The provisions of Law No. (26) of 2007, which regulates the relationship between landlords and tenants in the Emirate of Dubai, and Law No. (6) of 2019, concerning the ownership of jointly owned real property in Dubai, will apply.
In Dubai, the tenancy contract plays a crucial role in defining the rights and responsibilities of both the landlord and the tenant regarding the leased property. The tenancy contract determines the payment obligations, including fees and taxes owed to government entities. Generally, these obligations fall on the tenant, unless otherwise specified in the contract. This aligns with Article 22 of the Tenancy Law, which states the following:
“Unless the Lease Contract states otherwise, the tenant must pay all fees and taxes owed to government entities and departments in relation to the use of the real Property, and must pay the fees or taxes prescribed for any sublease of the real property.”
There are three components to the charges imposed by the management entity when renewing your tenancy contract. These components include (i) service charges, which are calculated at a rate of 2 percent of the annual rent, (ii) Dh226, and (iii) Rera registration fees. Let’s examine each component in detail.
Firstly, let’s discuss the ‘service charges’. This term is defined in Article (2) of the Apartments Law.
“The annual charges collected from Owners to cover the cost of management, operation, maintenance, and repair of Jointly Owned Real Property.”
Moreover, according to Article 25 of the Apartments Law, it is the responsibility of the premises owner to settle the service charges with the management entity. The specific provisions outlined in Article 25 are as follows.
“Article (25)
- An owner will pay the management entity his share of the annual service charges to cover the common parts management, operation, maintenance, and repair expenses. This share will be calculated, using the relevant method approved by the director-general, based on the ratio of the area of the owner’s unit to the total area of the jointly owned real property. A developer will pay his share of the annual service charges in respect of unsold units and in respect of the sold units for which he undertakes, under the provisions of the sale contract or reservation agreement, to pay the service charges on behalf of the purchaser.
- For application of paragraph (a) of this Article, the owner’s share of the service charges will be calculated based on the area of his unit as recorded in the Real Property Register.”
According to the Apartments Law, the owner of the leased property is responsible for paying the service charges to the management entity. However, your tenancy contract may have transferred this responsibility to you as the tenant. As a result, you have been required to pay the service charges for the leased property during all previous renewals. Nevertheless, before the next renewal of your tenancy contract, you have the option to renegotiate the terms and request your landlord to bear the service charges.
The Rera registration charges are mandatory fees that must be paid to a government entity. As stated in Article (22) of the Tenancy Law, you are obligated to pay these charges unless your tenancy contract states otherwise.
Lastly, any additional amounts charged to you during the renewal of your tenancy contract would be considered legal if you had agreed to such charges in your contract.