What Safety Measures Restaurants should take during the COVID-19 Pandemic

Steps restaurants can take to get more customers during pandemic

After months of being stuck at home during lockdown, even the most experienced home chef would be longing for a meal that he or she did not labour to make in their kitchen. For some, a reason to change out of their sleepwear and get out of the house—with or without the kids—is becoming more of a necessity to keep their sanity than a celebratory activity. In short, people are eager to be able to eat out again.

It is safe to say that most, if not all, in the food-service industry are also eager to welcome back the diners that they are used to serving. Business owners are eager to be able to reopen and recover lost earnings while the service staff is eager to earn again after months of being without work. There are also many who simply miss the satisfaction of serving people meals that nourish them and giving them an enjoyable dining experience; who missed the creative expression that came with their food industry jobs. Whether it is grabbing an inexpensive meal at a quick-service restaurant or an exquisite dining experience at a fancy restaurant, food safety and the assurance that a consumer will not go home with a COVID-19 infection is of paramount concern to everyone.

For the employers or business owners and their management team, the responsibility for prevention and management of outbreaks rests on their shoulders.

  • Take steps to ensure that staff adhere to existing and additional government regulations to keep the workplace safe while the COVID-19 threat still exists.
  • Conduct a COVID-19 risk assessment of the entire workplace; having a tried and tested business continuity plan in place would also be a big help.
  • Increase visible monitoring and enforcement of control measures including HACCP-based SOPs.
  • Conduct regular reviews, including seeking feedback from staff and customers to identify areas for improvement.

All employees, on the other hand, must be more vigilant, strictly following all processes put in place to ensure food safety. Although it is very unlikely COVID-19 could be transmitted through properly prepared food or food packaging that is properly handled, staff must observe good hygiene practices at all times.

  • Wash hands frequently with soap and water for at least 20 seconds (or sanitise), especially before and after handling food, cleaning cutlery, dishes, glasses, or other items to be used by the customer.
  • Staff that handle dirty or used items, collect used dishes from customer tables, and handle payments should be designated for these activities only, whenever possible.
  • All employees must ensure their thorough understanding of all HACCP principles and:
    • identify any food handling hazard;
    • identify the critical control points (CCPs) to prevent, remove or reduce a hazard;
    • set limits for CCPs;
    • monitor the CCPs;
    • immediately correct any problem with a CCP;
    • put checks in place to make sure the HACCP plan is working; and
    • keep accurate and up-to-date records.

There are other resources available for business owners that could help to further reassure their customers that their establishment is a safe environment for them to be in. The World Travel and Tourism Council (WTTC) has come up with a global safety stamp to recognise establishments around the world who have adopted policies and protocols that ensure the safety of consumers (for more info, click here). Certification agency Bureau Veritas has also launched a Safeguard label for shops, restaurants, and other confined spaces were people gather (for more info, click here or here).

With business owners and their employees clearly understanding how their cooperation will ensure their customers will be safe while in their premises, this will allow for a more comfortable, enjoyable, and most importantly, COVID-19 safe customer experience. If you are in need of help with regards to implementing HACCP or another food safety management system such as ISO 22000 in your establishment, contact Affiniax Partners for a free consultation.


Is it Safe to Travel Once Again?

List of guidelines for businesses during Covid-19

Is it safe to travel once again? What is being done at the moment to make it safe to travel once more? Despite the health risks and economic slowdown, travelling between cities or countries cannot be completely avoided.

The travel and tourism industry is no doubt one of the hardest hit, if not the hardest hit, by the ongoing COVID-19 pandemic. From the time the first outbreak on a cruise ship was reported, up to the recent string of airline bankruptcies and aircraft manufacturer layoffs. Add to this all the related local service industries and businesses that are dependent on tourists and business travelers that have either closed temporarily or been forced to close for good. So, what is currently being done to help make travelling safe once again?

