Article 36 of the Saudi Real Estate Investment Schemes Law
المادة 36 من نظام المساهمات العقارية · الفصل السابع: أحكام ختامية
The article gives the Capital Market Authority, in agreement with the Real Estate General Authority, the regulation of raising funds for the purpose of offering a real estate investment scheme, without prejudice to the Authority's powers.
Official text (Arabic)
This article has not been amended since the law was issued.
دون إخلال باختصاصات الهيئة، تنظم هيئة السوق المالية بالاتفاق مع الهيئة ما يتعلق بجمع الأموال لغرض طرح المساهمة العقارية.
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 36 explained in plain English
This article divides the roles between two government bodies on one specific matter, raising funds for the purpose of offering a real estate investment scheme:
- The Capital Market Authority is the body that regulates matters relating to raising funds for this purpose.
- This is done in agreement with the Real Estate General Authority, not by the Capital Market Authority alone.
- And it is without prejudice to the powers of the Real Estate General Authority; regulating the raising of funds does not take away the Authority's other powers.
In practical terms, the process of raising funds from shareholders when a scheme is offered is subject to regulation set by the Capital Market Authority in agreement with the Real Estate General Authority, so anyone who wants to know its details should refer to that regulation, not to this article, which does not give details.
The article is linked to Article 37, which provides that the Board, meaning the Authority's board under Article 1, issues the Implementing Regulations in agreement with the Capital Market Authority within 120 days of the date the Law was issued, so coordination between the two bodies appears in more than one place. It is preceded by Article 35, which sets an imprisonment penalty for violating the provisions of a number of articles.
Anyone planning to offer a scheme and raise funds for it would do well to consult a lawyer specializing in real estate cases or one specializing in banking, finance and securities.
Practical example
A company in Riyadh is preparing to offer a real estate investment scheme and raise funds from shareholders. It reviewed the regulation that the Capital Market Authority issues in agreement with the Real Estate General Authority on raising funds for this purpose, because Article 36 makes this a matter for the Capital Market Authority.
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 36 of the Saudi Real Estate Investment Schemes Law
Who regulates raising funds for real estate investment schemes?
The Capital Market Authority regulates it, in agreement with the Real Estate General Authority.
Does this cancel the powers of the Real Estate General Authority?
No. The article provides that this is without prejudice to the Authority's powers.
Does the Capital Market Authority regulate this alone?
No. The regulation is made in agreement with the Real Estate General Authority.
More articles on Definitions and Powers of the Real Estate Authority
- Article 1
The article defines the Law's key terms, such as real estate investment scheme, participant, licensee, scheme manager, escrow account and register of participants.
لغرض تطبيق هذا النظام، يقصد بالعبارات والألفاظ الآتية -أينما وردت فيه- المعاني المبينة أمام كل منها، ما لم يقتض السياق غير ذلك: النظام: نظام المساهمات العقارية.
- Article 2
The article states the Law's objectives: regulating real estate investment scheme activity, raising its level of transparency and disclosure, and protecting the rights of all parties to the scheme.
يهدف النظام إلى تنظيم نشاط المساهمات العقارية، وإلى رفع مستوى الشفافية والإفصاح فيه، وإلى حماية حقوق جميع أطراف المساهمة العقارية.
- Article 3
The article makes the General Authority for Real Estate the regulator of real estate investment schemes and lists its powers, from licensing, classification and qualification conditions to fee-basis setting and oversight.
دون إخلال باختصاصات الجهات الحكومية الأخرى، تتولى الهيئة تنظيم نشاط المساهمات العقارية وفقاً لما يحدده النظام واللائحة، ولها على وجه خاص ما يأتي: 1- إصدار الترخ
- Article 37
The article requires the Authority's board to issue the Implementing Regulations in agreement with the Capital Market Authority within 120 days of the Law's issuance, with effect from the date the Law takes effect.
يصدر المجلس اللائحة بالاتفاق مع هيئة السوق المالية، وذلك خلال (مائة وعشرين) يوماً من تاريخ صدور النظام، ويعمل بها من تاريخ العمل به.
- Article 38
The article provides that the Law is published in the Official Gazette and takes effect 120 days after its publication, and that it repeals every provision that conflicts with it.
ينشر النظام في الجريدة الرسمية، ويعمل به بعد (مائة وعشرين) يوماً من تاريخ نشره، ويلغي كل ما يتعارض معه من أحكام.
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.