What is the Real Estate Activity Report (REAR)?
Ministry of Economy has recently issued a Circular (No. 05/2022 dated 24th June 2022), instructing the real estate brokers and the law firms, to report the specified transactions pertaining to real estate in the new report named – Real Estate Activity Report (‘REAR’).
As mentioned by the Ministry of Economy, 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 the Real Estate Activity Report (REAR) filing requirement coming into effect?
As per Circular No. 05/2022 issued by the Ministry of Economy, the said provisions for filing the Real Estate Activity Report (REAR) is becoming effective from 1st July 2022 for all real estate brokers and agents, and law firms.
Who is required to file REAR?
Though the circular is merely addressed to the Real estate brokers and agents, but on the official post on LinkedIn by UAE Financial Intelligence Unit, it has been specified that such a report needs to be furnished by law firms as well.
Accordingly, all the real estate brokers/agents and lawyers are obligated to report the transaction pertaining to the buy/sale of Freehold Real Estate*, which involves cash or virtual assets.
When is REAR required to be filed?
REAR is applied 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 to or exceeding AED 55,000 (single payment or through several transactions)
- Virtual assets
- Funds converted from Virtual asset
What are the obligations of DNFBPS when it comes to REAR filing?
Real Estate brokers/agents and Law firms 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 the buyer, seller, and the transaction, agents and lawyers shall submit REAR on the GoAML platform, capturing details of such transaction pertaining to freehold real estate.
Documentation Requirement for REAR
REAR – An Additional Reporting
It is important to note that filing of REAR to report the transaction pertaining to freehold property is an additional requirement.
Real estate brokers /agents and lawyers are also required to file Suspicious Transaction Report / Suspicious Activity Report / Fund Freeze Report / Partial Name Match Report, as and when the same are applicable. Accordingly, along with the filing of reports as prescribed earlier for reporting of sanctions or suspicion, additional REAR is to be filed to report all freehold property-related transactions as prescribed above.
Summary of compliance requirements for Real Estate Activity Report (REAR)
It is important to note that filing of REAR to report the transaction pertaining to freehold property is an additional requirement.
Real estate brokers /agents and lawyers are not absolved from the filing of Suspicious Transaction Report / Suspicious Activity Report / Fund Freeze Report / Partial Name Match Report, as and when the same are applicable. Accordingly, along with the filing of reports as prescribed earlier for reporting of sanctions or suspicion, additional REAR is to be filed to report all freehold property-related transactions as prescribed above.
