AML Reforms Are Here: What Property Developers and Business Owners Need to Know

AML Reforms Are Here: What Property Developers and Business Owners Need to Know

AML Reforms Are Here: What Property Developers and Business Owners Need to Know

From 1 July 2026, Australia's anti-money laundering and counter-terrorism financing (AML/CTF) regime applies to lawyers providing certain property and commercial legal services.

While the reforms primarily impose new compliance obligations on law firms, they will also change the way property and commercial transactions are undertaken. Clients will be asked to provide more information at the outset of a matter than has traditionally been required.

For many businesses, these verification requirements will be new. Over time, however, they are likely to become a routine part of property and commercial transactions, much like finance approval, FIRB approval and the identity checks already undertaken by banks and other financial institutions.

More Than Just Proving Your Identity

Providing photo identification is only one part of the new verification process.

Depending on the matter, law firms may also be required to identify the individuals who ultimately own or control the relevant company, trust or other legal structure.

For individuals and straightforward transactions, the verification process is likely to be relatively simple. For developers and business owners who commonly operate through companies, trusts or joint venture structures, the verification process may require additional enquiries.

Depending on the circumstances, we may need to verify directors, shareholders, trustees, beneficiaries or other individuals who exercise effective control over the relevant entity. We may also need information about the purpose of the engagement, and, in some circumstances, the source of funds used in the transaction.

These requirements apply to all Australian law firms providing designated legal services. They are legislative requirements and are not specific to any particular client.

Planning Ahead Will Help Avoid Delays

For most clients, the new requirements should have little impact on transaction timeframes. Delays are more likely where the required information is not readily available or cannot be provided promptly.

This is particularly relevant for businesses with layered ownership structures, family trusts, offshore investors or multiple related entities. Identifying beneficial owners and gathering corporate records can take longer than expected.

Providing this information at an early stage will help transactions progress more efficiently.

Existing Clients May Still Be Asked to Provide Information

Many of our long-standing clients already have established relationships with us. Even so, the legislation requires us to verify or update information we already hold, particularly where a new entity is involved, ownership has changed or we are engaged to provide a different designated service.

How Can Businesses Prepare?

Businesses do not need to fundamentally change the way they operate.

However, they should ensure that company records, trust documentation and ownership information are accurate, up to date and readily available.

Where ownership structures are more complex, it may also be worthwhile preparing an organisational chart showing the ownership and control of each entity. Having this information available before a transaction commences will help streamline the verification process and minimise unnecessary delays.

Preparing for the New Regime

The AML/CTF reforms represent one of the most significant changes to the delivery of property and commercial legal services in Australia in recent years.

Although clients should expect additional verification requirements, the reforms are intended to strengthen the integrity of Australia's financial system rather than create unnecessary barriers to legitimate transactions.

Businesses that are well prepared and able to promptly provide the required information are likely to experience minimal disruption.

Nine Dots Legal has updated its onboarding and verification processes to ensure compliance with the new AML/CTF regime while continuing to deliver practical and efficient legal services. If you are planning a property acquisition, development, business sale or corporate restructure, we encourage you to speak with us early so that any verification requirements can be addressed well before key transaction milestones.