The Federal National Council of the United Arab Emirates has approved a draft federal law that would allow the Central Bank of the United Arab Emirates to regulate finance leasing, Emirates News Agency reported Jan. 30.
The legislation would require local and foreign firms offering finance leases to obtain licenses from the central bank as unauthorized parties will be prohibited from using "finance leasing," or any of its synonyms, in their trading name, the report said, adding that any violation could result in imprisonment or a fine of 10 million United Arab Emirates dirhams.
Finance leases allow industrial and commercial projects to receive equipment and production tools on rent, with ownership rights until leasing period ends, without taking loans from lenders to buy equipment directly, the news agency wrote.
As of Feb. 1, US$1 was equivalent to 3.67 United Arab Emirates dirhams.
