The deal felt done. Then the silence started.
Picture this: two agencies worked the same client. One held the developer relationship and the listing; the other brought the buyer. They shook hands on a 50-50 split of the developer commission at the launch event, talked it through on WhatsApp, and the booking form was signed that evening. The SPA followed a week later, Oqood registration was confirmed, and everyone went back to chasing the next launch.
Three months later, the listing agency receives the first commission tranche from the developer. The referring agency calls to ask for their share. The listing agency says they will transfer it “once everything clears.” Another month passes. The referring agency escalates. The listing agency now disputes whether the agreed split was 50-50 or 60-40, citing costs they claim to have incurred in running the launch. The referring agency has no signed document. The WhatsApp messages are ambiguous. There is no RERA-registered co-broking agreement in either file.
This is not a rare story. It plays out across Dubai with enough frequency that experienced brokers have a name for it: the ghost commission. The deal closed. The money arrived. And somewhere between those two events, the understanding dissolved.
The question this article answers is specific: why does the dispute surface months after the sale, not at the time of the sale? Understanding the mechanics behind the delay is what lets you design it out of your next deal before it starts.
How the developer pays — and why it creates a gap
In a resale transaction, commission flows at transfer: the buyer’s cheque clears at the Trustee Office, the title deed changes hands, and the commission cheques are drawn. The moment of payment is visible and shared by everyone in the room. In off-plan, the mechanism is fundamentally different.
In Dubai’s off-plan market, the buyer pays no separate agency commission. The developer compensates the agent directly. That sounds clean in theory. In practice, it introduces a timing gap that is baked into the structure of every off-plan deal.
Most developers release 50% of the commission after the buyer’s first payment clears and the remaining 50% after the second or third instalment. This creates a 30-to-90 day lag between the sale and full commission receipt.
That lag is not a bug or an oversight. It reflects the developer’s own cash-flow reality. Under Law No. 8 of 2007, every buyer instalment must be paid into a project-specific escrow account held by a RERA/DLD-approved bank. The account is dedicated exclusively to that one project and legally shielded from the developer’s creditors. The developer can only withdraw funds in stages that match construction milestones certified by an independent engineer.
This is the legal escrow mechanism that underpins all Dubai off-plan sales — not a service or a preference, but the law. Its existence means the developer is not sitting on the buyer’s money waiting to pay agents. The funds are ring-fenced, released in tranches tied to construction progress, and the commission the developer pays to an agency is itself tied to those payment events.
The result: an agent who sold a unit in January may not receive the second tranche of their commission until April or May, depending on when the buyer’s next instalment falls due and clears. And the agency that is owed a split by another agency has zero visibility into any of that. They did not sign the SPA. They are not in the developer’s system. They have no relationship with the developer’s finance department. They are entirely dependent on the listing agency choosing to pay them when the money arrives.
That dependency, unsupported by any signed agreement, is where disputes are born.
The shared listing problem: no mandate, no proof
The Dubai secondary market is well practised at handling shared transactions through Form F — the Memorandum of Understanding that captures the deal terms, the agreed commission, and the identities of all agents involved. It is signed before the transfer. The commission structure is part of the documented deal.
Off-plan launches have no equivalent forcing mechanism. The complexity of project launches — with multiple agents representing the same developer on a commission basis — creates opacity for buyers and accountability gaps across the market. At a launch event, five, ten, or twenty agencies may be working the same project simultaneously. The developer’s agreement is with the listing or primary agency (the one with the direct developer relationship and the Trakheesi-registered marketing permit). Any sub-agency arrangement between that primary agency and a referring agency is a private commercial agreement between those two parties — and the developer neither knows nor cares about it.
In a sub-agency arrangement, a referring agent passes a client to a listing agent and receives a referral fee, usually 25% to 50% of the total commission. In large or complex deals, the commission split between agencies can be negotiated between brokerages before the deal closes.
That negotiation is the critical moment. And far too often it happens verbally, at speed, in a noisy launch environment, by agents who are focused on closing the booking and not on documenting the commercial terms between themselves.
There is a further complication: RERA requires brokers to register, use standardised forms, and clearly document commission agreements. This protects all parties and reduces disputes. But the requirement to document applies most clearly to the broker-client relationship. The agency-to-agency split is a B2B arrangement, and it sits in a greyer space — one that the parties are expected to manage through their own written agreement, not through any developer or DLD-administered form. When that written agreement does not exist, or is captured only in a WhatsApp thread that neither party wants to screenshot in a formal dispute, the position of the referring agency is weak.
Why memory rewrites itself between booking and payment
There is a human dimension to this that no regulatory framework has ever solved: the gap between when something is agreed and when money actually changes hands creates conditions in which recollection drifts — sometimes innocently, sometimes not.
Consider what happens between a January booking and an April first-tranche payment.
The agent who sold the unit has, in the intervening months, closed three more deals. The referring agency who brought the buyer has gone on to work a different developer’s launch. Neither party has a signed document. The primary agency has been dealing with admin, Oqood registration, and a buyer who had questions about the SPA clauses. The split was discussed once, enthusiastically, on the night of the launch.
