Real Estate Commission Agreement (UAE)

A Real Estate Commission Agreement in the UAE is a written contract between a property owner (or authorised seller) and a RERA-registered real estate brokerage firm that appoints the broker to market and transact the sale or lease of a specific property in exchange for a defined commission payable upon the successful completion of a transaction. The agreement sets out the property's address and title deed details, the listing price or rent, the transaction type (sale, tenancy, or both), the exclusivity arrangement, the commission rate, who pays the commission, and the event that triggers the commission obligation.

Real estate brokerage in Dubai is regulated by the Real Estate Regulatory Agency (RERA), the regulatory arm of the Dubai Land Department (DLD), under Cabinet Resolution No. 85 of 2006 and the implementing RERA Bylaw No. 85 of 2006. Every brokerage firm must hold an Office Registration Number (ORN) and every individual agent must hold a current RERA brokerage card, renewed annually after completing the mandatory RERA training. RERA Circular No. 26 of 2010 established the standard commission rates: 2% of the agreed sale price for residential purchase transactions (payable by the buyer), and 5% of the first year's annual rent for residential tenancy transactions (payable by the tenant). These rates are conventions, not legal maximums — parties may agree different figures — but they are the baseline applied by the Dubai Courts in commission disputes.

The DLD has issued a series of standardised forms for property transactions: Form A (the seller's listing agreement with a broker), Form B (the buyer's broker mandate), Form F (the Memorandum of Understanding between buyer and seller), and Form I (the commission disbursement form issued on transfer). The real estate commission agreement on forms-legal.com supplements the DLD's Form A template with additional non-circumvention and exclusivity provisions important in practice, particularly for residential sales and for commercial property transactions where the DLD's standardised forms may not fully address the parties' needs.

For commercial property, industrial assets, and large-scale investment transactions, commission agreements may be more complex, involving co-brokerage arrangements, performance milestones, and earn-out structures. The forms-legal.com template provides a clear starting point that can be adapted for these more complex scenarios.

A Real Estate Commission Agreement UAE is needed in several contexts.

Residential property sales: A seller in Dubai instructs a RERA-registered broker to find a buyer for their apartment, villa, or penthouse. The commission agreement (aligned with the DLD's Form A) formally appoints the broker, sets the listing price, and defines whether the appointment is exclusive or non-exclusive. An exclusive listing gives the broker the assurance to invest in professional photography, Bayut.com and Property Finder portal advertising, and developer relationships, in return for which the seller benefits from a focused, committed marketing effort without competing listings diluting the property's perceived value.

Residential and commercial tenancies: A landlord instructs a broker to find a tenant for a residential apartment or commercial unit. The commission agreement records the annual rent, the broker's fee (typically 5% of annual rent for residential lets in accordance with RERA Circular No. 26 of 2010), and whether the broker has the exclusive right to let the property for the listing period.

Commercial property transactions: The sale or lease of office space, retail units, warehouses, or industrial property in Dubai's commercial districts (Business Bay, DIFC, Tecom, Jebel Ali Free Zone, and Dubai Logistics Corridor) typically requires a commission agreement tailored to the commercial context, where commissions may be negotiated at rates different from the residential standard.

Off-plan resales: A property investor selling an off-plan unit (an assignment of rights under a developer's sale and purchase agreement) requires a commission agreement with their broker, noting that the assignment must be approved by the developer under the Oqood off-plan registration system administered by the DLD.

Co-brokerage arrangements: Where two RERA-registered brokers cooperate on a transaction — one representing the seller and one representing the buyer — a commission-sharing agreement between the two brokerages, alongside separate commission agreements with their respective clients, documents the commission split and prevents post-transaction disputes about which firm earned which portion.

Portfolio listings: An institutional owner (a developer, REIT, or family office) instructing a broker to market multiple properties may use a single commission agreement covering the full portfolio, with a schedule listing each property by DLD title deed number.

A complete UAE Real Estate Commission Agreement should include the following provisions.

Party identification: The owner's full legal name, Emirates ID or company Trade Licence number, and contact details; the broker's company name, RERA ORN, the lead agent's name and individual RERA card number, and contact details. Confirming the RERA ORN and card number in the agreement is critical — a commission agreement with an unregistered broker is unenforceable for commission purposes.

Property description: Full address, DLD title deed number (for title verification), property type, and the current asking price or annual rent. The DLD title deed number enables cross-checking at the DLD's transaction portal and is required for the Form A and Form F if the property goes to completion.

Transaction type and exclusivity: Whether the appointment is for a sale, a tenancy, or both, and whether the appointment is exclusive (only this broker may market the property during the listing period) or non-exclusive. An exclusive appointment must specify the duration — 90 days is a common initial exclusive period for residential sales in Dubai.

Listing period: Start and end dates. After the exclusive period expires, the listing reverts to non-exclusive unless renewed.

Commission rate and payer: The percentage and who pays — typically buyer or tenant in Dubai's residential market. For commercial transactions, commission arrangements vary.

Commission trigger: The event on which commission becomes due. Signing of the sale and purchase agreement (SPA), payment of the reservation deposit, signing of the tenancy contract, or DLD title transfer are the common triggers.

VAT: Whether the commission is subject to 5% UAE VAT under Federal Decree-Law No. 8 of 2017. Real estate brokerage commissions on residential property transactions are in principle exempt from VAT under Cabinet Decision No. 52 of 2017 (Schedule 1 — residential supply), but this depends on the precise structure of the transaction and the broker's VAT registration status. The agreement should address VAT explicitly.

