Sharjah enacts new laws and resolutions aimed at enhancing the real estate sector

The Emirate of Sharjah has recently enacted a series of laws and resolutions aimed at enhancing the real estate sector, improving judicial processes, and ensuring sustainable development. These legislative measures include Law No. 6 of 2024 on the Rental Disputes Center, Executive Council Resolution No. 37 of 2024 regulating real estate development projects, Law No. 5 of 2024 concerning property leasing, and Executive Council Resolution No. 32 of 2024 amending the establishment of the Committee of Integrated Real Estate Services Platform Project. Collectively, these laws signify a comprehensive approach to addressing various aspects of real estate management, dispute resolution, and regulatory oversight in Sharjah.

• Law No. 6 of 2024:  The Rental Disputes Center

Law 6 of 2024 provides a comprehensive legal framework for the Rental Disputes Centre, detailing its objectives, competencies, and organizational structure. This enhances the center’s ability to function effectively and transparently, ensuring that all stakeholders are aware of the procedures and regulations governing rental disputes.

The RDC will consist of primary courts, appellate courts, and an enforcement department. Judges seconded from the Ministry of Justice will lead these judicial departments, ensuring that experienced legal professionals oversee the resolution of disputes. The center is also tasked with formulating public policies, proposing necessary legislation, and issuing and enforcing decisions and rulings. The law introduces a Litigation Management Office within the RDC to handle case preparation and management before the trial stage. This office is responsible for tasks such as registration, notification, and the exchange of documents, which helps streamline the litigation process and reduce delays. The RDC’s Execution Department is responsible for implementing decisions, rulings, and orders issued by the center. This includes handling temporary execution disputes and issuing related decisions and rulings, ensuring that the outcomes of rental disputes are effectively enforced.

• Executive Council Resolution No. 37 of 2024: Regulating Real Estate Development Projects

Executive Council Resolution No. 37 of 2024 introduces a robust regulatory framework for real estate development projects in Sharjah. It outlines the functions of the Real Estate Registration Department, conditions for project registration, escrow account management, and penalties for violations. The resolution mandates developers to open escrow accounts to ensure that funds are used solely for project development, thereby protecting buyers’ investments. Additionally, it sets stringent conditions for the registration of developers and projects, ensuring that only qualified entities can undertake real estate development. This resolution is crucial for maintaining transparency and accountability in the real estate sector, fostering investor confidence, and promoting sustainable urban development.

• Law No. 5 of 2024: Concerning Property Leasing

Law No. 5 of 2024 governs property leasing in Sharjah, detailing the obligations of landlords and tenants, lease contract regulations, and conditions for eviction and rent payment.  The law requires lease contracts to be certified by the municipality, making them enforceable executive instruments.  It also stipulates the responsibilities of landlords to maintain the leased property and prohibits actions that would disturb tenants.  For tenants, the law outlines their duty to pay rent on time and maintain the property. This law is important for both landlords and tenants as it provides a clear legal framework for rental relationships, protecting the rights of both landlords and tenants, and ensuring fair and transparent leasing practices.

• Executive Council Resolution No. 32 of 2024:  The Committee of Integrated Real Estate Services Platform Project

Executive Council Resolution No. 32 of 2024 amends the previous resolution regarding the establishment of the Committee of Integrated Real Estate Services Platform Project. This committee, now affiliated with the Sharjah Digital Department, aims to integrate various real estate services into a unified digital platform. The resolution outlines the committee’s formation and its members, who are representatives from key governmental departments. This initiative leverages digital technology to streamline real estate services, enhance coordination among different entities, and improve the overall efficiency of real estate transactions in Sharjah.

Conclusion

The recent legislative measures in Sharjah collectively represent a significant advancement in the emirate’s real estate sector. By establishing specialized judicial bodies, regulating real estate development, ensuring fair leasing practices, and integrating real estate services through digital platforms, these laws aim to create a more transparent, efficient, and investor-friendly environment. The impact of these laws is expected to be far-reaching, protecting stakeholders’ rights, and enhancing the overall stability and growth of the real estate market in Sharjah. As these laws come into effect, they will undoubtedly contribute to the emirate’s vision of becoming a leading hub for real estate investment and development in the region.

For more information on these decrees, please contact Ammar Haykal, Partner, Head of Office – Northern Emirates, Mohammed Kawasmi, Real Estate partner, Nasser Yahia, Senior Counsel, Dispute Resolution