Abu Dhabi escrow rules tightened: early withdrawals now require bank guarantee

Abu Dhabi's new escrow and off-plan sales regime, governed by Administrative Decisions 24 and 165 of 2025, reshapes how developer funds are held and released. Previously, no withdrawals were permitted from project escrow accounts until at least 20% of construction was completed. Administrative Decision No. 24 now allows ADREC-approved early withdrawals before that threshold, but only if developers meet strict eligibility criteria: at least four years' registration in Abu Dhabi, a track record of at least three completed projects within scheduled timeframes, no legal violations or administrative penalties in the prior 12 months, and submission of an unconditional, irrevocable bank guarantee of at least 20% of total construction costs plus an approved engineering cost report issued no more than 30 days before application. Administrative Decision No. 165 introduces a standardized cancellation and refund regime. When a purchaser defaults and the unit is cancelled, developers may deduct a percentage of sale contract value depending on construction stage: nil if not started (reasons outside developer control), 10% if below 10% complete, 15% if 10–30% complete, 25% if 30–60% complete, and 40% if 60–100% complete. Refunds must be processed within 15 business days of request; amounts collected outside escrow must be refunded in full within 30 days of ADREC's cancellation notification.