x Abu Dhabi, UAEMonday 24 July 2017

Dubai's Tanweer property law is the 'first of its kind'

A law to protect the rights of property investors and promote transparency and confidence in Dubai real estate is in the pipeline.

DUBAI // A law to protect the rights of property investors and promote transparency and confidence in Dubai real estate is in the pipeline.

The Tanweer legislation will be announced "soon", revealed Majida Ali Rashed, the head of the Real Estate Investment Management and Promotion Centre of the Dubai Land Department.

The industry has been waiting for more than a year for the law to be passed and legal experts said they provided the Land Department with feedback on the draft law last year.

No specific details were available but Ms Rashed said the law was ready and being looked at by higher authorities.

"The Dubai Land department will issue in the coming period a fully integrated law that will protect the rights of real-estate investors through a comprehensive framework based on transparency and clarity of the contractual relationship between the developers and the investors," she said.

"The anticipated real-estate investor protection law, Tanweer, is the first of its kind regionally and globally. Senior management has devoted considerable time and effort in discussing its provisions with a large segment of workers in the real-estate market and with consulting and legal firms.

"The real-estate investor protection law aims to set a framework and guidelines related to the rights and duties of real-estate investors to ensure transparency and strengthen confidence in the real estate market."

Experts welcomed the move and said it was unlikely more information about the law would be available until it was formally launched.

Legal firm Clyde & Co said proposed changes in the draft law included placing obligations on developers to provide accurate information to investors from the outset.

As per the draft text, which could be amended before it is enacted, a contract would be considered null and void if information was withheld by the developer that may "damage the interests of the investor".

The law also provides for a statutory cooling-off period during which purchasers can withdraw from contracts within 10 working days of signing a reservation form.

The draft specifies that investors can no longer sell or market properties held under reservation agreements but must register their sale and purchase agreements first with the Land Department.

Alexis Waller, partner at the legal firm Clyde & Co, said: "It was critical to adequately balance the rights of investors and developers and for the initiative not to be one-sided in a way which benefits investors but adversely impacts project development within the market.

"Any initiative that aims to improve the transparency, confidence and efficiency of the Dubai real-estate market is a welcome addition and will only serve to promote sustainable growth and foreign investment within the market.

"We are hopeful that more specific details of the initiative will be released soon so that a comprehensive analysis of its ultimate effect on investors can be carried out."

rtalwar@thenational.ae