Law No. (6) of 2019
Concerning
Ownership of Jointly Owned Real Property in the
Emirate of Dubai[1]
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We, Mohammed bin Rashid Al Maktoum, Ruler of Dubai,
After perusal of:
Federal Law No. (5) of 1985
Issuing the Civil Code of the United Arab Emirates and its amendments;
Law No. (3) of 2003 Establishing
the Executive Council of the Emirate of Dubai;
Law No. (7) of 2006 Concerning
Real Property Registration in the Emirate of Dubai;
Law No. (27) of 2007 Concerning
Ownership of Jointly Owned Real Property in the Emirate of Dubai;
Law No. (13) of 2008 Regulating
the Interim Real Property Register in the Emirate of Dubai and its amendments;
Law No. (7) of 2013 Concerning
the Land Department;
Decree No. (22) of 2009
Concerning Special Development Zones in the Emirate of Dubai;
Decree No. (17) of 2013
Concerning Licensing and Classification of Hotel Establishments in the Emirate
of Dubai;
Decree No. (26) of 2013
Concerning the Rental Disputes Settlement Centre in the Emirate of Dubai; and
The legislation establishing and
regulating free zones in the Emirate of Dubai,
Do hereby issue this Law.
This Law will be cited as "Law No. (6) of
2019 Concerning Ownership of Jointly Owned Real Property in the Emirate of
Dubai".
The following words and expressions, wherever
mentioned in this Law, will have the meaning indicated opposite each of them
unless the context implies otherwise:
|
Emirate: |
The Emirate of Dubai. |
|
Government: |
The Government of Dubai. |
|
Executive Council: |
The Executive Council of
the Emirate of Dubai. |
|
DLD: |
The Land Department. |
|
RERA: |
The Real Estate
Regulatory Agency. |
|
RDSC: |
The Rental Disputes
Settlement Centre in the Emirate. |
|
Competent Authority: |
The authority in charge
of issuing building permits and approving community plans in the Emirate. |
|
Director General: |
The director general of
the DLD. |
|
CEO: |
The chief executive officer
of RERA. |
|
Real Property Register: |
The register regulated
pursuant to the above-mentioned Law No. (7) of 2006. |
|
Master Developer: |
A Person who is licensed
to conduct Real Property development business in the Emirate and to dispose
of Real Property units to others, and who is classified as a master developer
in accordance with the legislation in force in the Emirate. |
|
Sub-developer: |
A person who is licensed
to conduct Real Property development business in the Emirate and to dispose
of Real Property units to others; who is granted by a Master Developer the
right to develop part of a Master Project, in accordance with the provisions
of a Master Community Declaration; and who is classified as a sub-developer
in accordance with the legislation in force in the Emirate. |
|
Developer: |
A Master Developer or a
Sub-Developer. |
|
Master Project: |
A project which involves
developing vacant land, constructing infrastructure and common service
facilities thereon, subdividing that land for the purpose of sale, and
constructing residential, commercial, or mixed-use multi-storey buildings or
compounds; and which is classified by RERA as a master project in accordance
with the relevant criteria approved by the Director General. |
|
Jointly Owned Real Property: |
A building, including
the parts and appurtenances allocated for common use, and the land on which
that building is constructed; or land which is subdivided into Units or land
plots intended for individual ownership. |
|
Major Project: |
Any Jointly Owned Real
Property designated as a major project in accordance with the relevant criteria
approved by the Director General. |
|
Hotel Project: |
Any Real Property whose
Units are intended for joint ownership, and which is licenced for use as a
Hotel Establishment by the Competent Authority. This includes hotels, hotel
villas, hotel apartments, and hotel rooms. |
|
Unit: |
A flat, shop, office,
warehouse, floor, whole or part of a land plot, town house, or independent
house that constitutes part of Jointly Owned Real Property and is intended
for residential, commercial, industrial, or any other use. |
|
Master Plan: |
A set of plans and
design and engineering drawings of a Master Project which are prepared by the
Master Developer and approved by the DLD and the Competent Authority. |
|
Site Plan: |
A map prepared by the
Developer, and approved by the DLD and the Competent Authority, which
delineates the boundaries of a building in Jointly Owned Real Property. |
|
Plans: |
These include Master
Plans and Site Plans. |
|
Common Facilities: |
The areas and spaces
demarcated on a Master Plan as common facilities which are owned by the
Developer, subject to ownership limitations, and are designated for common
use and for serving the Master Project. This includes gardens, landscape
areas, fountains, streets, ponds, swimming pools, playgrounds, public areas,
public car parks, pedestrian walkways, beaches, and other facilities. |
|
Common Parts: |
The parts of Jointly
Owned Real Property, as shown on the Site Plan, designated for common use by
the Owners and Occupants of Units. |
|
Designated Common Parts: |
The Jointly Owned Real
Property parts, connections, fittings, equipment, or facilities designated
for exclusive use by certain Owners rather than others. |
|
Developer-owned Areas: |
The areas and spaces,
other than Common Facilities and Common Parts, that are specified on a Master
Plan or a Site Plan, owned by the Developer, and designated by him for
private, commercial, or investment use. |
|
Owner: |
A Person registered in
the Real Property Register as an Owner of a Unit, including the holder of a
usufruct or long-term lease right pursuant to the above-mentioned Law No. (7)
of 2006; or a Developer in respect of unsold Units. |
|
Master Community Declaration: |
The conditions and
provisions governing the development and operation of a Master Project and
the Jointly Owned Real Property and Common Facilities therein, including the
planning and construction standards of the Master Community. |
|
Building Management Regulation: |
A document prepared in
accordance with the relevant bylaws issued by the DLD, and entered in the
Jointly Owned Real Property Register, which states the procedures for
maintenance of Common Parts, including equipment and services in any part of
