Sharjah’s new land ownership laws are a big step forward


Section 4 of Sharjah Law No. 5/2022 reaffirmed the general position that ownership in Sharjah is limited to UAE and GCC nationals, but provides a number of exceptions in which the ownership may also occur. We have summarized these exceptions as follows: ownership based on the approval of the Ruler of Sharjah; transfer by inheritance under a Sharia inheritance notice; by transfer by the owner to one of the parents up to the first degree, in accordance with the regulations of application of the law; and ownership in real estate development areas and projects, subject to controls determined by the Sharjah Executive Council.

While specific areas and projects have yet to be fully identified by the Sharjah Executive Council, granting property rights to foreign nationals can be seen as a positive step towards encouraging foreign direct investment in real estate. from Sharjah.

Foreign investors who have been shut out of the Dubai market due to rising prices can now consider turning to Sharjah for investment.

However, foreign investors may initially be cautious about entering this market. It should be noted that the legal framework that exists in other emirates which provides protection to foreign investors through various laws concerning, on the one hand, the ownership and maintenance of condominium properties, and on the other hand, the sale of off-plan properties and the governance of escrow accounts relating to same has not been fully fleshed out in Sharjah so far.

Therefore, although the provisions of Law No. 5/2022 are a welcome development, it may take some time before a complementary legal structure is in place that will provide foreign investors with the necessary comfort to invest in this market.

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