, or if he uses such a secret for his own private benefit or for the benefit of another person, unless the person concerned permits the disclosure or use of such a secret. A penalty of imprisonment for a period not exceeding five years shall apply to a culprit who is a public official or in charge of a public service, and has been entrusted with the secret during, because of or on the occasion of the performance of his duty or service."


     Further, Article 106 of the Union Law (Law number 10 of 1980 concerning the Central Bank, the Monetary System and Organization of Banking) also provides for the obligation to keep confidential all banking data submitted to the Central Bank.
    In criminal matters (whether pertaining to an international or a domestic offence), information must be disclosed to the investigating authority. While the banks can be required to make statements before prosecution, in practice material and formal disclosure can be ordered by the court.

    4– Under what circumstances may my Dubai bank account be blocked/frozen? What is authority able to block it?
     

    In international matters, the freezing of a UAE-based financial account would largely depend whether a treaty was in place between UAE and the country making the request. In any event, the power to make any decision with regards to freezing a bank account is vested in the public prosecution and/or court authorities. In instances of suspected money laundering or the financing of terrorism, the Governor of Central Bank has the power to order the freezing of a bank account. Dubai Prosecution is vested with powers of investigation and is able to bring an action against the accused and forward the matter to court for trial in domestic cases.
     

    5 –For how long will my account remain blocked?

    Timescales are entirely dependent on the nature and level of the charge and may be set by the prosecution or the court.


    In cases pertaining to money laundering and in accordance with Law No. 1 of 2004, the Governor of Central Bank can issue a notice for the freezing of a bank account for a period of seven (7) days. For the purpose of the investigation, the Governor and/or the Attorney General may extend this period for as long as it may take to complete the investigatory process.

    6–If my account has been frozen, may I appeal? To which court?

     In criminal matters the hierarchy (lower to highest) is as follows: (a)  Police; (b) Prosecution; (c) Court of First Instance; (d) Court of Appeal; (e) Court of Cassation. If the account is frozen then an appeal is heard by the higher court.

    7– Is the tax evasion a crime in Dubai? What are the tax laws of UAE?

    The UAE is, in general, a tax-free country. There are a few exceptions which apply to the oil and gas companies, branches of foreign banks. In the Emirate of Abu Dhabi, taxation principles are governed pursuant to Abu Dhabi Income Tax Decree of 1965 (and amendments thereto). Taxation in Dubai is covered under the statute being 'The Dubai Income Ordinance of 1969' (and amendments thereto) whereas Sharjah's tax system is controlled in line with the provisions contained in 'The Sharjah Income Tax Decree of 1968'.

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    Mon, 09 Mar 2015 12:00:00 GMT
    <![CDATA[Cross-Border Crime and Extradition (Part I)]]>

    They say that crime doesn't pay. But whether it pays or not it certainly sells, at least with Hollywood movies, computer games, fictitious novels all reaping the benefits of the public's general fascination with the subject. Generally, the term "crime" may cover anything from a road traffic offense to a mass murder. Yet countries across the world regularly increase the range of offenses to regulate and maintain public order in keeping with developments in society. For example, advancements in the fields of technology and finance have tempted criminals to resort to newer forms of crimes and adopt alternative forms of currencies such as bitcoins.   

    As any industry is a continuously fluctuating, changing concept, the law must constantly and correspondingly evolve in order to remain effective. However, it isn't just the evolution of crimes themselves that renders new legislation necessary – the vast improvement in international transportation is such that a person could theoretically now commit a crime on one side of the globe in the morning but be safely on the other side of the world by supper time. This concept is prevalent in the media, with the faces of accused such as Shrien Dewani, Julian Assange and Amanda Knox fronting our screens almost daily. The internationalization of crime has therefore forced domestic criminal law in several jurisdictions to rely on international co-operation. The primary aim of this article is to deal with core legal issues dealing with extradition, international co-operation by judicial bodies, heinous crimes, and their implications.