another building, and the percentages of contribution of Owners in the
relevant costs. |
|
Owners Committee: |
A committee constituted
from amongst Owners in accordance with the provisions of this Law. |
|
Statute: |
The rules and provisions
governing an Owners Committee, which are established and approved in
accordance with the provisions of this Law. |
|
Service Charges: |
The annual charges
collected from Owners to cover the cost of management, operation,
maintenance, and repair of Jointly Owned Real Property. |
|
Usage Charges: |
The annual charges
collected from Owners or Sub-developers in return for the management,
operation, maintenance, and repair of Common Facilities. |
|
Occupant: |
Any person using a Unit
for its intended purposes, including an Owner, a tenant, or any other person authorised
by the Owner to use the Unit. |
|
Management Company: |
A sole proprietorship or
a company recognised by RERA and specialised in managing Common Facilities,
Jointly Owned Real Property, or Common Parts, as the case may be. |
|
Hotel Project Management Company: |
A sole proprietorship or
a company recognised by RERA and specialised in managing Hotel Projects and
their Common Parts in accordance with the provisions of this Law. |
|
Management Entity: |
An entity in charge of
managing Common Facilities, Jointly Owned Real Property, or Common Parts in accordance
with the provisions of this Law. This includes Developers, Management
Companies, or Hotel Project Management Companies, as the case may be. |
|
Utility Services: |
These include water
connection or supply; gas connection or supply; electricity; air
conditioning; telephone; computer, television, and telecommunication cables;
sewerage; rain water drainage; garbage and waste removal or disposal; mail,
parcel, or cargo delivery; and horticulture and agriculture services, as well
as any systems or services intended for improving Common Facilities or Common
Parts. |
The provisions
of this Law will apply to all Master Projects and Jointly Owned Real Property
in the Emirate, including those in Special Development Zones and in free zones.
a. The DLD will maintain a special register of
Jointly Owned Real Property, which contains the following:
1.
details of the land plots owned by Developers on
which Jointly Owned Real Property are to be constructed;
2.
details of Units that are intended for individual
ownership in Jointly Owned Real Property and sold by Developers, and names of
Owners of these Units;
3.
details of members of Owners Committees;
4.
Building Management Regulations;
5.
Plans;
6.
details of Management Entities;
7.
the contracts for management of Jointly Owned Real
Property or Common Parts;
8.
statement of the total area of Common Parts and
Designated Common Parts, and its ratio to the total area of Units in Jointly
Owned Real Property; and
9.
details of Developer-owned Areas in Jointly Owned
Real Property.
b. Upon the request of concerned parties, the DLD
will issue the certificates, deeds, or other documents related to Units or
Jointly Owned Real Property based on the information in the register referred
to in paragraph (a) of this Article. Any interested party will have the right
to access that register.
The rules and conditions stipulated in the
above-mentioned Law No. (7) of 2006 will apply to the ownership of Jointly
Owned Real Property.
a. The Plans, Master Community Declaration, Statute,
and Building Management Regulation will constitute part of the title deed of
Jointly Owned Real Property. The DLD will maintain an original copy of each of
these documents.
b. An Occupant will be under an obligation towards
the Developer, the Owner, the Occupants of other Units, and the Owners
Committee to comply with the Master Community Declaration, Statute, and
Building Management Regulation to the extent that their provisions apply to
that Occupant.
c. A Developer must, upon completing the construction
of the Jointly Owned Real Property and obtaining a completion certificate from
the Competent Authority, file the documents referred to in paragraph (a) of
this Article with the DLD within sixty (60) days from the date of issue of the
completion certificate. The DLD may extend this time limit for a period not
exceeding thirty (30) days, provided that the Developer provides valid reasons
for the extension that are acceptable to the DLD.
d. The Developer's obligation under paragraph (c) of
this Article does not include filing the Building Management Regulation where
it is prepared by RERA.
e. Where the Developer fails to submit the documents
referred to in paragraph (a) of this Article within the time limit stated in
paragraph (c) thereof, the DLD may request any entity, as it deems appropriate,
to file and maintain these documents with the DLD; in which case, the Developer
will be held liable for all the expenses and costs incurred in this regard.
f. The DLD will issue and update the maps of Common
Parts, Designated Common Parts, and Common Facilities in accordance with the
provisions of this Law.
a. The Common Parts of a building include, without
limitation, the following:
1.
the structural components of the Jointly Owned
Real Property, including the main supports, foundations, columns, structural
walls, ceilings, ceiling joists, staircases, stairwells, façades, and roofs;
2.
unless otherwise indicated on the Site Plan,
thresholds; halls; parking aisles; entrances; emergency exits; and windows in
external walls;
3.
unless otherwise indicated on the Site Plan,
watchmen rooms; recreational facilities and equipment; swimming pools; gardens;
storage facilities; offices; and car parks designated for use by the Management
Entity, the Owners Committee, or visitors;
4. equipment
and systems of main utilities, including electricity generators; lighting
systems; gas, cold and hot water, and heating and cooling systems and equipment; air
conditioning systems; and waste collection and treatment facilities;
5.
elevators, tanks, pipes, generators, chimneys,
ventilation fans and ducts, air compressor units, and mechanical ventilation
systems;
6.
water mains; sewer pipes; gas pipes and chimneys;
and electrical and telecommunications towers, wiring, and conduits serving the
Owners of more than one (1) Unit;
7.
