How to Use the One-Year Transition Period: Effective Date, Rectification Obligations and Start of Penalties

1. Key takeaways

Federal Decree-Law No. 38/2024 entered into force on January 2, 2025, granting a 1-year transition period from the effective date, which the Cabinet may decide to extend. Our conclusion is that the value of the transition period lies in giving companies a time window for proactive rectification, not in deferring the obligations as a whole by one year. Rectification should proceed in the order of “unlicensed exposure, then entity and agent structure, then systems and documentation, then vigilance and labelling”; the response to penalties, for its part, must focus on the fine range for establishments of AED 1,000–1,000,000 under Article 160, the procedural arrangement of a 15-day appeal and a 30-day decision under Article 162, and the additional penalties of closure and confiscation under Article 168.

• The decree entered into force on January 2, 2025, granting a 1-year transition period that the Cabinet may extend.
• The transition period is a window for proactive rectification, not a deferral of obligations.
• Rectification follows the order: unlicensed exposure, entity and agent structure, systems and documentation, vigilance and labelling.
• Penalty response centres on Article 160, the Article 162 appeal procedure and the Article 168 additional penalties.

2. Legal basis

The table below sets out the entry-into-force and transition provisions and the three penalty provisions that define the financial exposure, the appeal procedure and the additional penalties attached to enforcement under the decree.

3. Expert insights

Insight 1: The effective date is the starting point of obligations, and the end of the transition period is the end of the margin for tolerance. Our judgement is that the mandatory marketing approval obligation of Article 5 applies in full to newly occurring acts as of January 2, 2025; what the transition period moderates is the pace of dealing with pre-existing states. The reading that “nothing needs to be done during the transition period” is therefore a misreading of the text. The correct use is: during the transition period, complete the correction of every arrangement established under the former law that fails under the new law, so that no exposure remains when the transition period expires.

Insight 2: The order of rectification should follow the degree of violation exposure, not the workload. Our reasoning for the ordering is this: unlicensed sale, display and use trigger Article 5 and Article 160 simultaneously, and the evidence is the most easily fixed by on-site inspection, so they rank first; the entity and agent structure — Article 22 requires at least 2 importers, 1 or more distributors and the designation of 1 lead institution, with each designated institution actually importing during the year in question — is a structural defect with a long rectification cycle, so it ranks second; systems and documentation, and vigilance and labelling, can be advanced in parallel and rank after them. Ordering the work this way compresses the highest risk first within a limited time.

Insight 3: The key to handling penalties lies in procedural rights, not in post-hoc explanation. Article 162 provides that an appeal should be filed within 15 days and that the competent authority decides within 30 days. Our judgement is that what companies lose most easily is not the opportunity for a substantive defence but the procedural window. A 15-day countdown reminder should therefore be built into the process for receiving penalty notices, with an appeal owner designated in advance and a template evidence pack prepared. The closure and confiscation under Article 168 are additional penalties whose impact exceeds the fine itself, and they should be listed separately in the contingency plan.

4. Practical recommendations

• Taking January 2, 2025 as the reference date, review whether all newly occurring acts since then have obtained a marketing authorization under Article 5, and suspend all those that have not.
• Rebuild the agent structure under Article 22, securing 2 importers, 1 or more distributors and 1 lead institution, and agreeing that each institution actually imports during the year.
• During the transition period, complete the EDE registration of the MAH and the manufacturing site, together with the verification of the marketing office or medical warehouse licence (practical estimate: from zero preparation to formal market entry, 6–18 months).
• Establish an internal forwarding process for penalty notices, with a 15-day appeal countdown and a 30-day decision-tracking milestone.
• Against the closure and confiscation risks of Article 168, prepare a business-continuity plan covering inventory handling, customer communication and alternative supply arrangements.
• Track whether the Cabinet decides to extend the transition period, and update the rectification plan timeline after each announcement.

5. Verification checklist

• □ It has been confirmed that all acts occurring after January 2, 2025 fall within the coverage of a valid marketing authorization.
• □ The rebuilding of the agent structure under Article 22 has been completed, with the numbers of importers and distributors meeting the requirements.
• □ The lead institution has been designated, and the agreement states its duties for licensing affairs, vigilance and whole-life-cycle management.
• □ It has been confirmed that each designated institution actually carried out imports within the calendar year and retained the records.
• □ A 15-day appeal countdown and a 30-day decision-tracking mechanism for penalty notices have been set up.
• □ A business-continuity plan against the closure and confiscation risks of Article 168 has been prepared.
• □ It has been confirmed that the rectification plan is updated in step with the Cabinet’s decision on extending the transition period.
• □ Timestamped evidence of every rectification action during the transition period, including submission receipts and correspondence, has been retained.

Further reading: Article 09 “From Federal Law No. 8/2019 to Decree-Law No. 38/2024: Repeal, Amendment and the Validity of Existing Certificates”; Article 06 “The Mandatory Nature of Marketing Approval: The Red Line of Article 5 and the Two Exemptions”; Article 48 “Penalties and Appeals: Articles 160/162/168 and the AED 1,000–1,000,000 Range”.

Regulatory information verified as of October 29, 2026.

How GRZAN can help. GRZAN provides medical device and IVD registration, quality system, authorised representative and local testing support for the United Arab Emirates. Our team manages MOHAP registrations and free-zone (DHCC) pathways, and supports post-market vigilance obligations. Business enquiries: info@grzanglobal.com