    International crime may be categorized under four broad headings, namely money laundering and financial crime, drug trafficking, heinous crimes and the war against terror. Offenders operating in any one or more of these areas have the potential to exercise great influence on authorities, states, and society in general through open or hidden channels. Therefore ensuring that such characters are appropriately investigated, tried and thereafter dealt with is not merely the responsibility of the country where the crime may have occurred, but is a concern on the global level. Such cooperation will, in turn, assist in upholding national security, and further ensure that domestic peace is maintained and bilateral trade and commerce are not subject to crime, corruption, and unlawful control.

    So what effects does this international co-operation have in practice? If an offender has committed a crime in country ABC but is now in country JKL, country JKL will presumably have no jurisdiction to try him. Is country JKL under any obligation to deliver him into the custody of country ABC? Or is he entitled to any protection afforded by country JKL? How do governments expedite any hand-over of suspects? Additionally what if the crime takes place across multiple jurisdictions or an area in which the governing law is difficult to determine? In what circumstances may jurisdiction be afforded to an international tribunal?

    "Extradition" in its broadest context means and results from cooperation between one or more nations and arising from a formal request by one state (generally, pursuant to a treaty or a special request) to surrender a person accused and/or convicted of a crime necessitating extradition/investigation. This general definition is largely understood and encompasses the basic principle, but evidently, an extradition process is much more complex. As such a far more specific understanding is necessary in order to effectively achieve the desired objective to the mutual satisfaction of all states involved. The problem here is that no universally-acknowledged specification of "extradition" exists. Whereas the law of the USA considers extradition to be the request for handing over a suspect (by a state with the competency – not necessarily the intention – to follow through with the consequential punishment of the suspect on conviction), alternative schools of thought consider extradition as being handing over the physical custody of the suspect and/or his eventual prosecution. The mechanics of extradition are therefore far more complex and governed by individual treaties or special case-by-case arrangements between nations.

    The United Nations General Assembly vide its resolution dated 14 December 1990 urged its member states to strengthen international co-operation in criminal justice. To this effect, the United Nations issued the Model Treaty on Extradition which is consistent with principle 37 of its 'Guiding Principles for Crime Prevention and Criminal Justice in the Context of Development and a New International Economic Order'. The Model Treaty serves as a guide and further places an obligation on member states to extradite 'any person who is wanted in the requesting State for prosecution for an extraditable offense or for the imposition or enforcement of a sentence in respect of such an offense'. This obligation to extradite however exists only between two or more member states and in absence of the treaty, no such requirement would apply.

    The international criminal law is, it seems, a vast and complex subject. This series of articles will guide you through some basic principles in order to answer the aforementioned questions.  Not only will we examine international principles and treaties currently in place to govern such situations, but we shall also explore the domestic legislation which often causes cases to take on an international dimension and necessitates these processes. In the next article, we will discuss one of the four main areas of international crime – namely, money laundering and Issue 7 will address specific terms of international treaties and the UAE Criminal Laws.

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    Wed, 17 Dec 2014 12:00:00 GMT
    <![CDATA[INDIA UAE Extradition Treaty]]>

    INDIA UAE Extradition Treaty

    When former Central Intelligence Agency employee and National Security Agency contractor Edward Snowden blew the whistle on the details of the secret surveillance program of the United States, he had to flee the United States under charges of espionage. But can fleeing away to another country prevent arrest by the countries of origin or state where one resides? Not if the two nations, i.e. the home country of the offender and the country to which person is fleeing, have an agreement whereby they decide to handover the offender to the home country for prosecution. And when the accused in the Bangalore (India) serial blasts case was absconding, a team of the Research and Analysis Wing had to track him in Muscat and sneak him out of Oman, since India doesn't have an extradition treaty with Oman whereby they should have returned him to India.

