Welcome back to the dispute.ae podcast. I'm Paul.

In the last episode, we explained how the Dubai Land Department (DLD) determines a project's completion percentage. That percentage is critical because it decides how much a developer may retain if an off-plan Sale and Purchase Agreement (SPA) is terminated.

Here are the key retention tiers under Dubai's off-plan rules:

• More than 80% complete: The developer may pursue the outstanding balance, request a DLD auction, or terminate the SPA and retain up to 40% of the purchase price.
• 60%–80% complete: The developer may terminate and retain up to 40% of the purchase price.
• Construction started but below 60%: The developer may terminate and retain up to 25% of the purchase price.
• Construction has not started, for reasons beyond the developer's control: The developer may terminate and retain up to 30% of the amounts actually paid, not the purchase price.

One point many buyers misunderstand is the calculation base.

For the first three tiers, the percentage applies to the purchase price, not the amount you've already paid. If you've paid only part of the purchase price, the permitted retention can still absorb your entire payment. Only where construction has not started does the law calculate retention from the amounts actually paid.

Another important phrase is "up to."

These percentages are maximum limits—not automatic entitlements. The law sets a ceiling, but it does not require the developer to retain the maximum. That creates room for negotiation.

Developers often weigh the time, administration, resale process, and potential disputes against the certainty of a negotiated settlement. A documented agreement can provide both parties with a faster and more predictable outcome.

An effective negotiation relies on three elements:

• A documented position supported by the SPA, payment ledger, notices, and DLD records.
• A clear written proposal setting out the retention figure, settlement terms, and mutual release.
• A credible alternative if the developer refuses to negotiate, supported by evidence rather than emotion.

Even if negotiations don't succeed, the documented offers and responses can become valuable evidence later.

Key takeaway: Retention depends on both the construction stage and the calculation base. The statutory percentages are maximum limits, not mandatory outcomes. Understanding the figures—and negotiating from a well-documented position—can significantly improve the result.

In the next episode, we'll discuss the buyer who defaulted, went silent, and now wants to restructure from within the legal process.

Thanks for listening. Visit dispute.ae for pre-legal dispute support and negotiation assistance.