Classification Table for Violations and Penalties Under the Law of Collective Real Estate Investment Schemes and its Implementing Regulations

rega_gov_sa · executive_regulation · processed · 9 chunks

Item | Violation * | Large Schemes | Medium Schemes | Small Schemes
1 | Offering, advertising, marketing, or raising funds for collective real estate investment schemes without the approval of the Capital Market Authority
(CMA) or a license from REGA. | The matter
shall be referred to the Public Prosecution for investigation and prosecution before the competent court
under Article 35 of the Law.
2 | The licensee or manager of the
collective real estate investment scheme
takes a
decision or action
involving
an existing or potential conflict of interest without complying with
the Regulations' conflict of interest procedures.
3 | Selling
the collective real estate investment scheme
assets
without valuation by accredited valuers
in accordance with
the Accredited Valuers Law.
4 | Failure to deposit
financial returns related to
the collective real estate investment scheme
directly into the escrow account.
5 | Providing
misleading information
as part of the license application. | -
A fine of
ten thousand to
thirty thousand riyals.
-
The licensee shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding five years.
6 | Granting loans from
the collective real estate investment scheme
capital
by the licensee, engineering consultant, or chartered accountant. | -
A fine
of 1% of the loaned
amount, up to
a maximum of one million riyals for each violator.
-
The licensee shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding five years
.
7 | The property owner, as an
in-kind
investor, fails to transfer the property ownership to
the collective real estate investment scheme
after
obtaining a
license
as stipulated by the Regulations. | A fine of
0.5% of the property value,
up to
a maximum of five hundred thousand riyals.
8 | An in-kind investor disposes of his entire contribution within
the first year or disposes of more than 50% of
it during the second year, before
the collective real estate investment scheme
expires. | A fine of
2% of the disposed
in-kind contribution
, up to
a maximum of one million riyals.
9 | The licensee fails to comply with the procedures for
dismissal of the manager of the collective real estate investment scheme | First time: warning; thereafter:
A fine of
twenty thousand to
fifty thousand riyals. | A fine
of fifteen thousand to
thirty thousand riyals. | A fine
of ten thousand to
twenty five thousand riyals.
10 | The licensee acts or refrains from acting in a way that would hinder the work of the manager of the collective real estate investment scheme, the engineering consultant, or the chartered accountant. | First time: warning; thereafter:
A fine
of twenty thousand to
fifty thousand riyals. | A fine
of fifteen thousand to
thirty thousand riyals. | A fine
of ten thousand to
twenty-five thousand riyals.
11 | The licensee or the manager of the collective real estate investment scheme borrows against the funds or assets of the collective real estate investment scheme without being granted the borrowing power under the collective real estate investment scheme agreement, or if the assembly has not approved the borrowing, or if the borrowed amount exceeds half of the collective real estate investment scheme capital, or if the borrowed amounts are allocated for purposes other than those of the collective real estate investment scheme, or if the borrowed amounts are not transferred directly to the escrow account. | A fine of
10% of the borrowed amount,
up to
a maximum of five million riyals.
12 | The licensee or the manager of the collective real estate investment scheme taking any decision or action that would hinder the work of the assembly of investors. | First time: warning; thereafter:
-
A fine
of twenty thousand to
fifty thousand riyals
-
The licensee or the manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding four years. | -
A fine
of fifteen thousand to
thirty thousand riyals
-
The licensee or the manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding three years. | -
A fine
of ten thousand to
twenty-five thousand riyals
-
The licensee or the manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding three years.
13 | Persons engaging in the collective real estate investment scheme activity provide misleading information to obtain a classification from REGA. | A fine
of ten thousand to thirty thousand riyals.
14 | The licensee fails to notify investors of significant
changes affecting
the collective real estate investment scheme
operations, financial position, organizational structure, or ownership. | -
A fine
of twenty thousand to
seventy thousand riyals
-
The licensee shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding four years. | -
A fine
of fifteen thousand to
fifty thousand riyals
-
The licensee shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding three years. | -
A fine
of ten thousand to
thirty thousand riyals
-
The licensee shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding three years.
15 | The licensee or the manager of the collective real estate investment scheme collects any amount related to the collective real estate investment scheme in cash or in a private bank account. | -
A fine of
5% of the collected
amount, up to
five million riyals.
-
The licensee or the manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding five years.
16 | The licensee or the manager of the collective real estate investment scheme fails to submit periodic reports specified in the collective real estate investment scheme agreement to the investors. | A fine
of fifteen thousand to
thirty thousand riyals. | A fine
of ten thousand to
twenty-five thousand riyals. | A fine
of ten thousand to
twenty-five thousand riyals.
17 | The engineering consultant fails to supervise and oversee
the collective real estate investment scheme activities
in accordance with the engineering specifications and standards,
designs,
regulatory requirements, and
contractual terms. | A fine
of twenty thousand to
fifty thousand riyals. | A fine
of fifteen thousand to
thirty thousand riyals. | A fine
of ten thousand to
twenty-five thousand riyals.
18 | The engineering consultant or chartered accountant fails to notify REGA of any violations of the Law or the Regulations
detected in the course of their work. | A fine
of fifteen thousand to
thirty thousand riyals. | A fine
of ten thousand to
twenty-five thousand riyals. | A fine
of five thousand to
fifteen thousand riyals.
19 | The engineering consultant signs
a
withdrawal request in violation of legal withdrawal rules. | A fine
of fifty thousand to
seventy thousand riyals. | A fine
of thirty thousand to
fifty thousand riyals. | A fine
of twenty thousand to
forty thousand riyals.
20 | The chartered accountant signs a
withdrawal request in violation of legal withdrawal rules. | A fine
of fifty thousand to
seventy thousand riyals. | A fine
of thirty thousand to
fifty thousand riyals. | A fine
of twenty thousand to
forty thousand riyals.
21 | The chartered accountant fails to check the financial data of the collective real estate investment scheme and fails to ensure that all the funds of the collective real estate investment scheme are deposited into the escrow account. | A fine
of twenty thousand to
fifty thousand riyals. | A fine
of fifteen thousand to
thirty thousand riyals. | A fine
of ten thousand to
twenty five thousand riyals.
22 | T
he collective real estate investment scheme
manager
fails to disclose
decisions on the distribution or non-distribution of
dividends of the
collective real estate investment
scheme after approval. | A fine
of twenty thousand to
fifty thousand riyals. | A fine
of fifteen thousand to
thirty thousand riyals. | A fine
of ten thousand to
twenty five thousand riyals.
23 | The
collective real estate investment scheme
manager
fails to notify the licensee and REGA of any
substantial events or developments that would affect the
collective real estate investment
scheme. | -
A fine
of twenty thousand to
seventy thousand riyals.
-
The manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding three years. | -
A fine
of fifteen thousand to
fifty thousand riyals
-
The manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding two years. | -
A fine
of ten thousand to
thirty thousand riyals
-
The manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding two years.
24 | The
collective real estate investment scheme
manager
fails to supervise and oversee the work of the engineering consultant
, the chartered accountant, or the scheme project
progress, leading to
a negative impact on the scheme. | A fine
of fifteen thousand to
thirty thousand riyals. | A fine
of ten thousand to
twenty-five thousand riyals. | A fine
of ten thousand to
twenty five thousand riyals.

