Dubai's new initiative to reduce real estate legal disputes - Zawya

By Parag Deulgaonkar

'Tanweer' is designed to enhance investor confidence: DLD official

After launching two initiatives in the last two years to revive stalled projects in the emirate, the Dubai Land Department (DLD) is all set to unveil its new initiative - Tanweer - that aims to minimise legal disputes and protect investors' rights.

Majida Ali Rashid, Chairwoman of the Center for Promotion and Management of Real Estate Investment, DLD, told Emirates 24|7: "Tanweer is designed to enhance investors' confidence in the real estate market and act as a reference guide aimed at setting the frameworks and general principles of the rights and duties of real estate investors in order to ensure transparency and promote confidence in the market."

The prime objectives of the programme include contributing to the organisation of the real estate sector; encouraging and attracting local and international investors; enhancing the confidence of investors in real estate sector; ensuring transparency at all transaction stages (sale or purchase); providing an umbrella for the protection of investor rights; minimising legal disputes and contributing to improving the real estate sector and its reflection on the rest of the national economy's sectors.

No details were given on when the initiative will be launched and how can investors seek protection through it.

In October 2011, Sultan bin Butti bin Mejrin, Director General of the Dubai Land Department told Emirates 24|7 that the department had appointed a consultant to review and finalise the real estate investor protection law, which was likely to be issued by 2011-end.

Earlier this month, bin Mejrin however, told Al Ittihad, an Arabic newspaper, that they were planning to enforce a new law to protect the rights of property investors from mid-2012.

It is understood that the new law will provide clarity on various issues such as steps that an investor can take in case of project delays, how an investor can cancel their contracts if the developer fails to fulfill his contractual obligation, etc.

The department already has a mediation committee that looks at resolving issues cordially. But if disputes are unsettled, then the either party has the option to move court.

Of the two initiatives, Tayseer was launched in July 2010. It aims to facilitate financing for purchasers in certain pre-qualified projects. To date, only two projects have been financed under this scheme.

Tania, initiated in September 2011, is aimed to get semi government/private investors on board to get projects completed.

The Dubai Land Department is currently auditing over 100 projects, but possibly just one project has got the requisite funding through this plan.

Moreover, if the code for corporate governance is implemented by the department from 2013, it will become mandatory for all developers to disclose recourse and alternatives available for prospective investors in case of a delay in completion and handover of their property.

The code will also ensure that companies inform their investors of various options such as swaps or refunds in case of project delays.

? Emirates 24|7 2012

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