    Edward Snowden is currently hiding out in Russia, and the Russian government does not plan to extradite or hand over Snowden - even though the US Prosecutor General's office asked them to do so - as the United States does not have extradition treaties with Russia. Moreover, as a Russian lawyer pointed out, Snowden hasn't committed any crime and faced no charges in Russia.

    Such events necessitate the need for an agreement between countries to send back the offender to his or her home country.

    What is an extradition agreement or treaty?

    Under international law, as there is no obligation for one country to surrender a criminal to another, nations have entered into agreements to help bring to book the fugitives who flee abroad.

    Importantly, extradition treaty allows either of the signatory countries to the treaty to handover to the other signatory country the accused who has committed an offense in that other country.

    In this article, we will discuss the main features of the India and UAE treaty on criminal matters.

    The Government of the United Arab Emirates and the Government of the Republic of India entered into an agreement in 1999 on mutual legal assistance in criminal suits following which the two countries signed an extradition treaty in 2000. Under the agreement, both the countries are required to handover the accused to the other country, the person to be extradited where such person is accused of offence in the country requesting extradition. Further such an offense must be punishable under the laws of both India and UAE with at least imprisonment for one year, or the person has been sentenced by the court of the other country for at least six months.

    The treaty is entered into by the two countries to strengthen bilateral co-operation and take concrete steps to combat terrorism and other crimes.

    The extradition will be possible irrespective of whether the crime was committed before or after the entry into force of the treaty.

    CONDITIONS FOR EXTRADITION:

    The person to be extradited must only be tried or punished in the requesting country for:

    • The offense for which his extradition is sought or for offenses connected therewith, or
    • Offenses committed after his extradition.
    • The signatory country to which the person is extradited must not extradite him to a third state, without the consent of the other signatory country.
    • If the person to be extradited is already under investigation or trial or is convicted in the requested state for an offense other than that for which his extradition is requested, then the requested state must decide on the request and communicate its decision to the requesting state. If the request for extradition is accepted, then the           surrender of the person concerned must be postponed until his trial in the requested state is completed and the punishment passed is executed.
    • If the person extradited had the freedom and means to leave the territory of the state to which he was extradited, and he did not leave within thirty days of his final release or left during that period, but returned on his own will, he may be tried for the other offences.
    • The two signatory countries may refuse to extradite the accused if the offence for which he is required to be extradited is a political offence.
    • When a number of requests from contracting countries for extradition are received for the same offence then the contracting party whose security or interest or interests of its nationals are affected by the offence is given priority for extradition. Second priority is given to that party in whose territory the offence was committed and lastly to the party of which the accused is a national.

    OTHER FACTORS FOR SIGNING A TREATY:

    When governments decide to sign a treaty, they should feel certain that those extradited, will receive a satisfactory level of care. This should amongst other things, include the right to a fair trial, reasonable sentencing and guarantees that human rights will be upheld.

    Many western countries already have extradition treaties with the United Arab Emirates (UAE). Australia and India have recently signed a treaty.  The UK has safeguards written into law to prevent extraditions where human rights may be breached whereas Australia is yet to pass the same safeguards to protect its citizens.

    Extradition treaties make it clear to criminals that there is no haven in the UAE. The extradition treaty provides a legal framework for seeking extradition of terrorists, economic offenders and other criminals from the UAE.

    Extradition for offenses in connection with taxes, fiscal charges, and customs duties will be in accordance with the provisions of this Treaty only if the said offense corresponds to an offense of a similar nature under the law of the requested State.

    Further the actual carrying out of the offense is not the only precondition for extradition, and even if a person attempts or plans to commit or is involved in such an offense he is eligible to be extradited.

    Extradition is also available for an extraditable offense if it is committed in a third state by a national of the requesting state who is present in the requested state and if it would be an extraditable offence under the laws of the requested state.

    TRANSFER OF SENTENCED PRISONERS AGREEMENT:

    Transfer of sentenced prisoners' agreement was signed between India and the UAE in New Delhi on November 23, 2011, to facilitate the social rehabilitation of persons convicted in their countries. It will provide convicted citizens of both countries who have been sentenced for their crimes "the opportunity to spend the duration of their sentences within their communities." Inmates serving sentences for murder, drug offenses, and financial crimes are not eligible.

