Car rental firms are barred from seeking cash deposits from customers, nor are they allowed to hold customer’s passports or IDs for security, the Roads and Transport Authority (RTA) announced on Tuesday in a new set of regulations for the car rental sector.
Aimed at restructuring the car rental sector and safeguarding the rights of both the customers and businesses, the new regulations also stipulate the conditions for setting up car rental business as well as its basic requirements.
Though, no cash deposits are allowed, the operators can secure an amount from the customer’s credit card.
Explaining the new regulations, Nasir Al Haj, Director of Commercial Transport Activities, RTA’s Licensing Agency, said: “Rental firms can block a certain amount on the credit card of the customer, but no cash deposit is allowed.”
He added that there is no stipulation of the minimum or maximum amount for the security deposit.
“The amount has to be agreed upon mutually between the customer and the companies. The deposit is allowed as security for the businesses against any fines incurred by the customers. Some companies secure a deposit of Dh750, but there is no regulation on the amount,” said Al Haj.
However, the deposit amount can be blocked only for a duration of a month after customer hands over the vehicle back to the company.
“Most of the fines are credited within a month of a particular violation and hence the companies are required to release the amount immediately after 30 days,” said Al Haj
In case the fines incurred by the customer is higher than the amount secured and the customer is not willing to pay, the owners have the right to take a legal action, he added.
Apart from cash, the car rentals are also barred from holding any personal document of the customer as a security, including passport and ID.
The regulations also bar rental firms from charging extra in case of an accident, as all the damages are covered by the insurance.
“All damages are covered by the insurance and the customers should not pay anything if there is an accident, however, if the rent-a-car driver was at fault he will have to pay the fine issued by Dubai Police,” said Al Haj.
Among the other stipulations for the car rentals is that they will have to have a sizeable private parking space for their vehicles, which will ensure that public parking spaces are free for others to use.
Another important condition for car rentals is that no vehicle can be used for more than four years.
When it comes to purchasing vehicles, any car that is more than 24 months old cannot be registered as a rent-a-car.
To be on the safer side, Al Haj urged all the customers to secure the vehicle possession document, indicating all damages, scratches and dents if any.
Al Haj said that the new regulations aim at improving the business practices of this sector as well as curb offences and risks, while clearly defining the roles and responsibilities of all stakeholders.
No holding of passport and ID allowed.
No cash deposit allowed.
Security deposit can be made only through credit card.
No minimum or maximum amount for security deposit.
Security deposit to released after 30 days of vehicle handover.
Rental vehicles have to be replaced after four years in use.
No extra charges on customers in case of accident.
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