equipment used for measuring the provision or
supply of Utility Services;
8.
any other parts outside the boundaries of Units
which are necessary or required for the existence, maintenance, sustainability,
safety, or operation of the Jointly Owned Real Property; and
9.
any other Common Parts indicated on the Site Plan.
b. The Common Parts of a land plot include, without
limitation, the following:
1.
roads, roundabouts, intersections, pathways,
pavement edges, median strips, viaducts, drainage systems, and all related
structures;
2.
unless otherwise indicated on the Site Plan,
lakes; ponds; canals; parks; fountains; water features; and other waterways,
including all equipment related thereto;
3.
unless otherwise indicated on the Site Plan,
landscape areas; public areas; playgrounds; rest areas; and car parks
designated for use by the Management Entity, the Owners Committee, or visitors;
4.
the wires, cables, pipes, drains, ducts,
machinery, and equipment used to supply Units or Common Parts with various services;
5.
equipment used for measuring the provision or
supply of Utility Services; and
6.
any other Common Parts indicated on the Site Plan.
When obtaining the approval of a Master Plan or
Site Plan for the first time, the Developer may, subject to the approval of the
DLD and the Competent Authority, designate areas owned by the Developer on the
Master Plan or Site Plan for private, commercial, or investment use. This
approval may only be granted, and the Developer-owned areas may only be used,
subject to the provisions of the Master Community Declaration and the rights of
Owners.
a. Unless otherwise indicated on the Site Plan, each Unit
in a building or part of a building includes, without limitation, the
following:
1.
floors and flooring materials and components down
to the base of the joists, and other structures supporting the floor of the
Unit;
2.
plaster ceilings and all other types of ceilings,
additions that form part of the interior of the Unit, spaces between such
ceilings, ceilings above the support walls and structures inside the Unit, and
walls separating the Unit from other parts of the Jointly Owned Real Property or
any adjacent Units or Common Parts;
3.
the internal area, non-support internal walls, and
surrounding walls of the Unit;
4.
windows, glass, fixtures that form part of the
internal windows, lighting systems, doors, door frames, and all equipment and
fixtures serving the Unit;
5.
bathrooms and other integral parts of the Unit,
such as balconies and other ancillary parts allocated to the Owner;
6.
facilities attached or allocated to the Unit, such
as gardens, car parks, storage rooms, or watchmen rooms, even if such
facilities are not adjacent to the unit, provided that these facilities are
attached to the Unit and their area is not included in the net area of the
Unit;
7.
internal connections serving the Unit;
8.
fixtures and fittings installed by the Occupant;
9.
additions, modifications, and improvements made to
the Unit from time to time; and
10. any
other components indicated on the Site Plan.
b. For the purposes of application of the provisions
of paragraph (a) of this Article, a Unit does not include the Utility Services
therein which serve the Common Parts or any other Unit.
c. Unless otherwise indicated on the Site Plan, each
Unit in any Jointly Owned Real Property comprising land, rather than a building
or part of a building, will include, without limitation, everything within the
boundaries of the Unit other than the Utility Services that serve the Common
Parts or any other Unit.
d. Each Unit intended for individual ownership is
entitled to the right of way in other Units or land plots, and in Common Parts.
e. The dividing walls between two (2) adjacent Units
will be shared by the Owners of both Units, provided that these walls are part
of the Common Parts.
a. The car parks allocated or designated to a Unit
under the legislation applicable by the Competent Authority will be deemed an
integral part of the Unit, and may not be separated, or sold independently,
from that Unit.
b. A Developer must register Units and their
designated car parks in the names of respective Owners in accordance with the
relevant instructions issued by the Director General. In all events, a Unit may
not be sold or disposed of without the car parks designated to it.
c. An Owner may purchase additional car parks,
provided that such car parks are in excess of those designated for all Units in
the Jointly Owned Real Property under the legislation and instructions referred
to in paragraphs (a) and (b) of this Article. The Director General may
prescribe the cases in which Owners may purchase additional car parks.
An Owner, or a Developer in respect of unsold
Units, will own an undivided interest in Common Parts. This interest will be
determined based on the ratio of the Unit area to the total area of the Jointly
Owned Real Property.
A Unit Owner may sell or dispose of his Unit in
any legal manner, and may mortgage his Unit to any bank or financing
institution licensed to operate in the Emirate.
A Unit jointly owned by two (2) or more Persons
may not be subdivided amongst them unless that subdivision is permitted under
the Master Community Declaration; the DLD approval is obtained; and the
necessary licenses are granted by the Competent Authority.
a. A co-owner of a Unit will have a pre-emption right
to purchase another co-owner’s share in the Unit if that share is offered for
sale or disposition to a non-Owner. Where more than one (1) co-owner exercises
this right, each of them will be entitled to purchase a share proportional to
his existing share in the Unit.
b. The pre-emption right prescribed under paragraph
(a) of this Article will not be established in case of sale or disposition of
the co-owner’s share to any ascendants, descendants, spouse, relatives up to
the fourth degree, or in-laws up to the second degree.
a. A pre-emption right may not be divided and may
only be exercised or waived in whole. In case of multiple co-owners, each of
them may exercise his pre-emption right in proportion to his share in the
relevant Unit; and if any of them waives his right, it will be transferred to
the other co-owners in proportion to their existing shares.
b. A pre-emption right will be forfeited if the
co-owner offering to sell or dispose of his share serves on the other
co-owners, through a notary public, a written notice that states the name and
address of the third-party purchaser and the terms of sale, but none of these
co-owners agrees to such terms of sale within thirty (30) days from receipt of
that notice.