Item

Violation *

Large Schemes

Medium Schemes

Small Schemes

1

Offering, advertising, marketing, or raising funds for collective real estate investment schemes without the approval of the Capital Market Authority
(CMA) or a license from REGA.

The matter
shall be referred to the Public Prosecution for investigation and prosecution before the competent court
under Article 35 of the Law.

2

The licensee or manager of the
collective real estate investment scheme
takes a
decision or action
involving
an existing or potential conflict of interest without complying with
the Regulations' conflict of interest procedures.

3

Selling
the collective real estate investment scheme
assets
without valuation by accredited valuers
in accordance with
the Accredited Valuers Law.

4

Failure to deposit
financial returns related to
the collective real estate investment scheme
directly into the escrow account.

5

Providing
misleading information
as part of the license application.

-
A fine of
ten thousand to
thirty thousand riyals.

-
The licensee shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding five years.

6

Granting loans from
the collective real estate investment scheme
capital
by the licensee, engineering consultant, or chartered accountant.

-
A fine
of 1% of the loaned
amount, up to
a maximum of one million riyals for each violator.

-
The licensee shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding five years
.

7

The property owner, as an
in-kind
investor, fails to transfer the property ownership to
the collective real estate investment scheme
after
obtaining a
license
as stipulated by the Regulations.

A fine of
0.5% of the property value,
up to
a maximum of five hundred thousand riyals.

8

An in-kind investor disposes of his entire contribution within
the first year or disposes of more than 50% of
it during the second year, before
the collective real estate investment scheme
expires.

A fine of
2% of the disposed
in-kind contribution
, up to
a maximum of one million riyals.

9

The licensee fails to comply with the procedures for
dismissal of the manager of the collective real estate investment scheme

First time: warning; thereafter:

A fine of
twenty thousand to
fifty thousand riyals.

A fine
of fifteen thousand to
thirty thousand riyals.

A fine
of ten thousand to
twenty five thousand riyals.

10

The licensee acts or refrains from acting in a way that would hinder the work of the manager of the collective real estate investment scheme, the engineering consultant, or the chartered accountant.

First time: warning; thereafter:

A fine
of twenty thousand to
fifty thousand riyals.

A fine
of fifteen thousand to
thirty thousand riyals.

A fine
of ten thousand to
twenty-five thousand riyals.

