Property traders in Monaco: a draft law to regulate the activity

In Monaco, there are nearly 300 property traders, individuals or commercial companies who carry out for their own account, on a professional, regular and speculative basis, transactions to purchase real estate, business assets or shares in real estate companies (SCI) with the purpose of reselling it. 

Whereas this professional activity was, until 2019, subject to the common law system of authorization and administrative declaration to exercise provided by law n°1.144 of July 26th, 1991 relating to the exercise of certain economic and legal activities, the Business Development Agency is now stricter for issuing authorizations to non-Monegasque persons.

The activity is also subject to the law n°1.044 of July 8th, 1982, just like the public sales, the sales of certain tangible goods and work contracts, provisions or supplies. This law specifies the exemption from registration duties for transactions carried out by property traders, provided that certain conditions are fulfilled (especially the one considering the timeframe limit of four years  for reselling the property). 

By observing on the one hand, the exponential increase in the number of property traders in a limited and already highly competitive market and, on the other hand, noting the total absence of tax revenues collected by the State in the majority of operations, the National Council reacted. It adopted during the Public Session of October 15th, 2020, the bill n°252 relating to the regulation of the activity in an autonomous way.

The goals of this law are multiple:

- regulating the activity of property trader and ensuring the security of real estate transactions,

- strengthening the issuance of authorizations, by ensuring the legitimacy of non-Monegasque applicants, in terms of their experience and professionalism,

- increasing State revenue by proposing a partial exemption of property transfer duties,

- encouraging property traders to carry out renovation work to improve the quality of the Principality's housing stock and generate VAT.

 

If you are already set up in the Principality as a property trader and would like to carry out new purchase and resale operations, the Valeri Agency team will be pleased to select the most interesting properties for you to purchase and/or to market.