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Dubai’s fine discounting festival

Dubai’s fine discounting festival

Over the past six months, the UAE has been adamant to get you to pay your fines. Let's get real. It isn't exactly because the markets are back on track.

January 9, 2012 3:08 by

The start of the year is just as good a time as any to start fresh for any one of us. And for businesses, it’s become even easier to wipe that slate clean with the recent decree in Dubai that enables companies to pay their fines at discounted rates.

So it’s good all around. Isn’t it?

After all, companies would have all learned their lessons and not accumulate fines while waiting for another round of discount decrees. We’re almost sure of that. Almost.

And according to executives quoted in a Gulf News article about the decree, the move was good for the economy with some even going as far as saying that “Such a decree thus makes it easier for them to do business. It’s most attractive for existing businesses to expand and for new businesses to flourish.”

They’ve got a point. Dodging payment of all those fines would take time away from growing the business.

One exec also said that “Companies were burdened with such fines because of a tough economic climate.” Well, that line from a long forgotten 70s detective show “Don’t do the crime if you can’t do the time” pops into my head just now.

Strategic Discounting
This kind of fine-discounting doesn’t really come as a surprise. Ajman already put a similar waiver last October 2011, when it gave a 30 percent discount to fines on commercial licenses in the emirate—the catch here though was the fines needed to be paid in cash before December 31.

Kipp has also covered another form of this discounting as early as September last year when motorists were encouraged to pay all their traffic fines by giving discounts depending on the amount you owed.

Back then, some concerns were raised about whether or not the discounts degraded the value of the rules and regulations by discounting the penalties. So it won’t be far-fetched to assume that there will be a few who’d wonder about the same concerns for the corporate fine discounting.

Could it be that it’s just that the bargains and discounting methods of the Dubai Shopping Festival are just seeping through into other aspects of our system? Nah.

But then again, one could argue that sometimes just getting even partial debt/fine payment is better than nothing especially in this economic climate.

Watch this short video and you’ll see what we’re talking about.

Put yourself in Dubai’s shoes. Think about all those people who are constantly looking for ways to dodge payment of fines. You’ll realise there’s a chance you’ll never see the full amount you are owed. And considering you’ve got your own bills and debts to manage, partial payment of fines will start to sound quite appealing.

Could these discounts be incentives?
But discounts on fines are a great incentive for people to pay up, you may say. Well, there are some like career analyst Dan Pink who may have more than a couple of things to say about using financial incentives.

He says that financial rewards work well only up to a certain point or only for menial issues. Beyond a certain degree, money means nothing and does not incentivize individuals the way we would expect it would.

Here’s the rather insightful video:

A relevant local example of this concept is this 29-year-old motorist in Umm Al Quwain who has avoided paying $49,863 in fines despite the recent discounts. So if fine-discounting doesn’t encourage this gentleman to pay, would you say ‘white points’ for good behaviour on the roads would do the trick? One can only hope.

Whether or not these same people/companies will commit the same offense again is hard to tell. But at least the powers that be are at least trying to close the books on what we can only imagine are large amounts of fines that may never have otherwise been paid and that are now possibly go toward something useful like debt payment or, okay, let’s say infrastructure development.

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