I INTRODUCTION TO THE LEGAL FRAMEWORK
i Ownership of real estate
The general rule for real estate ownership in Qatar is set forth in Law No. 5 of 1963, which permits only Qataris to own freehold real estate in Qatar. However, to attract investment the government opened the country's real estate market to foreign investors in 2004,2 permitting foreigners to own freehold real estate or to hold usufruct rights for 99 years in particular areas (investment areas).
A further development to attract investment into the real estate sector was the issuance of Law No. 6 of 2014 (the Real Estate Development Law) to regulate real estate developers. This Law regulates issues involved in selling units in real estate projects that were and are under construction (off-plan units) to provide greater security to investors investing in real estate in Qatar.
Freehold ownership entitles the buyer to have title to the land as well as ownership of structures on the land. However, the buyer and the purchaser may agree that the buyer owns the land only without having ownership of the structure to be built thereon, provided that the same is set out clearly in an agreement between the parties.
ii Registration of real estate
Law No. 14 of 1964 (the Real Estate Registration Law) establishes a framework relating to property registration in Qatar whereby all dispositions giving rise to real property rights, including usufruct rights, must be registered, including most recently off-plan property sales. This registration is usually conducted at the Real Estate Registration and Authentication Department at the Ministry of Justice.
Registration of freehold property
The process of registering a freehold property entails the submission of an application form with a minimal fee, along with the original of the title deed and the sale and purchase agreement (on the Ministry of Justice's letterhead). In the event that the parties are not present before the Real Estate Registration and Authentication Department, the authorised legal representative should be accompanied by a valid power of attorney (bilingual or in Arabic) with the authority to complete the sale of the concerned property.
In the event that one of the parties is a company, a copy of the company's commercial registration and immigration or computer card will have to be submitted. A shareholders' resolution approving the sale will also be required. The person signing and approving the sale on behalf of the company should be authorised, under the company's incorporation documents, to sell the company's assets, or, alternatively, authorised under a shareholders' resolution to undertake the sale. The purchaser is the party required to pay 0.25 per cent of the property value as a transfer fee.
Registration of usufruct
While rights of usufruct are to be registered with the Real Estate Registration and Authentication Department, rights of usufruct in the investment areas that are open to foreign investors (see below) must be registered with the relevant municipality at the Ministry of Municipality and Urban Planning (MMUP), where a certificate is to be issued in this regard. The MMUP has a standard usufruct agreement in the event that parties do not have their own in place. Once the usufruct agreement is signed, the MMUP will send a copy of the agreement to the Real Estate Registration and Authentication Department. Any registration, sale or assignment of usufruct rights requires payment of 1 per cent of the property value at the time of registration. This fee is to be paid by the person benefiting from the usufruct right.
Registration of off-plan units
The Real Estate Development Law established an interim register at the Real Estate Registration and Authentication Department. Pursuant to this Law, real estate developers are required to submit an application to register strata titles for projects being developed before units in the project can be sold on an off-plan basis. Any transaction in respect of an off-plan unit that is not recorded in the interim register will be considered invalid. While in principle this Law is in force, as it was published in the Official Gazette on 7 April 2014, there have been no executive regulations issued in relation to its application and the competent authorities have not started implementing any of its provisions.
Advantages and consequences of failure to register
In the event that real property rights are not registered with the competent departments as noted above, the relationship between the parties will remain only contractual. In other words, without registering real property rights, any recourse to action would only be available against the counterparty in contract, and damages would be the only remedy available. Furthermore, no enforcement against a third party will be possible.
iii Choice of law
Law No. 22 of 2004 (the Civil Law) provides that property possession, ownership and other real rights and the disposal and termination of the same are to be governed by the law of the place in which the property is located. Ownership or disposal of real estate property or rights thereon located in Qatar, whether within or outside the investment areas, will be subject to Qatari law. Therefore, parties should plan their transactions related to real estate, including their rights and obligations thereon, to be governed by Qatari law.
II OVERVIEW OF REAL ESTATE ACTIVITY
Real estate sales activity in Qatar has been falling since 2014. The recent measures taken by Saudi Arabia, Bahrain, Egypt and UAE have resulted in a further decline in market confidence, with transactional activity and values being impacted.3
Despite recent economic conditions, retail rents within organised malls have remained stable. However, supply of organised retail accommodation increased by more than 1 million m2 earlier in 2017, with a number of additional malls expected to open in the next 12 months. The quantity of retail construction in the development pipeline is likely to result in total supply of more than 2 million m2 by 2022, which has led to fears of an oversupply.
