THE NEW RULES IN UAE
The New Year comes with a series of changes, from the way you rent an
apartment, carry out banking transactions and buy a cellphone to paying
your traffic fines or buying a new car. Gulf News puts together a quick
reference list on procedure changes worthy of a spot on your fridge
What: Fines and denial of government services to those not having a
national ID will make it an unavoidable document in 2012. Emirates
Identity Authority started issuing cards to Emiratis in 2006 and to
expatriates in 2008. The majority of Emiratis have already registered
and their deadline has been extended several times since 2008.
When: The authority has linked ID card registration and visa processing
across the country except in Dubai which will do it in April 2012. Fines
were imposed on Emiratis from November 1 and expatriates in four
northern emirates (Fujairah, Ras Al Khaimah, Umm Al Quwain and Ajman),
and all expatriates working in the government sector across the country
from December 1 was the final push. The fine will be applicable for
expatriates in Sharjah, Abu Dhabi and Dubai from February 1, 2012, April
1, 2012 and June 1, 2012 respectively. October 31, 2011 was the deadline
for renewing all identity cards expiring up to that date. The delay
attracts a Dh20 fine per day, up to a maximum of Dh1,000.
Why: A deadline for professional expatriates in 2008 and denial of some
government services also started encouraging expatriates to take action.
The card is now mandatory across the country except in Dubai to access
Ministry of Interior services including that of the Traffic Department.
The rule began in four emirates — Umm Al Quwain, Ajman, Ras Al Khaimah
and Fujairah in November 2009. Dubai will implement it in mid-2012.
Ajman Government and many federal and local government organisations
have made the card compulsory to access their services and others will
follow suit soon.
Child safety campaign
What: A safety awareness campaign as a first step towards protecting
children in high-rise buildings.
Why: In view of the increasing number of children falling from
The tragic spate of children falling to their deaths alarmed authorities
across the UAE, who took measures to ensure that children are safe.
Authorities and safety experts have asserted the need to keep children
under the supervision of parents or guardians at all times, generating
awareness, while, at the same time, taking measures to ensure that
houses and buildings are safe.
The Municipal Council of Sharjah has announced that local authorities
will soon launch a safety awareness campaign as a first step towards
protecting children in high-rise buildings. The Child Protection Higher
Committee and the Ministry of Interior Child Protection Centre are also
considering issuing a new set of codes regarding construction and safety
specifications in high-rise buildings to promote child safety. The
Ministry of Interior's child protection centre called for balconies to
be covered with Perspex sheets. Balcony doors should remain closed at
all times and locked and keys have to be kept in a place that cannot be
reached by children. The Department of Municipal Affairs, Abu Dhabi, is
working to put in place a unified set of codes, known as the Abu Dhabi
Building Codes, to address this issue.
What: A discount on traffic fines if the amount is paid in full
in five emirates.
Why: Helping car owners pay off their accumulated traffic fines.
When: Abu Dhabi: no deadline set
Dubai: by January 12
Sharjah: by April 30
Ajman: by February 29
Ras Al Khaimah: by April 30
In 2012, drivers and vehicle owners who have accumulated traffic fines
will have a chance to pay them at a discounted rate in most emirates. In
Abu Dhabi, drivers can still pay their fines at 50 per cent discount
with no deadline given so far for the grace period, while in Dubai, the
40 per cent discount on traffic violations committed before December 2,
2011 will end on January 12. Drivers with offences in Sharjah and Ras Al
Khaimah have until the end of April to pay their fines at a 50 per cent
discount, while in Ajman, the same discount will apply only until the
end of February. The 50 per cent discount on traffic fines in Umm Al
Quwain ended on December 31, while those who committed traffic
violations in Fujairah will continue to pay their fines in full, as no
discount has been announced so far.
What: The International Bank Account (IBAN) number is required to
conduct any local or international transactions. The IBAN is a unique
23-digit long, internationally recognised code assigned to each bank
account. It is required if salaries are processed through UAEWPS,
whereby the employer is registered with the Ministry of Labour, and
UAEFTS, whereby the employer is outside the purview of the Ministry of
Labour and the accounts of the employer and employee are with different
banks. The IBAN is not required if the salary is processed through an
internal transfer, which means the employer is outside the purview of
the Ministry of Labour and the accounts of the employer and employee are
with the same bank.
Who: Mandatory for
all UAE bank account holders
When: IBAN launch date on November 2011 and will be mandatory
after a three-month grace period from the launch date.
Why: To ensure efficient and speedy payment transactions and
minimise the risk of transcription errors in cross-border transactions,
according to the Central Bank.
