Law No. 8 of 2007 is the reason Dubai off-plan investors did not lose everything in 2008, and escrow is the mechanic inside that law.
Escrow is a regulated arrangement where a neutral third party, usually a bank approved by the DLD, holds funds on behalf of a transaction until specific conditions are satisfied. In the UAE it shows up in two places that matter. First, on every off-plan sale the developer is legally required to place buyer payments into a RERA-approved project escrow account. Funds are only released to the developer as construction milestones are verified by an independent engineer. Second, on some secondary-market deals, a broker escrow is used to hold the buyer deposit between MOU signing and transfer at the trustee office.
A client of mine in 2024 bought into a small Dubai South development. Mid-build the developer went quiet for four months. The buyer’s AED 900,000 in progress payments was sitting untouched in the project escrow. The DLD eventually reassigned the project to another developer. The funds were protected the entire time.
When a developer asks you to pay outside the named escrow account, walk away. No exceptions.
Related: Escrow Account, Oqood, Payment Milestone, Off-Plan.
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