Welcome to the Saudi Arabia focus edition of Law Update.
One of the key markets in the Middle East and North Africa (MENA) that continues to lead from the front is the Kingdom of Saudi Arabia (KSA). As the largest country in the Middle East and the 18th largest economy in the world, the progress KSA continues to make is underpinned by its Vision 2030 that envisions developing the country as an investment powerhouse and hub that ultimately connects Asia, Europe, and Africa. Given Saudi Arabia’s significance to the regional economy, our team of experts have prepared a range of pertinent articles that provide insights into new laws, regulations, and the legal landscape in the Kingdom.
This edition will provide you with an up-to-date guide on matters such as; the framework issued by the Saudi Central Bank on IT governance, the anti-corruption landscape under Vision 2030; we also provide practical tips for dispute avoidance. This is only a snapshot; there are many more articles within the KSA focus section for you to read, which we hope you will find valuable and enjoyable.Read the edition
Maha Dahoui - Associate - Real Estate
Entities that are incorporated in Abu Dhabi Global Market (‘ADGM’) are permitted to own land and property in the areas of Dubai designated for foreign ownership by the Ruler of Dubai (‘Designated Areas’) pursuant to a Memorandum of Understanding (‘MoU’) signed between ADGM and the Dubai Land Department (‘DLD’) on 24 October 2018.
The MoU is a significant development and enables investors to use an ADGM vehicle to own Dubai properties and structure their businesses in ADGM accordingly.
Ownership of real estate in Dubai is governed by Law No. 7 of 2006 concerning Real Estate Registration in the Emirate of Dubai (‘Real Estate Law’).
Article 4 of the Real Estate Law provides that companies:
Despite the generality of the law, the DLD’s policy has long restricted the type of companies that are permitted to own property in Designated Areas to Dubai onshore companies and Dubai offshore companies incorporated in the Jebel Ali Free Zone, the Dubai Multi Commodities Centre Free Zone, Dubai International Financial Centre (‘DIFC’), among others.
Pursuant to the MoU, as of 24 October 2018 the DLD now allows the ownership of properties in Designated Areas by companies incorporated in ADGM.
The Registration Authority of ADGM (‘RA’) has issued guidance on the registration procedures to be followed together with information on the documents which should be provided to DLD in order to register a property within the Designated Areas in the name of an ADGM entity.
Pursuant to the MoU, the guidance issued by the RA and the current DLD policies, the following rules and procedures will apply when registering a property in Dubai in the name of an ADGM entity:
In accordance with the MoU and the current policies of the DLD, the transfer of all or part of the shares of an ADGM entity will be treated as a transfer of ownership of an interest in the properties owned by the ADGM entity. Accordingly, a transfer of shares triggers the payment of registration fees at the rate applied by the DLD at the time of the transfer with respect to each property owned by the ADGM entity. The transfer fees payable will be calculated by the DLD based on the percentage of interests in the ADGM entity being transferred.
It is important to note that the DLD’s policies are not formally published and are subject to change from time to time. Specific legal advice on a proposed ownership structure should be sought prior to entering into any property transaction.
Al Tamimi & Company’s Real Estate team regularly advises on real estate investment in Abu Dhabi. For further information please contact Maha Dahoui (firstname.lastname@example.org) or David Bowman (email@example.com).