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Aden - Yasmine El Tohamy - The real estate company which manages your tenancy should not collect a commission for the renewal of your tenancy contract every year.
I stay in a one-bedroom apartment in Dubai, and my annual rent is Dh50,000. However, my real estate company charges Dh2,000 as 'admin charges' every year for contract renewal. This clause is mentioned in the contract between me and the real estate company. However, there is no such thing in the Ejari. I recall reading your advice that annual 'commission' to real estate firms is illegal. Are 'admin charges' illegal, too? It's just a fancy name for commission, in my opinion. Which authority should I approach to raise this issue? And how do I go about it?
It may be noted that the real estate company which manages your tenancy should not collect a commission for the renewal of your tenancy contract every year.
However, the real estate company may charge a reasonable amount as administrative charges for facilitating the renewal of a tenancy contract, provided an obligation to make such payments is imposed on a tenant by way of a stipulation in a tenancy contract or a separate contract between a tenant and a real estate company.
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In your case, considering the existence of a separate contract between you and the real estate company wherein you have agreed to payment of annual administrative charges of Dh2,000 for the renewal of the tenancy contract, you may be liable to incur such administrative charges.
However, if you do not want to continuing paying this administrative charge, you may consider terminating this agreement with the real estate company for subsequent renewal.
Ashish Mehta is the founder and Managing Partner of Ashish Mehta & Associates. He is qualified to practise law in Dubai, the United Kingdom, Singapore and India. Full details of his firm on: www.amalawyers.com. Readers may e-mail their questions to: [email protected] or send them to Legal View, Al Khaleej Today, PO Box 11243, Dubai.
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