The office market has seen a decrease in occupancy and enquiry and an increase in vacancies. While many new office buildings are being developed and constructed, the demand for this type of space does not meet the fast-increasing supply, and so landlords are competing for tenants. According to DTZ's report, recent building completions in Lusail have increased the supply, with a total supply of purpose-built office accommodation estimated to be in excess of 4 million m2. DTZ estimates that there is currently 370,000 m2 of office accommodation available to lease in West Bay and Lusail, which reflects an availability rate in excess of 20 per cent. Approximately 2 million m2 of new office accommodation is planned for Qatar within the next decade, largely in Lusail. If completed, DTZ anticipates that occupancy rates will come under further pressure. A number of office developments have been put on hold over the past 12 months owing to fears of oversupply in the short to medium term.4
Similar to the office market, residential rent has also seen decrease of rent rates by 10 to 20 per cent. A large quantity of new residential spaces is being made available, especially in the non-central areas where landlords have shown flexibility and willingness to lower prices. This resulted in lowering the demand in the central areas such as the Pearl-Qatar and West Bay. This is a result of the current economic environment.5
III FOREIGN INVESTMENT
As previously mentioned, the ownership of real estate property in Qatar is generally restricted to Qatari nationals. However, the Foreign Ownership of Real Estate Law was passed in 2004 to permit foreigners and Gulf Corporation Council (GCC) citizens (whether individuals or companies) to own properties in certain investment areas as defined in related ministerial resolutions. Non-Qataris cannot own real estate properties outside these designated investment areas.
The Foreign Ownership of Real Estate Law defines 'investment areas' as 'lands allocated for carrying out commercial, industrial, tourism, residential and educational activities and any other activities the investment in which is permitted in accordance with the applicable laws in the State'.
Resolution No. 5 of 2006 permits GCC (individual or juristic) citizens to freehold ownership in the following areas: Lusail, Khuraj and Fox Hills (areas permitted to GCC citizens). Any registration of property, registration of real rights or transfer of ownership will be handled by the Real Estate Registration and Authentication Department through Qatari Diar Real Estate Investment Company, which is the company entitled to manage each of the mentioned areas permitted to GCC citizens.
In addition to the areas permitted to GCC citizens, GCC citizens are also entitled to freehold ownership in the areas designated for foreign investors. Ministerial Resolution No. 20 of 2004 determined such areas to be the Pearl, West Bay Lagoon and Al Khor. Similar to the registration process in the areas permitted to GCC citizens, any registration of property or real rights is to be administrated by each area's administrator. United Development Company (UDC), as the master developer, is the administrator for Pearl, and is required to liaise with the Real Estate Registration and Authentication Department in respect of purchased properties in the Pearl area. In practice, very few plots of land have been subdivided in the Pearl area, and no title deeds have been issued to purchasers of the units. The units are still considered by the Real Estate Registration and Authentication Department to be owned by UDC until they are subdivided and title deeds are issued in this regard.6
Another option available to non-Qataris is the right of usufruct of real estate for a term of 99 years, renewable for a similar period, in 18 investment areas determined by Ministerial Resolution No. 6 of 2006 (the Lusail development is one of these areas). There are no specific usufruct areas that are permitted only for GCC nationals; all of the above areas are open to all foreigners.
IV STRUCTURING THE INVESTMENT
Law No. 13 of 2000 (Foreign Investment Law as amended) regulates foreign investment within Qatar and sets down a general principle that foreign investors are allowed to invest in all sectors of the national economy provided they have one or more Qatari partners owning a minimum of 51 per cent of the entity's capital. Accordingly, non-Qataris wishing to incorporate an entity in Qatar are generally restricted to owning a maximum of 49 per cent of any such entity.7
Under the Foreign Investment Law, non-Qatari companies are not permitted to invest or trade in real estate. However, since the government's approval of foreign ownership of real estate by virtue of the Foreign Ownership of Real Estate Law, some foreign investment activities can take place in the real estate market provided that the investing company is established in Qatar and the company adheres to the restrictions that apply to foreign ownership, such as the inability to purchase land outside the investment areas. For example, a GCC fund would be able to own freehold properties in both the areas permitted to GCC citizens and the areas permitted to foreigners where the underlying ownership of the fund lies with GCC nationals. However, if the underlying ownership of the fund involves non-GCC citizens, then freehold would be restricted to the areas permitted to foreigners.