5. Rent registration
What: Registering rent contracts with the Dubai Land Department (DLD)
through Ejari.ae. This will be a pre-requisite to accessing other
government services. Failure to comply will result in a penalty.
Who: Dubai tenants and landlords only
When: Effective on new contracts registered in 2012. Tenants with
existing contracts can wait until their contract renewal date to seek
Why: To help the government monitor the property market and offer
better insights through its rental index while ensuring all tenants pay
their housing fees regularly.
Unified car purchase contract
What: The new unified auto purchase contract clearly states the
rights of the customers and dealers' obligations in terms of warranties,
after-sales service and maintenance, among others. Officials expect
disputes between car dealers and consumers to drop by 30 per cent with
the implementation of the unified contract. The unified contract for
sales comprises an invoice (containing the vehicle code, vehicle
specifications, colour, engine capacity and checklist), warranty
provided and a delivery acknowledgment from the customer. All printed
documents should be in both Arabic and English. A service contract must
include a service invoice, regular service check sheet, job cards and
customer acknowledgment of the documents. For a parts contract, there
should be an invoice with the service provider's name and address,
description of the goods or services provided, sales unit, price in
local currency and Arabic enabled documentation.
When: January 2012
Why: To help the UAE's automobile sector by making buying and
selling activity more transparent, for the benefit of customer,
Fake mobile phones
What: UAE telecommunication service providers etisalat and du
will suspend all services to mobile phone subscribers who use
counterfeit handsets. Users of fake devices will be contacted by their
service providers and all phones that are not type approved will be
disconnected from all telecom services, including calls, texts and the
internet, the Telecommunications Regulatory Authority (TRA) said.
When: January 1, 2012
Why: Officials say fake phones could be hazardous as they may not
meet safety standards.
Things you should know before
signing a new lease
Thinking of moving to a new
pad? Well, don’t even pick up a pen to sign that lease until you’ve read
By now, we all know that Dubai is a tenants’ market. With the
demand-supply equation tilted strongly against the landlords, tenants
are in a position to be more aggressive in negotiating rent and
facilities. However, the fact remains that tenants are not fully
equipped to demand what could rightly be theirs because of lack of
awareness. Property, in association with Ludmila Yamalova, managing
partner, Yamalova Plewka JLT, brings you the low-down on what every
tenant in this market must know
1. Ask for a customised tenancy contract
Remember, a standard tenancy contract does not really exist.
“Whenever you enter into a negotiation with a landlord or real estate
agent, just make it very clear that you want a contract that is
specifically drafted for you,” says Ludmila. “There is a standard
tenancy contract commonly used in Dubai, but that’s only a template. You
can draft your own or make changes to it. The existing template is a
one-page document which is limited and unhelpful. Today, tenants have
the leverage to dictate or set their own terms. Some landlords and real
estate agents will tell you it is not done that way. The truth is they
don’t want it to be done that way.”
2. Read the contract closely before you sign
Ludmila advises tenants to read the contract thoroughly. “You must read
the contract and if you don’t understand it, then don’t sign it,” she
says. It is better to include a termination clause in the contract so
that it becomes easier for both parties to terminate the deal if the
need arises. Generally, the exit clause comprises the notice period and
the penalty payable to the landlord. “You have to be fair and the term
should allow you to terminate the contract with some sort of penalty.
During the notice period, you should also give the landlord access to
the property so that he can show it to other clients. If the landlord
finds another tenant during the notice period, then he may not want to
penalise you. Not every landlord wants to penalise just because they
can,” says Ludmila.
3. Get the contract registered
Make sure the contracts are registered. Many people think it is the
landlord’s responsibility to do it but this is unrealistic. Tenants
should also be aware of this process. It is important — if anything goes
wrong, you are not allowed to file a case against the landlord if the
tenancy contract is not registered.
4. Have your deposit held in an escrow account
Many landlords ask for a guarantee deposit but at the same time
refuse to return the deposit to the tenants when they vacate. “It is
better to make sure that the deposit is held in an escrow account or
with a real estate agent or lawyers,” says Ludmila. “Damages are bound
to happen in the unit that you stay in and it is only fair that
landlords have a security deposit which they can use for maintenance.
Try to document everything.” Documentation is a vital aspect as there
may be unforeseen situations where the landlord is unavailable and there
is something wrong with the air conditioning or electricity. In such a
situation, the tenant should be able to get the work done and then the
cost should be reimbursed by the landlord. The whole process will be
smooth if it is properly documented in the contract. “Another thing is
to have the authority to deal with the service management company on
behalf of the landlord. Get some sort of authorisation or power of
attorney from the landlord,” adds Ludmila.
