United Arab Emirates (UAE), has stated that it requires brokers and real estate agents to report to Financial Intelligence Unit all real estate transactions where virtual currency is used to pay. Similarly, real estate purchases or sales where “the funds used in the transaction are derived from a virtual asset” must also be reported.
Recording Identification Documents Must be Made for All Parties
United Arab Emirates’ (UAE) government announced that it would introduce new reporting requirements to cover real estate transactions in which virtual currency can be used as a method of payment. With the introduction of these new reporting requirements, the UAE is showcasing its “sustainable and evolving approach to the global fight against money laundering and terrorist financing.”
As per a report published by WAM, the decision to alter reporting requirements followed several meetings and discussions which were held by the UAE’s Ministries of Economy, Justice, and the Financial Intelligence Unit (FIU). Discussions focused on the reporting requirements for real estate brokers and law firms when selling or buying property.
As part of the new reporting requirements, real estate agents must report all cash transactions where “single or multiple cash payment(s) [are]equal or higher than AED 55,000 [$14,974]” to the FIU. When payments involve the use of digital currency, brokers and agents are obliged to notify the FIU. The same should also be done when “the funds used in the transaction [are] derived from a virtual asset.”
As per the WAM report, the new reporting mechanism now “requires real estate agents, brokers, and law firms to obtain and record the identification documents of the parties to the applicable transaction, among other relevant documents related to the transaction.” The report added that the rules will apply “to both individuals and corporate entities that are parties to the above real estate transactions.”
For financial and economic stability: Reporting requirements
Meanwhile, the report quotes the UAE’s economy minister, Abdulla bin Touq Al Marri, commending the adoption of the new reporting requirements, which ostensibly not only ensure economic and financial stability, but combat malpractice by businesses. Abdullah Sultan Bin Awwad Al Nuaimi, the Justice Minister suggested that new reporting requirements were necessary to prove the government and private sectors are working together. He stated:
In addition to introducing reporting rules in certain real-estate transactions, this is yet another example of UAE’s coordination with the government as well as the private sector to enhance the nation’s framework for countering money laundering and financing terrorism.
The head of the FIU, Ali Faisal Ba’Alawi, said the new requirements will help “improve the quality of financial intelligence available to the FIU.” The requirements will help the FIU trace the suspicious transfer of funds or investments, Ba’Alawi added.
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