What is Real Estate Activity Report (REAR)?
Real estate agents and brokers licensed in the UAE are required to file the REAR effective from July 1st, 2022. They need to report the transaction related to the purchase/sale of Freehold Real Estate, which involves cash or virtual assets.
The purpose of REAR is to curb the illicit investment in real estate in UAE and track down the high-risk transactions around real estate involving money laundering.
When is REAR required to be filed?
REAR is application only to the transactions of purchase and sale of Freehold Real Estate, where the payment is by way of any of the following (whether for a portion or the entire property):
- Physical cash equal or exceeding AED 55,000 (single payment or through several transactions)
- Virtual assets
- Transaction were converted from or to a virtual asset for a portion or the entire property value
What are the obligations of DNFBPS when it comes to REAR filing?
Real estate agents and brokers have to obtain and record the following:
- Identification documents of the buyer and seller
- Receipts, invoices, contracts, and Purchase & Sale Agreement
Along with obtaining relevant documents pertaining to buyer, seller and the transaction, Real estate agents and brokers shall submit REAR on GoAML platform, capturing details of such transaction pertaining to freehold real estate.
- Documentation Requirements if Buyer/Seller is a Natural Person
If the buyer or seller is a natural person(s), identification documents must include the following:
- Valid Emirates ID
- Passport copy
Documentation Requirements if the Buyer/Seller is a Legal Person
Real estate agents and brokers need to obtain certain documents to file the REAR. If the buyer or seller is a legal person, the following identification documents must include the following:
- Trade License
- Articles of Association
- Register of Beneficial Owners
- Emirates ID or passport copy for all Beneficial Owners
- Emirates ID or passport copy for all shareholders/partners
Time period to maintain the records?
As per the Moe Circular, the records of all documents and the information related to the transactions must be kept for at least five years.
REAR – An Additional Reporting
Filing of REAR to report the transaction pertaining to freehold property is an additional requirement. Submissions of REARs do not exempt them from their existing AML-CFT obligations to submit the following types of reports via goAML.
Real estate agents and brokers are obliged to comply with AML-CFT requirements in the UAE.
- Suspicious Transaction Report (STR)
- Suspicious Activity Report (SAR)
- Funds Freeze Report (FFR)
- Partial Name Match Report (PNMR)
As required by the UAE authorities, Real Estate agents and Brokers shall have a policy in place to identify and submit the REAR on the three types of transactions stated in the Moe Circular.
“Navigate The Red Flags with the help of Ahmad Alagbari Chartered Accountants”
Ahmad Alagbari Chartered Accountants experts can help you by providing following services
- AML Health Check
- AML Business Risk Assessments
- Develop AML Policy & Procedures
- Develop Compliance Mechanism- Customer Due Diligence & Ongoing Monitoring.
- Train employees on countering money laundering and combating terrorism financing
Alia Noor (FCMA, CIMA, MBA, GCC VAT Comp Dip, Oxford fintech programme, COSO Framework)Associate Partner
Ahmad Alagbari Chartered Accountants