  1. The World Travel and Tourism Council (WTTC), along with governments and health experts, developed action plans to aid in the recovery efforts for the industry. They have come up with a global safety stamp to recognise governments and companies around the world who have adopted policies and protocols that ensure the safety of consumers and travelers. They will also be publishing protocols for the Hospitality industry, Attractions, Outdoor Retail industry, Aviation industry, Airports, Short Term Rentals industry, Cruises, Tour Operators, Convention Centres and MICE, Car Rental industry and Insurance industries. For more information, visit https://wttc.org/COVID-19/SafeTravels-Stamp-and-Assets.
  2. Bureau Veritas is an international organisation that tests, inspects and certifies other organisations according to accepted international standards. They have launched a Safeguard label “to provide reassurance to partners, customers and employees that the entities carrying the label have undergone checks and audits of the preventive measures in place”, according to their site. Commonly used in the hospitality industry, it can also be given to shops, restaurants, and corporate buildings, or other confined spaces where people gather. It covers audits of facilities, processes, staff, and hygiene/cleaning. This certification is valid for six (6) months, and a reassessment needs to be conducted in order to be able to continue to keep the label.  For more information, visit https://www.bureauveritas.com.au/newsroom/safeguard-assurance-program-bureau-veritas-australia-solution or https://www.bureauveritas.fr/besoin/label-bureau-veritas-safeguard.
  3. Spain’s Association for Standardisation (UNE) collaborated with its Institute for Spanish Tourism Quality (ICTE) to publish a series of specifications which in turn put in place guidelines and recommendations for reducing the risk of the spread of COVID-19 in its tourism sector. They have made these documents available for anyone to use on https://www.en.une.org/la-asociacion/sala-de-informacion-une/noticias/directrices-para-un-turismo-seguro.
  4. The emirate of Dubai in the United Arab Emirates went a step further and came up with an assurance stamp for all establishments that adhere to the government’s safety standards. After a thorough verification and validation process, the stamp can be displayed to let all consumers know that they are entering a place that follows rigorous safety and hygiene measures. The stamp is valid for only two (2) weeks, further reassuring the public that as long as the stamp is displayed, the place they are entering continuously meets safety requirements.

In most countries, the challenge that businesses face in dealing with the COVID-19 pandemic is the lack of a consistent and reliable approach. ISO’s technical committee on tourism and its related services is developing ways to support organisations and to prevent the further spread of COVID-19, but in the meantime, ISO 22483:2020 Tourism and Related Services can be a valuable resource.

Contact us if you want to find out how any of the news above can help you and your team get started on your road to recovery in a post-pandemic business environment.

How to improve Cash Flow Management during COVID-19

Accounting solutions to help business survive covid

A couple of months ago, we wrote a blog describing “WHY BUDGETING IS CONSIDERED KEY TO BUSINESS FINANCIAL SUCCESS?” and one of the mentioned benefits of budgeting was planning and predicting cash flows. We assume that, due to the unpredictable events caused by COVID-19, there would be a major change in the budgeted figures and improving cash flow is important to help owners make decisions that will influence the future of their company.

As a major portion of cash revolves around accounts receivable and payable, let us examine some methods to achieve budgeted cash flow through its proper management.