    The transfer pact applies to those who have already been convicted. Under-trials will not be eligible for this benefit. The crime should be punishable in both the countries. A prisoner who wishes to be transferred must have a minimum of six (6) months of jail term left, and there should not be any pending case against him or her. Both the governments of the host and receiving countries have the right to accept or reject the requests of the prisoners.

    CONCLUSION:

    It is important that both sides honor these agreements, as even when treaties were in place extradition did not always take place. Many nations refuse extradition if the accused is likely to face the death penalty, others will not extradite their citizens. In a recent example, an Indian who was facing legal action in the UAE for allegedly fleeing to India after issuing a dud cheque to his fellow countryman could not be extradited from India to the UAE. India and the UAE signed an extradition treaty in 1999, but a country cannot extradite its nationals under the extradition treaty. However, the accused can be tried in India based on the same case initiated in the UAE under the Agreement on Juridical and Judicial Cooperation in Civil and Commercial Matters signed by the two nations in 1999.

    Although such extradition agreements do not necessarily need to be in place for a wanted criminal to be handed over to a foreign government, they simplify the process and most importantly send the right message to such criminals who think they can escape the law.

     

     

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    Tue, 23 Sep 2014 05:00:00 GMT
    <![CDATA[Fraud and Deceit under the UAE law]]> "Fraud and deceit abound in these days more than in former times"1 

      Lord Coke could have been talking just as easily about the modern day. Hundreds of thousands of people fall victim to fraudulent activities each year. A number of these crimes go unpunished as the brains behind these operations are that of professionals. These crimes are committed with the intention of deceiving another for monetary or personal gain. This article examines the crime of forgery and its implications in our lives.   Forgery is a process of making, changing, or imitating objects, documents, statistics or money with the objective to deceive. Copies and reproduc- tions of products are not considered forgeries. The process of repro- ducing currency is known as counterfeiting. Consumer products are also considered counterfeit when they are not manufactured or produced by the original manufacturer and stamped with the logo of the manufacturer.    According to the UAE Federal Criminal Code, forgery is changing the truth in any original document, logo, stamp, trademark, money, cheque and signature, in civil and commercial transactions. The law stipulates that there are two different types of fraud- criminal and civil. There must be a criminal intention on the part of the person committing the fraud and is punishable by way of fines or imprisonment. On the other hand, civil fraud is most accurately applicable to instances of bad faith and the penalties do not only encompass the punishment of the perpetrator but also to ensure that the victim and his circumstances are restored to the original state before the forgery took place.    UAE Trademarks Law (Federal Law No 37 of 1992 in relation to trademarks); the UAE Commercial Fraud Law (Federal Law No 4 of 1979 preventing fraud and deceit in commercial dealings) and its Executive Regulations (set out in Ministerial Decision No 26 of 1984); and the UAE Civil Code (Federal Law No 5 of 1985 Civil Code of the UAE as amended by Federal Law No 1 of 1987) are legislations under which the aggrieved can seek recourse to rectify the wrongdoings against them. Although forgery and counter- feit are considered offences similar in nature, the laws relating to each are different. Forgery is most commonly prosecuted at the state level though certain types of forgery are deemed felonies under the Federal law.   Some examples of this are identity theft, a form of forgery where a person forges signatures or documents in order to assume the identity of another. This is a felony under Federal law  and is punishable by a fine and up to fifteen years imprisonment. Federal law prohibits other types of forgery, such as counterfeiting money; forging federal documents such as; immigration documents or certificates; or forgery intended to defraud the government. Forgery automatically becomes a federal offence if a forged document is carried or mailed across borders, or if the forgery has been carried out in multiple states.    Forgery and counterfeiting carry similar penalties as the two often cross paths. The penalty for aforementioned crime is dependent on the severity of the crime. A draft law that is yet to be implemented shows the positive steps being taken by the UAE authorities to combat the issues of counterfeiting. This draft law hopes to replace Federal Law. No. 4 of 1979 and aims to protect the consumers and regulate the market in the UAE. A notable facet of the law is that it will align the domestic legislation with that of standards and obligations set out by international treaties. The new law is deemed to complement the existing impositions related to intellectual property rights and particu- larly those related to trademarks. The innumerable international brands with their presence in the UAE are eagerly awaiting the execution of the new law and measure its worth against the current remedies available to them. The UAE awaits the execution of this law with bated breath to determine its immense capability.  ]]>
    Fri, 05 Sep 2014 12:00:00 GMT
    <![CDATA[Role of Forensics In Criminal Investigation in the UAE - Sherlock Holmes of Today]]> Role of Forensics In Criminal Investigation in the UAE

