Question: I plan to rent a car in Dubai, but the company demands a security deposit. I tried asking the reason, but the salesman did not offer a convincing answer. Is it legal for the company to seek a deposit? If yes, what are the rules for getting the security deposit back? For what purposes can the amount be used?
Answer: Yes, it is legal for car rental companies in Dubai to request a security deposit. This is a standard practice designed to safeguard the rental company against potential liabilities during the rental period. The deposit covers unforeseen costs, such as traffic violations, toll charges (Salik), minor vehicle damages, fuel discrepancies, or administrative fees.
As per the Federal Decree-Law No. (14) of 2024 on traffic regulations, vehicle rental companies must verify the validity of the driver’s licence before renting out vehicles. They must also operate under a licence issued by the competent authorities. Additionally, rental agreements must be signed, which outline all the rental terms.
Dubai's Department of Economy and Tourism mandates that rental companies return the security deposit within 30 days of the vehicle's return. If you paid the deposit by credit or debit card, the company is required to refund the amount via the same method, covering any transaction fees. However, they can deduct costs for traffic fines, vehicle damage, or applicable administrative fees.
If you encounter issues with getting your deposit back, you can file a complaint with the Department of Economy and Tourism for resolution.
This regulation ensures both consumer protection and a fair rental experience for all parties involved.
News Source: Khaleej Times
