Civil Transactions Law · Federal Decree-Law 25 of 2025
Article 725
Section Two: Contracts of Usufruct > Chapter One: Lease Contract > Part Three: Effects of the Lease Contract > First: Obligations of the Lessor / 1. Delivery of the Leased Property
English translation
1. If the lessee introduces to the leased property any construction, planting, or other improvements that increase its value, with the lessor's consent, the lessor shall be obligated to reimburse the lessee, upon the expiration of the lease, for the amount spent on such improvements or for the amount by which the value of the property has increased, unless otherwise agreed.
2. If such improvements were made without the lessor's knowledge or despite their objection, the lessor may require the lessee to remove them, together with compensation if justified.
Official translation, as published by the portal.
Official Arabic text
.1 إذا أوجد المستأجر في العين المؤجرة بناء أو غراسًا أو غير ذلك من التحسينات مما يزيد في قيمتها وكان ذلك بموافقة المؤجر، التزم المؤجر أن يرد للمستأجر عند انتهاء الإيجار ما أنفقه في هذه التحسينات أو ما زاد في قيمة العقار، ما لم يُتفق على غير ذلك.
.2 إذا كانت تلك التحسينات قد استحدثت دون علم المؤجر أو على الرغم من معارضته، كان له أن يطلب من المستأجر إزالتها مع التعويض إن كان له مقتضى.
What it means when you sign
This article deals with improvements the tenant makes to the leased property, such as construction, planting or other work that increases its value. If the landlord consented, the landlord must reimburse the tenant when the lease ends, either for the amount spent on the improvements or for the amount by which the property's value has increased, unless otherwise agreed. If the improvements were made without the landlord's knowledge or despite their objection, the landlord may require the tenant to remove them, together with compensation if justified.
For a contract about to be signed, this article is relevant to fit-out, renovation and alteration clauses. It means that whether the landlord consented matters a great deal, so consent is worth having in writing. Whether the tenant is reimbursed at the end of the lease depends on that consent, and the rule applies unless the lease says otherwise. A clause that says all improvements become the landlord's without payment may therefore change the position this article describes.
In Fahm reports this article usually sits under: One-sided mechanisms
Related articles
- Article 722This article sets out when the tenant must pay the rent.
- Article 723Cited in Fahm reportsThis article gives the landlord a right over movable property found in the leased premises, as security for rights arising under the lease.
- Article 724This article covers what the tenant must do when the lease ends.
- Article 726This article deals with a rent increase asked for after the lease term has ended.
- Article 728This article deals with a lease of property in which a factory or a shop has been set up.
- Article 729Cited in Fahm reportsThis article sets rules on assigning a lease or subleasing the property.