The Supreme Council is the main federal authority (the federal government) of United Arab Emirates. It has the power to pass laws on the matters assigned to it by the UAE Constitution (federal laws). The federal laws set out a number of principles regarding real property and rights relating to it. The Law of Civil Transactions of the UAE (Civil Code) is the primary source for defining the rights and obligations under the law for buying such property in UAE. Some part of the law deals with the application of laws in the UAE and the types of rights that are recognized. Other part deals specifically with property rights, setting out how they can be acquired and the rights that derive from ownership. Another part deals with the creation of security over all types of property (including real property). The concerned article by Property Lawyers of Dubai will enlighten the readers especially the expatriates over concerns whilst buying or selling property in the country.
It is important to have a proper and complete understanding of your rights and the legal risks involved, when buying a property anywhere in the world. The same applies when buying property in the UAE, especially for expatriates and overseas investors who may not be familiar with the local laws and market conditions. The available property rights include freehold, usufruct and musataha.
- freehold – the right to use, enjoy and occupy land or property permanently
- usufruct – the right to use, enjoy and occupy land or property belonging to another person for a fixed term not exceeding 99 years. Usufruct is similar to the concept of leasehold under English law.
- musataha – the right to build on land for a specified duration not exceeding 50 years. The holder of a musataha right is deemed to own all buildings on the land during the specified term.
In Dubai a ‘volumetric’ subdivision of land and buildings into designated components is permitted (see Article 8 of the Dubai Direction for General Regulation (2010) and Article 61 of Abu Dhabi Law 3/2015). There are no provisions that prohibit foreign nationals from owning property but each emirate has its own provisions and regulations regarding it. A non-UAE/GCC national can own only a freehold, leasehold (up to 99 years) or usufruct (up to 99 years) in designated areas in Dubai, which are listed in Regulation 3/2006 (as amended by Regulation 1/2010), or in the free zones. According to Dubai land department’ s policy a fund or a trust or an entity which is held by either of these cannot own property anywhere in Dubai.
A developer must register all dispositions of off-plan property in the Interim Register, which is maintained by the Dubai Land Department Article 3. And a disposition of a completed property must be registered in the Real Property Register, which is also maintained by the Dubai Land Department. All leases must be registered with the Real Estate Registration Authority and all mortgages must be registered with the Dubai Land Department. A contract is only binding if everything is done in accordance with the aforementioned provisions.