c. Where a co-owner agrees to purchase the offered
share, he must notify his intention to the co-owner offering to sell or dispose
of his share, through a notary public, within the notice period referred to in
paragraph (b) of this Article; and must finalise the sale procedures with the
DLD within no later than ten (10) working days from the date of expiry of that
notice period.
d. If it is proven that the sale made pursuant to
this Article is concluded under terms that are more favourable to the purchaser
than those mentioned in the notice sent to the co-owners having the pre-emption
right, these co-owners may file, with the RDSC, claims against the seller for
compensation for the damage they have sustained.
a. An Owner may lease out his Unit, provided that he
and the tenant remain under an obligation towards other Owners and Occupants,
the Owners Committee, and the Management Entity to comply with the Statute, the
Master Community Declaration, and the Building Management Regulation.
b. Unless otherwise stipulated in the Unit lease
agreement, the Owner will be liable to pay the Service Charges and Usage
Charges. In all events, the Owner may not be discharged from his liability to
pay the Service Charges and Usage Charges if the tenant fails to pay the same
as prescribed under this Law.
a. In all events, Common Parts may neither be
converted into private property; nor subdivided; nor disposed of in whole or in
part, independently from the Units to which they pertain, without first
obtaining the approval of the DLD and the Competent Authority. This applies
even if the building to which the Common Parts belong is under construction.
The Director General will issue a resolution prescribing the rules for using
the proceeds generated from such a conversion, subdivision, or disposition.
b. Unless the relevant prior approvals of the DLD and
the Competent Authority are obtained, it is prohibited to dispose of Common
Facilities in any manner whatsoever; or utilise, alter, redesign, or shut down
these facilities in a manner that restricts their use by Owners.
a. For the purposes of management of Common Parts,
Jointly Owned Real Property is classified into three (3) categories as follows:
1. Category 1: Major Projects
Projects
in this category will be determined in accordance with the criteria prescribed under the
relevant resolution issued by the Director General. The Developer will be
responsible for the management, operation, maintenance, and repair of Common
Parts and Utility Services. A Major Project will have an Owners Committee
constituted of members selected by RERA from amongst Owners residing in the
Jointly Owned Real Property. The duties of the Owners Committee will be
determined pursuant to the Statute and the rules and conditions prescribed
under the relevant resolutions of the Director General.
2. Category 2: Hotel Projects
These
are projects wherein the management of Common Parts must be outsourced by the
Developer to a Hotel Project Management Company in accordance with the relevant
rules approved by the Director General. A Hotel Project will have an Owners
Committee constituted of members selected by RERA if the Hotel Project
Management Company expresses its wish that such a committee be constituted.
This Owners Committee will not be authorised to participate in the management
of the Hotel Project or its Common Parts.
3. Category 3: Real Property Projects Other Than Major
Projects and Hotel Projects
These
are Real Property projects other than those falling in Category 1 and Category
2, as referred to in this paragraph. The management of Common Parts in these
projects will be undertaken by a specialised management company selected and
contracted by RERA in accordance with the relevant rules and standards approved
pursuant to the relevant resolution issued by the Director General. A Real
Property project in this category will have an Owners Committee constituted of
members appointed by RERA as prescribed under this Law.
b. Where the Jointly Owned Real Property includes a
project of Category 2 and a project of Category 3, as referred to in paragraph
(a) of this Article, the Common Parts in that Jointly Owned Real Property will
be outsourced to a Hotel Project Management Company. In this case, the Jointly
Owned Real Property will have a single Owners Committee constituted of members
appointed by RERA as prescribed under this Law.
c. The Developer may outsource all or any of his
duties, and delegate all or any of his responsibilities, under sub-paragraph
(a)(1) of this Article to a Management Company in return for the fees, and
subject to the conditions, agreed upon by both parties. This agreement must be
approved by RERA.
d. In case of absence of a Developer in a project
that falls in Category 1 or Category 2, as stated in paragraph (a) of this
Article, a Management Company will be appointed by RERA.
The Master Developer of a Master Project will
undertake the management and maintenance of the Common Facilities in that
project. The Master Developer must outsource such management and maintenance to
a Management Company pursuant to a written agreement approved in advance by
RERA.
a. A Developer will issue the Building Management
Regulations of the Major Projects and Hotel Projects managed by that Developer.
Building Management Regulations must be approved by RERA before making any
legal disposition in respect of the Units comprising the Jointly Owned Real
Property in the Major Project or Hotel Project in accordance with the
provisions of this Law, the resolutions issued in pursuance hereof, and the
Master Community Declaration.
b. RERA will issue the Building Management
Regulations of Jointly Owned Real Property other than the projects referred to
in paragraph (a) of this Article, provided that such Jointly Owned Real
Property has no Building Management Regulation. In this regard, RERA may engage
any specialised company to assist it in drafting the Building Management
Regulation.
c. If a part of the Jointly Owned Real Property is
developed in phases, the Building Management Regulation for that developed part
must be issued.
