Property agents will now be permitted to own 100% of their businesses in the UAE, since this commercial activity has been removed from the ‘restricted list.' According to industry sources, the decision is regarded as a game-changer because of the real estate sector's dominating position in defining the UAE's economic and business activities.
This will have the greatest influence on Dubai's real estate market, particularly at a time when buying and selling activity has been picking up well.
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“What the change means is that a property brokerage firm can be 100 percent owned by a foreign national though a local UAE national is required to act as a service agent,” said Atik Munshi, Managing Partner at the consultancy Enterprise House UAE.
“In Dubai, while registration with RERA (Real Estate Regulatory Agency) is required, taking the RERA-sponsored examination is not compulsory for the business owner.”
The UAE has recently changed its investor visa criteria for property assets, allowing owners of properties worth Dh750,000 to get a three-year visa. The previous threshold was Dh1 million for two years.
The UAE – both at the federal level and in individual emirates – recently revealed the number of commercial activities in which foreign citizens can control 100% of a company and not have a UAE national partner have a majority interest. However, property brokerage services were still classified as "limited" — this has since changed.
According to Jonathan Davidson, founding Partner at the DIFC-based law firm Davidson & Co. “As and when this amendment, is enacted there is likely to be a lot of those brokers seeking to change their historical ownership structure. It is noteworthy that to do so will require the full agreement and sign off of everyone involved whether they have been running the company or acting as a de facto nominee.
The Dubai Land Department and RERA are in charge of overseeing all brokerage companies in the UAE, ensuring that rigorous transparency criteria are met. If they want to practice here, the brokers must also have certain basic requirements.
“Dubai has well over 2,000 real estate brokerage businesses, all of which are now owned by local or Emiratis owing to existing legislation,” Davidson added: A large number of these brokerages are managed by foreign investors.”
Source: Gulf News