Sheikh Mohammed issues law regulating timeshare industry in Dubai

In his capacity as Ruler of Dubai, Vice President and Prime Minister of the UAE His Highness Sheikh Mohammed Bin Rashid Al Maktoum issued Law No.(14) of 2020 regulating the timeshare industry in Dubai.

The new legislation is part of the government’s efforts to enhance the legal framework required for the continued growth of Dubai’s various economic sectors, including tourism.

The Law, which provides a clear legal context for timeshare business activity, aims to further stimulate tourism and real estate sector growth in Dubai, encourage investments in the vacation ownership sector, provide adequate residential alternatives for tourists and visitors, and protect the rights of all parties in the industry.

The Law also seeks to regulate the timeshare industry in Dubai according to international best practices.

According to the Law, Dubai’s Department of Tourism and Commerce Marketing (Dubai Tourism) is responsible for overseeing all activities in the emirate’s timeshare industry. Dubai Tourism will develop the terms and conditions and technical standards required for timeshare facilities to obtain legal permits and approvals.

Dubai Tourism will also list and classify the residential units subject to the new Law. Furthermore, Dubai Tourism will coordinate with the Dubai Land Department and Dubai International Financial Centre in all matters related to the timeshare-related activities of developers and brokers, and registration of timeshare contracts and right of usufruct in the Land Department.

Dubai Tourism will inspect timeshare facilities to ensure compliance with this Law and any relevant bylaws. It is also responsible for receiving and investigating grievances and complaints against any individual or entity practising timeshare activities in Dubai without obtaining the required permits and approvals.

According to the Law, Dubai Tourism will establish and manage a database for all facilities operating as timeshare property in Dubai, create the contractual terms for timesharing, and outline the requirements for timeshare advertisements and transfer of usufruct to another beneficiary.

Timeshare permits are valid for a renewable period of one year. Dubai Tourism is authorised to grant permits for up to four years based on a request from the permit owner. The new Law details the obligations and rights of timeshare facilities and their beneficiaries and the terms and conditions for cancelling or transferring the contract.

All individuals and entities undertaking timeshare business activities in Dubai must comply with the provisions of the Law within six months of its effective date. The Director General of Dubai Tourism is authorised to extend this period if required.

Timeshare contracts concluded prior to the activation of this Law continue to be valid. They will be subject to the provisions of the new Law after the contracts are renewed. However, if cases or incidents not covered by such contracts arise in the interim, they will be subject to the new Law.

The Law annuls any other legislation that contradicts or challenges its articles. The new Law will be published in the Official Gazette and is effective within six months of the date of its publication.

WAM