Executive Council Resolution No. (6) of 2010

Approving the Implementing Bylaw
of Law No. (13) of 2008 Regulating
the Interim Property Register in the
Emirate of Dubai

Executive Council Resolution No. (6) of 2010
Approving the Implementing Bylaw of Law No. (13) of 2008
Regulating the Interim Property Register in the Emirate of Dubai (1)
We, Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai,
Chairman of the Executive Council,
After perusal of:
Law No. (3) of 2003 Establishing the Executive Council of the Emirate of Dubai;
Law No. (7) of 1997 Concerning Land Registration Fees in the Emirate of Dubai and
its amendments;
Law No. (7) of 2006 Concerning Real Property Registration in the Emirate of Dubai;
Law No. (8) of 2007 Concerning Escrow Accounts of Real Estate Development in the
Emirate of Dubai;
Law No. (13) of 2008 Regulating the Interim Property Register in the Emirate of Dubai and
its amendments; and
Bylaw No. (85) of 2006 Regulating the Real Estate Brokers Register in the Emirate
of Dubai,

Do hereby issue this Resolution.

Article (1)

The following words and expressions mentioned in this Resolution, will have the meaning ascribed to them in the Law No. (13) of 2008 Regulating the Interim Property Register in
the Emirate of Dubai and its amendments (the “Law”).

Article (2)

Where a Master Developer or Sub-developer requests, within the period stipulated in paragraph (2) of Article (3) of the Law, the registration of the legal disposition of a Real Property Unit with the Department, it will be deemed that he has complied with the time period required by the Law, even if the Department fails to complete the registration procedure within such period.

Article (3)

If the Master Developer or Sub-developer submits a request to register the legal disposition of the Real Property Unit after expiry of the time period stipulated in paragraph
(2) of Article (3) of the Law, the Department must:
1.register the legal disposition in the Interim Property Register; and
2.impose a ﬁne of ten thousand Dirhams (AED 10,000.00) on the developer.

Article (4)

The Master Developer or Sub-developer may not commence implementation of the project or dispose of its Real Property Units by way of Off-plan Sale unless:
1.he has taken possession of the land plot and has received the demarcation certiﬁcate;
2.he has actual control over the land plot where the project is proposed to be
constructed; and
3.he has obtained the required approvals from the Competent Entities to commence
implementation of the project.

Article (5)

1.The Department must, whether on its own initiative or upon request by the concerned parties, indicate in the record of the land plot where a development project is to be constructed that the project is designated as “a development project governed by the provisions of the Law”.

2.The Department will remove the designation referred to in the preceding paragraph upon completion of the development project and registration of its Real Estate Units in the names of the purchasers in the Property Register or upon cancellation of the project for any of the reasons set forth in Article (23) of this Resolution.

Article (6)

A request for registration of a Real Property Unit in the Interim Property Register must be submitted using the relevant electronic or paper form, along with the supporting
documents and deeds required by the Department.

Article (7)

1.Upon completion of the development project and obtaining the completion certiﬁcate from the Competent Entities, the Master Developer or Sub-developer may not refuse
to hand over or register the Real Property Unit in the name of the purchaser in the Property Register, provided that the purchaser has fulﬁlled all his contractual obligations even if there are other ﬁnancial dues payable by such purchaser to the developer other than in connection with the sale agreement of the relevant Real Property Unit.
2.The Master Developer or the Sub-developer must register the Real Property Unit and all its amenities, such as the car park, in the name of the purchaser.
3.If the Master Developer or Sub-developer refuses to register the Real Property Unit in the name of the purchaser in the Property Register for any reason whatsoever even
though the purchaser has fulﬁlled all his contractual obligations, the Department may, upon the request of the purchaser or upon its own initiative, register the Real Property Unit in the name of the purchaser in the Property Register.

Article (8)

A Master Developer or Sub-developer may not charge a purchaser any amount for any reason whatsoever in consideration for any legal disposition of a Real Property Unit, unless such amounts are approved by the Department.

Article (9)

Unless otherwise agreed, the Master Developer or Sub-developer and the purchaser must pay the fees for registration of the legal disposition of a Real Property Unit as per their respective percentages prescribed in accordance with the applicable legislation.

Article (10)

If the Master Developer or Sub-developer wishes to market his project through a Real Estate Broker, the Master Developer or Sub-developer must comply with the following:
1.the project to be marketed through the Real Estate Broker must be registered with
the Department;
2.an agreement must be entered into with a licensed Real Estate Broker in accordance
with Bylaw No. (85) of 2006 Regulating the Real Estate Brokers Register in the
Emirate of Dubai; and
3.the project marketing agreement with the Real Estate Broker must be registered with
the Department.

Article (11)

Any legal disposition made by the Master Developer, Sub-developer, or the Real Estate Broker for the sale of any Real Property or Real Property Unit off-plan prior to approval of the project by the Competent Entities and its registration with the Department will be null and void.

