UAE introduces additional Real estate transaction reporting rules to prevent money laundering
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The UAE has strengthened regulations on real estate investment by recently announcing the reporting rules for real estate transactions as part of an effort to tighten its regulatory framework for tackling money laundering and terrorism funding.
His Highness Abdullah Sultan Bin Awwad Al Nuaimi, Minister of Justice, said, “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 UAE is one of the first nations to have a system in place for real estate deals incorporating virtual assets. The real estate industry in the United Arab Emirates is a significant area for investment and a critical element of the nation’s economic growth. As a result, the UAE is eager to implement policies and rules that encourage the industry to adhere to the highest possible international standards for good financial operations.
As per the regulations, all real estate agents, brokers, and law offices will now be required to submit reports to the Financial Intelligence Unit (FIU) for all freehold real estate transactions in the United Arab Emirates that involve any of the following three payment methods given below, whether they account for all or a portion of the property’s value:
- Cash payments totalling or exceeding Dhs55,000 made in one or more instances
- Payments that also involve access to a virtual asset
- Payments made using virtual assets as the source of the fund(s) utilized in the transaction
Real estate agents, brokers, and law offices must collect and record the identity documents of the participants to the pertinent transaction as well as other necessary transactional documents as part of the reporting process. Both people and business entities that are participants to the aforementioned real estate transactions are contrary to the regulations.
“The new requirements, which apply to both the real estate and legal sectors, aim to ensure the development of their regulatory frameworks, leaving little or no room for manipulation or illegal practices that could negatively impact the work environment and the economy and investment within these sectors”, said His Highness Abdulla bin Touq, Minister of Economy.
The UAE has strict rules in place to stop both the financing of terrorism and money laundering. Over the years, the nation has continuously implemented rules to crack down on fraudulent activity. Exchange houses operating in the UAE have also been subject to penalties from the Central Bank of the UAE for not meeting the required standards of adherence to anti-money laundering laws.
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