<p>The Landlord and Tenant Law allows the parties to a lease to fix the  rent by agreement in the lease.&nbsp; Where the rent is not fixed, the  landlord currently has the right to an annual rent increment.&nbsp; This  right is currently subject to a maximum increase of 5% of the existing  rental amount (the &ldquo;Rent Cap&rdquo;).&nbsp; The Rent Cap may be increased, reduced  or cancelled from time to time by the Chairman of the Executive Council  as he considers appropriate.&nbsp; A tenant may refer the matter to the Abu  Dhabi Rent Committee for determination of the rent where a landlord  exceeds the Rent Cap. &nbsp;</p>
<p>The term of a lease will remain in force until its expiry and may be  renewed upon the mutual consent of both parties.&nbsp; Should a tenant remain  in occupation upon expiry of a lease with the knowledge and consent of  his landlord, then the lease shall be deemed to have been renewed for a  similar term on the same terms and conditions.&nbsp; Should either party not  wish to renew a lease, then at least 2 months&rsquo; (for residential  property) or 3 months&rsquo; (for commercial property) prior written notice  must be given to the other party. &nbsp;</p>
<p>Law No. (4) introduces changes for renewal of leases upon their  expiry and the determination of rent payable under renewal leases.&nbsp;  Under the current law, a landlord may not request that a tenant vacates a  property upon expiry of his lease.&nbsp; Once Law No. (4) has been fully  implemented a landlord will be entitled to request that a tenant vacates  a property on expiry of his lease and may refuse the renewal of the  lease, subject to requirement for necessary notice provisions to be  observed.&nbsp; Therefore whilst Rent Caps will continue to apply during the  lease terms there will be no protection for tenants against rent  increases upon lease renewals. &nbsp;</p>
<p>The deadline for full implementation set by Law No. (4) was  originally set for 9 November 2010, however the deadline has  subsequently been extended three times.&nbsp; The resolution issued on 13  November 2012 now states that the law will not be fully implemented  until 9 November 2013.&nbsp; We currently await publication of this  resolution in the Official Gazette.</p>