The incorporation of companies that are fully owned by foreign shareholders (whether GCC or other nationalities) in Qatar whose objects include investing or managing real estate assets, or both, within the areas permitted to GCC citizens or areas permitted to foreigners, require the approval of the Ministry of Economy and Commerce. Normally, the articles of association of such companies will contain objects for investing in, managing and leasing of real estate assets in the particular permitted area. The Ministry of Economy and Commerce has discretion with regard to the documents that must be provided before registering a company above the limits of the Foreign Investment Law.
The Real Estate Development Law permits non-Qatari companies to obtain a specific licence to conduct real estate development activities provided that:
- the activities of the real estate development are within the investment areas where freehold ownership is available for non-Qatari nationals and within the land space permitted to be owned;
- the activities are conducted by a company permitted to conduct real estate development activities in its place of incorporation. The incorporation documents should be authenticated by the Qatari diplomatic mission or consulate in the country of incorporation, or by an equivalent authority in the country of incorporation;
- the company has at least 10 years of previous experience in construction and building developments prior to the submission of its application to conduct real estate development activities in Qatar, and additionally has a good track record of performance; and
- the company is to be incorporated in Qatar with a commercial registration.
Real estate developers and contractors are expected to become compliant with the Real Estate Development Law within six months of it coming into force. The Law provides for financial and criminal penalties for those who practise real estate development activities without a licence being issued.
i Common forms of companies registered in Qatar
All juristic entities incorporated in Qatar (other than Qatari Financial Centre entities) must be established pursuant to the provisions of the Commercial Companies Law (the Companies Law).8 Foreign investors are often interested in incorporating a limited liability company (LLC) for the purpose of developing or conducting real estate activities in Qatar.9
The incorporation of a Qatari LLC requires registration with the Ministry of Economy and Commerce to obtain a commercial registration certificate that includes the company's activities to engage in real estate development, including acquisition, disposition and rental activities. At least 51 per cent of the shares in the Qatari LLC must be owned by Qatari nationals or a company wholly owned by a Qatari national.
V REAL ESTATE OWNERSHIP
The Real Estate Development Law places certain restrictions on real estate developers, including the licensing requirements outlined above. Under the Real Estate Development Law, developers may only sell off-plan units after obtaining the consent of the Real Estate Registration and Authentication Department. Developers are required to submit to the Real Estate Registration and Authentication Department an application to create strata title for the project being developed before selling any off-plan units in the project. The application should be accompanied with the relevant architectural plans, engineering drawings and a certified copy of the building permit. A strata title will then be issued in collaboration with the Ministry of Municipality and Urban Planning.
The Real Estate Registration and Authentication Department maintains an interim register for recording details of the strata title and all details related to transactions in respect of the off-plan units. Once the project has been completed, the interim title deeds are converted into permanent title deeds. Off-plan units approved and registered in the interim register can be subject to all legal actions, including the mortgaging and selling of the units. The Real Estate Registration and Authentication Department is required to issue interim title deeds to be converted to regular title deeds once a project is completed.
There is no particular law in Qatar that deals explicitly with contaminated lands. However, the Environment Law10 and its executive regulations place certain compliance obligations on owners of land and projects to protect the environment. There is no legal requirement to conduct investigations for potential contamination in connection with the sale of property.
The sale of real property is subject to the general provisions of the Civil Law regulating the parties' rights and obligations in any sale contract. Pursuant to Article 455 of the Civil Law, a seller remains liable to the purchaser where the subject of the sale, at the time of delivery, is defective in a way that would diminish the sale value or render the sale unfit for the purpose of its use. The seller would be liable for such a defect even if the seller was unaware of the defect's existence. However, if the purchaser was aware of such a defect at the time of the sale, or if the purchaser could have reasonably expected such a defect, the seller would not be liable towards the purchaser unless the purchaser has relied on the seller's assurance that such a defect does not exist or in the event that the seller intentionally did not disclose the defect to the purchaser.