The Master Developer of a Master Project will
issue the Master Community Declaration of that project before making any legal
disposition in respect of the land, buildings, or Units of the project. The
Master Community Declaration must be approved by RERA. Any amendment to that
Master Community Declaration, affecting in any way the rights of purchasers,
may not be made without first obtaining the relevant approval of RERA.
a. The Owners Committee of a Real Property project
that falls in Category 1 or Category 3, as stated in paragraph (a) of Article
(18) of this Law, will be constituted of a maximum of nine (9) members
appointed by RERA, including the committee chairman and vice chairman.
b. An Owners Committee will be constituted upon the
registration of at least ten percent (10%) of the total Units of the Jointly
Owned Real Property on the Real Property Register in the names of their
respective Owners.
c. A member of an Owners Committee must:
1.
be of full legal capacity;
2.
be an Owner residing in the Jointly Owned Real
Property;
3.
be of good character and repute;
4.
pay the Service Charges and Usage Charges; and
5.
attend, and actively participate in, the meetings
of the Owners Committee.
d. A Developer may be a member of the Owners
Committee only if he owns unsold Units in the Jointly Owned Real Property.
e. An Owners Committee will elect from amongst its
members the chairman of that committee, who will represent it before the
Management Entity and RERA.
f. The provisions and conditions stipulated in this
Law, the resolutions issued in pursuance hereof, and the Statute will apply to
Owners Committees.
g. Subject to the provisions of this Law, RERA will
issue Statutes.
h. The membership of an Owner in the Owners Committee
will be terminated if he ceases to meet any of the membership requirements
stipulated in paragraph (c) of this Article, in which case RERA will appoint a
replacement member who meets these requirements.
i. RERA may, at any time, reconstitute an Owners
Committee, provided that the new members meet the Owners Committee membership
requirements.
a. An Owners Committee will be regularly convened
every three (3) months, i.e. four (4) times a year; and its first meeting will
be convened within thirty (30) days from the date of its constitution. Meetings
of the Owners Committee will be valid if attended by the majority of its
members, provided that its chairman or vice chairman is in attendance.
b. Where necessary, the Owners Committee may convene
an extraordinary meeting, provided that it notifies RERA in advance of the date
and time of this meeting and the reasons for convening the same.
c. When voting on the resolutions and recommendations
of the Owners Committee, each of its members will have one (1) vote, whether he
owns one (1) Unit or multiple Units in the Jointly Owned Real Property. In the
event of a tie, the chair of the meeting will have a casting vote.
d. The Management Entity must designate a place for
holding the Owners Committee meetings, and must appoint a rapporteur of the
Owners Committee to prepare the reports and minutes of these meetings.
An Owners Committee will exclusively:
1. verify that the Management Entity undertakes the
management, operation, maintenance, and repair of the Common Parts in
accordance with this Law, the resolutions issued in pursuance hereof, and the
Building Management Regulation;
2. review, and provide the necessary recommendations
on, the annual budgets for the maintenance of the Jointly Owned Real Property;
and for this purpose, request the Jointly Owned Real Property financial
reports;
3. discuss the obstacles and difficulties related to
the management, operation, maintenance, and repair of Common Parts; and submit
the necessary recommendations on the same to the Management Entity or RERA, as
the case may be;
4. receive, and notify to the Management Entity, the
complaints and suggestions submitted by Owners and Occupants in respect of the
management, operation, maintenance, and repair of Common Parts; and submit
these complaints and suggestions to RERA if the Management Entity fails to
address them within fourteen (14) days from the date of being notified of the
same;
5. request RERA to replace the Management Entity of
any Real Property project that falls in Category 3, as stated in paragraph (a)
of Article (18) of this Law; and provide appropriate advice to RERA on the
selection and appointment of a new Management Entity;
6. notify the Management Entity or RERA of any
defects in the structural parts of the Jointly Owned Real Property; or any damage
to, or defect in, the Common Parts that requires urgent repair;
7. coordinate with RERA, the Management Entity, or
the Competent Authority with respect to any safety, environmental, security, or
other matter related to the Jointly Owned Real Property; and
8. submit to the Management Entity any proposals
regarding the method of use of Common Parts; or regarding amendment of the
Building Management Regulation, in which case the amendment must be approved by
RERA.
a. An Owner will pay to the Management Entity his
share of the annual Service Charges to cover the Common Parts management,
operation, maintenance, and repair expenses. This share will be calculated,
using the relevant method approved by the Director General, based on ratio of
the area of the Owner's Unit to the total area of the Jointly Owned Real
Property. A Developer will pay his share of the annual Service Charges in
respect of unsold Units, and in respect of the sold Units for which he
undertakes, under the provisions of the sale contract or reservation agreement,
to pay the Service Charges on behalf of the purchaser.
b. For the purposes of application of paragraph (a)
of this Article, the Owner’s share of the Service Charges will be calculated
based on the area of his Unit as recorded in the Real Property Register.
A Master Developer will be entitled to collect
Usage Charges from Owners or Sub-developers in return for the management,
operation, maintenance, or repair of the Common Parts in the Master Project.
Such Usage Charges apply in respect of completed buildings, under-construction
buildings, and vacant land. The Owner or Sub-developer's share of the Usage
Charges will be calculated using the method adopted pursuant to the relevant
resolution issued by the Director General, provided that this method is in
compliance with the approved Master Community Declaration.
a. A Management Entity must not charge Owners, or
collect from them, any amounts whatsoever in return for the management,
operation, maintenance, or repair of Common Parts or Common Facilities; or for
any other reason, without first obtaining the relevant approval of RERA. This
approval will be issued in accordance with the approved Master Community
Declaration and the relevant rules and criteria approved by the Director
General.
b. For the purposes of application of paragraph (a)
of this Article, RERA may not approve or ratify the Service Charges or Usage
Charges budget unless it is approved by a certified audit firm recognised by
RERA for this purpose.
c. Where necessary, RERA may approve a temporary
Service Charges budget until the budget referred to in paragraph (b) of this
Article is approved. The temporary budget will be approved in accordance with
the rules prescribed under the relevant resolution issued by the Director
General.