    "Fingerprints cannot lie, but liars can make fingerprints. Jekyll's finger patterns remain the same when he transforms himself into Hyde."

                                                                                                                                                                                    Henry Faulds

    The unconscious human will step, touch and leave a witness behind. This is the evidence that cannot be dismissed, cannot perjure itself or be swayed by emotions. Changes in forensic science have impacted not only the way forensic science results affect case resolution but what type of evidence can be analyzed from the crime scene. For example, changes in DNA technology have allowed analysis of smaller samples and degraded samples i.e., cigarette butts or sweat from a tee-shirt that otherwise might have been ignored. Because of the increased sensitivity of DNA analysis, Police Officer and Crime Scene Investigators must be aware of the potential for cross-contamination adopt clean techniques when collecting and handling evidence.

    Forensic science is a union of principles of science and those of law. Forensic professionals employ the strength of their scientific backgrounds to enable law enforcement to solve crimes. In the year 2012, the Department of Criminal Evidence and Criminology, United Arab Emirates had delved into 8,817 cases of the highest importance and collected the tiniest clues that could make or break a case when it lands in the court. In the United Arab Emirates department has grown leaps and bounds and now is of intrinsic value for achieving justice. This in itself explains the significant role of forensics in criminal investigations in Dubai and the UAE.

    In comparison to physical evidence forensic science is almost never wrong and will always stand strong in the face of a perpetrator. It is factual evidence that cannot be refuted and only diminishes in value at a human failure of discovering, studying and understanding it. The forensic evidence is one of the departments of scientific importance in achieving justice through the establishment of physical evidence that raise from the scene as tracers that are dealt with in the laboratory to convert it to physical evidence of benefit in denial or proof considering that criminal evidence is the main fundamental proof for issues at the police or the Bureau of Investigation and Prosecution of public and judicial authorities and the courts according to the crime scene. In addition, all competent authorities benefit from the expertise of forensic science to clarify the facts as well as its role in the registration criminal records on its committees.

    Forensic linguistics, legal linguistics is the application of linguistic knowledge, methods, and insights to the forensic law, language, crime investigation, trial, and judicial procedure. There are three areas of application for linguists working in forensic contexts. They are as follows:

  • Understanding the language of the written law;
  • The understanding language used in forensic and judicial processes; and
  • The provision of linguistic evidence.
  • The area of forensic linguistics involves a wide range of experts and researches in different parts of the field. Forensic linguistics is diverse and occurs in the following areas: emergency calls, ransom demands or other threat communications, suicide letters and death row statements.

    One of the principles that govern criminal proof in the UAE is that the Criminal judge has full freedom in considering any evidence it deems appropriate as per the principle of "freedom of the judge's criminal conviction," the court can mull over all perspectives that lead to convicting a criminal.  In addition, the Code of the Federal Criminal Procedure confirmed the previous principle by stating that: "The court may order on its own during the hearing of the case to request or demand any evidence that it deems necessary to establish the truth."