Pursuant to the Income Tax Law of 2009, income and capital gains derived by investors in Qatar who are Qatari nationals or legal entities that are wholly owned by Qatari nationals are not subject to tax. GCC nationals and all businesses owned by GCC persons are also exempted from paying tax in Qatar. Pursuant to the Income Tax Law and Regulations issued in relation to the Law, profits derived from sources in Qatar would be subject to tax at a rate of 10 per cent. In practice, to determine the tax payable by a corporate entity in Qatar, the Tax Department of the Ministry of Economy and Commerce looks at the underlying interest in the same. Where the underlying interest lies with GCC persons, no tax will be payable. Where the underlying interest lies with other foreigners, tax will be levied at the 10 per cent rate applied to profits. Where there is a mix of GCC and other foreign ownership, the Tax Department exempts a percentage of profit from the imposition of tax pro-rated with the GCC ownership. For example, if profits of a company are 100,000 Qatari riyals and GCC ownership of the company is 60 per cent, then 60 per cent of the profit will be exempt from tax. Accordingly, applying the tax rate to 40 per cent of the profit (i.e., 40,000 Qatari riyals) results in a tax of 4,000 Qatari riyals.
iv Finance and security
The Civil Law and the Commercial Law11 recognise various categories of securities based on the type of property to be secured (movable and immovable properties). In respect of real estate, the creation of security is mostly seen in the form of mortgages or assignments of rights (conditional assignment).
Mortgages are generally the most common form of security whereby under a mortgage agreement, the mortgagor charges its interest in real property as security to a creditor (mortgagee). The mortgagee acquires the right to sell the real property in the event that the mortgagor is unable to satisfy its indebtedness. A mortgage agreement will have to be officially registered at the Ministry of Justice to give the creditor priority rights over the mortgaged property. In the event of default, the mortgagee shall have the right to request the court to sell the property subject to the mortgage provided that:
- an official notice has been given to the debtor;
- seven days have elapsed since the debtor's notification date;
- a court decision to sell the property has been notified to the debtor; and
- a five-day period has elapsed since the debtor was notified of the same.
An assignment of rights or conditional assignment is an inferior form of security to a registered mortgage as it is a contractual agreement that does not entitle the creditor to sell the property in the event of the debtor's default. To enforce an assignment of rights, a claim must be filed before a court to evidence the debt that is the subject of the assignment.
Under the Civil Law, an assignment of rights is only effective towards the debtor or a third party if the debtor has acknowledged such an assignment. Such an acknowledgement must be date certified. Date certification is carried out by the Real Estate Registration and Authentication Department. The authentication of the assignment grants the assignment an official date, so the priority of the creditor is established from the date of the authentication. An assignment of rights is commonly used in respect of non-official sale contracts where title deeds have not been issued in the name of unit holders (e.g., mortgages on Pearl units where there is no title deed issued yet in the name of the purchasers).
VI LEASES OF BUSINESS PREMISES
i Applicable law
Law No. 4 of 2008 as amended (the Lease Law) is the primary legislation in Qatar that regulates the relationship between landlords and tenants. The Lease Law applies to all lease contracts in Qatar that are of a term of at least one month, excluding leases applying to:
- state, private and public properties;
- agricultural land;
- undeveloped land;
- industrial services land;
- hotels and touristic apartments and units; and
- residential units reserved by the state or other companies for their employees.
ii Mandatory provisions under the Lease Law
Eviction of tenants during a lease term
The Lease Law imposes certain rights and obligations upon the landlord and the tenant that are mandatory (parties cannot contractually agree to exclude these from the application of certain provisions). One mandatory provision is Article 19 of the Lease Law, which provides for exclusive circumstances pursuant to which the landlord may request the competent leasing committee established under this Law to evict a tenant from the leased premise during the tenant's lease term. These grounds are as follows:
- in the event that the tenant does not perform its obligations in respect of rental payments;
- in the event that the tenant relinquished his or her interest in the lease (e.g., by assigning it to another person) without the written approval of the landlord;
- if the tenant uses the premises, or permits the premises to be used, for purposes contrary to those set out in the lease or that are otherwise inconsistent with public order or morals;
- if the competent authorities decree that the property must be demolished, or the premises are determined to be in danger of collapsing, causing a hazard to public safety;
- if the landlord decides to demolish the building (in limited circumstances);
- if the landlord decides to modify or extend the building (again, subject to certain restrictions outlined below); or
- if the leased premises are located within the landlord's private dwelling, and he or she or a member of his or her immediate family decides to utilise it for personal purposes (subject to the provision of due notice to the tenant).
The legislator's intention is to protect tenants from any sudden eviction at the discretion of the landlord during the lease term.
