Ras Al Khaimah’s New Real Estate Development Law: What Developers Need to Know

On 21 July 2026, the Ruler of Ras Al Khaimah issued Law No. (10) of 2026 on the Regulation of Real Estate Development in the Emirate of Ras Al Khaimah (the New Law), taking effect sixty days from issuance and repealing Law No. (12) of 2023. The New Law tightens financial controls, sharpens purchaser protections and streamlines institutional oversight.

A Simpler Regulatory Structure

The 2023 law split oversight between a Real Estate Project Development Committee and the Real Estate Regulatory Administration. The New Law abolishes the standalone Committee, consolidating its functions into Ras Al Khaimah Municipality Department (the Department) and its Real Estate Regulatory Department. Licensing, project registration, escrow oversight and enforcement decisions now sit with the Director General and Director of the Department, giving developers a single point of contact rather than two-tier sign-off.

New Category: Sub-Developers Formally Recognised

The New Law introduces a clearer three-tier framework of Main Real Estate Development Projects, Sub Real Estate Development Projects and corresponding Main Developer and Sub-Developer roles. A Sub-Developer must obtain Main Developer approval before commencing off-plan sales, and the contract between them must be registered with the Department. Where main project and sub-project plans conflict, the main project prevails. Developers structuring phased or multi-party master developments should expect closer scrutiny of these internal arrangements.

Tighter Registration and Disclosure Obligations

Both laws require registration in the Register of Real Estate Developers and Register of Real Estate Development Projects before infrastructure works, construction or off-plan sales may begin. The New Law adds:

• A duty to register the marketing agreement with any accredited real estate broker;
• A duty to register the contract between Main Developer and Sub-Developer with the Department;
• An express prohibition on amending plans, technical specifications or project management systems without Department approval; and
• A new compensation obligation – the developer must compensate the purchaser for any shortfall in sold area exceeding five percent.

The New Law also expands grounds for striking a developer off the Register, adding forged documents, fictitious project offerings, and inaccurate or incomplete financial disclosures to the existing grounds of failure to register within a year, voluntary withdrawal, licence revocation and bankruptcy.

Escrow Accounts Become More Prescriptive and Less Flexible

Escrow remains central to off-plan sales protection, but the 2026 law narrows several flexibilities developers previously relied on:

• No profit disbursement mechanism. The 2023 law allowed a developer, with Department approval, to draw up to five percent of expected project profits from escrow in three instalments once specified conditions were met (funds exceeding remaining construction cost, completion above sixty percent). The 2026 law removes this mechanism entirely. Disbursements are now permitted only for construction related project expenditure, or other costs the Department deems necessary to complete the project.
• Marketing spend carve-out replaced by discretionary approval. The 2023 law authorised marketing disbursements of up to five percent of deposited amounts as a standalone entitlement. That automatic carve-out does not appear in the New Law. However, Article 34(1) of the New Law permits escrow disbursements for construction expenditure and “other expenditures the Department deems necessary to complete the project”, which could potentially encompass marketing costs if specifically approved by the Department. In practice, therefore, marketing spend is no longer available as of right but may still be permissible on a case-by-case basis with Department approval under this broader discretionary clause.
• Land payment restriction retained. Both laws prohibit paying for project land out of escrow unless a completion certificate has been issued.
• Maintenance retention unchanged. Both laws require the escrow trustee to retain five percent of total construction cost for one year following the completion certificate, releasable early against a liquid bank guarantee.
• Escrow account trustees remain subject to registration and must continue providing the Department with account statements; the 2026 law adds an explicit list of the data those statements must cover, including purchaser names, account changes and balances.
• Mortgage financing simplified. The 2023 law permitted mortgages over individual unsold units (above fifty percent completion) with detailed conditions including purchaser disclosure. The New Law instead permits the developer to mortgage the project land itself, with proceeds deposited into escrow.
• Financing plan unchanged. Developers must still contribute at least twenty percent of construction cost, and a project cannot rely entirely on off-plan proceeds.

Off-Plan Sales: Firmer Purchaser Remedies, Recalibrated Developer Remedies

The core reservation deed mechanism and thirty-day contract conclusion window carry over, as does the purchaser’s right to withhold instalments tied to unmet milestones. However, the New Law’s treatment of the reservation deed in Article 16 is significantly condensed compared to the 2023 law’s Articles 29 and 30. The detailed provisions previously set out in the law itself regarding reservation deed content — including developer details, purchaser details, unit description, payment details, escrow trustee information and financer details — have been delegated to the executive regulations. Developers should monitor the implementing regulations for the specific content requirements that will apply. The most significant shift in this section concerns purchaser default.

The 2023 law set four deduction bands linked to completion percentage with auction and forced completion options at the highest band. The New Law simplifies this to three bands:

Auction and forced completion options are removed as self-help remedies but are still available via court intervention and unilateral termination (after Department confirmation) is the default remedy. Refunds must be returned to the purchaser, or deposited with the Department, within six months. This regime applies to all off-plan contracts regardless of signing date, except where a completion certificate has already been issued.

Purchasers also gain an explicit right to access all data relating to their project and unit, replacing the narrower access rights under the 2023 law.

Project Delivery, Defects Liability and Stalled Projects

Developer liability periods are unchanged: ten years for structural defects and collapse, one year for defective mechanical, electrical and plumbing installations, both from the completion certificate (or unit handover for installations). Contrary agreements remain void.

The regime for stalled and cancelled projects is restructured. The New Law establishes a dedicated Judicial Committee for Stalled and Cancelled Projects with binding power to cancel a project, strike it from the register and determine the priority of purchaser refunds and creditor claims. The six-month inactivity trigger is unchanged, but the escalation path now runs to a body with adjudicative rather than advisory authority.

Practical Impact on Project Structuring and Sales Planning

The removal of the profit disbursement mechanism and the replacement of the automatic marketing spend carve-out with a requirement for specific Department approval materially change the cash flow assumptions underlying off-plan projects. Developers should consider whether their existing financial arrangements and project budgets reflect this tighter escrow framework.

The clearer Main Developer / Sub-Developer framework, together with the requirement to register the contract between them with the Department, introduces additional compliance steps for master-planned and multi-party developments. Existing arrangements may need to be reviewed in light of these requirements.

The compressed three-band deduction table changes the economics of purchaser default at every completion stage. Developers with existing off-plan portfolios should be aware that the new regime applies retrospectively to all contracts where a completion certificate has not yet been issued.

The five percent area-shortfall compensation duty is new and applies to all developers. This introduces a specific financial exposure that did not exist under the previous law.

The establishment of a dedicated Judicial Committee with binding authority over stalled and cancelled projects represents a shift from the previous advisory committee model. Developers involved in projects facing delays or disputes should be aware that the escalation path has changed significantly.