Since the 2008 global financial crisis, the United Arab Emirates (UAE) has taken great care to reinforce confidence in the real estate market. Most recently, the Dubai courts, in particular, have issued a number of landmark judgments that aim to balance the competing interests of developers and buyers, to facilitate the sale and purchase of property in the Emirate, and to keep the market as buoyant as possible in the face of a global economic slowdown.
The courts are upholding the spirit of the law to achieve justice and commerciality rather than simply sticking to the letter of the law. Their approach is highlighted by cases in two different areas relating to property development in Dubai.
1. Developers gain clarity over required governmental approvals for the first time
Two judgments recently issued by the Dubai Court of Cassation in 2019 have clarified the types of approval required, the governmental entities responsible to issue such approval, and, crucially, the timing of the approval, before developers can promote or sell off-plan property in the Emirate.
These groundbreaking rulings and interpretation of the real estate laws provide specific guidance on the above for the first time: developers can now promote or sell off-plan projects after obtaining an approval from a number of competent government entities, including the Department of Tourism & Commercial Marketing (DTCM) and the Dubai Municipality, in addition to registering the property with the Dubai Land Department (DLD).
To speak to us in relation to the above judgments, please feel free to contact Tarek Saad and Abdalla Eisa.
2. Main developers are obliged to ensure completion of infrastructure for sale
A ruling by the Dubai Court of Cassation in 2018 in relation to the dispute over the sale and purchase of two plots of land in Downtown Jebel Ali set a precedent by confirming the liability of both main developers and sub developers for ensuring that the infrastructure is completed for a property or land before it is advertised or offered for sale.
To speak to us in relation to the above judgment, please feel free to contact Wael El Tounsy, Shaima Al Barguthi and Marina Gaballah.
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