Article 10 of the Lease Law does not permit landlords to increase the rent value for leases in respect of leases in force prior to or after the enactment of the Lease Law except in accordance with the rules, terms and rates to be issued by the Council of Ministers.12 In 2008, the Council of Ministers issued Decision No. 9 of 2008, which restricted rent increases upon renewal in respect of residential and commercial leases. This Decision prevented landlords from increasing rent for leases entered into on or after 1 January 2005, except after two years from the date the Lease Law became effective, unless the parties agreed otherwise. The same Decision also set out the rent increase limits permitted for leases entered into before 1 January 2005. Council of Ministers Decision No. 9 of 2010 replaced the earlier 2008 Council of Ministers Decision (2010 Decision). Pursuant to the 2010 Decision, rent increase restrictions upon renewal applied only to commercial leases. The 2010 Decision set out new rental increase limits; however, it restricted the application of such limits to commercial leases that were entered into before 1 January 2005,13 with such an increase being effective from the date the increase is notified to the tenant. Pursuant to the 2010 Decision, a landlord is entitled to increase the rent for commercial leases entered into before 1 January 2005 every year upon renewal, provided that the landlord complies with the limits set out below:
- 20 per cent annual increase if the monthly rent is less than 3,000 Qatari riyals;
- 15 per cent annual increase if the monthly rent is between 3,000 and 6,000 Qatari riyals;
- 10 per cent annual increase if the monthly rent is between 6,000 and 10,000 Qatari riyals; and
- 5 per cent annual increase if the monthly rent is more than 10,000 Qatari riyals.
The 2010 Decision also prohibited rental increases for commercial leases entered into from 1 January 2005 onwards, except after a year from the date of the Decision, unless the leases provide otherwise. The 2010 Decision became effective on 15 February 2010. By virtue of a subsequent Council of Ministers Decision, the one-year period provided for under the 2010 Decision was extended for another year until 15 February 2012. As such, landlords were not permitted to increase rent upon renewal until 15 February 2012, unless the lease provided otherwise. Since the issue of this subsequent Decision, there have been no further decisions issued in this regard; however, rent increases with respect to commercial leases have been kept under control as a result of the Council of Ministers Decision extending all commercial lease terms by force of law, as noted below.
Protection of commercial tenants and extension of commercial leases by force of law
Article 27 of the Lease Law offered an exceptional measure of protection for commercial tenants14 by preventing landlords from evicting such tenants with expired lease terms for a one-year period commencing on 15 February 2010 (eviction can only be carried out under specific grounds set out under Article 19 of the Lease Law). The same Article conferred authority upon the Council of Ministers to extend the relevant period thereafter, should it see fit. Accordingly, by virtue of Decision No. 22 of 2011, Decision No. 8 of 2012, Decision No. 15 of 2014, Decision No. 8 of 2015 and Decision No. 6 of 2016 the Council of Ministers extended the protective periods until 15 February 2012, 15 February 2014, 15 February 2015, 15 February 2016 and 15 February 2017 respectively. Thereafter, if no further extension is granted, landlords shall be able to evict tenants from leased premises upon the expiry of the lease term.
The above-mentioned decisions exempted the following from such extension:
- headquarters of commercial companies;
- engineering, lawyers' and accountants' offices;
- veterinary clinics; and
- offices of agricultural, fish and animal health experts.
VII DEVELOPMENTS IN PRACTICE15
i The Real Estate Development Law
The Real Estate Development Law introduced significant changes to the legal framework governing the development and financing of real estate projects in Qatar by providing protection to the purchasers of off-plan units, thus enabling developers to register the off-plan units in an interim register created by the Real Estate Registration and Authentication Department. Consequently, purchasers would obtain rights in rem in the project land rather than just having contractual rights under the sale and purchase agreements. However, to date, the Real Estate Development Law still has limited application in practice.
Other than the registration and licensing requirements, the Real Estate Development Law provides for other significant developments as follows:
- a requirement that each developer must open an escrow account for each project, and the purchase price paid by purchasers of off-plan units is to be deposited directly into the escrow account. Developers are only permitted to withdraw monies from the escrow account upon achieving construction milestones and subject to a schedule approved by the Ministry of Municipality and Urban Planning. Withdrawals may only be made once 20 per cent of the project has been completed, and such withdrawals may be made towards payment of construction costs, purchase costs of land and marketing expenses. Escrow accounts may not be provided as security for financing obtained by the developer for the project;
- developers are required to obtain the consent of the Real Estate Registration and Authentication Department prior to obtaining the financing for a real estate project subject to certain requirements provided for under the law. The law provides for the following conditions that would have to be satisfied by the developer to obtain such financing:
- financing can only be obtained where off-plan units in a project remain unsold (i.e., there should be a number of units that have not been booked by purchasers, as this is relevant in determining the quantum of the loan);
- the aggregate amount deposited in the escrow account should exceed the value of the construction works that have been completed, and the amount of construction works that has been completed shall be certified by a consultant;
- the quantum of the financing obtained should not exceed the value of the unsold (or unbooked) off-plan units; and
- the developer is required to submit a statement of the escrow account.
ii The Real Estate Brokerage Law
The Real Estate Brokerage Law16 was introduced in 2017, with the aim of regulating the business and licensing of real estate brokers, which replaces the earlier law, Law No. 13 of 2011.
