Article 2 of the Saudi GCC Nationals Real Estate Ownership Statute

This article deals with a special case of the ownership allowed in Article 1, where the property is land rather than an existing building.

The basic obligation: the owner must complete building on the land or using it within four years starting from the date it is registered in his name, not from the date the purchase was agreed.

What if he does not comply? The state where the land is located has the right to dispose of it, while compensating the owner with the lesser of two amounts:

• The price of the land when it was bought.
• Or its price when it is sold.

So if the land's value rises, the owner does not benefit from the increase, and if it falls, he receives the lower price.

Safeguards for the owner:

• His right to file a grievance before the competent authority in the state is preserved.
• The state may extend the period if it is satisfied with the reasons for his delay.

The article does not specify the authority competent to hear the grievance or its procedures, which is a matter for the laws of the state concerned. This article ties in with Article 3, which prevents disposal of the land before it is built on or four years have passed, except with permission. Anyone who has been late in building for reasons beyond his control would do well to consult a lawyer specialized in real estate cases.