Article 7 of the Saudi Off-Plan Real Estate Sales and Leasing Law
المادة 7 من نظام بيع وتأجير مشروعات عقارية على الخارطة
The article allows the competent authority, when needed, to register a natural person in the developers registry and license them for off-plan sale and leasing under rules set by the Implementing Regulations.
Official text (Arabic)
This article has not been amended since the law was issued.
للجهة المختصة -في سبيل تحقيق أهداف النظام وعند الاقتضاء- قيد الشخص الطبيعي في سجل قيد المطورين والترخيص له بمزاولة نشاط بيع وتأجير مشروعات عقارية على الخارطة؛ وفق ضوابط تحددها اللائحة على أن تشتمل على سقف محدد لحجم المشروع العقاري، وعلى عدد محدد من المشروعات العقارية التي يسمح له بتنفيذها سنويًّا، وذلك وفقًا لأحكام النظام واللائحة.
This is the official Arabic wording, the only legally binding version. We do not translate the law itself; the explanation below is ours. Official source: Bureau of Experts at the Council of Ministers
Article 7 explained in plain English
The default, under the definition of developer in Article 1, is that a developer is a legal entity (such as a company). This article comes as an exception that allows a natural person (an individual) to enter this activity on conditions.
The competent authority may, in order to achieve the objectives of the Law and when needed, register a natural person in the developers registry and license them to engage in the activity of off-plan sale and leasing of real estate projects. This is a discretionary power of the authority and not an automatic right of the individual.
This is to be under rules set by the Implementing Regulations, and the text requires these rules to include at least two things:
- A specified ceiling on the size of the real estate project that the individual may carry out.
- A specified number of real estate projects that the individual is permitted to carry out annually.
The article does not specify the amount of this ceiling or the number of projects, but leaves them to the Implementing Regulations. The individual is subject in this to the provisions of the Law and the Regulations just as a legal-entity developer is.
The article is linked to Article 6, which sets out the documents for the project license application, and to Article 8, which deals with annotating the property's title deed when the license is issued. Anyone wishing to apply as an individual can consult a lawyer who specializes in real estate cases to learn what the Regulations require.
Practical example
Fahad owns land in Qassim and wishes to build a small number of units and sell them off-plan in his personal capacity without setting up a company. The competent authority may, when needed, register him in the developers registry and license him, but this would be under the Regulations' rules, which set a ceiling on project size and a specified number of projects annually.
Translated from our Arabic explanation with machine assistance. For guidance only; it does not replace advice from a lawyer on your situation.
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Frequently asked questions about Article 7 of the Saudi Off-Plan Real Estate Sales and Leasing Law
Can an individual sell off-plan?
The competent authority may, when needed, register a natural person in the developers registry and license them, under rules set by the Implementing Regulations.
What are the restrictions on an individual developer?
The text requires the rules to include a specified ceiling on the size of the real estate project and a specified number of projects the individual is permitted to carry out annually; the Regulations set the details.
Is registration of an individual an automatic right?
No. The article makes it a power of the competent authority, exercised to achieve the objectives of the Law and when needed.
More articles on Licensing an Off-Plan Sales Project
- Article 3
The article bars a developer from off-plan sale and leasing unless registered in the developers registry, and bars advertising or exhibiting a project before it is licensed.
لا يحق لأي مطور عقاري مزاولة نشاط بيع وتأجير مشروعات عقارية على الخارطة إلا إذا كان مقيدًا في سجل قيد المطورين، ولا يحق الإعلان عنها في وسائل الإعلام المحلية أو
- Article 4
The article sets the competent authority's tasks: supervising real estate projects, licensing and monitoring them, preparing a public database of licensed projects, and preparing the developers registry.
تتولى الجهة المختصة وفقًا للنظام ما يلي: 1- الإشراف على المشروعات العقارية، بما في ذلك إصدار التراخيص اللازمة لها، ومتابعة تنفيذها، والرقابة والتفتيش عليها. ويج
- Article 6
The article lists the documents a registered developer submits to license its off-plan project, and requires the competent authority to decide within 30 days, failing which the application is deemed approved.
1- يجب على المطور الراغب في بيع أو تأجير مشروعات عقارية على الخارطة -بعد قيد اسمه في سجل قيد المطورين- أن يقدم طلبًا إلى الجهة المختصة للحصول على الترخيص الخاص
- Article 8
The article requires the competent authority, when licensing a project, to ask for a no-disposal annotation on the property's title deed until development is complete, to be lifted only with its approval.
دون إخلال بأحكام نظام التسجيل العيني للعقار؛ على الجهة المختصة عند إصدار الترخيص الخاص للمشروع العقاري، طلب إجراء التأشير على صك تسجيل الملكية للعقار المراد تطو
The texts are reproduced from the official website of the Bureau of Experts at the Council of Ministers for reference; where they differ, the officially published Arabic text prevails. This content is not legal advice.