What are the penalties for violating the real estate regulatory code?

The market for real estate in Dubai is highly regulated in order to promote fair dealing and protect interest of investors in the market. The Real Estate Regulatory Agency (RERA), which is a division of the Dubai Land Department (DLD), is primarily responsible for the regulation of the errands of the real estate players the standards set by the law. Below you can find the general information about the penalties for violating the real estate regulatory code in the emirate of Dubai:

Different kind of Violations and the sanctions that accompany them

Lack of Compliance to Advertising Policies and Laws There are strict laws pertaining to advertising especially in the real estate business. They are as follows;; The following v destroying a barrier utilized for home use, advertising or offering an item without one of the needed permits and QR codes. Consequences for such violations include fines. For instance, below is a case where companies who violated advertising terms and conditions are liable to a fine not exceeding AED 50000. This measure does prevent all business and specifically; real estate companies from posting misleading adverts.

Violation of the Licensing Standards Any person or company engaged in the business of selling or leasing of residential units must be licensed to do so. These can lead to huge fines and the suspension of business activities for without a valid license or practicing beyond the authority given to him or her by the license. RERA particularly oversees audits on all affairs of the authorized persons to ensure that they adhere to the set measures.

The DLD also provides that all property transaction should be complied with certain regulations in this case failure to register the transaction. This kind of abuse may warrant; legal actions that include fines and even legal prosecution for not registering or for misrepresenting the property transactions as required by law. This helps to make the property dealings very abreast with legal documents to make them legal.

There has been the mismanagement of escrow accounts The developers are supposed to open escrow accounts for off-plan projects to ensure that the buyers’ funds are protected. This is because in case of embezzlement of these accounts or farmers use it in other non authorized activities, developers face penalties including fines and even legal suits. This regulation safeguards the investors and ensures that real estate projects go as per the planned strategies.

Illegal subletting and breaching the tenets A person can be arrested and evicted from his or her rented premises or the landlord could be fined for subletting the premises or for being in violation of the tenancy laws of the state. Both landlords and tenants are bound with these rules and any violation of these rules can be referred to the DLD’s Rental Dispute Settlement Centre (RDSC).

Enforcement and Compliance

RERA has all the legal authority to take different actions against the violators and offenders of the real estate laws, ranging from fines, suspension of the licenses of the violators and even legal action among others. It also carries out periodically inspection and audits in the operations of Real Estate companies and brokers.

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