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99-year usufruct for government lands: Housing and Urban Planning Ministry


MUSCAT, Sept 18

The Ministry of Housing and Urban Planning has stressed that Royal Decree 59/2022 regulating the usufruct of Omani lands aims to achieve a number of economic, social, planning and environmental objectives.

From the economic standpoint, the Decree seeks to enhance incentives for economic diversification and financial sustainability in order to achieve the priorities of Oman Vision 2040 in stimulating investment inflows from individuals and businesses. Moreover, it seeks to streamline integration between different agencies in supporting optimal land use.

As for the social aspect, the new Decree seeks to ensure that local communities benefit the most of any land development, thereby nurturing sustainable and homogeneous urban development.

In the planning aspects, the Decree mandates an upgrade of all land use regulations to bring them into line with the broad goals of Oman National Spatial Strategy. By raising planning standards in the regions of the country, it is hoped that high quality investments will flow into the region, thereby contributing to the growth of prosperous cities.

As for the environmental aspect, the Decree seeks to enhance the sustainability and balance of the elements of the environment and the use of green spaces and surfaces through sustainable investment and development of a basic environment that is resilient and deals with climate change.

Several initiatives will be pursued in line with the objectives of this Decree: introduction of efficient land use guidelines, stimulus programme for the economic sector, completion of the governorate development system, providing service and commercial activities per urban strategy policies, working to achieve sustainability and maximising the financial return from the real estate sector, and strengthening the capabilities of the sector.

It also seeks to support the localisation of industries in integrated areas to raise the value-added rates. Besides contributing to the inflow of expertise and modern technologies, the Decree will also open wider horizons and new markets for Omani products, work to provide more job opportunities, support the national economy, and enhance investment opportunities for small and medium enterprises, the ministry said.

It added that the public bidding process advocated under the Royal Decree seeks to enhance transparency, strengthen governance, enable equal opportunities, drive productivity and efficiency, support competition, and localisation of industries.

Significant, the usufruct for any government land is for 99 years as a further incentive to investors, enable investment stability and support long-term investment projects. An usufruct agreement is initially for a period of one year, subject to renewal, provided it is renewed every 5 years after the completion of implementation, or according to the period of the mortgage in the case of financing, provided total period of the contract does not exceed 99 years.

The period allowed for the beneficiary to start the project shall not exceed two years from the date of registration of the usufruct contract, and the contract shall be considered null and void in the event of any failure to implement the project within the stipulated period.

Regarding the lowest ceiling for the value of the public auction, the ministry indicated the bidding starts from the price per square metre in the wilayat or governorate in which the land is located. It is RO 1 in the governorates of Muscat and the Wilayat of Salalah, and 500 baisas for the rest of the wilayats and governorates, and is based on the market value of the location of the land subject to bidding.

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