Question:
A questioner asks: I want to know the terms necessary according to the law in Dubai to establish a real estate company. Do I have the legal right upon establishing the company, in addition to mediating in buying and selling real estate, to rent a property in the name of the company and then re-rent it? Do I have the legal right to open this company without partners or a citizen sponsor? Is a bank guarantee required for such a company? Please advise.
Answer:
To answer such question, I would advise the questioner that:
The licence to practice real estate activity depends on the type of the activity you want to choose. Each type has its own terms. Sometimes you cannot mix several activities together and some activities can be mixed as per the Dubai Land Department and the Dubai Department of Economy and Tourism. You should follow up with them for the exact terms and conditions for each type of activity.
The general terms to get a real estate licence are:
1- Applying for a licence through the Dubai Department of Economy and Tourism.
2- Registering in the Licensing System (Trakhees) through Dubai Land Department website www.dubailand.gov.ae
3- Applying for issuing a profession practice card for a real estate activity must be made immediately after applying for and approving a real estate licence.
The activities of Brokerage for sale and purchase of real estate activity and Brokerage for renting real estate activity can be mixed in one licence. The licence can be given under the name of one person, without an Emirati sponsor and, usually, such activities don’t need a special approval from the Dubai Land Department or a bank guarantee.
To rent a property in the name of the company and then re-rent it, this falls under another kind of activity, not the brokerage for renting real estate activity. It might be private real estate leasing and managing services activity or real estate leasing and managing services for third-party activity, and such licences need special terms to get it, such as "for private real estate lease and management services licences", a copy of the title deed of the property, as the title deed must be in the name of the licence holder or a partner.
The licence holder and his second-degree relatives only are allowed to manage the private properties according to Local Order No. 2/2003.
For third party real estate lease and management licenses:
- Providing a bank guarantee of Dh5 million
- In the case of opening a branch of the licence, the commercial name of the branch must be identical to the parent licence, and the number of employees will not be less than 20 administrative employees.
