ActiveE-InvoicingCabinet DecisionVII. Legal Ramifications

Cabinet Decision No. 173 of 2026 On the Violations and Administrative Penalties Resulting from Violation of the Legislation Regulating the Electronic Invoicing System

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Summary

This Cabinet Decision establishes the framework for violations and administrative penalties applicable to breaches of the Electronic Invoicing System legislation in the UAE. The Decision defines key terms including Electronic Invoice, Electronic Credit Note, Issuer, and Recipient, and prescribes specific penalties for non-compliance with electronic invoicing requirements. It applies to violations of the Electronic Invoicing System under Federal Decree-Law No. 28 of 2022 on Tax Procedures, while exempting persons who voluntarily adopt electronic invoicing from these penalties.

The Decision establishes a comprehensive penalty structure covering four main violation categories: failure to implement the Electronic Invoicing System (AED 5,000 for first instance plus AED 5,000 per month of continued non-compliance, capped at AED 50,000 within any 12-month period); failure to issue and transmit Electronic Invoices (AED 100 per invoice up to AED 5,000 per calendar month); failure to issue and transmit Electronic Credit Notes (AED 100 per credit note up to AED 5,000 per calendar month); and failure to notify the Accredited Service Provider of data changes (AED 250 per day of delay up to AED 5,000 per calendar month). The Decision references Ministerial Decision No. 244 of 2025 and Ministerial Decision No. 243 of 2025 as the governing implementation frameworks.

The Decision includes a proportionality provision stating that if the same person acts as both Issuer and Recipient in respect of the same violation, only one administrative penalty shall be imposed. It repeals Cabinet Decision No. 106 of 2025, which previously governed violations and penalties for the Electronic Invoicing System. The Decision is to be published in the Official Gazette and enters into force the day following its publication date.

Key points

Defines Electronic Invoice as an invoice issued, transmitted, and received in a structured electronic format enabling automatic and electronic processing
Defines Electronic Credit Note as a credit note issued, transmitted, and received in a structured electronic format in accordance with the Electronic Invoicing System
Defines Issuer as any person obligated to issue, transmit, share and exchange Electronic Invoices and Electronic Credit Notes through the Electronic Invoicing System
Defines Recipient as any person who shall receive Electronic Invoices and Electronic Credit Notes through the Electronic Invoicing System
Applies to violations of the Electronic Invoicing System legislation under Federal Decree-Law No. 28 of 2022 on Tax Procedures
Exempts persons who issue, transmit, share, exchange or report Electronic Invoices and Electronic Credit Notes on a voluntary basis from penalty provisions
Violation 1(a): Failure by Issuer or Recipient to implement the Electronic Invoicing System in accordance with Ministerial Decision No. 244 of 2025, including failure to appoint an Accredited Service Provider - penalty of AED 5,000 for first instance
Violation 1(a) continued: AED 5,000 for each month or part thereof during which non-compliance continues following commission of violation
Violation 1(a) cap: Total fines capped at AED 50,000 within any period of 12 consecutive months
Violation 1(b): Failure by Recipient to maintain compliance with obligations under Ministerial Decision No. 243 of 2025 after having implemented the system - same penalty structure as 1(a)
Violation 2: Failure by Issuer to issue and transmit Electronic Invoice to Recipient through the Electronic Invoicing System - penalty of AED 100 per Electronic Invoice
Violation 2 cap: Maximum penalty of AED 5,000 per calendar month
Violation 3: Failure by Issuer to issue and transmit Electronic Credit Note to Recipient through the Electronic Invoicing System - penalty of AED 100 per Electronic Credit Note
Violation 3 cap: Maximum penalty of AED 5,000 per calendar month
Violation 4: Failure by Issuer or Recipient to notify appointed Accredited Service Provider of changes to data registered with the Authority - penalty of AED 250 per day of delay or part thereof
Violation 4 cap: Maximum penalty of AED 5,000 per calendar month
If same person acts as both Issuer and Recipient for same violation, only one administrative penalty shall be imposed (Article 3.2)
Repeals Cabinet Decision No. 106 of 2025 on the Violations and Administrative Penalties Resulting from Violation of the Legislation Regulating the Electronic Invoicing System (Article 4)
To be published in the Official Gazette and enter into force from the day following the date of publication (Article 5)
Signed by Mohammed bin Rashid Al Maktoum, Prime Minister
Issued in 1448H corresponding to 2026