11

The licensee or the manager of the collective real estate investment scheme borrows against the funds or assets of the collective real estate investment scheme without being granted the borrowing power under the collective real estate investment scheme agreement, or if the assembly has not approved the borrowing, or if the borrowed amount exceeds half of the collective real estate investment scheme capital, or if the borrowed amounts are allocated for purposes other than those of the collective real estate investment scheme, or if the borrowed amounts are not transferred directly to the escrow account.

A fine of
10% of the borrowed amount,
up to
a maximum of five million riyals.

12

The licensee or the manager of the collective real estate investment scheme taking any decision or action that would hinder the work of the assembly of investors.

First time: warning; thereafter:

-
A fine
of twenty thousand to
fifty thousand riyals

-
The licensee or the manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding four years.

-
A fine
of fifteen thousand to
thirty thousand riyals

-
The licensee or the manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding three years.

-
A fine
of ten thousand to
twenty-five thousand riyals

-
The licensee or the manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding three years.

13

Persons engaging in the collective real estate investment scheme activity provide misleading information to obtain a classification from REGA.

A fine
of ten thousand to thirty thousand riyals.

14

The licensee fails to notify investors of significant
changes affecting
the collective real estate investment scheme
operations, financial position, organizational structure, or ownership.

-
A fine
of twenty thousand to
seventy thousand riyals

-
The licensee shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding four years.

-
A fine
of fifteen thousand to
fifty thousand riyals

-
The licensee shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding three years.

-
A fine
of ten thousand to
thirty thousand riyals

-
The licensee shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding three years.

15

The licensee or the manager of the collective real estate investment scheme collects any amount related to the collective real estate investment scheme in cash or in a private bank account.

-
A fine of
5% of the collected
amount, up to
five million riyals.

-
The licensee or the manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding five years.

16

The licensee or the manager of the collective real estate investment scheme fails to submit periodic reports specified in the collective real estate investment scheme agreement to the investors.

A fine
of fifteen thousand to
thirty thousand riyals.

A fine
of ten thousand to
twenty-five thousand riyals.

A fine
of ten thousand to
twenty-five thousand riyals.

17

The engineering consultant fails to supervise and oversee
the collective real estate investment scheme activities
in accordance with the engineering specifications and standards,
designs,
regulatory requirements, and
contractual terms.

A fine
of twenty thousand to
fifty thousand riyals.

A fine
of fifteen thousand to
thirty thousand riyals.

A fine
of ten thousand to
twenty-five thousand riyals.

18

The engineering consultant or chartered accountant fails to notify REGA of any violations of the Law or the Regulations
detected in the course of their work.

A fine
of fifteen thousand to
thirty thousand riyals.

A fine
of ten thousand to
twenty-five thousand riyals.

A fine
of five thousand to
fifteen thousand riyals.

19

The engineering consultant signs
a
withdrawal request in violation of legal withdrawal rules.

A fine
of fifty thousand to
seventy thousand riyals.

A fine
of thirty thousand to
fifty thousand riyals.

A fine
of twenty thousand to
forty thousand riyals.

20

The chartered accountant signs a
withdrawal request in violation of legal withdrawal rules.

A fine
of fifty thousand to
seventy thousand riyals.

A fine
of thirty thousand to
fifty thousand riyals.

A fine
of twenty thousand to
forty thousand riyals.

21

The chartered accountant fails to check the financial data of the collective real estate investment scheme and fails to ensure that all the funds of the collective real estate investment scheme are deposited into the escrow account.

A fine
of twenty thousand to
fifty thousand riyals.

A fine
of fifteen thousand to
thirty thousand riyals.

A fine
of ten thousand to
twenty five thousand riyals.

22

T
he collective real estate investment scheme
manager
fails to disclose
decisions on the distribution or non-distribution of
dividends of the
collective real estate investment
scheme after approval.

A fine
of twenty thousand to
fifty thousand riyals.

A fine
of fifteen thousand to
thirty thousand riyals.

A fine
of ten thousand to
twenty five thousand riyals.

23

The
collective real estate investment scheme
manager
fails to notify the licensee and REGA of any
substantial events or developments that would affect the
collective real estate investment
scheme.

-
A fine
of twenty thousand to
seventy thousand riyals.

-
The manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding three years.

-
A fine
of fifteen thousand to
fifty thousand riyals

-
The manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding two years.

-
A fine
of ten thousand to
thirty thousand riyals

-
The manager of the collective real estate investment scheme shall be prohibited from engaging in any collective real estate investment scheme activity for a period not exceeding two years.

24

The
collective real estate investment scheme
manager
fails to supervise and oversee the work of the engineering consultant
, the chartered accountant, or the scheme project
progress, leading to
a negative impact on the scheme.

A fine
of fifteen thousand to
thirty thousand riyals.

A fine
of ten thousand to
twenty-five thousand riyals.

A fine
of ten thousand to
twenty five thousand riyals.