Prohibition on New Cheques
Article 604 of Qatar Law No. 27/2006 On the Issuance of the Commercial Transactions Law (the Commercial Transactions Code, or the Trade Law) states that:
The court, should it adjudge conviction of one of the cheque offenses set forth in the Penal Code, may order withdrawal of the cheque books from the convict and refuse to provide that person a new cheque book for a period of no more than one year.
In August of 2019, the Criminal Courts (under the ambit of the Supreme Judiciary Council) concluded the cooperative mechanism with the Qatar Central Bank to commence implementing the procedures set out in Article 604 above in an aim to reduce the frequency of bounced cheques in Qatar.
Where an individual or a corporate are convicted of a bounced cheque by the Court of Misdemeanors, it is planned that a circular will be issued to the banks via cooperation between the Qatar Central Bank and the courts, instructing the banks to refrain from providing any new cheque books for one year, or more, depending on the number of cases filed.
This initiative falls hand-in-hand with Article 357 of Qatar Law No. 11/2004 on the Issuance of the Penal Code to obligate the person upon which a judgement is issued to pay the value of the cheque and expenses incurred by the beneficiary without filing a civil case (in addition to a criminal case). Article 357 states as follows:
The bank shall undertake to return the deposited securities immediately when the depositor requests same, taking into account the time required for the preparation of the securities for the return.
The securities shall be returned at the place where they were deposited or at any other place agreed upon. The bank shall undertake to return the deposited securities themselves unless the parties agreed and the law permitted that the equivalent may be returned.
In relation to Article 357, in Qatar Court of Cassation 15/2013, the public prosecution issued proceedings against two defendants with the accusation of providing the beneficiary with a cheque with insufficient funds. The public prosecution took action under Article 357 and the Primary Criminal Court issued a judgement of a two-month imprisonment sentence for each of the defendants, and a fine to stay the sentence of 800 Qatari Riyals. The defendants were also required to provide the value of the bounced cheques to the beneficiary.
One of the defendants appealed the judgement before the Court of Appeal. The Court of Appeal upheld the primary judgment and ordered a halt to the implementation of the prison sentence for three years starting from the date of the execution of the judgment. The matter was further appealed at the Court of Cassation, which ruled that due to the defendants having had paid the value of the cheques to the Treasury of the Court, presented proof thereof to the Court of Appeal, and reconciled with the beneficiary, the criminal proceedings should have been stayed.