Reservation forms in off-plan sales may be binding contracts under UAE law

Off-plan sales have become a cornerstone of Dubai's real estate market, supported by a comprehensive legislative framework designed to safeguard investors and promote market transparency. Under UAE law, the legal nature of an agreement is determined by its substance rather than its title. Where a reservation form identifies the parties, specifies the property, records the purchase price, sets out the payment mechanism and reflects the parties' mutual intention to conclude the sale, it satisfies the essential elements of contract formation and may constitute a legally binding agreement. Once the reservation form constitutes a valid contract, it creates reciprocal obligations for both parties. The purchaser is required to comply with agreed payment obligations and other contractual commitments. The developer is required to reserve the unit for the purchaser, refrain from disposing of it to third parties, proceed with the project in accordance with applicable legislation, execute the Sale and Purchase Agreement where applicable, and complete statutory registration in the Interim Real Estate Register. Dubai Law No. (13) of 2008 requires every disposition relating to an off-plan property to be registered in the Interim Real Estate Register. Registration protects purchasers' interests, prevents multiple sales of the same unit, enhances market transparency, and provides legal certainty in relation to proprietary rights. Dubai courts have consistently held that registration is a mandatory statutory requirement rather than a procedural formality. Where a reservation form or off-plan sale agreement has not been duly registered, Dubai courts have in numerous cases declared the transaction null and void for failure to comply with the mandatory requirements of Dubai Law No. (13) of 2008.