Dubai: In his capacity as the Ruler of Dubai, His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE, has issued a decree regulating the grant of ‘Musataha’ rights on commercial lands in Dubai.
As per the decree, the ‘Musataha’ agreement creates a real property right that entitles its holder to construct a building or invest in, mortgage, lease, sell, or purchase a plot of land belonging to a third party for a period of up to 35 years. The agreement can be extended to a maximum of 50 years. The request for renewal has to be submitted two years ahead of the agreement’s expiry date.
The new legislation forms part of the emirate’s efforts to consolidate Dubai’s status as a preferred global real estate investment destination.
The holder of the agreement has to abide by a number of rules and regulations. These include not changing the use of commercial land without obtaining the prior approval of the owner. Additionally, the holder of the agreement should register the agreement with the Dubai Land Department (DLD) registry or the Dubai International Financial Centre registry.
The DLD is mandated to specify the terms and conditions, and responsibilities of parties in ‘Musataha’ agreements. Its other functions include identifying commercial land plots for which ‘Musataha’ agreements can be signed, in coordination with relevant government entities.