A revision to confused wording has ensured that people paying rent or for goods such as building materials in advance via post dated cheques can continue to do so in Qatar.
Like most Gulf countries, cheques issued ahead of their encashment date have been the stock way of ensuring payment for future goods and services. However, an amendment to this law demanded that cheques be payable ‘on sight’. Although this amendment was drafted back in 2006, it wasn’t implemented until May this year.
After taking effect, the rule, known as ‘Article 580’ meant that banks could attempt to cash cheques no matter what the date on them was, with obvious consequences for those who had written them. This in turn caused problems for landlords and others who were now unable to take any advance payment as no direct debit system operates in Qatar.
After objections from just about everybody, another amendment has been swiftly made, and is now in effect. “The cheque shall be due and payable at sight and every statement that contradicts the same shall be deemed non-existent. If the cheque is submitted prior to the date shown as the date of issue, the bank shall not settle that cheque until the date shown. Where the bank cashes the cheque before that date, it shall be liable for damages arising from its actions.”
‘Bouncing’ a cheque, regardless of what law was in force when issued, remains illegal in Qatar and will most likely result in gaol time. The number of bounced cheques rose dramatically to 44,958 in 2009 from just over 22,000 the previous year.