VIII OUTLOOK AND CONCLUSIONS
As anticipated, in 2017 there was a significant drop in the demand for real estate, both commercial and residential; and, accordingly, rentals have come down and incentives such as rent-free periods are much more common and are being seen on a far wider scale. The continuing completion of various developments, in particular the large-scale developments in Lusail and Msheireb, are expected to further increase the supply available in the market and increase the competition between landlords struggling to attract tenants. Landlords will ultimately have to show greater flexibility in negotiating the terms and conditions with the tenants and offering incentives. Although the retail market remained relatively strong in 2017, it is also expected to face increase in the supply as more retail developments are completed, which would certainly have an impact on the dynamics of the retail market in Qatar.
With regard to real estate development and despite that the Real Estate Development Law was considered a significant move into regulating the real estate market development we have yet seen full implementation of the law pending the executive regulations of the law to be issued. The initial reading to the law indicates that a further development in shaping and regulating the legal framework of real estate developments and developers in Qatar can be expected to be seen in respect of a strata model of ownership. The main principle of a strata management is the division of property into privately owned units and jointly owned common areas, which are managed by co-owners' associations representing the collective interests of the owners. Whereas Articles 884 to 903 of the Civil Law generally regulate ownership of units and the management of common areas by a co-owners' association, Articles 884 to 903 are not equivalent to a separate and fully implemented strata law. A regulatory framework for the management of developments would contribute to prevent, inter alia, abuses by developers where the management fees charged are used as a source of cash flow.
1 Nicola de Sylva is a senior associate at Al Tamimi & Company. The information contained in this chapter is relevant as of February 2018.
2 Law No. 17 of 2004 Regulating Ownership and Usufruct of Real Estate and Residential Units by Non-Qataris (the Foreign Ownership of Real Estate Law).
3 DTZ Research by Johnny Archer, Property Times, 'Real estate feels the impact of recent blockade.' Qatar Q3 2017.
6 This practice should change once the Real Estate Development Law is fully implemented.
7 As an exception to the above rule, the Foreign Investment Law provides a number of exemptions for foreigners wishing to undertake commercial, economic or professional activities within Qatar in specific fields to hold up to 100 per cent of such entities. An approval must be obtained from the Ministry of Economy and Commerce allowing the 100 per cent ownership. The Foreign Investment Law lists the categories that would qualify for such a ministerial exemption, including agriculture, industry, health, education, tourism, development and exploitation of natural resources, energy or mining, IT services, technical services, consulting services and distribution services (noting the Minister has recently indicated that distribution services will no longer be approved), provided that such projects match the objectives of the development plan of the state of Qatar.
8 Law No. 11 of 2015 regulating Commercial Companies.
9 The Companies Law provides for other types of companies: general partnership, simple limited partnership, limited partnership with shares, joint stock company (private and public), unincorporated joint venture, single person company and holding company.
10 Law No. 30 of 2002.
11 Law No. 27 of 2006.
12 Law No. 4 of 2006 (the 2006 Lease Law), which has since been repealed, capped rental increases in any renewed lease to a 10 per cent increase of the amount agreed upon in that lease. The 10 per cent increase applied to all types of leases, whether residential or commercial, and whether the leases existed before or after the 2006 Lease Law came into effect.
13 While the percentage restriction should (pursuant to the 2010 Decision) apply to commercial leases signed before 1 January 2005, in practice, it appears that the percentages are adhered to for all commercial leases, whether signed before 1 January 2005 or after (the issue of rent increases should be considered in conjunction with the extension of commercial leases by force of law – see below for further details).
14 This protection was initially given to tenants under Article 3 of the 2006 Lease Law.
15 The text for Section VII was initially written by Rafiq Jaffer (partner) and Dina Al Wahabi (associate) for an Al Tamimi & Company Law Update article. The full article is available at: www.tamimi.com/en/magazine/law-update/section-8/july-august-3/regulating-real-estate-development-in-qatar.html.
16 Law No. 22 of 2017.