Buying Off-Plan in Morocco (VEFA): What Protects Your Deposit

VEFA stands for vente en l'état futur d'achèvement, sale in a future state of completion. It is the legal framework for any residential sale where the buyer pays before the building is finished, whether that is a reservation on a show flat or a villa still at foundation stage. The rules sit in the Code des Obligations et Contrats, at articles 618-1 onward, inserted by Law 107-12, promulgated by Dahir 1-16-05 of 23 Rabii II 1437, corresponding to 3 February 2016.

A VEFA sale only exists once a preliminary contract is signed. Everything before that, viewing a show flat, putting down an initial reservation, is a separate and optional stage with its own, lighter rules.

A developer can ask you to sign a reservation contract to hold a unit before the preliminary contract is ready. It is not compulsory, and the law caps what it can cost you. Under Law 107-12, a reservation contract cannot run for more than six months and cannot be renewed: it has to lead either to a preliminary contract or to cancellation and a refund. The deposit it can ask for is capped at 5% of the price, and that money has to sit in a special bank account in the seller's name rather than the developer's general funds. You also have the right to walk away from a reservation within one month of signing it, and the seller then has to return the full amount within seven days.

If a developer asks for more than 5% at reservation stage, or wants the money paid straight to a company account with no mention of a dedicated account, that is already outside what the law allows.

The preliminary contract, contrat préliminaire de vente, is where a VEFA sale actually begins in law. It has to be drawn up either as a notarised deed or as an act with a certain date prepared by an authorised professional, adoul or notary, with every page signed and initialled by both sides. Crucially, it cannot legally be signed until the developer already holds the building permit for the project. If a preliminary contract is put in front of you before a permit exists, the project is not yet at the stage the law requires.

The contract itself has to state specific things: both parties' identity, the land registration details for the plot, the building permit number and date, the price per square metre, the agreed delivery deadline, and a reference to the financial guarantee covering your payments. If any of those is missing, ask why before you sign, not after.

Checking that the land under the project actually has a clean, registered title matters here too. Titre foncier and melkia are not the same thing, and a development built on land that has not gone through proper registration carries its own risk on top of the VEFA rules.

This is the core protection. Law 107-12 fixes the maximum a developer can demand at each stage, tied to construction actually reaching that point, not to a date on a calendar:

A schedule that asks for more than this at any given point, or that is not tied to verified progress on site, is not what the law allows. In practice this is the single easiest thing for a buyer abroad to check against an invoice: does the percentage being requested match how far the building has visibly got. None of these instalments include what the notary, the land registry and registration duty add on top of the purchase price, which is due separately when the final deed is signed.

Once the preliminary contract is signed, the developer is required to put a financial guarantee in place covering everything you pay from that point on. It takes one of two forms: a completion guarantee, where a bank commits to funding the building through to finish if the developer cannot, or a reimbursement guarantee, where the bank commits to refunding what you have paid if the sale does not go ahead. The guarantee stays in force until the final sale deed is registered.

There is a gap worth knowing about: public developers and state-owned companies are exempt from this guarantee requirement. If the project you are looking at is run by one of those, ask what protection, if any, replaces it.

The same law sets a penalty for delay on both sides: 1% of the sum due per month, capped at 10% a year, and it only applies once a formal notice has been sent. If the developer misses the delivery date written into your preliminary contract, you are entitled to cancel without penalty to yourself and to claim compensation set out in the contract and the law, on top of getting your payments back. That right depends on the delivery deadline having been written into the contract properly in the first place, which is one more reason the preliminary contract needs checking by someone who reads it in French or Arabic, not translated after the fact.

If you are buying without being able to visit regularly, structuring the purchase so someone can act for you on the ground matters as much for a VEFA purchase as it does for a resale, arguably more, since there are several more signing stages to get through.