When a Dubai Broker Is Entitled to Commission and When They Are Not

The transfer went through last month. The buyer has the keys, the seller has the money and your invoice is still sitting unpaid. At that point the question stops being commercial and becomes a question of what your paperwork actually establishes.

Broker commission in Dubai is governed mainly by Bylaw No. 85 of 2006 Regulating the Real Estate Brokers Register in the Emirate of Dubai, issued under Law No. 7 of 2006 Concerning Real Property Registration. Brokerage is also treated as a commercial activity under the Commercial Transactions Law issued by Federal Decree-Law No. 50 of 2022. Most brokers know the market custom. Fewer have read what the Bylaw says about when the fee is earned and when it is lost.

The Fee Is Earned by Conclusion, Not by Effort

Article 28 of Bylaw No. 85 of 2006 sets the entitlement. A broker is entitled to remuneration only if a contract is concluded between the parties. A contract is deemed concluded when all parties agree on all the conditions provided for in the brokerage agreement. Entitlement arises on signing the sale contract and registering it with the Dubai Land Department, unless the brokerage agreement says otherwise. Where the sale is conditional on a term agreed in the brokerage agreement, the fee falls due only once that term is satisfied.

Article 30 completes the picture from the other direction. If the broker's work does not lead to a concluded contract, there is no claim for compensation and no claim for expenses, unless the brokerage agreement provides for it.

The practical consequence is uncomfortable but clear. Six weeks of viewings, negotiation and chasing produce nothing on their own. If you want to be paid for a deal that collapses, for an abort fee or for marketing costs, the entitlement has to be created by the agreement. The default position under the Bylaw is against you.

Broker Commission in Dubai Starts With a Written Brokerage Agreement

Article 26 requires the brokerage agreement to be in writing and to state the names of the parties, the specifications of the property and the brokerage terms. The same article states that the agreement will be entered into the record of the Real Property Register. In practice this is the RERA form: Form A between broker and seller, Form B between broker and buyer and Form I between two brokerage firms.

The registration requirement produces a defence that appears in almost every unpaid commission file. The buyer or the seller argues that the brokerage agreement was never registered with the Dubai Land Department and is therefore void.

Dubai courts have not applied this consistently. Some judgments have accepted the argument and dismissed the broker's claim where registration could not be evidenced. Others have rejected it, on the reasoning that Article 26 is an administrative requirement, that the Bylaw does not state nullity as the consequence of non-registration and that Chapter Six of the Bylaw already provides disciplinary penalties such as notice, warning, suspension and blacklisting for breaches of this kind. Both lines of reasoning exist in decided cases.

What that means for a broker is straightforward. The point is contested, which means it is free for the other side to raise and expensive for you to answer. A registered Form A removes the argument before it starts.

When Two Brokers Claim the Same Fee

Articles 31 and 32 separate two situations that brokers routinely confuse.

Where several brokers act together for one party in the same negotiation and the contract is concluded, Article 31 treats them as a single broker and divides the fee between them according to the terms of the agreement they concluded.

Where one party appoints several brokers severally for the same matter and only one succeeds in concluding the transaction, Article 32 gives that broker the entire remuneration. Introducing the property first does not create a share. Concluding the transaction does.

Article 24 adds that where several brokers are engaged to carry out one contract they are jointly liable unless authorised to work severally. The wording of a co-brokerage arrangement therefore carries consequences beyond the split of the fee.

Where the Right to Commission Is Lost Completely

Article 23 removes the right to remuneration and to reimbursement of expenses where the broker breaches obligations to the client by acting in the interest of the other party or by accepting a promise of a benefit from the other party, where that conduct is inconsistent with good faith or the code of professional ethics. This is the provision behind quiet arrangements with the opposing side. It does not reduce the fee. It forfeits it.

Article 20 states that a broker may not present himself as the second party to the contract he facilitates unless authorised by one of the contracting parties. Where he does so with authorisation he is not entitled to any remuneration. Buying through a relative or a company you control sits close to this line.

Article 19 confirms that a broker acting for one party still owes disclosure of the transaction details and conditions he is aware of. He remains responsible for any fraud or mistake he commits. Article 3 prohibits brokerage activity by anyone not licensed by the competent authorities and entered in the Register, which is where an unregistered agent working under someone else's firm runs into difficulty.

Who Actually Owes You the Money

Article 33 answers a question most brokers only ask after the transfer. Remuneration is payable by the party who appointed the broker to conclude the transaction. Where the broker was appointed by both parties, each party is severally liable for its own share, even if the parties agreed between themselves that one of them would pay the whole amount.

That last sentence matters. A verbal understanding that the seller will settle both sides does not by itself move the buyer's share onto the seller as far as the broker's claim is concerned. If one party is genuinely paying everything, it belongs in the signed documents rather than in a conversation at the transfer counter.

On the amount, Article 27 provides that remuneration is fixed by agreement and, where there is no agreement, according to prevailing practice. The commonly quoted two percent is market practice in Dubai rather than a rate fixed by the Bylaw, which is precisely why an unsigned rate becomes an argument about custom instead of an argument about contract.

A File That Turns on Documents

A broker introduces a buyer to a villa, runs three viewings and negotiates the price down over two weeks. Form A was signed but never registered. The rate was agreed on WhatsApp. The seller then closes with a second brokerage at the same price and takes the position that the first broker did nothing.

Nothing about that file is decided by who worked harder. It is decided by what can be produced. When a matter like this reaches me as a Legal Consultant, the assessment begins with the same set of documents:

1. The signed Form A or Form B with evidence of registration at the Dubai Land Department
2. The listing permit number and the property reference
3. A dated record of the introduction of the buyer to that specific property
4. Viewing confirmations, access approvals or security records placing the buyer at the unit
5. Written confirmation of the commission rate and of which party is paying it
6. The Form F and the transfer record showing the concluded transaction

Where those six exist, the position is usually assessable within an hour. Where three of them are missing, the file becomes an argument about recollection. Recollection is the weakest evidence in any commission dispute.

Most brokers protect their client's transaction carefully and leave their own entitlement to trust. The Bylaw has been sitting in the same place since 2006. It decides these files far more often than the negotiation does.