    In a recent case before the Dubai prosecution, forensics played a significant role in attaining a guilty conviction for a stepmother who was accused of assaulting her four-year-old stepdaughter and causing her death. The stepmother told the court that the girl had fallen off her bicycle which had resulted in her death but forensics told a different story. The verdict is up for an appeal but the court of the first instance has found the woman guilty and sentenced her to ten years in prison followed by deportation.

    Furthermore, the experienced scientific discoveries continue to serve as a revolution in the field of criminal investigation, including the division of forensic evidence and denials. This division is important for the forensic specialist, as well as the investigator and they, are divided into two parts in this account evidence to prove any evidence to deny.  For the purposes of evidence of Proof, it has to be a strong and conclusive and one of its characteristics is that they need to be direct evidence, it is their strength that proves the responsibility of the accused of the crime in criminal cases, for instance, if we found a weapon, which proved to be the murder weapon (DNA) samples in the possession of the accused, it is the evidence of his conviction. Likewise in exculpatory evidence, it proves denial of the conviction of the accused and may be used in mitigating the sentence if the evidence weren't that strong. One of the clearest examples is the blood type and is more than the former evidence as an evidence of denial however not suitable to become the evidence of proof.

    The rapid advancement in technology has left no stone unturned, however, there are limitations. The forensic science also needs appropriate strategies to manage the workloads and the probity and analyses of the evidence to the satisfaction of the public. In the most situations, the investigative question has a direct impact regarding which evidence is analyzed and in what priority. Therefore it can be concluded that in addition to increase resources, such technological advancements are needed before the role of forensic science can be effectively moved from the "end" to the "front" of the investigative process in the criminal justice system.

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    Tue, 08 Jul 2014 12:00:00 GMT
    <![CDATA[Cybercrime and UAE Law]]> From coding a logic bomb to malicious hacking and from the formation of ransomware gangs to spear phishing, no computer in the cyber world is today immune from an electronic misdeed that continues to grow and develop and at the same time survive criminal prosecution in many instances. The year 2013 witnessed a new trend of cyber-attacks ranging from blackhole web malware, TDOS (telephony denial of service) and bad DDOS (distributed denial of service) attacks, advanced banking Trojans, proliferation of PUAs (potentially unwanted applications), invention of Tor network designed to hide user identity, advanced botnets, exploit kitsandcrypters. Cybercriminals recently went as far as setting up open market-place to sell drugs, illegal goods and harmful substances misusing the Tor network.

    Cyber threat laboratories around the world treat blackhole exploit kits (the Blackhole)amongst the top 50 malware in the world. A Blackhole is a bundle of maliciously coded software that permits its creator to create security risks, manage networks, obtaining analytical information of victims such as victim's location information, operating system, running applications, and system related information. The creators of such malware generally use a polymorphic engine (or; mutation engine) that converts software into various other versions with different code but are still capable of operating with the same functionality as original software. For this reason, anti-virus software generally cannot detect a Blackhole at the early stage.

    Banks are being targeted almost every minute of the day and it is anticipated that very soon, mobile services could be the next wave of cyber crimes. Cybercriminals resort to a range of cyber-attacks to target banks and financial institutions. One such attack is a denial of service (DOS) attack whereby overwhelming requests are made to the bank's server leading to temporary or indefinite interruption or suspension of services. Similarly, a bank's security may be compromised by adopting telephone denial of service (TDOS) attacks. Scammers make use of caller ID spoofing whereby the number appearing on recipient's caller id or phone screen is not the same as of the person making the call. For instance, the scammer may contact a bank representing itself as the bank's customer and request for a wire transfer. In return, the bank attempts to reach its customer for verification purposes but fails to reach as customer's lines are being flooded with fake calls. A recent trend of such frauds and bad practices is ransomware. Ransomware gangs work in union to create a 'fix' or malware that freezes victim's computer making it impossible for the victim to access any part of his computer. The victim has only displayed a message demanding the ransom to be paid to ransomware gang to remove the restrictions placed on the victim's computer.

