Dubai Property Law

Following months of speculation as to when the UAE property law will be passed and whether it will allow full ownership for foreign nationals, it has finally happened.

In a landmark move, on 13 March 2006 His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, has issued, in his capacity as Ruler of Dubai, a long-awaited Dubai Real Estate Registration Law No. 7 of 2006 (the “Law”) that legalises freehold ownership of land and property in Dubai.

The Law includes 11 chapters comprising 29 articles covering the issues of definitions, general rules, the implementation system of property hold, and the jurisdictions of the Dubai lands and properties Department.

In response to the most frequently asked questions of our clients, we summarize below some of the provisions on this Law.

To which properties is the Law applicable to?

The provisions of the Law are applied to properties located in Dubai.

Who can own property in Dubai?

Article 4 of the Law states that the freehold is limited to the following persons:

  1. UAE and GCC citizens
  2. companies wholly owned by UAE and GCC citizens
  3. public shareholding companies
  4. upon approval of the Ruler of Dubai, expatriates may be given the right to own properties in some areas of Dubai, designated by the Ruler. Though the decree in respect of such areas is still awaited, it would most probably be issued in relation to the projects of Nakheel, Emaar and Union Properties.

The Law also provides that expatriates will be given the right to own property either on freehold or 99-year lease basis in the areas designated by the Ruler.

Where and how can ownership rights be registered?

Article 7 of the Law stipulates for setting up of a property registration office at the Dubai Lands and Properties Department. This office will be responsible for documenting property rights and their amendments. Its records hold the ultimate evidence against all - without exceptions. Its records cannot be challenged except in the case of forgery.

Pursuant to Article 15, the registration of property areas and units at the property register must be based on typographic, property unit and property area maps. It also reads that each property area must have an independent map, manifesting all property units in the area and their numbers. Each property unit must also have a separate map, showing its location, boundaries, length, area and buildings, and the numbers of neighbouring units.

A multi-storey property is considered a single property unit that shall be given one entry in the property record. All apartments of a single property unit will have supplementary records that include names of the owners of its apartments, storeys and any common facilities.

The law also stipulates that any amendment to the property unit, whether by dividing or merging units must be registered with the property register.

The department issues ownership certificates regarding property rights, which are considered ultimate evidence to prove property rights. Such certificates must include any terms, conditions, undertakings or any other commitments.

In practice, Mr Mohammad Sultan Thani, the director of development and marketing administration at the Department, said in his interview to Gulf News, that the Department have made arrangements with three master developers, Emaar Properties, Nakheel and Dubai Properties, that they will handle the registration of land and properties with Dubai Lands and Properties Department on behalf of their freehold clients. Property owners do not need to rush to the department for registration.

Which property transactions shall be registered?

All property transactions and deals that result in assigning, transferring, amending or disposing of property rights, must be registered with the property register. Moreover, all final rulings that prove such dealings, shall not be considered valid until they are registered.

The undertaking of transferral of any property rights is limited to the contractor"s commitment to the guarantee if he defaulted on his contractual duties whether a compensation was stipulated in the undertaking or not.

Pursuant to Article 11 of the Law, the inheritance notification must be registered with the property register, in case heirs have property rights within their inheritance. And, no dealings will be admitted unless registered.

What are the other duties of the Dubai Lands and Properties Department?

Pursuant to Article 6 of the Law, the Department will carry out the following duties:

  1. Specifying survey areas or re-conducting surveys and attesting location maps.
  2. Specifying rules related to survey and releasing maps related to property units.
  3. Preparing model property contracts.
  4. Setting rules related to regulating, keeping and destroying documents.
  5. Setting rules related to the use of computer in data entry and saving.
  6. Setting rules related to the regulation and keeping the records of property brokers.
  7. Setting rules related to the assessment of properties.
  8. Setting rules related to the sale of properties in auctions and supervising the auctions.
  9. Fixing fees for services offered by the department.
  10. Setting up branches of the department upon the director"s discretion.
    Pursuant to Article 12, the department also has the authority to look into applications submitted by owners of unregistered lands seeking to settle their legal status.

What Next?