Unified lease contract in Dubai from March

The Dubai Land Department (DLD) has announced the launch of a ‘unified lease form’, which will become a mandatory procedure starting in March 2017.

The new form is a standardised tenancy contract for residential, industrial and commercial units, which is combined with Ejari.

Items within the contract are governed by applicable laws, including rental laws that determine and regulate the imposition of penalties. The new contract requires the signatures of the lessor and tenant along with two witnesses.

The move is in line with the DLD’s aim to create a transparent and professional real estate market with measurable standards. The new form has been designed to regulate relationships between all parties involved in real estate transactions in order to guarantee their rights.

“Dubai has managed to acquire a prestigious position because of the stability the city provides in terms of investments, work and daily life. This latest step by DLD contributes further to consolidating Dubai’s positive image across the globe,” said Mohammad Ahmad Yahya, Deputy CEO of Rental Affairs Sector at the DLD.

Applicable laws

The new contract was drafted based on several Dubai tenancy laws, however, the laws are not individually listed on the unified contract. Law No. (2) issued in 2003, one of the references used, regulates rental and property management as well as all related requirements, including licensing and guarantees.

The contract is also in line with Law No. (33) issued in 2008, which regulates the relationship between landlords and tenants in Dubai, and specifically focuses on clause No. (25). This clause specifies cases that enable the landlord to request eviction of the tenant from the property. These include the tenant sub-leasing the property, or using it to carry out prohibited or illegal activities.

With regards to property maintenance, DLD confirmed that Law No. (26) issued in 2007, under clause No. 16 is applicable. The law states that under the terms of the lease, the landlord is responsible for property maintenance repair work, and repair of any damage or defect that may affect the well-being of the tenant within the premise, unless otherwise agreed on between both parties. Should the landlord want to shift the responsibility of maintenance to the tenant, the term should be listed in the addendum and mutually signed by both parties.

All parties should agree on any additional terms before signing the lease for the first time.

Gulf News spoke with Majdel Mousa, consultant and legal instructor, about the effects of the new unified contract on both landlords and tenants.

“A unified contract may help avoid confusion about what is being signed. However, all of the essential terms should be included in the form itself, and more space given for additional terms to be added,” said Mousa.

She explained the new form does not include the legal clauses that were listed in the previously used green tenancy contract.

“It seems there is only room for four additional terms. Considering the number of missing terms in this new contract, such as discussion of maintenance issues, termination notices and penalties, more space is needed,” said Mousa.

She pointed out the new unified contract form is unlikely to reduce tenancy disputes filed at Real Estate Regulatory Agency (RERA), as many cases are related to landlords violating eviction procedures or demanding excessive rental increases.

Moving forward, the DLD encourages landlords to download and print tenancy contract from Ejari’s official website (www.ejari.ae) in order to assure that all items included are based on a legal framework, which is protected by the law.

Terms and conditions listed on new unified lease contract

The tenant has inspected the premises and both parties have agreed to lease the unit in its current condition.

The tenant undertakes to use the premises for the designated purpose; the tenant has no rights to transfer or relinquish the tenancy contract either with or without counterpart to any or sublease the premises or any part thereof to third party in whole or in part unless it is legally permitted.

The tenant undertakes not to make any amendments or modifications to the premises, subject of the contract, without obtaining the landlord’s written approval.

The tenant should be responsible for payment of all electricity, water, cooling and gas charges resulting from occupying the leased unit unless other conditions are agreed on.

The tenant fully undertakes to comply with all regulations and instructions related to the management of the property and the use of the premises and of common areas such as parking, swimming pools, gymnasium … etc.

Any disagreement or dispute arising from execution or interpretation of this contract shall be settled by the special judicial committee competent to settle disputes between landlords and tenants (the Rent Committee).

This contract is subject to the laws, regulations and legislations applied in the Emirate of Dubai.

Any additional condition will not be considered in case it conflicts with the law.

Requirements for EJARI registration

1. Copy of tenancy contract
2. Emirates IDs or passport copies of all parties (for individuals) or copies of trade licences for all parties (for companies)
3. Copy of security deposit receipt voucher for leased unit issued by Dewa
4. Emirates ID copy of applicant

source : gulfnews