    Growing use of interconnected network systems has heightened criminal opportunities and expert computer criminals pose a threat to law enforcement. Although new techniques and malware are being developed rapidly, legal development has not been able to maintain the pace. Computer or internet crimes are generally very complex and it is difficult to prove and/or nab the criminals. Unless incriminating evidence exists, it is generally difficult to prove) that the computer was in fact compromised or hacked; ii) difficult to prove the creator or the hacker; iii)issues such as access, intent, and jurisdictional difficulties. For instance, a person possessing hacked information and person hacking the computer may be two different people. Document management in today's global economy is much different than earlier when we had record trails. It is practically possible to commit a crime and destroy all the evidence.

    Computer forensic experts, however, play a major role in technical matters involving cyber-crime. Forensics is a scientific method of examining questions of interest to a judge. Computer forensic experts employ advanced scientific techniques and tools that detect steganography (steganography is the science of encoding hidden messages), cryptographic messages, concealment, read slack area, detect encryption, remote attacks, and using advanced tools such as Nmap, Nessus, and computer online forensic evidence extractor. 

    In the United Arab Emirates, the Federal Law number 5 of 2012 (the UAECyber Crimes Law)combating cyber-crimes aims at preventing cyber-crimes. The UAE Cyber Crimes Law replaces and repeals its predecessor Federal Law number 2 of 2006 and dated 1 March 2006. The UAE Cyber Crimes Law is perhaps the most recent and advanced piece of legislation. A wide range of offenses that may be committed using the World Wide Web has been codified under the UAE Cyber Crimes Law. The law aims at criminalizing persons who gain unlawful access (the Access)to a website, electronic information system, computer network, or information technology (the System and collectively, the Systems) and also those who indulge in deleting, omitting, destructing, modifying deteriorating, altering, copying, publishing or republishing any data or information (the Violation). The basic features of the UAE Cyber Crimes Law can briefly be summarized as under:-

    Article 1 to Article 11 – Persons posing threat to the security of any Systems, Phishing, and Forgery

    Article 12 to Article 27 – aim at punishing offenders involved in more serious cybercrimes such as gaining access to bank accounts, credit cards, extortion, slander, eavesdropping, etc.

    Article 28 and remaining articles – cover matters relating to public order, state security and other provisions.

    Article

    Particulars

    Comments

    2

    criminalizes persons who gain unlawful Access to System and this includes persons who abuse their position and act in excess of their permitted authorizations. Persons who indulge in Violation (this includes corporate as well as personal data) shall face criminal prosecution.

  • Imprisonment and/or a fine between AED 1,000 to 3,000/- for unlawful Access (term of imprisonment has not been provided);
  • Imprisonment for at least six months and/or fine between AED 100,000/- to AED 750,000/- to persons engaging in any Violation; and
  • Imprisonment for at least one year and/or fine between AED 250,000/- to AED 1 million if the individual's Violation relates to personal data.
  • 3

    Punishes persons who engage in both – gaining unlawful Access to System and indulges in Violation.

  • Imprisonment for a term of one year and/or fine between AED 250,000/- to AED 1 million. This clearly suggests that the Law aims at punishing offender violating personal data with the same punishment as the person committing gaining access to a system and disabling, copying or publishing it.
  • 4

    Seeks to punish persons who gain unlawful Access to System with the intention of gaining government data, or confidential information relating to the financial, economic or commercial facility.

  • Imprisonment for a term of five years and a fine between AED 500,000/- to AED 2 million towards the Violation.
  • 5

    Offends persons who participate in any Violation and consequently gaining access to a website

  • Imprisonment and/or a fine between AED 100,000 to 300,000/- (term of imprisonment has not been provided).
  •  

    6.