Full text · 1,350 words

logo: United Arab Emirates Ministry of Finance Office of the Minister

Cabinet Decision No. 173 of 2026

On the Violations and Administrative Penalties Resulting from Violation of the Legislation Regulating the Electronic Invoicing System

The Cabinet:

having reviewed the Constitution,
Federal Law No. 1 of 1972 on the Competences of the Ministries and Powers of the Ministers, and its amendments,
Federal Decree-Law No. 13 of 2016 on the Establishment of the Federal Tax Authority, and its amendments,
Federal Decree-Law No. 8 of 2017 on Value Added Tax, and its amendments,
Federal Decree-Law No. 28 of 2022 on Tax Procedures, and its amendments,
Cabinet Decision No. 106 of 2025 on the Violations and Administrative Penalties Resulting from Violation of the Legislation Regulating the Electronic Invoicing System, and
pursuant to what was presented by the Minister of Finance and approved by the Cabinet.

Has decided:

Article 1 – Definitions

Definitions in the Federal Decree-Law No. 28 of 2022 on Tax Procedures shall apply to this Decision, and other than this, the following words and expressions shall have the meanings assigned against each, unless the context requires otherwise:

Electronic Invoice : An invoice issued, transmitted, and received in a structured electronic format that enables automatic and electronic processing, in accordance with the Electronic Invoicing System.
Electronic Credit Note : A credit note issued, transmitted, and received in a structured electronic format that enables automatic and electronic processing, in accordance with the Electronic

ABU DHABI, UNITED ARAB EMIRATES P.O. BOX 433 • أبوظبي، الإمارات العربية المتحدة ص.ب. 433 • TEL +971 2 6726000 هاتف • FAX +971 2 6713333 فاكس
DUBAI, UNITED ARAB EMIRATES P.O. BOX 1565 • دبي، الإمارات العربية المتحدة ص.ب. 1565 • TEL +971 4 3939000 هاتف • FAX +971 4 3939090 فاكس
www.mof.gov.ae

UNITED ARAB EMIRATES
MINISTRY OF FINANCE
OFFICE OF THE MINISTER
logo: Emblem of the United Arab Emirates
الإمارات العربية المتحدة
وزارة المالية
مكتب الوزير

Invoicing System.

TEL +971 2 6726000 • FAX +971 2 6713333 • ABU DHABI, UNITED ARAB EMIRATES • أبوظبي، الإمارات العربية المتحدة • P.O. BOX 433 .ص.ب
TEL +971 4 3939000 • FAX +971 4 3939090 • DUBAI, UNITED ARAB EMIRATES • دبي، الإمارات العربية المتحدة • P.O. BOX 1565 .ص.ب
www.mof.gov.ae

logo: United Arab Emirates Ministry of Finance Office of the Minister

Issuer : Any Person who is obligated to issue, transmit, share and exchange Electronic Invoices and Electronic Credit Notes through the Electronic Invoicing System.

Recipient : Any Person who shall receive Electronic Invoices and Electronic Credit Notes through the Electronic Invoicing System.

Article 2 – Scope of Application

The provisions of this Decision shall apply to the violation of the legislation regulating the Electronic Invoicing System, in accordance with the Federal Decree-Law No. 28 of 2022 referred to.
Excepted from the provisions of this Decision shall be the Person who issues, transmits, shares, exchanges or reports Electronic Invoices and Electronic Credit Notes, on a voluntarily basis, in accordance with the decisions issued pursuant to Federal Decree-Law No. 28 of 2022 referred to.

Article 3 – Violations and Administrative Penalties

The administrative penalties listed in the table annexed to this Decision shall be imposed on the violations related to the Electronic Invoicing System.
If the same Person acts as an Issuer, a Recipient, or both, in respect of the same violation, only one administrative penalty for that violation shall be imposed on that Person under the provisions of this Decision.

Article 4 – Repeals

Cabinet Decision No. 106 of 2025 on the Violations and Administrative Penalties Resulting from Violation of the Legislation Regulating the Electronic Invoicing System shall be repealed, and any provision that contradicts or conflicts with the provisions of this Decision shall be repealed.

