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Property laws in Dubai >> Law No. 8 - Escrow Law



Dubai real estate will have major impact from the newly formed escrow law. The said escrow law is Law No. 8 Concerning Guarantee Accounts of Real Estate Developments in the Emirate of Dubai. The law states that all funds received by real estate developers with respect to a property have to be administered through an escrow account, which in turn will be regulated by the Dubai Land Department.

Who all have to subscribe to the escrow law?

All real estate developers who engage with the sale of units off-plan and get payment from buyers/financiers before the completion of the property development have to comply by the escrow law. This will apply whether the respective property development is in the planning phase or under construction.

What is the time-frame for complying with the escrow law?

The escrow law came into force on June 28, 2007 with an allowance of six-month transitional period. In other words, all concerned have to subscribe to the law by December 28,2007.
Who will keep record of property developers subscribing to the escrow law?

Dubai Land Department will keep a register of property developers in Dubai who have been licensed to carry on real estate business.
What will be the consequences of non-compliance with the law?

Unless a property developer is registered with Dubai Land Department under the escrow law, s/he won’t be able to carry out any activity related to real estate development
(including advertising).

Where can one get the registration form?

Property developers can get hold of the registration form from the Dubai Land Department.
Registration is compulsory along with bearing a valid trade license.

Without being registered, can a property developer conduct advertising?

Before advertising a property development through regional or foreign media, the concerned property developer must obtain a written permit from the Dubai Land Department. This is compulsory and is additional to getting registered with the Department.

Can a property developer sell units from a development after registration?

After getting registered with the Dubai Land Department, a property developer must apply for a guarantee account (escrow account) for managing the funds received from buyers, investors or financiers.

What are the documents required to apply for an account?

• The trade license of the property developer;
• The developer’s certificate of registration with the Dubai Chamber of Commerce and Industry;
• The original title deed of the plot on which the property is to be developed;
• A copy
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