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Planning and environmental issues

Planning

Which government authorities regulate planning and zoning for real estate development and use in your jurisdiction and what is the extent of their powers?

The Dubai Municipality is the principal authority regulating planning controls in Dubai (Local Orders 2/1999, 33/1988 and 8/2003).

Additional controls can be imposed by the Real Estate Regulatory Agency, the relevant free zone authority and the master developer, which are regulated by:

  • Law 13/2008 (as amended);
  • Law 8/2007;
  • Law 27/2007;
  • rules and regulations of the relevant free zone;
  • master community declarations; and
  • bylaws and rules of owners' associations.

The master developer's standard sale contract will also contain provisions relating to planning control.

For projects being completed by Dubai World Group entities, an organisation called Trakhees (which forms part of the Ports, Customs and Free Zone Corporation) is responsible for all planning, health and safety, and commercial licensing activities.

What are the eligibility, procedural and documentary requirements to obtain planning permission?

Each emirate imposes its own planning controls in relation to real estate in its area. In Dubai, the Planning and Survey Administration of the Planning Authority grants initial planning consent, subject to the regulations of the classification and use of land in Dubai. However, master developers and free zone authorities can have additional planning procedures. Neither the legislation nor the planning regulations set out the length of time in which the municipality must issue its decision.

Can planning decisions be appealed? If so, what is the appeal procedure?

Each emirate imposes its own planning controls in relation to real estate in their area. In Dubai, there are no formal procedures for third parties to object to a particular planning application. However, the planning authorities can review and amend the regulations of the classification and use of lands in Dubai if a third-party application is filed on serious and effective grounds that justify an amendment (Article 8 of Local Order 2/1999). Further, the planning authority officials have full discretion to investigate as they deem appropriate (Article 11 of Local Order 2/1999). 

What are the consequences of failure to comply with planning decisions or regulations?

Each emirate imposes its own planning controls in relation to real estate in the emirate. In Dubai, the violating party may be subject to one or more of the following penalties, as set out in Article 28 of Local Order 2/1999:

  • a fine not exceeding Dh50,000;
  • disconnection of all the utilities in the building or the site;
  • suspension of the issuance of new building permits or renewal of any building permit; and/or
  • suspension of the professional or commercial licence of the engineer or the contractor on a temporary or permanent basis. 

What regime governs the protection and development of historic and cultural buildings?

The Architectural Heritage Department of the General Support Sector at Dubai Municipality governs the protection and development of historic and cultural buildings in Dubai. Any building constructed before 1960 comes under the category of historic building in Dubai and must have the municipality’s approval for any construction or alteration.

Government expropriation

What regime applies to government expropriation of real estate?

Local and state authorities can acquire real estate compulsorily if it is necessary for the public’s benefit and just compensation is paid (Article 1135 of the Civil Code (Federal Law 5/1985)). In addition, each emirate can pass its own laws to regulate compensation.

What is the required notice period for expropriation and how is compensation calculated?

There is no formal notice period for expropriation.

Pursuant to Article 1135 of the Civil Code, when assessing compensation, consideration is given not only to the value of what is expropriated, but also to loss of profit and other damage that may result from the expropriation.

In Dubai, the Lands Valuation Committee (with the approval of the director general of Dubai Municipality) decides on applications for compensation for persons affected by expropriation (Resolution 2/2003).

In the case of road expansion, compensation will be in the form of:

  • cash, if the Lands Valuation Committee determines that the value of the compensation is Dh200,000 or less; or
  • additional land, if the Lands Valuation Committee determines that the value of the compensation should be more than Dh200,000 (see Dubai Local Order 1/2014).

Environmental issues

What environmental certifications are required for the development of real estate and how are they obtained?

A unified building code for all Gulf Cooperation Council states (the Gulf Building Code) has been proposed to deal with (among other things) green building certifications; however, it is unclear when this will come into effect.

In Dubai, all new buildings are rated under the Green Building Regulations and Specifications by the Dubai Municipality and buildings that do not achieve the minimum bronze rating are not given permits.

In Abu Dhabi, the Pearl Building Rating System applies, and all new buildings must achieve a minimum of one pearl, while all government-funded buildings must achieve a minimum of two pearls. 

What environmental disclosure obligations apply to real estate sales?

The Direction for General Regulation (2010) requires all off-plan developers to make certain disclosures about the property, including in relation to the features of, or equipment or services included in, the building or project that contribute to ecologically sustainable development and any ecologically sustainable development rating that applies to the building or project.

Aside from this, there is currently no statutory (or other) duty of disclosure on a seller of real estate. However, any misrepresentation can result in both civil and criminal liability.

What rules and procedures govern environmental clean-up of property? Which parties are responsible for clean-up and what is the extent of their liability?

Federal Law 24/1999 on the protection and development of the environment governs environmental clean-up. Under this law, any person who intentionally or by way of negligence causes damage to the environment or to others is responsible for all the costs for treatment or removal of such damages and may be imprisoned and fined.

Unless otherwise stipulated in the sale agreement, the buyer generally inherits liability for all matters relating to the property, including environmental liability. 

Are there any regulations or incentive schemes in place to promote energy efficiency and emissions reductions in buildings?

All new buildings in Dubai must comply with the Green Building Regulations and Specifications, which have been designed to increase energy efficiency and reduce buildings' carbon footprints.

In Abu Dhabi, buildings must comply with the Abu Dhabi building codes, which cover a wide range of aspects – from energy conservation, light, ventilation, sanitation, structural strength, stability and maintenance to safety from hazards such as fire.

A unified building code for all Gulf Cooperation Council states (the Gulf Building Code) has been proposed to deal with (among other things) green buildings and renewable energy; however, it is unclear when this will come into effect.

Pursuant to UAE Cabinet Decision 26/2014, all importers, exporters and re-exporters of any materials, equipment or products containing ozone-depleting substances must register with the relevant authorities and obtain permission to import, export or re-export any of the materials listed in the decision.

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