TEL +971 2 6726000 • FAX +971 2 6713333 • ABU DHABI, UNITED ARAB EMIRATES • P.O. BOX 433 • ص.ب. 433 • أبوظبي، الإمارات العربية المتحدة • هاتف 6726000 2 971+ • فاكس 6713333 2 971+
TEL +971 4 3939000 • FAX +971 4 3939090 • DUBAI, UNITED ARAB EMIRATES • P.O. BOX 1565 • ص.ب. 1565 • دبي، الإمارات العربية المتحدة • هاتف 3939000 4 971+ • فاكس 3939090 4 971+
www.mof.gov.ae

logo: United Arab Emirates Ministry of Finance Office of the Minister

Article 5 – Publication and Entry into Force

This Decision shall be published in the Official Gazette and shall come into force from the day following the date of its publication.

Mohammed bin Rashid Al Maktoum

Prime Minister

Issued by us,

On: / / 1448H

Corresponding to: / / 2026

UNITED ARAB EMIRATES
MINISTRY OF FINANCE
OFFICE OF THE MINISTER
logo: United Arab Emirates Ministry of Finance
الإمارات العربية المتحدة
وزارة المالية
مكتب الوزير

Table annexed to Cabinet Decision No. 173 of 2026
On the Violations and Administrative Penalties Resulting from Violation of the
Legislation Regulating the Electronic Invoicing System

No.	Description of Violation	Administrative Penalty Amount
1	a) Failure by the Issuer or the Recipient to implement the Electronic Invoicing System, in accordance with Ministerial Decision No. 244 of 2025 issued by the Minister of Finance and its amendments, or any decision replacing it, including the failure to appoint an Accredited Service Provider. b) Failure by the Recipient, having implemented the Electronic Invoicing System in accordance with Paragraph (a) of this Clause, to thereafter maintain compliance with its obligations as a Recipient in accordance with Ministerial Decision No. 243 of 2025 issued by the Minister of Finance and its amendments, or any decision replacing it.	AED 5,000 for the first instance in which the Issuer or Recipient commits the violation provided for in Paragraph (a) or Paragraph (b), or both; and AED 5,000 for each month or part thereof during which non-compliance continues following the commission of the violation provided for in Paragraph (a) or Paragraph (b), or both; provided that the total fines imposed do not exceed AED 50,000 within any period of (12) twelve consecutive months.
2	Failure by the Issuer to issue and transmit an Electronic Invoice to the Recipient through the Electronic Invoicing System.	AED 100 for each Electronic Invoice up to a maximum of AED 5,000 per calendar month.
3	Failure by the Issuer to issue and transmit an Electronic Credit Note to the Recipient through the Electronic Invoicing System.	AED 100 for each Electronic Credit Note up to a maximum of AED 5,000 per calendar month.
4	Failure by the Issuer or the Recipient to notify the appointed Accredited Service Provider of any changes to the data registered with the Authority.	AED 250 for each day of delay or part thereof, up to a maximum of AED 5,000 per calendar month.

TEL +971 2 6726000 • FAX +971 2 6713333 • ABU DHABI, UNITED ARAB EMIRATES • ص.ب. 433 P.O. BOX • أبوظبي، الإمارات العربية المتحدة
TEL +971 4 3939000 • FAX +971 4 3939090 • DUBAI, UNITED ARAB EMIRATES • ص.ب. 1565 P.O. BOX • دبي، الإمارات العربية المتحدة
www.mof.gov.ae

UNITED ARAB EMIRATES
MINISTRY OF FINANCE
OFFICE OF THE MINISTER
logo: Emblem of the United Arab Emirates
الإمارات العربية المتحدة
وزارة المالية
مكتب الوزير

TEL +971 2 6726000 هاتف • FAX +971 2 6713333 فاكس • ABU DHABI, UNITED ARAB EMIRATES أبوظبي، الإمارات العربية المتحدة • P.O. BOX 433 ص.ب.
TEL +971 4 3939000 هاتف • FAX +971 4 3939090 فاكس • DUBAI, UNITED ARAB EMIRATES دبي، الإمارات العربية المتحدة • P.O. BOX 1565 ص.ب.
www.mof.gov.ae