Federal Decree-Law No. 6 of 2025 was signed at the Presidential Palace in Abu Dhabi on 8 September 2025 and came into force the day after it was published in the Official Gazette. Article 184 then gave every agency and person it covers “a period of one (1) year from the date of entry into force” to reconcile their positions. Norton Rose Fulbright puts that deadline at 16 September 2026, which is two weeks from today.
I read the whole 124-page text the way I read a supplier contract at the trading company where I work: skip the governance chapters, find the clauses that create an obligation someone can be held to. There are two, and both sit in Article 148.
Can a UAE bank charge interest on interest?
No. Article 148, clause 11 is one sentence long: “Licensed Financial Institutions shall not charge interest on accrued interest (compound interest) in relation to facilities extended to customers, and shall, in this regard, follow the rules and controls prescribed in regulations issued by the Central Bank.”
That prohibition is not new. It already existed as Article 121 of Federal Decree-Law No. 23 of 2022, and the UAE Supreme Court enforced it in a case Pinsent Masons reported on 12 November 2025: a bank sued over two defaulted facilities, an AED 634,000 commercial loan at 11.25 per cent and an AED 66,000 personal loan at 10.5 per cent, and the court threw out the calculation because the interest charged had grown past the principal itself. What the 2025 law does is carry the ban into the statute that everything else now hangs off, and attach it to Central Bank regulations that institutions have to be aligned with by the deadline.
Here is the part nobody writes about, because it only shows up if someone actually opens a statement. Compound interest almost never appears as a labelled line. A finance charge posts against a closing balance that already contains last month’s finance charge, and the statement prints one figure, not two. The only way to see it from outside the bank is to line up three consecutive statements and check what base the charge was applied to: the outstanding principal, or the running balance with prior interest folded in. If the charge grows while the principal falls, the base is wrong. That is a ten-minute arithmetic exercise, not a legal opinion, and it is the exercise a complaint has to be built on.
What happens when a bank rejects a complaint
The rest of Article 148 is the machinery. Clause 2 requires the Central Bank to run an independent unit with its own legal personality that receives, hears and adjudicates customer complaints against banks and insurance companies, and issues binding resolutions. Clause 5 puts a judge at the head of each dispute committee, sitting with a second judge and at least one expert. Clause 3 requires a bank that rejects a complaint, in whole or in part, to state its reasons in writing.
A refusal that is not in writing is not really a refusal.
Then the number that matters. Under clause 6, where the disputed amount does not exceed AED 100,000, the committee’s decision is final and enforceable and the bank is not allowed to challenge it. Above AED 100,000, clause 7 gives either side thirty days to take it to the Court of Appeal. Most consumer disputes here, a duplicated fee, a mis-sold policy, an interest calculation on a car loan, sit well under that line, so the institution gets no second bite.
The unit already exists. Sanadak operates as the UAE’s financial and insurance ombudsman, it is free for consumers and small businesses, and it takes a case only after the bank has had its own 30 complete business days to answer, with a three-year outer limit from the conduct complained of. The step-by-step mechanics of disputing a bank charge, and what evidence actually moves one, I wrote up separately. The new law is the statute that unit now stands on.
What does not change on 16 September
Quite a lot, and it is worth being blunt about that. Article 184 lets the Board extend the reconciliation period as it sees fit, so the date is a target, not a guillotine. Article 183 keeps every regulation and circular issued under the old 2018 law in force until a replacement is issued, so the rulebook a bank quotes at the counter next month will mostly be the same rulebook. No fee disappears on the day. Nobody gets a refund because a deadline passed.
What changes is the quality of the paper trail. A statute that says compound interest is prohibited, that a rejection must be reasoned in writing, and that a judge-led committee can bind a bank below AED 100,000, is a statute that rewards whoever brought the arithmetic. In trading, a disputed invoice is never won by being annoyed about it; it is won by the party who can show the calculation line by line and name the clause it breaches. Retail banking is not different. It only feels different because the document is harder to read.
So the useful preparation for 16 September is not watching for an announcement. It is pulling the last three statements on any loan or card, finding the charge line, and working out what base it was applied to. Statement importing is the one part of that I automated in Masrofna, because I got tired of doing it with a calculator. The rest is arithmetic, and the law has just been rewritten around the people who bother to do it.
This is general educational material about how the rules work, not legal or financial advice. Run the numbers on an actual statement, and take a real dispute to Sanadak or a lawyer.