  • Improve Receivables Credit Policy: Review your receivable credit policy i.e. your credit terms. It should be less than the credit period given to you by your suppliers. In order to improve your receivables credit period, you can encourage customers to pay faster with an early payment discount scheme.
    On the other hand, you can check with your supplier if payment terms can be increased on the basis of your long-term relationship. If not all, some of them may agree and extend your credit period from (hypothetically) 30 days to 45 days.
  • Advance Payment: If you are providing a service or goods that involve substantial cash or effort before delivery of said service or goods, ask your customer to pay a portion of that as an advance. An advance can range between 30%-50%, depending on the agreement with your customer and the type of services or goods to be provided.
  • Transaction cycle between receivable and payable should not be too long, or else you will end up investing in additional human resources or will end up paying interest on delay in payments to your suppliers.
  • Invoice financing: This option is also known as invoice factoring, invoice discounting or, in simple terms, selling your sales invoice to finance companies or banks. For example, if you have credit terms of 30 days with a customer, you can get the amount from a finance company on the day the invoice was issued, instead of waiting for 30 days.
  • Set up a policy for long outstanding receivables: Set up a policy indicating the maximum period it should take to clear a customer’s account. If any outstanding receivables exceed the maximum period, act immediately and suspend any further business with that client until their account is settled.
  • On-time Accounting: Record all transactions immediately and keep track of aging summary on a regular basis.
  • Use Automated feature of accounting software: Tracking receivables and payables manually would be time consuming and more cumbersome if even a single document is missed. Automating the process will help you with quick compilation of information and send regular reminder mail to customers for payment without interrupting your routine work.

Other than the methods mentioned above, you can also improve cash flow by converting fixed costs into variable costs, cutting or delaying expenses, looking to sell or lease idle assets, checking for deferment of loan instalments, lowering instalment amounts etc.

It is very important that you consider your business model before selecting from the above methods to improve cash flow. Contact us for more information

Key Steps accountants should take to guide SMEs out of the Covid-19 Crisis

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In the present situation where the whole world has come to a stop, it is now more important than ever to have savings in hand. There will be a massive impact felt due to the coronavirus, and businesses need to be ready for any situation which comes their way. It is because of this reason that outsourcing the accounting functions of a company will be more beneficial for the management.

Accountants – for many – are SME’s trusted advisors.

The Covid-19 crisis is a critical time where SMEs need all the guidance they can get to navigate through the storm. We call on accountants and small accountancy practices to help struggling SMEs through these difficult times.

The following actions are required to be taken by accountants to support their struggling SME clients:

1. Informing clients about all aid options

Accountants should be aware of all financial (and other) forms of aid provided by national governments. It would be helpful for the national accountancy body to be aware of aid that other countries provide, so they can flag the best practices to their own national policymakers.

2. Applying the available aid to client’s situations

Identify clients in high risk sectors and those that would benefit most from public support measures. Help them by:

  • Advising them on, and guiding them through, all the claims available to them
  • Identifying options to help them diversify their business
  • Providing a path to accessing emergency financing being provided by governments
  • If possible, consider renegotiating your fees and payment schedules with them

3. Helping with immediate business survival

One of the ways in which accountants can help is by informing their SME clients of immediate measures that might make the difference between survival and collapse. They should also help them implement these measures where required. Examples of this include:

  • Accessing the reliefs on offer as soon as possible to increase the impact.
  • Reviewing and adjusting their cash flow forecast to determine what impact cuts in sales will have on their ability to pay their suppliers and debt. Businesses should continue to pay their suppliers when they can to help avoid a wide-spread collapse of the financial system.
  • Considering the business model to ascertain whether the SME can deliver goods or services in an alternative manner – such as by home delivery or online, and whether it can downsize or stop certain activities, such as travel, sales and marketing.
  • Understanding their supply chains and planning for disruptions in the supply of products and services. This may involve scaling back production for some parts and stock and re-considering suppliers and clients from countries heavily impacted by the virus.
  • Checking their insurance to understand whether they are eligible for a claim for any financial losses.
  • Communicating with their staff to discuss the possibility of short term pay cuts.
  • Ensuring that their financials are up to date so they can monitor profitability, stock, and debtor-creditor balances. Many governments are offering deferment of tax returns and financial information filing. However, such deferments’ long-term impacts are not clear. They could result in a later bottleneck in filing such returns and the possible loss of financial and tax data.
  • Negotiating with their debtors- for example, to offer discounts in exchange for early payment.
  • Negotiating with their debtors– for example, to offer discounts in exchange for early payment.
  • Continually monitoring the situation and informing clients of new initiatives so that when lifting the restrictions becomes imminent, they are ready to recommence trading.
  • If all else fails, considering the options within insolvency as it may be possible to rescue viable businesses by debt reorganization rather than being forced into full liquidation.

