Cancelled Projects In UAE

Buying property has always carried multiple risks, and the notion of canceled projects is widespread.

A canceled project is defined as the termination of a specific project before it has been completed. The cancellation of a project often occurs for many reasons, such as a change in budget, scarce recourses, and economic and technical difficulties. Under Decree (6) of 2010, RERA (Real Estate Regulatory Agency) has the ability to cancel Real Estate projects.

There are multiple steps in the process of canceling a project. First, RERA must write a technical report stating the reasons it decided to cancel the project, and the developer must be notified in writing. Then an accredited auditor must be appointed to assess the projects' financial position, assess the money paid to the developer, and the money that's been disposed of by the developer. Additionally, upon cancelation, RERA must contact the trusted Escrow agent within 14 days of the cancellation to repay the purchasers the amounts deposited. However, if there aren’t enough funds in the escrow account, the developer will be obliged to pay the purchasers back from personal funds within 60 days. Nonetheless, if the developer fails to do so, RERA has the authority to take any means deemed necessary to ensure the rights of the purchasers. Furthermore, the developer has seven days to attempt an appeal to cancellation, and it must be done in writing, and RERA has seven days to announce a decision with regards to said appeal.

The Phenomenon of canceled projects was initially overlooked in UAE. However, in 2013, the Dubai Land Department (DLD) created the “Cancelled Real Estate Projects Committee,” which aimed to protect all Real Estate investors, buyers, and developers from such incidents. Although the committee doesn’t have the authority to reverse decisions made by RERA, it has the authority to liquidate canceled projects. In particular, the committee deals with scenarios in which the developer fails to refund the purchaser over the canceled project. Additionally, the committee’s orders, judgments, or decisions are final and can’t be appealed.

As mentioned above, when a project gets canceled by RERA, the developer is under a contractual duty to reimburse the buyer. However, if the developer fails to do so, RERA will take all the measures needed to guarantee the buyer’s rights are maintained. In order to ensure your rights are upheld, you must follow the following procedure:

  1. It is advisable to first refer to DLD’s website to see the progression rate of the canceled project.
  2. After you’ve confirmed that the project is canceled, you should present evidence such as the SPA agreement and proof of the money you paid to DLD.
  3. You must file a petition to DLD, which will then be referred to the committee.
  4. The DLD will contact you with a hearing date to begin the reimbursement process.

Whether you’re a developer or purchaser and your project has been canceled, Abdullah Al Suwaidi is the home of highly skilled, intelligent, and dedicated lawyers that are capable of assisting you at any stage and have handled over 60 successful Real Estate cases per year. For more information, assistance, or clarification, please call +971 559 230 221 or email us at