An Owner or Sub-developer may not refrain from
paying the Service Charges or Usage Charges approved by RERA. An Owner may not
waive his interest in Common Parts to avoid paying the charges due from him.
A Developer or Management Entity must not take any
action against any Owner to prevent him from taking possession of, or using,
his Unit or using Common Parts or Common Facilities, with the intent of forcing
him to pay Service Charges or Utility Services in contravention of the
procedures stipulated in this Law and the resolutions issued in pursuance
hereof.
a. A Management Entity must open a Service Charges
account for each Jointly Owned Real Property with a bank licensed to operate in
the Emirate and recognised by RERA.
b. In accordance with the rules prescribed under the
relevant resolution issued by the Director General, the Management Entity must
deposit the Service Charges it collects in the account referred to in paragraph
(a) of this Article within seven (7) working days from the date of collection
of these charges.
c. The amounts deposited in the Service Charges
account may not, for any reason whatsoever, be subject to attachment in favour
of the Management Entity creditors.
d. Until a Management Company is appointed by RERA,
the Developer must undertake the management of the Jointly Owned Real Property
and maintain the Service Charges paid by Owners in the relevant Service Charges
account, as prescribed by this Law.
e. The funds deposited in the Service Charges account
may not be disposed of, and may only be used for the following purposes:
1.
paying for Common Parts cleaning services;
2.
paying for security and safety services in the
Jointly Owned Real Property;
3.
paying for the operation, maintenance, repair, and
improvement of Common Parts and their fixtures, fittings, and installations;
and for preserving the same in a good condition;
4.
paying the Jointly Owned Real Property insurance
premiums;
5.
paying any fees for the audit of the accounts and
budgets related to the Service Charges account;
6.
paying the Management Company fees, as per the
amount and method of payment determined by RERA;
7.
cover the Developer's administrative expenses
related to Major Projects, as approved by RERA;
8.
creating a cash reserve to cover emergency
expenses, or to replace equipment and devices in Common Parts, which must be
deposited in an account separate from the Service Charges account and may not
be disposed of for any purposes, other than in critical emergencies, without
first obtaining the approval of RERA;
9.
paying any fees or costs in return for inspecting;
or overseeing the management, operation, maintenance, and repair of, Jointly
Owned Real Property by RERA; and
10. covering
any other costs prescribed under the Master Community Declaration and approved
by RERA, as required for the management, operation, maintenance, and repair of
Common Parts.
f. Where the cash reserve referred to in
sub-paragraph (e)(8) of this Article is not sufficient to cover emergency
expenses, the DLD may, subject to obtaining the relevant prior approval of
RERA, request Owners to cover these expenses.
a. A Master Developer must open a Usage Charges
account for each Major Project with a bank licensed to operate in the Emirate
and recognised by RERA.
b. In accordance with the rules prescribed under the
relevant resolution issued by the Director General, the Management Entity must
collect Usage Charges and deposit them in the account referred to in paragraph
(a) of this Article within seven (7) working days from the date of collection
of these charges.
c. Where the Developer uses Common Facilities for
profitable commercial purposes based on the DLD approval, he must deposit a
percentage of the net profits generated from that use in the Usage Charges
account within ten (10) days from the date of collection of the proceeds from
use of the Common Facilities. This percentage of net profits will be determined
pursuant to the relevant resolution issued by the Director General.
d. The funds deposited in the Usage Charges account
will be used only for the purposes stated in paragraph (e) of Article (30) of
this Law in relation to Common Facilities in the Major Project.
e. In addition to the purposes mentioned in paragraph
(e) of Article (30) of this Law, the Master Developer may, subject to obtaining
the prior approval of RERA, use a portion of the funds deposited in the Usage
Charges account for the purposes of repair and maintenance in the
Developer-owned Areas in the Master Project, provided that these areas are
available for public use without consideration.
f. The amounts deposited in the Usage Charges account
may not, for any reason whatsoever, be subject to attachment in favour of the
Master Developer creditors.
a. The Management Entity will have a lien on every
Unit for unpaid Service Charges in respect thereof. A Unit may not be disposed
of unless these charges are paid to the Management Entity.
b. Where an Owner fails to pay his share of the
Service Charges or any part thereof, the Management Entity must request him to
pay such charges within thirty (30) days from being served the relevant written
notice approved by RERA. In the event of failure of the Owner to pay the
charges within this time limit, the financial claim made by the Management
Entity against the Owner will be enforceable by the execution judge at the RDSC
in accordance with the relevant rules and procedures adopted by the RDSC.
c. Where necessary, the competent execution judge may
order that a Unit in respect of which the Owner fails to pay his share of
Service Charges is sold by public auction to collect these charges.
d. An Owner who defaults in paying his share of
Service Charges must pay any court fees and costs, or advocates’ fees, adjudged
by the competent execution judge.
e. RERA will determine the method of service of the
notice referred to in paragraph (b) of this Article.
f. The provisions of this Article apply to the
collection of Usage Charges owed to Master Developers.
a. RERA will inspect; and audit the management,
operation, maintenance, and repair of, the Jointly Owned Real Property, Common
Parts, and Common Facilities. For these purposes, RERA will have the authority
to:
1.
inspect Jointly Owned Real Property, Common Parts,
and Common Facilities; and verify their suitability for the intended purposes,
without prejudice to the functions of the Competent Authority;
2.
record violations and serve notices on Developers
or Management Entities, as the case may be, where it is proven that they have
failed to preserve the Jointly Owned Real Property, Common Parts, or Common
Facilities in a good condition; and grant them time limits as necessary to
remedy such violations;
3.
audit the revenue credited, and the expenditure
debited, to the Service Charges account and the Usage Charges account; and for
this purpose, request any information, data, or statements and engage a
certified auditor recognised by RERA in this regard;
4.
consider the complaints filed against Developers,
Management Entities, or Owners Committees in relation to the management,
operation, maintenance, and repair of Jointly Owned Real Property, Common
Parts, and Common Facilities; and take the necessary action in respect thereof;
5.