Article (12)

If the Master Developer or Sub-developer agrees with the Real Estate Broker to market the project in full or in part, the Real Estate Broker must deposit the sale proceeds of the relevant Real Property Unit into the project escrow account. The Real estate Broker may not deposit the sale proceeds in his own account or deduct his commission from such proceeds before depositing it in the escrow account. Any agreement to the contrary of the provisions of this Article will be void.

Article (13)

1.As of the effective date of this Resolution, the net area of the Real Property Unit
will be adopted for the purposes of registration in the Property Register and will be
calculated as determined by the Department.
2.Any area in excess of the net area of the sold Real Property Unit may not be taken
into consideration. Unless otherwise agreed, the developer may not claim the value
of such extra area.
3.The developer must indemnify the purchaser if the area of the Real Property Unit is
less than the agreed area by more than ﬁve percent (5%) of the net area of such unit.
4.The indemnity payable to the purchaser where the percentage of shortage of the
net area exceeds the percentage prescribed in paragraph (3) of this Article will be
calculated based on the price of the Real Property Unit as agreed in the relevant
contract between the developer and the purchaser.
5.For the purposes of application of this Article, the net area of a Real Property Unit
set out in the sale agreement and the plan of such unit will be taken as the basis for
calculation of any extra area or shortage in the area of the Real Property Unit.

Article (14)

If any dispute arises between the developer and the purchaser, the Department may attempt conciliation to preserve their contractual relationship and may propose solutions for such purpose as it may deem ﬁt. If the Department concludes an amicable settlement, such settlement must be conﬁrmed in writing by an agreement executed by the developer and the purchaser or their respective representatives. Upon conﬁrmation of such agreement by the Department, it will become binding upon both parties.

Article (15)

In any case where the purchaser breaches any of his obligations under the Real Property Unit sale agreement concluded between the purchaser and the developer:
a.The developer must serve a notice on the purchaser to fulﬁl his contractual obligations,
either by appearing in person before the Department or in writing by registered mail or
email, in which case the developer must provide the Department with a copy of such notice.
b.The Department must give the purchaser a notice period of thirty (30) days to fulﬁl
his contractual obligations, which will commence from the date on which the notice
is served by the developer on the purchaser.
c.If the purchaser fails to fulﬁl his contractual obligations within the notice period set
forth in paragraph (b) of this Article, the developer may:

1.where he has completed at least eighty percent (80%) of the project, retain all
the amounts paid by the purchaser and either sell the property by way of public
auction to recover the balance amounts payable to him, or terminate the agreement
and retain a maximum of forty percent (40%) of the value of the Real Property Unit;
2.where he has completed at least sixty percent (60%) of the project, terminate
the agreement and retain a maximum of forty percent (40%) of the value of the
Real Property Unit set forth in the agreement;
3.where he has completed less than sixty percent (60%) of the project, terminate
the agreement and retain a maximum of twenty ﬁve percent (25%) of the value
of the Real Property Unit set forth in the agreement; and
4. where he has not commenced implementation of the project for circumstances
beyond his control, terminate the agreement and retain a maximum of thirty
percent (30%) of the amounts paid by the purchaser to the developer.
d. The developer may resort to the relevant competent court to seek a judgment entitling
him to the percentages as prescribed in paragraph (c) of this Article where the
amounts retained by the developer are less than the respective amounts provided
for in sub-paragraphs (1), (2), (3) and (4) above.

Article (16)

A developer who has not commenced implementation of the project may not terminate the agreement or retain thirty percent (30%) of the payments made by the purchaser
unless the developer provides evidence that he has fulﬁlled all his contractual obligations to the purchaser and that failure to commence the project is not due to negligence or default on the part of the developer, or is due to circumstances beyond the control of the developer.

Article (17)

For the purposes of application of Article (15) of this Resolution:
1. The completion percentage of a project must be conﬁrmed by a technical report
issued by a consultant approved by RERA. Such report must state the completed
works based on an actual survey of the project.

2. Completion of levelling works and the infrastructure of the project will be deemed as
commencement of the project construction.

Article (18)

The developer must refund to the purchaser the amounts retained by him pursuant to
Article (15) of this Resolution no later than one (1) year from the date of terminating
the agreement or within sixty (60) days from the date of sale of the Real Property Unit,
whichever is earlier.

Article (19)

1. In the event of sale of the Real Property Unit by way of public auction in accordance
with the provisions of Article (15) of this Resolution, the Department may, at its
sole discretion, deposit the sale proceeds of the Real Property Unit in an escrow
account and pay to the purchaser or his representative all the balance amounts after
deduction of the developer’s dues.

2. The developer may use the Real Property Unit or lease the same to third parties if it
is not sold by way of a public auction, provided that the developer must return the
balance amounts to the purchaser within the time period stipulated in Article (18) of
this Resolution.

