New Law for settling property disputes

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Full refunds will be given to investors of real estate development projects that are officially cancelled by government property regulators under a pending law,

Under Law No 9 of 2009, Real Estate Regulatory Agency (Rera) has stipulated that if – after a thorough government review – a project is cancelled, all cash paid by buyers will be returned by developers upon termination of contract.


Law No 9, which provides a sliding scale for refunds, has been signed and approved. The law however, only becomes official and legally binding once it gets published in Dubai’s official gazette.

Rera will apply the law and give directions to developers on what steps to take. Mohammad Kamal, Head of Real Estate

Rera officials couldn’t be reached for comment by press time. The new rules amend previous laws and will frame new procedures for “terminations of sale and purchase agreements for off-plan units and will set the damages payable to the developer depending on the progress of construction”, according to Lovells law firm.

Lovells stated that if a “developer’s project is cancelled by Rera” the “purchaser shall be refunded all monies paid to date”.

The changes may help unravel months of uncertainty by investors who have faithfully continued to pay instalments to developers who failed to begin any construction on projects to which buyers legally signed contracts.

“Law 9 will provide significant guidance to the real estate market and will clarify the uncertainty on terminations and damages,” said Lovells.

Mohammad Kamal, Lovells Head of Real Estate Middle East, said the final version of the new law contains the full refund provision for cancelled projects only.

Kamal was part of a Rera working group that helped draft the new rules.

“Rera will apply the law and give directions to developers on what steps to take,” Kamal said, noting that arbitration won’t be needed because “the disputes would be settled under the law”. Compensation rate

As previously reported by XPRESS, the new law contains a sliding scale that spells out the rate of investor compensation to be paid by developers based upon the amount of construction completed.

Roughly 875 projects are now being visited by government inspectors across Dubai to determine the progress of each development.

The new law, meanwhile, dictates that all terminations “must be served through the Dubai Land Department and the purchaser shall be given 30 days to rectify a breach”.

Sliding scale

The following is the percentage of refunds as provided for in Law No 9:

80 per cent completed: Buyer forfeits 100 per cent of cash he/she has paid to date
60 per cent completed: Buyer forfeits 40 per cent of purchase price
Less than 60 per cent completed: Buyer forfeits 25 per cent of purchase price
Construction hasn’t started: Buyer forfeits 30 per cent of cash he/she has paid to date
When project is officially cancelled by Rera: Buyer shall be refunded all cash he/she has paid to date.


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I hope that people will get their life saving back
government official help investors now or u will loose a big investor for your country act now.....................?
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