In another major step to wipe out money laundering and terrorist financing, payments for real estate transactions in the UAE through virtual assets, sale of virtual assets, or cash amounts above AED55,000 will now be subjected to additional reporting to authorities.
All real estate agents, brokers, and law firms are now obliged to file reports to the UAE Financial Intelligence Unit (FIU) for purchase and sale transactions of freehold real estate properties including any of the three methods of payment.
The payments methods are:
- Single or multiple cash payments equal to or above AED55,000
- Payments with virtual assets
- Payments where the fund(s) used in the transaction have been derived from a virtual asset
The introduction of new reporting requirements was announced by the Ministry of Economy (MoE) and the Ministry of Justice (MoJ) in partnership with FIU.
It makes UAE one of the first countries to implement such a mechanism for real estate transactions involving virtual assets, and shows the country’s evolving approach to the global fight against money laundering and terrorist financing.
The decision was made following multiple meetings and discussions involving the MoE, MoJ, FIU, and other authorities like the Executive Office for Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT).
Ali Faisal Ba’Alawi, head of the UAE FIU, said: “These new measures will improve the quality of financial intelligence available to the FIU and will be used to trace the suspicious movement of funds or investments as part of our fight against money laundering and terrorism financing.
“Importantly, the requirements further strengthen the stability and integrity of the UAE’s real estate sector and provides all stakeholders with greater transparency in a sector that is a key contributor to the UAE’s economy.”
Abdulla bin Touq Al Marri, Minister of Economy, said the adoption of the highest standards of transparency and governance, in addition to the necessary regulations to ensure economic and financial stability while combating malpractice within the business community, are priorities of the Ministry of Economy and its partners in local, federal, and private sector entities.
Abdullah Sultan Bin Awwad Al Nuaimi, Minister of Justice, added: “The introduction of reporting rules for certain transactions in the real estate sector is another example of how the UAE is coordinating across the government and with the private sector to strengthen the national framework for anti-money laundering and countering the financing of terrorism.”
The agents, brokers and law firms will also need to obtain and record the identification documents of the parties to the applicable transaction. The rules apply to both individuals and corporate entities.
The relevant private sector entities have been informed about the specific requirements in regulatory circulators issued by the MoE and MoJ. The authorities are also collaborating to host three separate workshops with these parties to help guide them through the new requirements and enhance their familiarisation with the FIU’s goAML system.
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