4. Guiding SME’s plan for the medium term

Many SMEs are likely to be in a crisis mode. Our accountants help them avoid emergency measures that could endanger the business’ medium-term viability. They can, for example, help them to:

  • Reconsider whether laying off employees is unavoidable. On top of having negative social and societal impacts, cutting down on workforce also constitutes a loss of key skills for the business. This should be a last resort option only, so make your clients aware of that and help them access all alternative options, aid and financing available first. It is possible that staff would prefer taking a temporary pay cut over redundancy. This could increase staff loyalty and allow the business to resume operations once the restrictions are lifted.
  • Start building financial reserves as soon as possible, to prepare for a new peak in coronavirus cases even after the current restrictions are lifted.

E-commerce Business Setup in United Arab Emirates

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E-commerce means buying and selling of goods, products or services over the internet. E-commerce is also known as electronic commerce or internet commerce. These services are provided online over the internet. Transaction of money, funds and data are also considered to be E-commerce. While it is not new, this sector is growing rapidly across the world and creating new opportunities for businesses, particularly in the United Arab Emirates (UAE).

The current situation is further boosting the E-commerce sector in the UAE, as the behaviour of consumers is changing and social distancing is becoming the new norm, forcing businesses to transition to digital models in order to adapt. With the internet becoming an essential requirement of everyday life, many businesses are learning to take advantage of the numerous benefits of E-commerce, as it shifts from a luxury to a necessity.

Several Free Zones in the UAE offer E-commerce licenses with incredibly affordable options. However, there are several reasons aside from the cost to set up E-commerce operations in a UAE Free Zone. Some of them are:

  • Free Zones allow for 100% company ownership
  • Businesses can be started with relatively low capital investment
  • Free Zone businesses have no time barrier
  • No import duties on E-commerce license
  • 0% corporate and personal tax
  • Repatriation of capital and profits
  • Ease of opening bank accounts
  • Visa eligibility
  • Flexible office facility

E-commerce is a great way for businesses to interact with consumers internationally. It has become an important part of our society. It has also become more affordable for small businesses to use the world wide web to sell their products. E-commerce will continue to progress radically over the years as the number of internet users among businesses and consumers continues to grow.

E-commerce licenses can also be set-up with Dubai Economy- once you identify your requirements, you are good to go.

To know more about E-commerce license setup, please feel free to contact us at mail@affiniax.com.

Business Continuity

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The current global scenario has hampered the growth of the economy and stability with almost all sectors facing a decline as a result of Covid 19. Although this has only started to emerge, the extent of this will be noticed in the upcoming months. The spread of the virus is causing different impacts in each country and governments are quickly backing up to protect its citizens and limit the damage.
The decline experienced by the global financial markets indicate that the world economy could take much longer to recover and return to normalcy. The pathway to growth and the degree to which the demand will be delayed can be explained in three scenarios – described as V-U-L.


Equivalent to the classic real economy, where the shift and decline in output eventually rebounds back. In this scenario, the annual growth rate might completely absorb the shock.


Under this scenario, the shock persists and there is permanent loss of output, with initial growth resuming and having a slower rebound.


A more downbeat scenario where one would have to assume that Covid-19 has led to significant structural damage to the economy’s supply such as labor market, productivity or capital formation. This would have a larger impact on the economic growth, triggering a global recession.

In order for businesses to survive, companies will have to be resilient and take necessary precautions to navigate past the changing times.