By April, the primary agency’s position has subtly shifted. They remember the split being agreed “in principle” but not confirmed. Or they remember agreeing to a 50-50 split of their net commission after deducting launch costs, not the gross commission. Or their team has changed and the person who made the original commitment is no longer with the agency. Or the developer has paid less than expected, and the primary agency feels entitled to absorb the shortfall rather than pass it through proportionally.
None of these are necessarily dishonest positions. But they are the predictable product of a verbal agreement separated from its payment by ninety days of unrelated activity. The referring agency, with no signed document and no direct relationship with the developer, is in the weakest possible position to challenge any of them.
The tranche structure amplifies every disagreement
The staged commission payment structure that developers use does not just create a single point of potential dispute — it creates several. Each tranche is a fresh opportunity for the primary agency to delay, renegotiate, or simply not pay.
Consider a deal where the developer pays commission in two tranches: the first on the booking payment clearing, the second when the buyer makes a second instalment. If the primary agency disputes the split or delays payment at the first tranche, the referring agency faces a choice: escalate now and potentially damage the relationship before the second tranche arrives, or wait and hope the situation resolves itself. Most choose to wait. Then the second tranche arrives, the same dynamic repeats, and now the referring agency is chasing two overdue payments simultaneously.
Project delays from developers failing to deliver units within the agreed timeframe can also complicate matters. Payment disputes can arise from disagreement over instalment schedules, the escrow account process, or overdue payments. When a construction delay pushes a buyer’s second instalment back — because the developer has not hit the milestone that would trigger it — the referring agency’s second commission tranche is also delayed, without warning and without any explanation from the primary agency who holds the developer relationship.
The referring agency does not receive developer construction updates. They do not receive a notice of delay. They simply stop hearing anything. And when they chase, the answer is often “the developer hasn’t paid us yet” — a statement that may be entirely true, may be partially true, or may be used to justify a payment delay that is entirely within the primary agency’s control.
With no signed agreement specifying what happens in a delay scenario — whether the primary agency commits to paying within a defined window of receiving the developer payment, or whether the two tranches are passed through proportionally and on the same schedule — the referring agency has no basis on which to demand anything specific.
What the VAT on commission adds to the complication
Agency fees in Dubai attract VAT at 5%. When the developer pays commission to a VAT-registered agency, the tax treatment is between the developer and that agency. In a co-broke arrangement, the split between agencies introduces a second layer: the primary agency is paying a service fee to the referring agency, and that fee is also subject to VAT if the referring agency is VAT-registered.
When the split is agreed verbally and neither agency has raised a proper tax invoice, the VAT question becomes another item to unpick after the fact. Does the agreed split include VAT or exclude it? Who issues the invoice to whom and when? If the payment arrives and the referring agency’s share is calculated on the net-of-VAT commission rather than the gross, the variance on a large deal is material. A 5% difference on AED 200,000 worth of commission is AED 10,000 — not a number anyone wants to discover through a WhatsApp argument months after a handshake.
The split must be agreed gross or net, VAT treatment must be agreed, and the invoicing obligation must be agreed, before the deal is booked. None of this is complex in principle. All of it becomes contentious in retrospect.
The buyer who changes their mind — and what that does to the split
An off-plan buyer who cancels or is cancelled by the developer midway through the payment plan creates its own chain reaction for agents.
Dubai’s off-plan rules provide developers with a process to take action against a purchaser in default, subject to notice requirements and the percentage of the project completed.
If the buyer defaults after the first instalment has cleared — meaning the developer has already released the first commission tranche to the primary agency — but before the second instalment clears, the primary agency has money in hand and the referring agency is still waiting for their first payment. The developer’s commission policy in a cancellation scenario varies by developer and by the stage at which the cancellation occurs. The commission may be partially clawed back. It may not be. The primary agency may have already paid the referring agency their share. Or not.
Most Dubai off-plan contracts include a grace period of 6 to 12 months beyond the anticipated completion date. During this period, the developer is not considered to be in breach. That grace period is a buyer-facing clause, not an agent-facing one. But its existence means that a buyer can be in a period of technical non-default for months after any reasonable observer would consider the project late. During that window, the primary agency may be sitting on a received first commission tranche while the deal’s ultimate outcome — completion and full commission, or cancellation and potential partial reversal — is genuinely uncertain.
In that environment, the path of least resistance for a primary agency is to hold the split payment until the situation “clarifies.” That clarification may take six months. The referring agency has no contractual right to demand anything sooner, because there was no contract.
What a signed split agreement changes — everything before the money moves
The pattern described throughout this article has a single structural cause: the split is agreed after the client relationship is established but before the commission arrives, in a moment of enthusiasm and urgency, without a document.
The dispute does not happen at the time of the sale because there is nothing to dispute at the time of the sale. No money has moved. Both agencies are aligned on wanting the deal to close. The disagreement only emerges when real money arrives in one party’s account and has to be shared with another party who has no contractual claim on it.
