Regulations governing real estate investments and activities in the Duqm Special Economic Zone will come into force today, September 6, 2017.
The new guidelines were approved by the Board of Directors of the SEZ Authority at Duqm (SEZAD) at their second meeting of the year chaired by Yahya bin Said al Jabri, Chairman of the Board.
The regulations, published in the latest issue of the Official Gazette, aims to strengthen SEZAD’s efforts to attract domestic and foreign investments and provide the legislative environment that encourages the private sector to invest in real estate projects, such as tourist complexes and mixed-used developments for residential, commercial and hospitality uses.
Ismail bin Ahmed al Balushi (pictured), SEZAD’s Deputy CEO, said real estate projects have garnered strong investor interest in recent years. Accordingly, SEZAD decided to draft guidelines to regulate the use of state owned land for real estate development, provide greater clarity on the rules governing the sale of usufruct rights over real estate units, and delineate the developer’s obligations and usufruct rights.
In an interview, Al Balushi added that the new regulations also aims to encourage citizens and foreigners to stay in Duqm by allowing them to purchase the usufruct rights offered by real estate developers for sale. The regulations allow Omanis and expatriates — whether natural or legal entities — to acquire usufruct rights over real estate units built in real estate projects.
This will contribute to meet the demand for residential units in Duqm in line
with SEZAD’s vision to make the SEZ a suitable place to live and work.
According to the new regulations, real estate developers will receive a total land area of not less than 100,000 square metres per project, allowing them to provide many facilities for the residents. The term of the usufruct shall be 50 calendar years, renewable for a similar period. This shall provide the stability sought by workers and residents in Duqm.
Al Balushi noted that residency rights may be granted in line with Royal Omani Police procedures to foreigners, and their relatives of the first degree, who reside in properties located in one of the real estate development projects in the SEZ, subject to the provisions of the regulation and without prejudice to the provisions of Oman’s Foreigners’ Residency Law. It is also possible to grant residency to two natural persons who are not related to the usufructuary but legally represent the legal usufructuary. This procedure also applies to the legal representative of the principal developer and his or her first-degree relatives.
Giving details about the usufructuary’s rights enshrined in the Real Estate Development Regulation, he said the statute grants usufructuaries the right to use the real estate unit in its entirety and the parts intended for the common use of the building and to dispose of this right and exploit it without prejudice to the ownership of the assets. The principal developer may transfer or dispose of the usufruct right after obtaining SEZAD’s written approval without prejudice to usufruct of the real estate units.
The Regulation allows the usufructuary of real estate units to form and manage associations that include a group of neighbouring properties. The association shall maintain the safety of the property, its common parts and its annexes, and ensure its maintenance, the provision of the required services for the property, and the optimum use for the purpose for which it was established. For this purpose, the associations have the right to contract with companies specialised in the maintenance of buildings and are registered with SEZAD as determined by the Board in terms of the conditions, controls and procedures set in this regard.
In concluding, Al Balushi called upon investors wishing to establish real estate development projects in Duqm to obtain a licence from SEZAD in accordance with the provisions of SEZAD investment. He also affirmed the Authority’s commitment to eliminating all hurdles in facilitating investment in the Zone.