Dubai’s new standard tenancy contract: Points to consider

Dubai’s new standard tenancy contract: Points to consider

During February 2017, the Dubai Land Department announced the creation and launch of the “new standard tenancy contract,” which is required to be signed for the lease of any property in Dubai (excluding property in the DIFC), which is leased for residential, commercial or professional use.

The use of the new standard contract became mandatory from March 1, 2017.

The new contract is aimed at aligning the provisions of the tenancy contract signed by landlords and tenants with the provisions of Law No. 26 of 2007, regulating the relationship between landlords and tenants in the emirate of Dubai (as amended) (the tenancy law).

The stated aim of the new standard contract is to contribute to a transparent and professional property market, to limit the potential actions and disputes between parties, and to guarantee the rights of parties to such contracts.

This is a welcome development on the part of the Dubai Land Department as the previous standard contract, which was being used for residential tenancy contracts, had not been updated for some time and its clauses did not adequately reflect the important provisions of the current tenancy law.

The new contract makes provision for the inclusion of the details as required in Article 4 of the Tenancy Law. It also provides that the landlord undertakes to register the contract (together with the required ancillary documents) with Ejari.

A copy of the new standard contract can be downloaded from the Ejari website.

The new contract does however allow the parties to include additional terms in their contract, provided such terms are not in conflict with the provisions of any article of the tenancy law or any other applicable property laws and regulations.

One such term, which tenants and landlords need to consider, relates to the obligations in respect of the repairs and maintenance of the property leased.

The Dubai Land Department has pointed out, that as article 16 of the tenancy law provides that the landlord is responsible for the maintenance works and repairs of any defects in the property, unless otherwise agreed between the parties, the law (and the new contract) cannot stipulate a standard provision to deal with the parties’ respective repair and maintenance obligations.

It is therefore important that the parties clearly list those repairs and maintenance items which remain the landlord’s responsibility and those which the tenant will be responsible for.

This is often a point of conflict between a landlord and tenant and ensuring that the obligations of each party are clearly recorded will go a long way towards fostering the aim of limiting disputes and guaranteeing the parties’ rights.

It is likely that in respect of commercial leases, substantial additional terms will be included by way of a signed addendum, attached to the new standard tenancy contract.

Gulf Business

24 Jun 2017