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New law issued for Joint Ownership Real Estate in Dubai

The Ruler of Dubai, Vice President and Prime Minister of the UAE His Highness Sheikh Mohammed bin Rashid Al Maktoum issued, Law No. (6) of 2019 regarding joint ownership of the real estate in Dubai. The new law has been issued for all major real estate projects and jointly owned properties including those located in Dubai free zones and special development zones.

This law will form a part of a regulatory framework designed to boost competitiveness and enhance investment in the real estate sector and also protect the rights of all parties. The issuance of the Law follows directives issued by His Highness to from the Higher Committee of Real Estate Planning in Dubai.

According to the new law, developers have to furnish all necessary documents of jointly owned real estate projects within 60 days of completion to Dubai Land and also submit date and receipt of completion certificate.

The Dubai Land Department can extend the deadline by 30 days. If the documents are not submitted, the department can request the document to be presented from another party. In this case, the developer will be charged with all related expenses and fees.

The DLD will prepare a register for all jointly owned real estate properties featuring all the information related to all owned by developers and real estate units for independent ownership.

The register will feature the names of the owners, members of the committee of the owners, and the building management company responsible for managing common areas and amenities, and information about the developers and operators of the project.

The new regulation divides jointly owned properties into three categories for the purpose of management of common areas.

  • The first category involves mega projects where the developer is responsible for managing, operating and maintaining common areas and facilities.
  • The second category constitutes hotel projects, where the developer has appointed a company to manage the common areas as per DLD regulation.
  • The third category comprises of projects other than megaprojects and hotel projects where a specialized facility management company manages the common areas.

Other legal aspects

The developer will be responsible for any damage to the structure of the jointly owned real estate property which occurs within 10 years, starting from the date of issuance of completion certificate.

The developer is responsible for replacing and repairing any defaults in the individual’s units within a period of 1 year from the date of delivering the unit to an owner. In the case wherein the owner refuses to take the finished unit in his possession or defaults, the period has to be calculated starting from the issuance date indicated in the completion certificate.

All details regarding contracts related to such developments and common areas owned by the developer of the project should be registered. The DLD will issue ownership certificates related to individual units as per the terms and conditions of law pertaining to real estate registration in Dubai.

Violators have to face financial penalties up to DHS 1 M. Penalties will reach up to DHS 2 M in case of repeated violation within a year.

The new regulation announced plans for a higher committee FOR real estate planning in Dubai and also issued a new law pertaining to RERA.

The new law will come into effect within 60 days of its publication in the official gazette.

Hassan Humaid Al Suwaidi., LL.B. is a Senior Partner in HHS Lawyers. He has 20 years of experience dealing with high-value and complex cases. Frequently featured in local and international legal directories and commended for his ability to attain favorable outcomes for clients, Hassan has been involved in some of the largest legal settlements. A major part of his work is providing expert legal advice on UAE legislation and acting for individuals and businesses during disputes and litigation.