The Official Gazette “Umm Al-Qura”, in its issue issued last Friday, published Regulations of the escrow account for real estate contributions, issued by the decision of the Board of Directors of the General Authority for Real Estate No. (Q/M/E/E/2/2024/T) dated 18/07/1445 AH.
According to Umm Al-Qura, the second article of these regulations clarifies the mechanism of opening an escrow account for real estate contributions.
According to the Umm Al-Qura newspaper, the second article of these regulations clarifies the mechanism of opening an escrow account for real estate contributions as follows:
According to the Umm Al-Qura newspaper, the second article of these regulations clarifies the mechanism of opening an escrow account.
Article Three:
1- The escrow account (in Saudi Riyals) shall be opened in the name of the real estate contribution at the request of the licensee after obtaining the license.
2- One main escrow account shall be established in the name of the real estate contribution under a written agreement between the licensee and the custodian of the account; to deposit and manage the funds of the real estate contribution.
3- Sub-accounts linked to the main account of the real estate contribution shall be opened as follows:
a- Reserve account for the purposes of meeting any unforeseen expenses of the real estate contribution in accordance with the provisions stipulated in the Real Estate Contributions Law and its Executive Regulations.
b- Revenue account for the purpose of depositing the proceeds from the sale or liquidation of the contribution's assets.
c. Any other sub-accounts for the purpose of the project, e.g: Financing Account.
4- The agreement to open the escrow account between the licensee and the custodian must ensure that the licensee commits to disburse from the account only for the purposes of the specific real estate contribution only, and the conditions and procedures for disbursement from the escrow account in accordance with these regulations and the agreements or contracts signed between the licensee and each of the custodian, engineering consultant and legal accountant.
5- A written undertaking from the licensee to agree to amend the agreement signed between the licensee and the account custodian in the event that any relevant laws, regulations or decisions are issued or amended.
The licensee shall agree to amend the agreement signed between the licensee and the account custodian.
