This bill is part of a drive to professionalise the sector in the face of an increasingly complex market and major economic challenges, as well as to strengthen transparency and compliance, particularly in the fight against money laundering and terrorist financing.
The main measures of this proposed law are as follows:
Strengthening the conditions for granting administrative authorisation
Any natural person applying for administrative authorisation must provide proof of actual residence in the Principality. For companies, this requirement extends to directors and beneficial owners.
In addition, directors of companies engaged in real estate activities must hold at least 25% of the share capital.
The bill also stipulates that shareholders of a Monegasque public limited company or limited partnership with share capital must obtain approval from the Minister of State. This approval would also be required in the event of a change of shareholder.
Finally, the proposed law confirms the practice whereby the activity of estate agent may not be carried out at the home of the natural person or directors of the companies concerned.
→ These measures are intended to strengthen the local roots of real estate professionals, the effective responsibility of managers, and to guarantee the good character of agency shareholders.
Introducing a professional licence and a requirement for regular, non-certificate-based training
The proposed law introduces, as has been the case in the neighbouring country since 1970, the obligation to hold a professional licence for several categories of persons involved in activities relating to "transactions in real estate and business assets", including directors, branch or agency managers and persons equivalent to negotiators or commercial agents. This card, issued after authorisation has been granted, will be valid for a period of three years and will be renewable.
Cardholders must undergo specific training within six months of the authorisation being granted or their taking up their duties, and then at least once every three years when the card is renewed, which is a condition of renewal, in order to ensure that their skills are kept up to date. The number of hours and the content of this training will depend on the experience of the persons concerned, who will bear the cost.
→ These measures aim to create a clear means of identifying real estate professionals and to enhance the professionalism of the sector. They also aim to strengthen the credibility of the market in the eyes of foreign investors and professionals.
Making written estate agency mandates compulsory
From now on, as is the case in France, all real estate transactions must be governed by a written mandate, limited in time, which may be drawn up in electronic form in accordance with the requirements of the Monegasque Civil Code.
With regard to property management operations, the proposed law stipulates that the agent must publish accounts at least once a year.
→ These measures aim to formalise the contractual relationship between the professional and their principal and to guarantee the legal certainty of the mandate.
Reserving commission payments for professionals holding administrative authorisation
Only holders of administrative authorisation will be able to receive commission, thereby excluding any remuneration for unauthorised intermediaries.
→ This measure aims to combat the illegal practice of the profession of estate agent. It contributes to the moralisation of the sector and the protection of buyers.
Regulate advertising of real estate activities in order to combat the usurpation of professional status and protect duly authorised players in the market
Any advertising relating to a real estate activity is prohibited for non-professionals, unless expressly authorised by a licensed professional and the name of the establishment operated by the authorised person is mentioned in the advertising medium.
→ This measure aims to prevent any misrepresentation of professional status in the real estate sector that could cause confusion among the public or lead to illegal activities in the sector.
In light of these new obligations, the system of penalties provided for by law has been adapted to include, in particular, the revocation or suspension of administrative authorisation in the event of a breach of the obligations relating to the professional licence, or the imposition of fines if a mandate in accordance with the provisions of the law has not been established. Finally, the penalty mechanism is being revised in order to restore consistency in the scale of penalties, while maintaining a sufficient level of repression to ensure their deterrent effect.
With regard to the transitional provisions of the proposed law, it is envisaged that its provisions will apply to all administrative authorisation procedures under investigation after its entry into force. With regard to training obligations, it is envisaged that persons subject to the obligation to hold a professional licence must comply within one year of the law's entry into force.
It should be noted that this bill is still subject to numerous amendments before the legislative committees and may even never see the light of day if the legislative process is interrupted.