  1. Establish the facts
    It becomes essential for all businesses to outline the current business scenario and its impact in the short, medium and long term, keeping in mind the present-day situation. This involves running different scenarios, revisiting key business decisions for immediate recovery to alleviate business disruptions and potential revenue loss.
  2. Employee Involvement
    Employees, being a key part of any business, should be well informed with the transformational changes taking place. With each business and industry having different requirements, the employees should be made aware of the current situation and what is expected of them. Companies should support employees and communicate clearly about adaptation to digital workplace to ensure seamless continuity.
    It is also important to utilize collaborative tools across the departments to ensure communication and quality of work or service provided to clients is not hampered/ compromised in any manner.
  3. Cloud Based Solutions
    With social distancing being practiced by most companies, it is necessary for employees to adapt to cloud based applications and storage for easy access of data and documents by all the employees.
    Working on cloud technology provides real time data, thereby resulting in transparency and deeper engagements with clients.
  4. Dedicated Crisis Management Team
    A crisis like Covid 19 is having an impact on every part of the business. During a time of complexity and uncertainty, teams should be able to adapt and proactively coordinate in an effective way. Led by the CEO, a core team should take charge, with members from different teams and functions defining key specific goals to be achieved by the organization, focusing largely on the output to be achieved.
  5. Stress Testing
    Stress testing helps in identifying vulnerabilities in the current business model and can be useful in managing risk, strategy, risk appetite and capital decisions. Internal stress testing should be conducted to identify gaps and work towards recovery planning. Businesses need to focus on key trigger areas, revenue and variables that will directly impact their revenue and cost.
  6. Managing the Funds flow
    Growth objectives are key to every organization to maximize value and preserve the continuity of funds. During such times, it is important to identify areas of surplus and deficit funds and engage surplus to cover any deficits.
  7. Support clients
    During such times, it is equally important to work closely and maintain personal relationships with customers and clients by communicating clearly to identify key areas to focus on and offer assistance beyond the areas of regular service offered.

1. Business Continuity

  • Providing your team regular updates on the current situation in the region on key labor, fiscal and monetary measures taken by the Government.

2 Cloud Based Solutions

  • Keeping in mind the safety of employees, we can analyze the current system and processes in place and provide support towards digital transformation to cloud services to ease access across the business.
  • Affiniax Partners can help identify and maintain flexibility and synchronization between the business processes, applications and IT infrastructure.
  • This can be conducted through evaluating, planning, designing, implementing and testing of cloud-based solutions for companies.

3 Cross Functional Response Team

  • Setting up cross-functional teams for key workstreams – Employees welfare and ability to perform tasks, financial stress testing of the business, evaluation of budgets and closely monitor supply chain and other areas important to businesses.

4 Stress Testing

  • Define risk factors and run business-wide stress testing using various platforms across the organization, supported by technology to enable reviews.
  • Conduct sensitivity analysis and run scenarios on the viability and financial implications of business decisions. Review of potential opportunities to grow revenues within designated risk tolerance level.
  • Scenario analysis on the variables affecting revenues and cost and identifying input variables that could affect liquidity position of the business.
  • Running different scenarios of financial models (Cash flows, Balance sheets and P&L) to measure and identify potential liquidity and optimization techniques.
  • Scrutiny of budgets (revenue, sales, marketing, inventory, investment capacity) on pricing changes and discounts and optimization of supply chain (inventory levels, after sales stock, delivery capacity and capability).
  • Implement appropriate stabilization techniques for optimizing costs and supply chain.

5 Practice with Top Team

  • Analysis and scenarios will be discussed and reviewed with the top Management via reporting tools for deeper understanding of company risk profile.

To learn how we can help you, please contact us at mail@affiniax.com


When we talk about ‘Leadership’, what is the first thing that comes to your mind?

An Executive, busy developing a Company’s strategy to compete in the market; or a Political leader pursuing his passion; or maybe an Explorer, cutting a path through a dense jungle for the rest of his group to follow. One thing remains common in all cases – Leaders set directions, build an inspiring vision and create something new for others to follow.