Non-circumvention: A clause preventing the owner from transacting directly with an introduced buyer/tenant during the listing period and for 12 months after, based on the broker's introduction right under Article 870 of the UAE Civil Code Federal Law No. 5 of 1985.

On forms-legal.com, all these elements are populated through a guided wizard.

Completing a UAE Real Estate Commission Agreement involves the following steps.

Step 1 — Verify broker registration: Before signing, the owner should verify the broker's RERA ORN and the individual agent's RERA card number through the DLD's RERA verification portal or the Dubai REST app. Instructing an unregistered broker exposes the owner to unprotected transactions and the risk that commission claims cannot be filed through RERA's formal mechanism.

Step 2 — Enter party details: Record the owner's full legal name exactly as it appears on the DLD title deed, and the broker's company name, ORN, and lead agent details.

Step 3 — Complete property details: Enter the full address and the DLD title deed number. The asking price should be agreed between the owner and broker after reviewing the DLD's transaction price history for comparable units, available on the DLD website and Dubai REST app.

Step 4 — Set exclusivity and listing period: Decide whether to grant an exclusive appointment and for how long. Most experienced brokers in Dubai request a 60–90 day exclusive period for a residential sale, after which the listing becomes non-exclusive if unsold.

Step 5 — Define commission terms: Confirm the rate, who pays, the trigger event, and whether VAT is applicable. For residential sales, the 2% rate payable by the buyer is standard; for tenancies, 5% payable by the tenant.

Step 6 — Review the non-circumvention clause: The 12-month post-listing non-circumvention period protects the broker from the owner re-listing after the exclusive period and selling to a buyer already introduced. Review the period and ensure it is acceptable to both parties.

Step 7 — Sign in duplicate: Both the owner and the broker's authorised representative sign. The broker should retain the original in the property file alongside the DLD Form A.

Several specific legal requirements apply to real estate commission agreements in the UAE.

RERA registration (mandatory): Under Cabinet Resolution No. 85 of 2006, a person may not conduct real estate brokerage in Dubai without a current RERA registration. An agreement with an unregistered broker may be void as to the commission obligation, and the unregistered broker has no standing before RERA's Real Estate Brokers Committee.

DLD Form A compliance: For most residential transactions in Dubai, the DLD requires the broker to have a completed Form A (Seller's Listing Agreement / Owner's Authorisation) on file before the transaction can proceed to Form F (MOU) and then to transfer. The real estate commission agreement on forms-legal.com is designed to be used alongside and not instead of Form A.

VAT obligations (Federal Decree-Law No. 8 of 2017): Real estate brokerage services are in principle subject to 5% VAT. However, brokerage commissions earned on the first supply of residential property (new-build) are exempt under Cabinet Decision No. 52 of 2017, while commercial property brokerage commissions are taxable at 5%. The agreement should specify whether VAT is applicable and, if so, which party bears it.

Anti-money laundering (Federal Law No. 20 of 2019): RERA-registered brokers are Designated Non-Financial Businesses and Professions (DNFBPs) for anti-money laundering (AML) purposes. Brokers must perform customer due diligence (CDD) on sellers, buyers, and tenants before entering commission agreements. This includes verifying Emirates ID and passport documents and, for high-value transactions, conducting enhanced due diligence on source of funds.

Coastal and restricted property: For properties in investment zones (identified by the DLD for foreign ownership) versus non-investment zones, the ability to sell to non-UAE nationals must be confirmed before agreeing a commission to sell to foreign buyers.

Instructing an unregistered broker or an agent whose RERA card has expired is a common and avoidable error. Check the RERA registration status through the DLD portal or Dubai REST app under 'Broker Check' before signing. Commission claims by unregistered brokers will fail before the Dubai Courts and RERA's Real Estate Brokers Committee, leaving the property owner with no commission protection if the broker introduces a buyer who then circumvents the process.

Not specifying the commission trigger precisely. An agreement that says commission is 'due on completion of a deal' is ambiguous — does this mean signing the SPA, paying the deposit, or DLD title transfer? Each stage involves different risks. For sales, the DLD transfer is the safest trigger (it is the definitive moment title passes); for tenancies, signing the tenancy contract and initial payment of the first cheque is the conventional trigger.

Granting a non-exclusive listing to multiple brokers without coordination. Multiple listings on Bayut.com, Property Finder, and Dubizzle from different brokers at different prices confuse buyers, damage the property's perceived value, and result in commission disputes between brokers before RERA's Real Estate Brokers Committee. An initial exclusive listing with a reputable broker typically achieves faster and cleaner results.

Failing to complete and retain DLD Form A before proceeding to negotiations. Without Form A on file, the DLD's transaction management system may not recognise the broker's participation, and RERA may not intervene in a commission dispute where the broker cannot produce the completed and signed Form A.

Omitting VAT from the commission calculation. Where VAT applies at 5% under Federal Decree-Law No. 8 of 2017 (primarily for commercial property brokerage services), failing to state that the commission is 'plus VAT' means the broker may need to absorb the tax from the gross commission, reducing their net income. The Federal Tax Authority (FTA) requires VAT-registered brokers to issue a valid VAT invoice for their commission. Agents should retain signed commission agreements and Form A copies in a secure property file for at least five years, which is the standard limitation period for civil claims in the UAE under the UAE Civil Code Federal Law No. 5 of 1985.