The Abu Dhabi Global Market (ADGM) Registration Authority has launched a public consultation on its proposed Consumer Protection Regulations 2025 (Consultation Paper No. 4 of 2025). These draft regulations aim to establish a comprehensive consumer protection framework for retail products and services within ADGM. They introduce new obligations for retail providers and strengthen consumer rights.

Purpose of the Proposed Regulations

The primary goal of these regulations is to enhance consumer welfare and confidence in the ADGM retail market, especially considering ADGM’s recent expansion and the growing number of retail businesses operating under ‘Category C’ licenses.

The proposed regulations outline a comprehensive set of requirements for all ADGM-licensed or permitted entities engaged in ‘Category C’ retail activities. To ensure compliance, businesses will need to focus on several key areas:

1. Review and Update Contracts: Businesses must revise their standard terms and conditions, invoices, and sales documentation. This includes removing any prohibited clauses, such as blanket “no returns or exchanges” clauses, unilateral termination rights, or waivers of consumer rights.
2. Product Labeling and Information: All products must be clearly labeled with essential information, including country of origin, shelf life, storage instructions, and any associated risks. Additionally, clear instructions for use and installation must be provided to consumers.
3. Advertising and Promotions: Providers must avoid misleading advertisements. A new layer of regulatory oversight will require businesses to obtain Registrar approval before announcing any promotions or sales.

Additionally, the proposed regulations include:

Stricter After-Sales and Warranty Requirements – Providers will need to establish and clearly communicate written procedures for offering warranties, maintenance, and spare parts. Warranty documents must explicitly state their duration, coverage, and any exclusions. If repairs take longer than seven days, providers must supply a comparable replacement product or agree on alternative compensation with the consumer. Additionally, frequently requested spare parts must be supplied within seven days, while less common parts should be provided within a reasonable timeframe. If parts are unavailable, alternative solutions must be offered to the consumer. 

Expanded Consumer Rights and Remedies – Consumers will benefit from expanded rights and available remedies under these new regulations. For defective products and services, consumers will have the right to choose between a refund, replacement, or repair of the product. For defective services, consumers can demand re-performance or a full refund if the provider fails to resolve the issue. The regulations also significantly limit the use of “no returns or exchanges” clauses in return and exchange policies, allowing such clauses only in specific cases, such as for perishable goods, custom-made items, or when a defect was disclosed at the time of purchase.

Increased Regulatory Oversight and Enforcement Risks – The Registrar will have significantly increased powers, leading to greater oversight and potential enforcement risks for businesses. The Registrar is authorized to receive and investigate complaints, issue determinations, and impose financial penalties for non-compliance. They can also order product recalls and collaborate with other authorities. Regarding product safety, providers must notify the Registrar and withdraw products from the market if defects are found that affect consumer health or safety. The Registrar can direct recalls and even seize products if necessary.

Operational and Strategic Adjustments – Businesses will need to make several operational and strategic adjustments to comply with the new regulations. This includes implementing or updating internal processes for handling complaints, managing warranties, and monitoring overall compliance. Comprehensive staff training will be essential, especially for employees involved in sales, customer service, and marketing, to ensure understanding and adherence to the new requirements. While these regulations aim to align with the UAE’s federal consumer protection regime, businesses must also ensure compliance with both ADGM and federal requirements, which may involve reconciling differences between the two frameworks.

Legal and Financial Exposure – Non-compliance could result in increased legal and financial exposure. Consumers will have the right to file direct consumer claims with the ADGM Court for declarations and compensation if providers fail to meet their obligations, increasing the risk of litigation and financial liability. Additionally, non-compliance, product recalls, or adverse determinations by the Registrar could significantly damage a business’s reputation and erode consumer trust.

Market and Competitive Implications– The regulations are expected to create a level playing field by standardizing consumer protection across all ADGM retail businesses, potentially raising the bar for market entry and ongoing operations. Ultimately, these enhanced protections are likely to boost consumer confidence in the ADGM retail market, which could benefit compliant businesses through increased customer loyalty and market share.

Recommended Actions and Deadlines 

We strongly advise all ADGM retail providers to carefully examine the proposed regulations to assess the potential impact on business operations, contracts, and compliance frameworks.

ADGM retail providers were required to submit their comments or concerns to the ADGM Registration Authority by June 8, 2025, especially if the proposals presented operational challenges or conflicted with existing practices.

What Happens Next? 

Following the submission of the comments, ADGM will consider whether the proposal requires any modifications. Once the proposal is finalised, the ADGM Board of directors and the Registration Authority will enact the proposals in their final form. 

It is important to note that ADGM retail providers should only act on the proposals once a notice of the final regulations has been officially published on the ADGM website.

How Can We Help?

Our team is ready to assist you by:

• Reviewing your current practices, identifying compliance gaps, and helping you prepare tailored feedback for the consultation.
• Offering strategic advice on aligning your business with the new regulatory requirements and minimizing legal and operational risks.

Active engagement is crucial to stay informed about regulatory changes that could potentially impact your business. Should you require any assistance, please reach out to the key contacts listed below or any member of the Corporate Structuring Team or Corporate Commercial Teams.