  • Persons committing forgery of an electronic document of the federal or local government or authorities or federal or local public establishments
  • Persons committing forgery of an electronic document of authorities other than those mentioned in part (A) above
  • Persons knowingly using forged documents
  • Temporary imprisonment and/or a fine between AED 100,000 to 300,000/-
  • imprisonment and/or a fine between AED 100,000 to 300,000/-
  • imprisonment and/or a fine between AED 100,000 to 300,000/-
  •  

    7 to 11

  • Persons engaging in Violation of any data or information relating to medical examinations, medical diagnosis, medical treatment or care or medical records;
  • persons who hinder or obstructs access to any System;
  • whoever uses a fraudulent computer network protocol address by using a false address or a third-party address by any other means for the purpose of committing a crime or preventing its discovery;
  • whoever runs a malicious software that renders and system inoperable;
  • Persons without legal right or those who fraudulently misrepresent themselves and steal personal information, property or deed for itself or others.
  • Temporary imprisonment;
  • Imprisonment and/or a fine between AED 1,000 to 3,000/- for unlawful Access (term of imprisonment has not been provided);
  • Imprisonment and/or a fine between AED 150,000 to 500,000/- for unlawful Access (term of imprisonment has not been provided);
  • Imprisonment for a term of five years and/or a fine between AED 500,000/- to AED 3 million towards the Violation if System becomes inoperable and imprisonment and/or fine of AED 500,000/- if the System survives and is operable;
  • Imprisonment for a term of one year and/or a fine between AED 250,000/- to AED 1 million.
  • Article 12 to Article 16 cover a wide range of serious offenses including unlawful access by persons to bank accounts, credit or electronic card numbers, persons resorting to counterfeiting or reproducing credit cards, persons attempting to hack Systems to obtain codes or passwords, intercepting communications through the computer network, and resorting to extortion. Article 17 and 27 punishes offenders who establish, manage or run pornographic or gambling activities on the website or those who deliberately acquire pornographic material involving juveniles using any System. Article 19 to Article 30 cover crimes relating to morality and public order and these include provisions criminalizing persons who establish, manage or run prostitution or lewdness, engaging in crime of slander as determined by Islamic Sharia, acts of eavesdropping, photographing others, or illegally disclosing any confidential information, prompt riot, hatred, racism, sectarianism, or damage, trading or promoting fire weapons, ammunition, or persons accepting donations without license.
    Article 28 to Article [ ] aim at maintaining the security of the UAE, public order and peace. These provisions prohibit persons who engage in inciting acts, publishing or transmitting information, drawings or pictures that may endanger national security and higher interests of the State or afflict its public order, operating a website providing information on or relating to any terrorist group or any unauthorized group, information, news or rumours with intent of sarcasm to damage reputation and prestige of State, any of its institutions or rulers, whoever runs website aiming or calling to overthrow, change the ruling system of the State, or seize it or to disrupt the provisions of the constitution, persons planning, organizing, promoting or calling for demonstrations or protests, persons running a website dealing in trafficking of antiquities or archaeological artifacts, any conduct or act that is disrespectful to Islam, resorts to money laundering, and persons who save or makes available any illicit content available on their website.

    Conclusion

    The UAE Cyber Crimes Law addresses dominant areas of paramount concern. Any activity on the cyberspace which poses a threat to the state security and political stability disturbs the Islamic principles of social and moral behavior or is financial criminal activity is punishable under the said law. Persons so acquitted are liable to pay penalties as specified under the law. While acting in conformity with the law, a court can pass a custodial sentence or deportation of the accused. The authorities have been provided the right to seize and destroy the equipment used in the process of such crime.

    With Saudi Arabian oil giant Aramco's claim of cyber attack, the UAE Government's activity to combat cyber crimes has gained momentum. Experts argue that with the rollout of new projects and massive economic growth, the increase in sophisticated cyber crimes in the Middle East will be witnessed. In light of recent legislation in place and active involvement by authorities, UAE seems to be geared up for the challenge. 

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    Wed, 12 Mar 2014 12:00:00 GMT