AUSTRAC Clarifies Leasehold and Notarial Services Under Tranche 2 AML/CTF Rules

AUSTRAC updated its guidance on 31 August 2026 to clarify how long-term leasehold interests, standalone licences to occupy and notarial services are treated under Australia’s expanded anti-money laundering and counter-terrorism financing regime.

The changes affect guidance for real estate and professional designated services, two areas brought into the AML/CTF framework under Australia’s tranche 2 reforms. AML/CTF obligations for newly regulated tranche 2 entities began on 1 July 2026.

Leasehold interests and licences to occupy

AUSTRAC’s updated real-estate guidance explains that “real estate” includes a leasehold interest of more than 30 years, excluding options for renewal, extension or further terms. It also covers certain land-use entitlements, including arrangements where occupation rights arise through shares in a company or units in a unit trust.

By contrast, leases of 30 years or less are excluded from the definition. AUSTRAC also distinguishes a standalone licence to occupy from a leasehold interest. A standalone licence generally gives contractual permission to occupy premises but does not itself grant an interest in land, usually does not provide exclusive possession and generally cannot be registered on title.

AUSTRAC gives the example of a retirement-village resident who pays a contribution and receives a standalone licence to occupy a unit, but is not recorded on title, cannot sell, transfer or sublet the unit and does not obtain rights through shares or units. On those facts alone, the arrangement is not “real estate” for AML/CTF purposes, so services relating only to that licence are not real-estate designated services.

The guidance also confirms that granting or re-granting a leasehold interest can constitute selling real estate where a business sells or transfers real estate without an independent real-estate agent. Residential-site leaseholds qualify as real estate where the interest exceeds 30 years.

Professional services guidance also updated

AUSTRAC made the same 31 August clarification on licence-to-occupy and leasehold arrangements in its professional designated-services guidance. For professionals assisting with property transactions, the guidance states that regulated activities can include preparing or reviewing sale and transfer documents, researching titles, coordinating payments and mortgage discharges, holding or disbursing settlement funds and preparing documents for registry authorities.

AUSTRAC separately recorded a second 31 August update to its professional-services guidance, adding a new example involving notaries and notarial services to help businesses assess whether they are providing a professional designated service.

The updates are guidance clarifications rather than a new legislative commencement. They matter because they refine the boundary of activities that can trigger AML/CTF obligations for newly regulated real-estate and professional-services businesses after tranche 2 obligations took effect.