In this article, we are focusing on the process of leadership – particularly the “Transformational Leadership Model in the workplace”. This model was first proposed by James MacGregor Burns and then developed by Bernard Bass. This model highlights visionary thinking and bringing about change, instead of management processes that are designed to maintain and steadily improve current performance.

According to the idea of Transformational Leadership, an effective leader is a person who does the following:

1. Creates an inspiring vision of the future.

Vision for a business is basically where you want to be in the future. It provides directions, sets priorities, timelines and finally, a model to analyse if you have achieved your milestone. Leaders should focus on an organisation’s current skills, analyse situations and then proceed with innovation by shaping the business and strategy in such a way that it creates something meaningful to the people being led in the organisation. A very important aspect of this theory is that a leader should be “Proactive” and should not be satisfied with things as they are.

2. Motivates and inspires people to engage with that vision.

The ability to motivate your employees inspires them and helps to deliver the vision. Effective leaders link motivation under two segments:

  1. The expectation that hard work will lead to good results.
  2. The expectation that good results will lead to attractive incentives and rewards – intrinsic or extrinsic.

People believe in and admire leaders who have an expertise in that area. A leader must have a proven record to support that he can lead people, which means he should have earned such power and not by mere position in the organisation.

3. Managing delivery of Vision.

A leader must make sure that his vision is followed and managed effectively – either by himself or by dedicated managers under him to whom responsibilities and roles are clarified. They should set KPI (Key Performance Indicators) for each employee to make sure they are on the right track and working collectively towards achieving their goal. This stage may also include certain changes and a leader should ensure that changes go smoothly and with the support of all employees in the organisation.

4. Coaching and building a team to achieve Vision.

A leader must understand the team dynamics in order to strategise his vision. He needs to make sure that the required abilities and skills are set to move forward. This is an ongoing process under which the team is mentored, various training and coaching is provided along with appropriate feedback and analysis by way of KPIs.

Leadership includes searching for and grooming leadership skills in others. Once the skills are developed in the team, success continues for the long term- and that’s the true measure of Great Leadership.

Leaders become great, not because of their power but because of the ability to empower others – John C Maxwell

Written by

Nihar Kothari



Case Study

We were recently approached by a mid-sized Events Management Company having a successful track record across several GCC countries. The Company performed much better than the young entrepreneurs had expected in a short span of time. Due to the inherent nature of their business, most of the revenue was collected in advance, thus making it a cash-rich Company. The entrepreneurs were happy to see their bank account flowing with cash and resultantly began to indulge in fancy business meetings, business class travel and investing in Associate Companies that were not doing so well.

Suddenly, they got the shock of their life when one of their suppliers refused to provide any further event management related services to the Company – followed by a few more suppliers. As expected, the event was the biggest failure in the history of the Company. The event sponsors blamed the Company’s management for making false promises and underperforming. Aggravated with the sudden change in attitude of suppliers, the Management decided not to renew their contracts and appointed an alternate chain of suppliers. Surprisingly, the same issues started trending for other events which affected the reputation and goodwill of the Company even more.