Audit the contracts and agreements concluded by
Management Entities with maintenance, security, cleaning, insurance, and other
corporations and companies; and
6.
exercise any other duties or powers assigned to it
by the Director General.
b. RERA may outsource any of its duties and delegate
any of its powers under paragraph (a) of this Article to any natural or legal
person in accordance with the relevant conditions and rules approved by the
Director General.
a. A Management Entity will conclude contracts and
agreements with maintenance, security, cleaning, insurance, and other
corporations and companies to the extent required to enable it to perform its
duties and obligations as prescribed in this Law.
b. A Management Entity must provide RERA, every six
(6) months, with a periodic report on the management of, and the maintenance
works performed in, Jointly Owned Real Property, Common Parts, and Common
Facilities. Where necessary, RERA may request the Management Entity to provide
it with any information or with a statement of the revenue and expenditure
related to Service Charges or Usage Charges.
a. Where it is established to the satisfaction of
RERA that Common Parts or Common Facilities are not duly maintained, or not
preserved in a good, clean, and serviceable condition, RERA may serve a written
notice on the Management Entity requesting it to take any necessary action or
perform the relevant repair or maintenance works it deems appropriate.
b. RERA must state in the notice referred to in
paragraph (a) of this Article, the required repair and maintenance works and
the dates of commencement and completion of such works.
c. Where the Management Entity fails to perform
repair or maintenance works in accordance with paragraph (a) of this Article,
RERA may appoint any other entity to perform all or any of these works; and
debit the costs and expenses incurred in this regard to the Service Charges
account or to the Usage Charges account referred to in Article (30) and Article
(31) of this Law respectively.
a. A Management Entity must provide a bank guarantee,
in favour of the DLD and in the amount it determines, with respect to all
Jointly Owned Real Property managed by that Management Entity. The bank
guarantee will be held as a security deposit to be used to remedy any damage
sustained by Common Parts or Common Facilities as a result of omission or
negligence on the part of the Management Entity.
b. Where Jointly Owned Real Property, Common Parts,
or Common Facilities sustain damage as a result of any act, negligence, or
omission of the Management Entity, RERA may serve a written notice on the
Management Entity requesting it to remedy such damage within the time limit
specified by RERA.
c. Where the Management Entity fails to remedy the
damage within the time limit specified in the notice served on it pursuant to
paragraph (b) of this Article, RERA may appoint any other entity to fulfil all
or any of the requirements stated in the notice and deduct the costs and
expenses incurred in this regard from the bank guarantee referred to in
paragraph (a) of this Article.
a. Where a Developer or Hotel Project Management
Company is proven incompetent or unable to manage Jointly Owned Real Property
or Common Parts in projects that fall in Category 1 or Category 2, as stated in
paragraph (a) of Article (18) of this Law, in a manner that ensures their
sustainability and serviceability, the CEO may appoint a specialised Management
Company to undertake the management and operation of that Jointly Owned Real
Property or Common Parts.
b. The provisions of paragraph (a) of this Article
will apply if a Master Developer is proven incompetent or unable to manage the
Common Facilities in a Master Project in a manner that ensures their
sustainability and serviceability,
a. Where RERA deems that a Management Company is
incompetent, unqualified, or unable to manage and maintain Common Parts in Real
Property projects that falls in Category 3, as stated in paragraph (a) of
Article (18) of this Law, RERA may appoint a replacement Management Company to
undertake the management of the Jointly Owned Real Property. In this case, RERA
must adhere to the following procedures:
1.
notify the Owners Committee of the violations
committed by the Management Company, and seek its opinion regarding such
violations;
2.
serve a written warning on the Management Company
stating its mistakes and wrong practices with respect to the management,
operation, maintenance, and repair of Common Parts; whereupon the Management
Company may respond to that written warning within fourteen (14) days from the
date of service of the warning;
3.
appoint a certified audit firm to audit the
Service Charges account and verify the Management Company’s compliance with the
Service Charges budget approved by RERA; and
4.
grant the Management Company a time limit to hand
over the management of the Jointly Owned Real Property to the replacement
Management Company within thirty (30) days from the date of issue of RERA’s
decision appointing that replacement Management Company.
b. Where any damage to property in the Jointly Owned
Real Property or Common Parts is caused by the acts of the substituted
Management Company, that company will be liable for the cost of remedy of this
damage, which will be deducted from the bank guarantee provided by that company,
as referred to in paragraph (a) of Article (36) of this Law.
a. Without prejudice to the construction legislation
in force in the Emirate, an Occupant may make substantial alterations or
modifications to the structure or external appearance of his Unit, or to any
part of the Jointly Owned Real Property, only after obtaining the approval of
the Master Developer, the DLD, and the Competent Authority.
b. An Occupant who violates the provisions of
paragraph (a) of this Article will be liable for remedying, at his own expense
and in the manner prescribed by Master Developer or RERA, any damage arising
from the alterations or modifications made by him.
c. Where an Occupant fails to remedy the damage in
accordance with paragraph (b) of this Article, RERA or the Master Developer may
appoint any entity to remedy such damage; and hold the Occupant liable for the
remedy costs and expenses.
