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Article 8 of the Saudi Off-Plan Real Estate Sales and Leasing Law

المادة 8 من نظام بيع وتأجير مشروعات عقارية على الخارطة

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.

Official text (Arabic)

This article has not been amended since the law was issued.

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 تطويره (لدى الجهة المختصة بالتوثيق) بعدم التصرف في ملكيته إلى أن تستكمل أعمال التطوير العقاري، ولا يرفع التأشير عن صك تسجيل الملكية لذلك العقار إلا بعد موافقة الجهة المختصة. وتحدد اللائحة الحالات التي يرفع فيها التأشير بعدم التصرف. وللمتضرر من قرار الجهة المختصة التظلم أمام اللجنة المنصوص عليها في المادة (الحادية والعشرين) من النظام.

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 8 explained in plain English

This article provides an important protection for buyers and lessees: when the special license for the real estate project is issued, the competent authority must ask the body competent for documentation to make an annotation on the title deed of the property to be developed, prohibiting disposal of its ownership until the real estate development work is complete.

Its most important provisions:

  • The annotation is mandatory for the competent authority when it issues the license, not optional.
  • The annotation remains until development work is complete, and is lifted only with the approval of the competent authority.
  • The Implementing Regulations specify the cases in which the annotation is lifted.
  • This applies without prejudice to the provisions of the Real Estate Registration Law.

The practical purpose is that the property on which the project is built is not transferred or disposed of during execution, which preserves the rights of those who paid amounts to the project. Article 9 also requires this annotation before the escrow account is activated.

Grievance: A person harmed by a decision of the competent authority may submit a grievance to the committee provided for in Article 21, which is formed by decision of the official for 3 years, renewable, from members no fewer than 3, and which issues its decisions by majority, with reasons, and they are approved by the official. Paragraph (3) of that article allows objecting to the committee's decisions before the Administrative Court within 60 days of notification of the decision.

Anyone who believes they have been harmed by a decision in this regard can consult a lawyer who specializes in real estate or administrative cases.

Practical example

A development company in Khobar obtained a license for an off-plan apartment project, and the competent authority requested an annotation on the land's title deed prohibiting disposal. The company later wanted to sell the land to another party before completing construction, but the annotation prevents disposal of its ownership, and it is lifted only with the approval of the competent authority in the cases the Implementing Regulations specify.

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 8 of the Saudi Off-Plan Real Estate Sales and Leasing Law

Can the developer sell the project's land during construction?

The land's title deed is annotated with a prohibition on disposing of its ownership until development work is complete, and the annotation is lifted only with the approval of the competent authority.

When is the no-disposal annotation lifted?

With the approval of the competent authority, and the Implementing Regulations specify the cases in which it is lifted.

How do I challenge a decision of the competent authority in this matter?

A harmed person may submit a grievance to the committee provided for in Article 21, and the committee's decisions may be objected to before the Administrative Court within 60 days of notification.

Articles this article refers to

More articles on Licensing an Off-Plan Sales Project

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.