The Advisory Council yesterday passed an amendment to the Commercial Law No 27 of 2006, making a cheque redeemable once presented at the bank irrespective of its issuing date and urged the government to set up special sections in courts to deal with bounced cheques.
In a meeting on April 21, the Cabinet had approved amendments to two articles of the Commercial Law and referred it to the Advisory Council for consideration. The council’s general secretariat was advised to consider the draft law on an urgent basis.
Cheques will be encashed immediately on presentation at a bank, according to the relevant provisions of Qatar’s Commercial Law, which takes effect on May 13, 2010. If a cheque bounces for lack of funds when presented at a bank, the drawer will be liable for its value and he/she may be prosecuted, convicted of a penal offence, fined or imprisoned, sources said.
Advisory Council secretary general Fahad bin Mubarak al-Khayareen said the Committee of Financial and Economic Affairs at the council had submitted a report on the
proposed changes to the members.
To tackle what it called “lengthy litigations”, the council recommended to the government to set up special departments within courts to hear cheque-related
disputes and settle them swiftly.
“Such an arrangement will be useful since they will help maintain the rights of the beneficiaries, especially since many cheques are issued to property developers and owners of car agencies,” said Nasser Rashid al-Kaabi, a member of the council.
The Advisory Council, a consultative body, urged the government to give the “Cheques Department” at the Capital Police Station more teeth to deal effectively with “bounced cheques” so that the amount could be recovered from the drawer without seeking court’s intervention.
“This will help restore investors’ confidence in cheques and prevent problems which can adversely affect the country’s economic growth,” explained the secretary general during the discussions.
Al-Kaabi said the Qatar Central Bank could play a more effective role in this regard by instructing the country’s financial institutions to disclose the names of their customers who had been penalised for issuing cheques without having sufficient funds in their accounts.
He argued that banks should issue cheque books only to clients who had sufficient funds in their accounts.
Rashid bin Mohamed al-Maadhadi, another member, said the number of cheque-related disputes had increased significantly in the recent past. “Traders and investors have incurred losses because of lengthy litigations to recover their money.”
The provisions of the law take effect on May 13 following the expiry of the three-year period notified after its implementation. The law was issued on July 27, 2006 and implemented six months after gazette publication.
According to a senior banker, the system of issuing post-dated cheques will get scrapped with the law taking effect.
Earlier reports said QCB had already notified the local banks about the relevant provisions of the Commercial Law of Qatar taking effect in May.
The Advisory Council yesterday passed an amendment to the Commercial Law No 27 of 2006, making a cheque redeemable once presented at the bank irrespective of its issuing date and urged the government to set up special sections in courts to deal with bounced cheques.
In a meeting on April 21, the Cabinet had approved amendments to two articles of the Commercial Law and referred it to the Advisory Council for consideration. The council’s general secretariat was advised to consider the draft law on an urgent basis.
Cheques will be encashed immediately on presentation at a bank, according to the relevant provisions of Qatar’s Commercial Law, which takes effect on May 13, 2010. If a cheque bounces for lack of funds when presented at a bank, the drawer will be liable for its value and he/she may be prosecuted, convicted of a penal offence, fined or imprisoned, sources said.
Advisory Council secretary general Fahad bin Mubarak al-Khayareen said the Committee of Financial and Economic Affairs at the council had submitted a report on the
proposed changes to the members.
To tackle what it called “lengthy litigations”, the council recommended to the government to set up special departments within courts to hear cheque-related
disputes and settle them swiftly.
“Such an arrangement will be useful since they will help maintain the rights of the beneficiaries, especially since many cheques are issued to property developers and owners of car agencies,” said Nasser Rashid al-Kaabi, a member of the council.
The Advisory Council, a consultative body, urged the government to give the “Cheques Department” at the Capital Police Station more teeth to deal effectively with “bounced cheques” so that the amount could be recovered from the drawer without seeking court’s intervention.
“This will help restore investors’ confidence in cheques and prevent problems which can adversely affect the country’s economic growth,” explained the secretary general during the discussions.
Al-Kaabi said the Qatar Central Bank could play a more effective role in this regard by instructing the country’s financial institutions to disclose the names of their customers who had been penalised for issuing cheques without having sufficient funds in their accounts.
He argued that banks should issue cheque books only to clients who had sufficient funds in their accounts.
Rashid bin Mohamed al-Maadhadi, another member, said the number of cheque-related disputes had increased significantly in the recent past. “Traders and investors have incurred losses because of lengthy litigations to recover their money.”
The provisions of the law take effect on May 13 following the expiry of the three-year period notified after its implementation. The law was issued on July 27, 2006 and implemented six months after gazette publication.
According to a senior banker, the system of issuing post-dated cheques will get scrapped with the law taking effect.
Earlier reports said QCB had already notified the local banks about the relevant provisions of the Commercial Law of Qatar taking effect in May.