Article (20)

The purchaser may apply to the relevant competent court to terminate the contractual
relationship between the purchaser and the developer in any of the following cases:
1. if the developer refuses, without any reason acceptable to the Department, to deliver
the ﬁnal sale agreement of the Real Property Unit to the purchaser;
2. if the developer declines to settle the payments in accordance with the construction
milestones as proposed by RERA;
3.if the developer makes material changes to the agreed speciﬁcations agreed to in
the agreement;
4. if, upon handover of the Real Property Unit, it is found that the Real Property Unit is
unﬁt for use due to material constructional defects; or
5.any other cases that may require termination of the agreement in accordance with
the general principles of law.

Article (21)

The following will be considered as circumstances beyond the control of the developer:
1. if the land plot on which the project to be constructed is expropriated for public
interest purposes;
2.if any Government Entity suspends the project for re-planning purposes;
3.if structures, excavations, or utility lines are found in the site of the project;
4. if the Master Developer makes any variations to the site of the project that change
the boundaries or area of the project in such a manner that affects the performance
of the Sub-developer’s obligations; and
5. any other circumstances determined by RERA.

Article (22)

The developer is deemed to have committed negligence or failed to perform his obligations in any of the following circumstances:
1. delay, without any valid reason, in taking possession of the land plot or obtaining
the required approvals from the Competent Entities to commence implementation
of the project;
2. a Sub-developer sells the project Off-plan without prior written consent of the
Master Developer;
3. delay in obtaining the written approval of the Master Developer of the plans
and designs;
4. delay in preparing the project for the construction works;
5. failure to provide RERA with the information required to approve the project;
6. failure to register the project with RERA;
7. failure to disclose the ﬁnancial statements of the project to RERA; or
8. any other circumstances determined by RERA.

Article (23)

RERA may, based on a reasoned technical report, decide to cancel the development project in any of the following circumstances:
1.if the developer fails, without any valid reason, to commence the construction works
despite having already obtained all the required approvals from the Competent Entities;
2.if the developer commits any of the offenses set forth in Article (16) of Law No. (8) of
2007 Concerning Escrow Accounts of Real Estate Development in the Emirate of Dubai;
3. if it is proven to RERA that the developer has no intention of implementing the project;
4. if the land plot upon which the project is to be constructed is revoked due to a breach
by the Sub-developer of any of his contractual obligations to the Master Developer;
5. if the land plot is substantially affected by the planning or re-planning projects
implemented by the Competent Entities in the Emirate;
6. if the developer fails to implement the project due to gross negligence;
7. if the developer expresses his intention not to implement the project for reasons
acceptable to RERA;
8. if the developer is declared bankrupt; or
9. any other circumstances determined by RERA.

Article (24)

1.The developer may appeal a decision issued by RERA to cancel a project no later than seven (7) working days from the date on which the developer is notiﬁed of such decision.
2.The appeal must be in writing and must include the grounds of objection to the decision.
3.RERA must consider the appeal and render its decision within seven (7) working days from the date of submission of the appeal to RERA.
4.If RERA allows the appeal, RERA must set the conditions and requirements the developer must satisfy in order to overturn the decision to cancel the project.
5.The developer must undertake in writing to satisfy the conditions and requirements of RERA.
6.If RERA rejects the appeal, its decision in this regard will be ﬁnal, in which case RERA must proceed with the project cancellation procedures.

Article (25)

In any case in which RERA cancels a project, it must:
1. prepare a technical report justifying such cancellation;
2. notify the developer in writing, by registered mail or electronic mail, of the cancellation decision;
3.appoint a certiﬁed auditor at the cost of the developer to review the ﬁnancial position of the project and verify the amounts paid to the developer or deposited in the escrow account of the development project, as well as the expenditures; and
4. request the escrow agent of the project or the developer, if payments are made otherwise than through the escrow account, to refund the amounts deposited in the
escrow account or paid to the developer to the relevant parties no later than fourteen (14) days from the date of such cancellation.

Article (26)

If the funds in the escrow account of the project are insufﬁcient to refund the purchasers the amounts paid by them, the developer must refund the amounts payable to those purchasers no later than sixty (60) days from the date of the decision cancelling the project, unless RERA determines to extend such period for valid reasons.

Article (27)

If the developer fails to refund the amounts payable to the purchasers within the time period set forth in Article (26) of this Resolution, RERA must take all necessary actions to secure the rights of purchasers, including referring the matter to the competent judicial authorities.

Article (28)

This Resolution comes into force on the day on which it is issued and will be published in the Ofﬁcial Gazette.

Hamdan bin Mohammed bin Rashid Al Maktoum
Crown Prince of Dubai
Chairman of the Executive Council

Issued in Dubai on 14 February 2010
Corresponding to 30 Safar 1431 A.H.