The developers were fined for promoting off-plan properties without mandatory registration. Dubai Law No. 8 of 2007 on Escrow Accounts for Real Estate Development in the Emirate of Dubai applies to developers who conduct marketing activities related to off-plan real estate and receive payments from buyers or funding organizations.
The developers violated Article 5 of the Law which states the following:
“The developer may not announce in local or foreign media or participate in local or foreign exhibitions to promote the sale of units or real estate off plan, unless after receiving a written permit from the Dubai Land Department (DLD).”
The Law also stipulates that in order to sell off-plan properties, a developer must be included in the DLD's list of the licensed real estate developers and must obtain necessary authorisation from the competent organizations.
Whoever perpetrates the Law shall be sentenced to imprisonment and to a fine amounting to AED 100,000 at least, or to either penalties.
Real estate investors are recommended to ascertain the following before any transaction: