Property Law No.8
Property Law No. 8 (effective December 2007), Concerning Guarantee Accounts of Real Estate Developments in the Emirate of Dubai (the escrow law), regulates property developers by requiring all funds received in relation to a development be administered through an escrow account controlled by the Dubai Lands Department ‘ the Department’.
The developer enters into an escrow agreement with the ‘account trustee’, which is a bank or financial institution certified by the Department. The account trustee administers the guarantee account under the supervision of the Department and must provide regular statements to the Department.
The escrow law applies to all developers who sell units off-plan (whether the development is in the planning or the construction phase) and receive payments from buyers or financiers before completion of the development. The purpose of the law is to protect the consumer by ensuring that the developer is utilising off plan sales receipts for the projects development and completion prior to taking profits.