d. Subject to the provisions of the Building
Management Regulation, an Occupant and his guests must use Common Parts only
for their intended purposes, and in a manner that does not prejudice the rights
of others to use these Common Parts, disturb them, or endanger their safety or
the safety of the Jointly Owned Real Property.
a. Subject to the provisions governing contractor
agreements, as stipulated in the above-mentioned Federal Law No. (5) of 1985, a
developer will remain liable, for a period of ten (10) years from the date of
obtaining the completion certificate of the Real Property project developed by
him, to remedy or rectify any defects in the structural parts of the Jointly
Owned Real Property.
b. The Developer will remain liable, for a period of
one (1) year from the date of handover of the Unit to the Owner, for repairing
or replacing defective installations in the Jointly Owned Real Property. These
include mechanical and electrical works, sanitary and sewerage installations,
and similar installations. Where an Owner refrains from taking possession of
his Unit for any reason, the above-mentioned liability period will commence
from the date of obtaining the completion certificate of the Real Property
project developed by the Developer.
c. Subject to the provisions of paragraphs (a) and
(b) of this Article, nothing in this Law may preclude or prejudice any rights
or warranties granted to Owners as against Developers pursuant to any other
legislation.
d. An agreement which is made after this Law comes
into force and which contradicts, in any way, the provisions of this Article
will be deemed null and void.
a. A Management Entity must insure the Jointly Owned
Real Property under an insurance policy that covers the maintenance and
reconstruction of the Jointly Owned Real Property in case of fire, damage, or
destruction for any reason whatsoever. For these purposes, the beneficiary of
the insurance must be the Management Entity.
b. The Management Entity must insure the Jointly
Owned Real Property against the liability for damage and for bodily injuries
sustained by Occupants or third parties.
c. Insurance premiums payable by Owners will be
calculated pursuant to the insurance contracts concluded with insurance
companies, and will be included in the Service Charges.
In addition to the functions assigned to the RDSC
under the legislation in force, the RDSC will have the exclusive jurisdiction
to hear and determine all disputes and disagreements related to the rights and
obligations stipulated in this Law and the resolutions issued in pursuance
hereof, in accordance with the relevant rules and procedures adopted by the
RDSC.
In return for issuing the approvals and providing
the services prescribed under this Law and the resolutions issued in pursuance
hereof, the DLD will collect the fees determined pursuant to the relevant
resolution issued by the Chairman of the Executive Council.
a. Without prejudice to any stricter penalty
stipulated in any other legislation, a person who commits any act constituting
a violation of the provisions of this Law and the resolutions issued in
pursuance hereof will be punished by a fine of not less than one million
Dirhams (AED 1,000,000.00). Upon repetition of the same violation within one
(1) year from the date of the previous violation, the amount of the fine will
be doubled. A fine must not exceed two million Dirhams (AED 2,000,000.00).
b. The acts constituting a violation of the
provisions of this Law, and the fines prescribed for each of these acts, will
be determined pursuant to the relevant resolution issued by the Chairman of the
Executive Council.
The persons nominated by a resolution of the
Director General will have the capacity of law enforcement officers to record
the acts committed in breach of the provisions of this Law and the resolutions
issued in pursuance hereof. For this purpose, they may issue the necessary
violation reports and seek the assistance of concerned Government Entities in
the Emirate, including police personnel.
Any affected party may submit a written grievance
to the Director General against any decision or measure taken against him under
this Law and the resolutions issued in pursuance hereof, within thirty (30)
days from the date of being notified of the contested decision or measure. The
grievance will be determined, within thirty (30) days from the date of its
submission, by a committee formed by the Director General for this purpose.
Without prejudice to the grievant's right to recourse to the RDSC to seek any
relief, the decision issued in respect of the grievance will be final.
The fees and fines collected pursuant to this Law
and the resolutions issued in pursuance hereof will be paid to the Public
Treasury of the Government.
a. All Developers, Management Entities, and Owners
Associations must comply with the provisions of this Law within six (6) months
from its effective date. Where necessary, the Director General may extend this
grace period for the same period.
b. The provisions of this Law will apply without
prejudice to the provisions of the contracts concluded before its effective date
between Developers and Owners and the Master Community Declarations approved by
and filed with RERA, except for the provisions related to the exemption
applicable to the constitution of Owners Associations.
All rights and obligations of Owners Associations,
arising before the effective date of this Law, are hereby transferred to
Management Entities.
The Director General will issue the resolutions
required for the implementation of this Law. These resolutions will be
published in the Official Gazette of the Government of Dubai.
a. The above-mentioned Law No. (27) of 2007 is hereby
repealed. Any provision in any other legislation will also be repealed to the
extent that it contradicts the provisions of this Law.
b. The bylaws, regulations, and resolutions issued in
implementation of the above-mentioned Law No. (27) of 2007 will continue in
force, to the extent that they do not contradict this Law, until new
superseding bylaws, regulations, and resolutions are issued.
This Law will be published in the Official Gazette
and will come into force sixty (60) days after the date of its publication.
Mohammed
bin Rashid Al Maktoum
Ruler of Dubai
Issued in Dubai on 4 September 2019
Corresponding to 5 Muharram 1441 A.H.
©2019 The Supreme
Legislation Committee in the Emirate of Dubai
[1]Every effort
has been made to produce an accurate and complete English version of this
legislation. However, for the purpose of its interpretation and application,
reference must be made to the original Arabic text. In case of conflict, the
Arabic text will prevail.