Official Gazette publishes rules for handling canceled municipal real estate investment contracts

The Official Gazette, Umm Al-Qura, published today Cabinet Decision No. 282, dated March 19, 1448 AH (Islamic calendar), which regulates the handling of investment contracts for municipal real estate assets transferred from the Ministry of Municipal and Rural Affairs and Housing to another entity by legal instrument.

According to the Official Gazette, under the decision, the entity receiving the municipal property must either continue with any existing investment contract on the property or compensate the investor for all damages resulting from the contract's cancellation.

The decision assigns the Saudi Authority for Accredited Valuers, in coordination with relevant bodies, to develop a mechanism for assessing damages resulting from the cancellation of investment contracts for municipal real estate transferred from the Ministry of Municipal and Rural Affairs and Housing to another entity.

The Authority is also tasked with submitting any necessary regulatory procedures to help establish a clear framework for damage assessment and address the consequences of canceling such investment contracts in these cases.

The decision follows a submission from the Royal Court (No. 54302, dated 6/7/1447 AH), which included a letter from the Minister of Municipal and Rural Affairs and Housing (No. 4700431121, dated 25/6/1447 AH) regarding a joint report on establishing a mechanism for handling the cancellation of government investment contracts for municipal real estate.

According to Umm Al-Qura, the decision also took into account the Municipal Real Estate Disposal Law (Royal Decree No. M/64, dated 15/11/1392 AH), the Law of Accredited Valuers (Royal Decree No. M/43, dated 9/7/1433 AH), and the Municipal Real Estate Disposal Regulations (Royal Order No. 40152, dated 29/6/1441 AH).

The decision further considered memoranda No. 4116 (dated 4/12/1447 AH) and No. 700 (dated 3/3/1448 AH) prepared by the Bureau of Experts at the Council of Ministers, as well as recommendation No. 26-2/48/D (dated 10/1/1448 AH) from the Council of Economic and Development Affairs, and recommendation No. 2856 (dated 14/3/1448 AH) from the General Committee of the Council of Ministers.

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