Long-term leaseholds, licences and land-use entitlements: what should real-estate businesses check?

What AUSTRAC clarified

AUSTRAC’s real-estate guidance distinguishes ownership-like interests from arrangements that only give limited contractual permission to occupy. The real-estate definition can include leasehold interests of more than 30 years and land-use entitlements linked to company shares or trust units.

Leases of 30 years or less and standalone licences that provide only limited contractual occupancy rights are generally excluded from the real-estate definition. Other designated services or circumstances may still need separate consideration.

Questions for the initial scope test

• What is the base lease term, excluding renewal, extension or further-term options?
• Does the occupant have exclusive possession or only contractual permission to occupy?
• Can the interest be registered on title, sold, transferred or sublet?
• Do company shares or trust units confer an entitlement to occupy the land?
• Is the business acting as broker, principal seller or residential-site operator—and for whom?

Do not rely on the agreement title alone

An arrangement labelled a licence may create different legal and practical rights from a simple standalone licence to occupy. Conversely, a dwelling or short-term land arrangement may not itself satisfy the real-estate definition.

Where the classification is uncertain, obtain legal advice on the property rights and designated-service position. Operational support can then implement the resulting AML/CTF requirements without presenting the scope assessment as a legal determination.