The Board of Directors identified key problem areas in the business cycle:
  • Continuous decline in revenue. Due to them having a lesser number of projects in hand, the sustainability of the Company was being questioned.
  • Bank account balance was used by Management. Looking at the declining trend of business, bankers reduced their facility limits and charged a higher rate of interest to safeguard their interest.
  • Low-quality services were provided by suppliers
  • Employee turnover started rising in the Company
Since most of the issues were finance related, they hired Affiniax to provide Outsourced CFO Services. The intention was to identify the root cause and provide solutions. After two months of interaction with their team and suppliers, we came up with the following observations:
  • The Company hired the best category of suppliers in the first place. Their services were at par with their big brand competitors. However, they were not paid in a timely manner. This exposed the Company to various legal cases. Even though the Company was cash-rich, the process of approval and payment took a long time. As a result, these suppliers stopped engaging themselves with the Company for any future projects. 
  • The news was widespread in the market for non-payment of dues which ultimately affected sales and impacted negatively on the goodwill of the Company.
  • The Company was making reasonable profits from all their projects individually. However, the Company was not prepared to incur the additional expenses of the young entrepreneurs. The money they spent on their lifestyle was supposed to be paid to their suppliers in the first place. It is a common practice and a big mistake for entrepreneurs to consider bank balance as their profits. 
  • Employees started leaving the Company as they felt stuck in the same position in the Company for years. Regular appraisal/performance-based bonus was never made a part of the Company’s policy. As a result, they lost their best talent to their competitors.
  • The Company maintained a very high level of inventory. This not only exposed the Company to obsolete items but also increased the cost of storage.
  • We helped the Company to re-negotiate terms and conditions with their bankers.
  • We gave them an insight into market conditions and recommended they amend their contracts to ensure compliance with local authorities.
  • Potential business opportunities were discussed with the management.


Outsourced CFO is a financial management solution that renders a combination of visionary and technical service to accomplish the ambitions of SMEs.

How it works

An outsourced CFO model involves a part-time, temporary or project-based CFO. This gives small business owners the strategic financial expertise they need while saving them money in terms of salary, benefits and additional overhead that is typically associated with hiring a full-time CFO with a hefty salary. The responsibilities of an outsourced CFO may include overseeing financial and accounting functions, training staff on accounting best practices, developing cash flow improvement programs and evaluating internal controls.

Services Provided under Outsourced CFO

  • Management of the finance infrastructure (accounting, treasury, finance)
  • Financial, business, and strategic planning and implementation
  • Hands-on guidance during transitions
  • Cash flow management and projections
  • Budgeting and forecasting
  • Assisting with private equity and debt financing
  • Bank financing and investor meeting preparation
  • Key metrics benchmarking and trend analysis
  • Accounting software selection and implementation
  • Financial and operational improvement plans
  • Mergers and acquisition support
  • Risk management
  • Contract review

How Affiniax Partners can help?

We have a talented and purpose-driven team of Chartered Accountants and finance professionals that help entrepreneurs to identify their key areas, focus on providing customised business solutions, report on cost-benefit analysis, provide market updates, automate systems and scale up their competence in pursuit of business eminence. Article written by Nihar Kothari, Partner, Affiniax Partners The author can be contacted at nihar@affiniax.com


The Law No. (6) of 2019* regarding Ownership of Jointly Owned Properties in the Emirate of Dubai has been issued to regulate the joint ownership of real estate in Dubai.

The Law applies to all major real estate development projects and jointly owned properties in Dubai, including those located in free zones and special development zones.

The new Law repeals Law No. (27) of 2007 Concerning Ownership of Jointly Owned Property in the Emirate of Dubai and any other law that contradicts it.

Jointly Owned Properties (JOP) are now divided into three categories with different rules for their management of common areas. The Law has enhanced the powers of RERA such as selection of the members of the Owners’ committee, appointment of specialized management company for third category of jointly owned properties and to replace the management entity in case they are found inefficient. The Law is designed to boost competitiveness and ensure the rights of all parties are protected.

