Setting up a real estate brokerage in Qatar: the Ministry of Justice licence

Real estate brokerage is not an activity you add to a commercial register and then practise. It is a separate licence, it is issued by the Ministry of Justice rather than the Ministry of Commerce and Industry, and it has conditions of its own on the person, on the company and on the premises. This guide sets out what Law No. 22 of 2017 requires, what the two routes are for a non-Qatari firm, what the office itself has to be, and what a broker may not do before a written contract exists.

The licence comes from the Ministry of Justice

Article 2 of Law No. 22 of 2017 prohibits practising real estate brokerage without a licence from the Department — meaning the administrative unit for real estate brokers' affairs at the Ministry of Justice. The same law creates a Real Estate Brokers' Affairs Committee, which hears appeals against the Department's decisions, hears complaints by and against brokers, assesses a broker's fee where it is disputed, and holds the disciplinary jurisdiction. Neither body sits at the Ministry of Commerce and Industry, and that is the first thing people get wrong about this activity.

Article 3 divides the conditions in two. For a natural person seeking the licence there are eight, and none of them is procedural.

• Qatari nationality.
• Full legal capacity.
• Good conduct and reputation.
• No final judgment against them in a felony or in an offence against honour or trust.
• Passing the specialised tests and training courses in the real estate field, on the rules and mechanism the Committee sets.
• No final judgment or decision against them cancelling a licence.
• No previous employment at the Ministry of Justice, or at any administrative unit concerned with real estate and urban planning at another ministry, unless at least three years have passed since they left.
• Suitable premises in the State, to the specification the Minister issues, dedicated to practising brokerage.

And a company carries four more

The second limb of Article 3 is the one that decides whether the business can exist in the shape somebody has in mind. It is about the company itself, not about the individual signing for it — though the responsible manager must separately meet the first seven conditions above.

• It must be a company under the Commercial Companies Law, whose principal object is practising real estate brokerage.
• The Qatari partner's or partners' share must be not less than 51% of its capital.
• Its head office must be in the State.
• It must never have been declared bankrupt by a final judgment.

The non-Qatari firm: a separate door

The last paragraph of Article 3 allows non-Qatari brokerage companies and offices to be licensed on conditions set by the Cabinet, and Cabinet Decision No. 28 of 2019 sets them. This is a licence for the foreign firm itself, not an ownership share in a Qatari one, and the bar is a track record rather than capital.

• Specialised international experience in the brokerage fields the State needs.
• A licence in its own country valid throughout the whole period of its work in the State.
• Never declared bankrupt by a final judgment.
• At least five years since incorporation, with brokerage practised throughout that period without interruption — the Cabinet may exempt from the period on the Minister of Justice's proposal.
• An insurance policy covering the civil liability arising from the firm's work, as the Department determines.
• An undertaking that the firm bears every obligation arising from practising brokerage in the State.
• A responsible manager meeting conditions 2 to 7 of the natural-person list above.
• A number of brokers working at the firm no lower than the number the Minister of Justice sets, each with at least five years' experience — the Minister may exempt from the experience period.

The premises is not an address

Article 3 asks for suitable premises dedicated to brokerage, Article 16 forbids the broker from carrying on any other activity in them, and Minister of Justice Decision No. 3 of 2020 says what "suitable" means. Nine specifications, and the last of them is the one most often missed.

• Suitable and dedicated to brokerage, with no other activity for the licensee or for anybody else.
• Meeting the security, safety and civil defence requirements.
• Licensed as premises for practising a commercial activity by the Ministry of Commerce and Industry.
• Equipped with what is needed to receive clients and preserve the confidentiality of transactions.
• Equipped with what is needed to receive clients with disabilities and elderly clients.
• Carrying a sign on its frontage, in Arabic at least, showing the type of activity, the brokerage licence number, and whatever else the Department specifies.
• Provided with computers and modern property search software.
• Containing a secure place set aside for keeping title deeds, client documents and brokerage contracts.
• In place permanently, throughout the whole term of the licence — not merely on the day of inspection.

The application, the term and the renewal

1. 1The application for the licence, or for its renewal, goes to the Department on the form prepared for it, with the supporting documents.
2. 2The Department decides and notifies the applicant within fifteen days of the date it was submitted, and a refusal must be reasoned.
3. 3That period passing without a reply is an implied refusal of the application.
4. 4A refused applicant may appeal to the Committee within sixty days of being notified, or of the date the application became an implied refusal.
5. 5The Committee decides within thirty days; that period passing without a reply is a refusal, the decision on the appeal is final, and the Committee's decisions become final only once the Minister approves them within sixty days, or that period passes without approval.

The Department hands the licensee a brokerage practice card carrying their name, their number in the register, the licence term and their place of business. The licence may not be assigned to anybody else and passes to heirs only with the Department's approval, after the conditions are verified. Every licensee is entered in a register kept by the Department called the Register of Real Estate Brokers. A broker may use representatives in their work, on conditions the Minister issues.

What has to exist before a deal or an advert

Article 14 prohibits the broker from carrying out any brokerage work at all — or advertising by any means the sale, purchase or lease of a property, or any disposition over it — before five documents are in hand. It is a prohibition on acting, not a filing requirement, and the fine for breaching it sits in Article 26.

• A written brokerage contract naming the contracting parties, describing the property, and setting out the terms of the brokerage, the broker's fee and the capacity in which each party acts, on the Department's form.
• A certified copy of the property's title deed, with the survey plan approved by the competent authority, and the capacity of the parties in disposing of it.
• A certificate from the real estate registration department at the Ministry showing the property's status, including the restrictions, dispositions and everything else the other contracting party must know and that affects their decision.
• A certificate from the competent authority that there are no violations relating to the property.
• Where the property is mortgaged, proof that the mortgagee accepts its sale, lease or other disposition.

Fees, and what a breach costs

Where the brokerage contract does not fix the fee, Article 17 has the Committee assess it according to custom, and failing custom according to the effort the broker expended and the time the work took — capped at 1% of the contract value where the disposition transfers ownership or a right in rem, or the equivalent of half a month's rent where it is a lease. Several brokers who complete one deal share equally or as agreed. Where one person engages several brokers separately on the same matter, whichever of them completes the contract takes the whole fee and the others take nothing. And no fee is earned at all unless the brokerage led to the contract being concluded — or, where it failed because of the person who engaged them, unless the Committee is persuaded to assess something for the effort.

What an office should actually do

1. 1Settle the shareholding before anything else, because a Qatari share below 51% is not a licence application the law can accept from a brokerage company.
2. 2Read Decision No. 3 of 2020 before signing a lease, since three of its nine specifications are about the building rather than about the furniture.
3. 3Put the responsible manager through the Committee's tests and training early — the company's licence waits on a person clearing conditions 1 to 7.
4. 4Have the five Article 14 documents as a checklist the office opens on every instruction, before the listing goes up and not after the buyer appears.
5. 5Write the fee into the brokerage contract, because the alternative is a Committee assessment against a cap rather than against the agreement.
6. 6Diary the renewal in the month before the licence expires — the three-month grace after expiry rests on an excuse the Department chooses to accept.