5. Never pay in one cheque
During the boom time, tenants used to pay rent for the whole year in
advance as the sector was dominated by single cheque payments. However,
when the market crashed and the demand for units came down drastically,
landlords and real estate agents were forced to accept more cheques —
some even offering payment option in many as 12 cheques. “Landlords can
no longer dictate the terms as they used to. As a legal practitioner, my
strongest advice is never pay in one cheque,” Ludmila says. She advises
those who pay in one cheque to ask for a guarantee deposit from the
landlord so that they can be held accountable for any damage or
disturbance that may come up before the end of the lease. “You have to
decide whether the guarantee deposit will be held with the real estate
agency or the lawyers who are involved in it or an escrow account. While
there are no escrow services in the UAE as such, real estate agents and
lawyers can hold investment funds,” she explains.
6. Know your landlord
Make sure you know everything about your landlord because in the UAE
many of them are absentee landlords who are represented either by
licensed real estate agents or somebody else acting on behalf of the
landlord. This actually means that you very rarely deal with the
landlord directly. Ludmila says it is a problem if you don’t have the
landlord’s contact details. “You are entitled to get this info and I
suggest you don’t sign any kind of contract before you receive this
information. You should also be provided with a copy of the landlord’s
passport and visa page, and more importantly contact details,” she
explains. If a situation arises, without the details of the landlord it
is not possible to file a suit against the landlord or lodge a complaint
with the rent committee, simply because without the physical address the
notice cannot be served. Tenants also need to make sure these contact
details belong to the landlord and not some of his representatives or
real estate agents, which is the case most of the time.
7. Get proof of authorisation
In Dubai, it is very rare for tenants to deal with the landlord
directly, so it is imperative that whoever you are dealing with should
show you some proof that he or she is authorised to conduct the
transactions and dealings on behalf of the landlord. “For example, if it
is a real estate company, you need to see some kind of documents that
show that this company is authorised to act on behalf of the landlord.
If it is a representative of the landlord, then a power of attorney,
which is a legally binding document, is an absolute must,” says Ludmila.
8. Document expenses in the contract
Tenants should make sure that they look at all the expenses such as
water and electricity bills, housing fees, air
conditioning/chiller/district cooling charges and service fees.
“Generally, service fees are paid by the landlord while some others want
to pass it on to the tenants,” says Ludmila. The issue of service
charges must be discussed with the landlord in advance as it is
something which will affect the tenants directly. If the landlord
doesn’t pay the service fees, then the tenant’s rights to the property
or amenities could be curtailed. Before signing the deal, the tenant and
the landlord should make a decision as to who will pay the Dewa (Dubai
Water and Electricity Authority) bill, which also includes the housing
fee which is 5 per cent of the annual rent — a substantial amount. “Air
conditioning is a big expense too and you need to decide who will pay
for it because if you don’t pay and the landlord doesn’t pay either, it
gets cut off” says Ludmila. “You need to discuss instruments such as
access cards, parking access cards and parking numbers. If these get
lost, how can you get a replacement? These are some of the issues that
need to be addressed.”
9. Plan for the unexpected
There should be provisions in the contract for unforeseen issues
such as power or water leaks, which can be a major cause of concern
sometimes. Tenants need to discuss with their landlord who will be
responsible in case of such an event. Ludmila recollects the plight of
one of her clients who was forced to pay Dh10,000 every month as a Dewa
bill because of some leaks. “Ultimately it affects the tenants and it is
their name that is there on the Dewa account. Landlords may return this
amount after finding out what the issue is but that’s only a hope.
That’s why I insist on taking a deposit from the landlord as well.”
10. Make sure all bills have been settled
Ludmila advises tenants to conduct proper due diligence before they sign
the deal and money exchanges hands. “Make sure all the accounts are
settled by the previous tenant. There are many instances when tenants go
to set up utility or telecom accounts only to find that the previous
tenants haven’t paid their dues.” In such cases, the new tenants will be
on a hook because on the one hand the dues of the previous tenant are
standing unpaid while on the other the new lease agreement has been
signed and deposit paid, she adds.
11. Have automatic provisions in the contract
Having automatic provisions in the tenancy contract allows the tenant to
take appropriate decisions in case of any problem related to the unit
even in the absence of the landlord. “Try to make an automatic provision
where if the landlord doesn’t respond in two weeks, then the tenant gets
the right to contact the contractors,” Ludmila concludes.