Abu Dhabi Strengthens Real Estate Governance with New Regulatory Package Safeguarding Investor Funds
The Department of Municipalities and Transport (DMT) in Abu Dhabi has announced a new set of administrative decisions aimed at implementing Law No. (3) of 2015, as amended by Law No. (2) of 2025, which regulates the real estate sector in the emirate. This initiative seeks to enhance transparency and governance within the real estate market, establishing a legislative framework that aligns with international best practices. The decisions are designed to respond to the rapid growth of the sector, ensuring that the law is enforced according to well-defined regulatory requirements.
The newly issued package includes four key administrative decisions that address various stages of real estate development, regulation, and management. These decisions focus on several critical areas, including the regulation of disbursements from real estate project escrow accounts prior to achieving 20 percent project completion, the management of jointly owned properties, and the establishment of bylaws for owners’ committees.
Supporting Developers, Protecting Investors
These decisions are part of Abu Dhabi’s broader strategy to reinforce its position as a global investment hub in the real estate sector. By creating a flexible legislative environment, the new regulations aim to support real estate developers while simultaneously protecting investors’ rights. This approach is intended to enhance market governance and safeguard investor interests, thereby increasing the competitiveness of the market on both regional and international fronts.
The decisions also aim to improve legal and contractual relationships among stakeholders in the real estate market. By providing a comprehensive regulatory framework, the new measures ensure a balanced alignment of interests between developers, investors, and property owners. This framework clarifies the roles and responsibilities of developers, property management companies, and owners’ committees, fostering a collaborative relationship that supports the sustainability of real estate projects.
Additionally, the decisions are designed to facilitate project implementation for developers while protecting buyers’ rights and funds. They introduce an efficient mechanism aimed at reducing disputes between developers and unit purchasers, thereby enhancing the overall efficiency and diversity of the real estate market.
Escrow Controls
Decision No. (24) of 2025 specifically addresses the mechanism and controls for disbursements from real estate project escrow accounts prior to reaching the 20 percent completion threshold. This decision establishes clear controls linked to the submission of bank guarantees and approved cost estimates, ensuring the safeguarding of purchasers’ funds and preventing any unregulated use of money deposited in escrow accounts.
Regulating Common Areas and Facilities
Decision No. (25) of 2025 focuses on the regulation of jointly owned properties by creating a comprehensive framework for the management of real estate assets, common areas, and shared facilities. This decision clarifies the roles and responsibilities of owners, developers, and property management companies, supported by a robust regulatory framework that enhances the operational efficiency and sustainability of real estate assets.
Unified Bylaw Across the Emirate
Decision No. (26) of 2025 introduces a unified bylaw for owners’ committees, aiming to standardize the operation of these committees across the emirate. This decision outlines the mechanisms for establishing owners’ committees, defines their competencies, and clarifies their relationships with authorities and management companies. The goal is to improve the management of residential communities and enhance owners’ participation in the sustainability of real estate projects in accordance with international best practices.
Off-Plan Breach Compensation Rules
Additionally, Decision No. (165) of 2025 regulates the compensation percentages owed to developers when purchasers breach their contractual obligations under off-plan sales agreements. This decision also outlines the timeframes and procedures for refunds to purchasers following the cancellation and resale of units. The compensation ratios established aim to ensure fairness between parties, taking into account the project’s status and level of completion.
Transparency and Governance Strengthened
His Excellency Rashed Al Omaira, Director General of the Abu Dhabi Real Estate Centre (ADREC), emphasized that the issuance of this package of executive and regulatory decisions marks a significant advancement in implementing Law No. (3) of 2015. He stated that these decisions enhance the efficiency of sector regulation and reinforce principles of transparency and governance, thereby supporting investor confidence and strengthening Abu Dhabi’s position as a leading real estate destination. The decisions establish a clear executive framework that ensures balanced contractual relationships and strengthens the protection of all parties’ rights.
This regulatory package also aims to integrate the real estate regulatory ecosystem by introducing supervisory controls that support ADREC’s role in overseeing the market. The decisions represent a qualitative advancement in the regulation and implementation of the law, adopting a comprehensive and transparent framework that is adaptable to the evolving landscape of the sector, ultimately enhancing market efficiency and credibility.
Source: economymiddleeast.com.
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Published on 2026-03-30 13:32:00 • By Editorial Desk
