5 years imprisonment and a fine of 10 million for violators

The Real Estate General Authority has referred a violator of the off-plan sale and lease system to the relevant authorities, as the developer began marketing the project before obtaining licenses. In a statement, the authority confirmed that it will continue its efforts, through electronic and field inspection teams, to verify the regularity of real estate practitioners and ensure that advertisements comply with regulatory requirements. This will ensure the provision of quality real estate services to beneficiaries, enhance transparency in the real estate market, and increase its reliability.

The Real Estate Authority called on those interested in off-plan real estate development to submit a qualification application, obtain the necessary permits to practice the activity, and comply with the regulations, instructions, and legislation that regulate the real estate market and protect the rights of those involved.

It should be noted that the off-plan sale and lease system prohibits any real estate developer from engaging in the activity of selling and leasing off-plan real estate projects, advertising them, holding exhibitions, or inviting visitors to them unless the real estate project is licensed by the General Authority for Real Estate.

Lawyer Majed Al-Ahmari confirmed that the Off-Plan Real Estate Projects Sale and Leasing System stipulates in Article 24 that, without prejudice to any more severe penalty stipulated in another system, anyone who engages in the activity of selling and leasing off-plan real estate projects, or collecting sums of money from buyers or tenants of properties in a real estate project, without obtaining a license, and anyone who submits incorrect documents or data to request a license for the real estate project, shall be punished with imprisonment for a period not exceeding five years or a fine not exceeding 10 million riyals, or both.

It also included anyone who offered or advertised the sale or rental of off-plan properties in fictitious real estate projects with knowledge of that, anyone who embezzled, squandered, or unlawfully used sums given to him for the purpose of establishing the real estate project, and anyone who received sums for the purpose of reserving lands or real estate units with the intention of selling or renting them off-plan, as the case may be, and did not deposit them in an escrow account.