Registering your rental contract in UAE is a legal requirement.
An expatriate requires more than a residence visa to hold a legal stay with family in the UAE. You must have a valid tenancy contract as well. Besides the valid legislation in the land, some expatriates still stay in informal premises in several parts of the UAE.
There was an age in which people with residence visas lived in ‘shared accommodations.’ While the permanent rule on Tenancy Law has changed the country’s system, it forcefully generates shelters for bachelors or provides a family home for families of people coming for work. The sponsor must submit a valid tenancy contract to the visa authority for the family member’s visa. Only after confirmation do they grant it. By applying this legislation, the government ensures the protected stay of the expatriates. The tenancy law in the UAE is tenant-friendly.
A tenancy contract is an essential tool to regulate the rental property market in the UAE. As a landlord or tenant, you must understand rental contracts and their rights and obligations. It can help you avoid uncertainty, errors, and potential repercussions. We have put together the ultimate guide to tenancy contracts, so you know exactly what you’re getting into when you sign a tenancy contract in Dubai or any other emirates.
Both landlord and tenant have responsibilities in a tenancy contract. As per the terms, the agreement must be in writing with a valid address and rent value and should be attested by the authority. You should mention the rent period mandatorily. After the specified period, the parties may choose to renew or revoke the contract. The tenant also has to maintain the property in good condition.
What is a tenancy contract?
A tenancy contract, also called a rental agreement, is a legally binding contract that allows tenants to use premises for a specific purpose and a set period. The lease agreement explains all the lease terms and the parties’ mutually agreed-upon expectations and requirements. Having a formal rental agreement helps to avoid misunderstandings and future disputes.
Tenancy Law in the Different Emirates
Tenancy Law in Dubai
Under Dubai Rental Law No. 26 of 2007 (and revisions from Law No. 33) 2008, the Real Estate Regulatory Agency regulates the interaction between tenants and landlords in Dubai. The law explains in detail the roles and responsibilities of landlords and tenants to avoid any potential problems or misunderstandings. Decree No. 26 of 2013 established the Rental Dispute Settlement Center (RDSC), which investigates and resolves all rental disputes in Dubai, while Decree No. 43 of 2013 governs all rent increases.
Important Tenancy Contract Clauses Article 19: The tenant is responsible for paying the agreed-upon rent on time. The tenant is also prohibited from performing any maintenance, restoration, or changes to the property unless the landlord permits (after obtaining the necessary licenses from the authorities).
Article 21: The tenant must also return the property in the same condition as when the lease agreement began. Normal wear and tear is considered an exception.
Article 22: Unless the landlord and tenant have agreed otherwise, the tenant is responsible for paying all necessary taxes and fees.
Article 23: Unless the parties agree otherwise, the tenant must not remove any improvements made to the property when vacating.
Registration: Registration of tenancy contracts through EJARI is mandatory. The landlord is responsible for registering the tenancy contract with EJARI. This is usually delegated to the real estate agent by the landlord. In practice, however, the tenant will complete the process and pay the necessary fees. You must double-check that your EJARI contains all deposits, contract duration, and rent amounts.
Tenancy Law in Abu Dhabi
Law No. 20 of 2006 established the tenancy law that governs Abu Dhabi tenancy contracts, which has since been amended to reflect changing market conditions. Authorities have considered both the landlord’s and tenant’s rights to ensure that both parties’ interests are protected under Abu Dhabi’s tenancy law. In addition, Law No. 20 of 2006 was passed to regulate issues such as rental prices and eviction policies. Before the 2006 amendments, landlords could not evict tenants after the expiry of the lease contract. Several changes have been made to the original Abu Dhabi Tenancy Law in a series of amendments till 2016. The law reflects various factors that have shaped a strong tenancy law in Abu Dhabi.
Important Tenancy Contract Clauses
Rental Price Cap: There is a 5 % rental cap on an increase in rent annually. Rent can only be increased after informing the tenant at least two months before the account renewal.
Notice Period: When a tenant’s tenancy contract expires, landlords have the right to evict them under Law No. 4 of 2010. The Abu Dhabi rental law also allows landlords to refuse to renew a tenancy contract if they so desire.
A landlord can evict a tenant by giving the tenant 60 days’ notice before the lease expires. They are no longer required to provide a reason for the eviction. Similarly, if a tenant does not want to renew the lease, the landlord must be given 60 days’ notice.
Dispute Resolution: If the claim amount in the dispute is less than AED 50,000, the decision of the Abu Dhabi Rental Disputes Settlement Committee will be considered final and binding on the parties. If the claim exceeds AED 50,000, the parties have 15 days to file an appeal in the Court of Appeal, beginning on the next day of the judgement or, if the judgement is absent, on the next day of judgement notification.
Registration: The Abu Dhabi Executive Council No. 4 of 2011 mandates landlords register their properties and tenancy agreements with the Abu Dhabi Municipality (ADM). To keep track of tenancy contracts and data related to the property being leased, ADM employs the Tawtheeq system. To be accepted in the Tawtheeq registry, the Abu Dhabi tenancy contract registration must be in English and Arabic or only in Arabic.
The registration process for lease contracts was further standardized by Administrative Resolution No. 97 of 2012. The resolution directs ADM to create a record of the Abu Dhabi tenancy contract registration, which must include information about the property (residential, commercial, or industrial units) and the landlord and tenant.
Tenancy Law in Sharjah
According to Sharjah’s tenancy laws from 2007, landlords can only raise the rent three years after the tenancy contract’s start. However, the rent hike after three years is not capped. Landlords can only raise the rent every two years after the first increase. This is one of the Sharjah tenancy laws that protect tenants from annual rental increases, but many residents in the emirate are unaware of it.
The Sharjah Executive Regulations of Law Number (2) of 2007 on Landlord-Tenant Relationship Regulations (The Law) describes Lease and rent law in Sharjah. In accordance with Article (2) of the Executive Council Resolution Number (2) of 2010, dated 10 February 2010, Article 22 was added to the Law.
Important Tenancy Contract Clauses
Article 22 of the law governs several important rules and regulations in the tenancy law of Sharjah.
Notice Period: Before the addition of Article 22, old law (the Old Law) required either party – the Tenants – to serve a sixty (60) day notice in writing to the Landlords. However, according to the new law, tenants cannot terminate the lease agreement (except in the case of an unforeseeable event) and are obligated to keep the lease until it expires.
Dispute Resolution: The RDC is in charge of reviewing all lease and rental matters for Sharjah-based properties. According to article 24, in cases where the judgment value exceeds AED 100,000, the RDC’s decision is final. The Sharjah Rental Dispute Committee comprises three members: one judge and two experts.
Registration: The Sharjah Municipality attests and registers all tenancy contracts. You must provide your passport, your spouse’s and other family members ID, and a copy of your visa for the tenancy contract in Sharjah.
Bottom Line
While tenancy law clarifies the majority of confusion surrounding tenancy contracts and the rights and obligations of the tenant and landlord, people occasionally have questions unique to their circumstances. Feel free to contact our property lawyers in UAE for all such queries or rental disputes related to tenancy contracts or real estate.
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In case of any issues related to tenancy contracts or real estate, feel free to contact us.