The fix is not complicated. It is inconvenient only when people choose not to do it.
Before the booking form is signed — not after, not “once we confirm,” not “when the developer confirms our split” — the two agencies need a written, signed co-broking agreement that specifies:
- The gross commission the developer will pay, or the best available figure at time of signing
- The percentage or fixed amount that constitutes each party’s share, expressed in AED and percentage
- The VAT treatment — gross or net, and who invoices whom
- The payment timing — whether the primary agency commits to passing the referring agency’s share within a fixed number of days of receiving each tranche from the developer
- What happens in a cancellation — whether any portion of a received tranche is clawed back or retained
- The triggering events — specifically what developer payment events trigger each tranche distribution
Brokerage laws in Dubai mandate that commission must be tied to a written agreement. Once conditions of the contract are met, the commission becomes payable. This ensures that commission is only charged after genuine service delivery. The same principle that protects agent-client commission needs to be applied, with the same rigour, to agent-agent splits.
The Real Estate Regulatory Agency governs how agents operate in Dubai, including how they earn and collect commission. Agents are required under RERA rules to disclose their commission arrangement to all parties. A properly executed co-broking agreement sits within that framework. It is not a bureaucratic imposition — it is what makes the framework work for both sides.
The RDSC route: real but slow and costly
When the split agreement does not exist and the dispute cannot be resolved commercially, the Real Estate Dispute Settlement Centre — part of the DLD’s judicial infrastructure — is the formal route. Agents can and do file commission claims there.
But the RERA mediation stage typically takes 30 to 60 days. If escalation is needed, total resolution time including court proceedings is typically 12 to 24 months.
A referring agency waiting on a commission split that was agreed verbally at a January launch event and has been disputed since April should not realistically expect a resolution by December of the same year through the formal route. And in a dispute where the primary evidence on both sides is a WhatsApp thread and a competing recollection of a conversation, the outcome is not guaranteed even after a year of proceedings.
The RDSC is a backstop. It is not a strategy. Using it to recover a split that should have been documented at the time of the sale is expensive in time, in management attention, and in the agency relationship that will not survive the process. The cost of a five-minute co-broking agreement at the point of booking is essentially zero. The cost of not having one surfaces months later — and it is rarely just financial.
Repeating launches compound the problem
Dubai’s off-plan market is a repeat-launch market. The DLD recorded more than 180,000 property transactions in 2024 as the off-plan boom drove a surge in broker registrations. Off-plan sales accounted for over 60% of Dubai transactions in 2024, a trend expected to continue through 2026.
In that volume environment, the same pairs of agencies work together across multiple launches. The informal arrangement that worked once — or seemed to work once, because nobody disputed it — becomes the assumed template for the next launch and the one after. Until it breaks. And when it breaks, it breaks across several transactions simultaneously, because the same undocumented understanding applied to all of them.
The complexity of project launches, with multiple agents representing the same developer on a commission basis, creates opacity for buyers and accountability gaps across the market. That opacity does not only affect buyers. It affects the referring agencies who have no line of sight into the developer’s payment schedule and are entirely dependent on the goodwill and organisation of the primary agency.
Agencies that work together at scale — on multiple launches, across multiple developer relationships — are the agencies most exposed to this risk, precisely because the relationship feels established and the informal approach feels like it has always worked. The dispute, when it arrives, is not just a financial event. It tends to end the working relationship and sometimes both agencies’ reputations in the community that sits between them.
The principle that removes the friction
There is a version of this market where the dispute described at the start of this article simply does not happen. Not because agents trust each other more, not because the regulatory framework has changed, not because developers have altered the way they pay — but because both agencies sat down before the booking and signed a document that said: here is the amount, here is each party’s share, here is what triggers each payment, here is what happens if the deal falls through.
That document would have been signed while both parties were motivated, aligned, and willing to be fair. The payment, when it arrived from the developer, would have triggered an automatic obligation — not a negotiation. And if the referring agency’s share had not arrived within the agreed window, they would have had a clear, written basis on which to demand it.
The fundamental principle is simple: the split must be agreed and signed before the client pays, and every party must be paid at once — or at least on a defined, pre-agreed schedule — rather than relying on one party to voluntarily pass money to another weeks or months after receiving it.
That sequence — signed agreement, client payment, automatic distribution — is the difference between a co-broke that works and one that becomes a ghost commission. Every element of the dispute outlined in this article is a direct consequence of not following it.
The agents who have stopped chasing split payments, stopped writing frustrated messages into WhatsApp threads at 11 at night, and stopped losing good agency relationships to avoidable disputes are the ones who figured out this sequence and applied it to every single off-plan transaction before the launch event ended.
It is not a luxury. It is the minimum viable process for working in a market where commission arrives months after the sale, developer payment schedules are opaque to everyone except the listing agency, and verbal agreements dissolve in the time it takes construction to reach the next milestone.