Key Elements of the new Law
  • Components of the common area of the building and land of the JOP along with components of the unit are clearly defined in the Law, which regulates the ownership of developer-owned areas.
  • The Developer should allocate parking space for owners of the unit, which cannot be sold separately.
  • The Management Entity cannot charge fees for managing, operating, maintaining common facilities or for any other purpose unless it receives an approval from RERA.
  • The Management Entity shall provide RERA with a periodic report every six months on the management of the jointly owned properties, common areas and the maintenance works carried out therein. At any time, RERA can request for information on the revenues and expenses related to service charges.
  • The Developer shall establish the building management system for major projects and hotel projects managed by them which must be approved by RERA. RERA shall establish the building management system on the other common properties.
  • Service charges and utilization charges collection, disposal and use are clearly set out under the new Law. The Management Entity shall deposit the service charges and the Utilization charges into the licensed bank account within seven (7) working days from the date of payment of service and utilization charges. The competent execution judge may, when necessary, sell the unit through public auction in the event of continued payment default by the owner.
  • RERA can appoint a specialized Management Entity to manage and operate common property in case the developer or hotel project management company are proven inefficient. Similarly, in the case of an inefficient management entity, RERA may appoint an alternative Management Entity to manage the common property.
  • As per Article 41, the Management Entity must maintain comprehensive insurance coverage for the JOP.
  • The Management Entity, which includes the developer, the management company or the hotel project management company, as the case may be shall be, shall replace the owner’s association in rights and obligations stated before the application of provision of new Law (Article 49).
  • The Rental Disputes Settlement Centre in Dubai will now have jurisdiction to hear and settle all disputes that fall under the purview of this Law. Violators are subject to financial penalties up to AED 1,000,000 and can be penalized up to AED 2,000,000 in case of repeat violations within one year of the previous violation.
Common Property Register
The Dubai Land Department shall prepare a special register of Jointly Owned Properties which would include details about the ownership of land and units, area owned by the developer, members of the owners’ committee, building management system, contracts for the management of common areas and details about the common areas and private jointly owned parts.

The developer is required to submit all necessary documents of the jointly owned real estate project to the Land Department within 60 days of the completion date and receipt of completion certificate. The Department can extend the deadline for this by 30 days. If the documents are not submitted, the Department can request the documents from any other party it deems appropriate and will charge the developer all related fees and expenses.

Management of Common Areas
Under the previous Law, the Owners’ Association board was formed and was entrusted with the management of the common areas of the building, and they could delegate these responsibilities to an Association Manager to perform.

According to the new Law, jointly owned properties are divided into three categories: (1) Major projects, (2) Hotel projects, (3) Real estate projects other than major projects and hotel projects, with different rules pertaining to the management of each type of jointly owned property.

Owners’ Committee
An Owners’ Committee for the first and third categories must be formed with its members selected by Real Estate Regulatory Agency (RERA), which shall not exceed nine members and should be established when at least 10 percent of the total number of units in the jointly owned property are registered.

The Developer cannot be part of an owners’ committee unless there are unsold units.

The functions of the Committee are listed under Article 24 of the law which mainly relate to advisory, reviewing and verifying the operations of the Management Entity. The Owners’ Committee shall be required to hold quarterly meetings every 3 months with a total of four meetings in a year.

Obligation of the Property Developer
The Developer is under the obligation to repair or correct any damage to the structure of the jointly owned property occurring within a period of 10 years from the date of issuance of the completion certificate.

The Developer is further obligated to replace or repair any defective fixtures in the individual units within a period of one year from the date of delivering the unit to the owner.

*The new law is effective within 60 days of its publication in the Official Gazette.

Affiniax Partners joins Allinial Global

Affiniax Partners is very pleased to announce it has joined Allinial Global (formerly PKF North America), a member-based association that has dedicated itself to the success of independent accounting and consulting firms since its founding in 1969. Allinial Global is based in North America but offers international support by connecting its firms to providers and global networks of accounting firms worldwide, fostering the independence, profitability, and continuous improvement of its members. Affiniax Partners has 4 partners and a total of 60+ employees.

“We joined Allinial Global because of our strong commitment to our clients,” said Sumeet Nayyar, CEO & Partner. “Through this global association, we will have access to cutting edge skill-building and niche information designed to bring greater profitability to the business owners we serve. We will enjoy all the advantages of national firm resources while still maintaining our independent status.”

Allinial Global firms continually seek new ways to better meet the needs of their clients. In this cooperative environment, firms share ideas, training programs, and technical expertise. “We look forward to being active participants in the Allinial Global association, working closely with other successful firms nationwide,” commented Sumeet Nayyar.