Abu Dhabi to refund 20% of commercial leases

By Eudore R. Chand

ABU DHABI 12 May 2020: The Abu Dhabi Department of Economic Development (DED), announced on Monday the launch of a strategic new digital service that will enable restaurants, tourism and entertainment facilities within the emirate to apply for a 20 percent refund on the annual rental value of their commercial property leases.

According to DED Chairman Mohammed Ali Al Shorafa, the move follows the directive that was issued by His Highness Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, Deputy Supreme Commander of the UAE Armed Forces, and Chairman of the Abu Dhabi Executive Council, to support private sector businesses via the implementation of initiatives included in a special economic stimulus package.

The stimulus package launched aims to support companies and facilities affected by the implementation of the precautionary measures taken in the UAE to prevent the spread of the coronavirus, said Wam.

Al Shorafa explained that Abu Dhabi Government ensures the refund of 20 percent of the total rental value paid by investors who started their lease from September 2019 or renewed their contracts during the period from 1st April 2020 until the end of September 2020. The move is expected to help add and enhance the confidence in the emirate’s business environment. The resolution covers all facilities practicing activities of restaurants, cafeterias, tourism and entertainment.

Exemptions from fines

He added that the resolution is also part of the series of initiatives that DED has launched to help support the private sector, among which economic facilities operating in Abu Dhabi were recently exempted from violations recorded by the department, with a total value of around Dh246 million.

Also, Al Shorafa continued, DED frequently communicates with businesspeople and investors to learn about the challenges and constraints that they are facing, which in turn, will help them in determining the extent of the impact made on their investments as a result of the preventive and precautionary measures implemented to contain the Covid-19 outbreak.

For his part, Rashed Abdul Karim Al Blooshi, ADDED Under-Secretary, pointed out that owners of restaurants and tourism and entertainment facilities – not including hotels – that are covered by the resolution, can obtain a 20 percent refund on their annual rental contracts via registration of the required information about their economic licenses and commercial property leases by visiting the ’20 per cent Rental Rebate Initiative Registration’ page on the DED website.

How to get the refund

Al Blooshi explained that the service of receiving applications for refunding the identified rental percentage has been activated in collaboration and e-connection with the Abu Dhabi Department of Finance. He noted that the service will help complete all requests without human intervention by the automation of procedures and the online registration of data required for applications.

DED’s issued resolution also stipulates that in case the rent allowance is in participatory form, such as a fixed rental allowance and a percentage of the income, the refund is then calculated on fixed allowance.

The property owner who claims financial rights towards the tenant or any other financial right owner has to review the competent court’s decision to reserve the due allowance, in which the department does not accept any reservation request of any kind except those mandated by a court ruling.

The resolution will not affect the rest of the terms of the rental contracts and adopts the entire contractual annual allowance for the purposes of documentation and fees.

It does not apply on rental contracts ending in ownership. However, the decision will apply on all new contracts that were signed during the period covering 1st October 2019 until 31st March 2020, in addition to all rental contracts that were renewed from the beginning of April 2020 to 31st September 2020, regardless of the date of signing.



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