Can I negotiate rental price because of COVID-19 restrictions which are reflected to local businesses ?
In general, such unforeseen circumstances and force majeure conditions in this regard are covered under Federal Law Number 5 of 1985 (as amended) (the “UAE Civil Code”). The events leading to the application of force majeure to be unforeseeable, and not related to any of the parties; and most importantly by presenting enough proof to show that the obligation was impossible to perform.
In addition to the above there are certain provisions in the UAE Civil Code under Article 782 which could particularly give certain reliefs for tenants in a tenancy relationship to cancel the rental contract or negotiate terms accordingly, if it can prove that:
- If by any act of the competent authorities it become impossible to derive full enjoyment from the thing hired through no cause on the part of the tenant.
- If the impossibility affects the enjoyment of part of the property hired in such a way as to affect the enjoyment intended.
In case the parties do not mutually agree on terms during such situations (either for residential or commercial), the matter can be forwarded to the Rental Dispute Center to accordingly hear the case.