Used Car Breakdowns in the UAE: What the Law Says When a Vehicle Fails Soon After Sale Due to Hidden Defects

Buying a used car in the UAE can be a cost-effective option, but it also carries legal risks --particularly when defects surface shortly after purchase. Recent updates to UAE consumer protection regulations have strengthened buyers’ rights and clarified sellers’ obligations, even in private sales. If a vehicle breaks down soon after purchase due to pre-existing faults, the law may provide remedies.

Seller’s Duty to Disclose Defects

Under UAE law, a sale is presumed to be concluded on the basis that the item sold is free from defects, except for minor defects tolerated by custom. This principle is set out in Article 543(1) of Federal Law No. 5 of 1985 (UAE Civil Transactions Law).

Where a serious defect existed before the sale and was not disclosed, Article 544(1) gives the buyer the right to either:

• return the item and rescind the sale, or
• keep the item at the agreed price.

The law does not allow the buyer to keep the item and unilaterally demand a price reduction, unless compensation is claimed under other applicable laws.

In practical terms, if a used car develops major engine problems shortly after purchase and mechanics confirm that these issues existed before the sale, the seller may be legally responsible for failing to disclose them.

Misrepresentation and Misleading Conduct

Beyond civil law principles, consumer protection legislation imposes strict rules on how goods are described and advertised. Federal Law No. 15 of 2020 on Consumer Protection, as amended by Federal Decree Law No. 5 of 2023, prohibits sellers from providing incorrect or misleading descriptions of goods.

Article 17 of the Consumer Protection Law expressly bans misleading statements or advertisements by suppliers, advertisers, or agents. This obligation is further detailed in Cabinet Decision No. 66 of 2023, which implements the executive regulations of the Consumer Protection Law.

Under Article 8 of Cabinet Decision No. 66 of 2023, a description or advertisement is considered deceptive if it creates a false or misleading impression about matters such as:

• the nature, condition, or composition of the product;
• its source, authenticity, or manufacturing details;
• warranty terms, after-sales service, or price; and
• the expected performance or results of using the product.
  
  

If a seller represents a used car as being in good condition while concealing known engine defects, this may amount to deceptive conduct under the regulations.

Special Rules for Used and Defective Goods

The law is particularly clear when it comes to second-hand items. Article 7 of Cabinet Decision No. 66 of 2023 requires suppliers offering used, refurbished, or defective goods to clearly and visibly disclose the condition of the item. This disclosure must:

• be apparent on the product and at the place of sale, and
• be clearly stated in the contract or invoice.
  
  

Any failure to do so, especially where it misleads the buyer, can trigger regulatory penalties.

Right to Compensation

In addition to contractual remedies, buyers may claim compensation for losses suffered due to defective goods. Article 24(1) of the Consumer Protection Law grants consumers the right to seek compensation for material or personal damage resulting from the use of a defective product. Any agreement attempting to waive this right is deemed null and void.

This means repair costs incurred due to undisclosed defects may, in appropriate cases, be recoverable.

Complaints and Penalties

Consumers can lodge complaints with the UAE Ministry of Economy or the competent consumer protection authority in the relevant emirate, as provided under Article 35 of Cabinet Decision No. 66 of 2023.

Notably, Addendum No. 2 to the same Cabinet Decision sets out financial penalties, including fines of up to Dh100,000 for offering defective used or refurbished products without proper disclosure.

Effect of Warranties

Where a seller has issued a warranty for the vehicle, claims for defects or breakdowns during the warranty period must generally be pursued under the warranty terms. However, the existence of a warranty does not necessarily absolve a seller from liability for deliberate misrepresentation or concealment of known defects at the time of sale.

The Bottom Line

If a used car in the UAE breaks down shortly after purchase due to serious, pre-existing defects that were not disclosed, the buyer may have multiple legal options. These include rescinding the sale, seeking compensation, and filing a complaint with consumer protection authorities. Recent legislative amendments reinforce the principle that sellers -- whether businesses or individuals --must be transparent about the true condition of used vehicles and must not mislead buyers.

 

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