Off-the-plan and developer sales: when your AML obligations actually attach

An off-the-plan contract can be signed years before the building exists to settle in. Your agency did its job long before the keys change hands, so it's fair to ask: does the AML/CTF clock start at signing, or does it wait for settlement?

The fastest way to have a defensible answer

The fix isn't reasoning through statute each time a project comes up. It's having a system that timestamps the obligation the moment it exists and flags the file if it goes stale before settlement.

1. Sign up, around 2 minutes. Enter your ABN and AML Simple pulls your registered business details from the ABR automatically.
2. AUSTRAC Readiness Check, around 5 minutes. Shows exactly where your agency's program stands against Tranche 2 obligations, including how it treats project marketing and developer engagements.
3. Client screening, you run identity verification and sanctions/PEP checks on each buyer at the point your obligation starts, timestamped and stored against that file, so a multi-year settlement gap doesn't leave you guessing whether the record is still current.

Your agency has a record of when CDD started and whether it's still good. That's the part a spreadsheet doesn't do for you automatically.

When the designated service is actually provided

The AML/CTF Act's designated service for real estate is brokering the purchase, sale, or transfer of real estate for someone else, as part of a business. Whether your agency acts for the buyer or is engaged by the developer to run project marketing, that brokering role starts the moment you begin acting as intermediary on the deal, not at settlement. (For the separate question of whether a developer selling direct, with no agent involved, is itself a reporting entity, see when does CDD apply in real estate transactions, that's a scope question; this post is about timing.)

The default rule under AML/CTF Act 2006 s 34 is that CDD must be completed before the designated service is provided. For an off-the-plan sale, that means before your agency starts acting as broker on that contract, which in practice is around the point of signing, not years later when the title actually transfers.

This matters because project marketing agents sometimes treat the sale as "not real yet" until settlement is close. Under the Act, the obligation doesn't wait for the transaction to feel imminent. It attaches at the point your agency is brokering the deal.

What this means for the gap between signing and settlement

Off-the-plan contracts routinely run 18 months to several years from exchange to settlement. Your CDD obligation doesn't switch off for that gap. It changes shape. Once initial CDD is complete, the obligation becomes ongoing CDD: keeping the file current for as long as the relationship continues, and re-checking it when something material changes.

Over a multi-year settlement window, several things can make a completed file stop being current:

• Sanctions and PEP status can change. Current guidance points to re-screening periodically and whenever sanctions lists update, not just once at signing. A buyer who screened clean in 2026 isn't guaranteed to still screen clean in 2029.
• The buyer's structure can change. An off-the-plan purchase bought in a buyer's personal name at signing sometimes settles into a company or trust structure. A changed structure generally means updating who you've identified as standing behind it.
• The transaction itself can change. A different funding source, a nominee substituted before settlement, a price variation. Current guidance treats a material change in the nature of the transaction as a trigger to revisit the file, not just note it and move on.

None of this is unique to off-the-plan sales. It's the same ongoing CDD obligation covered in why CDD doesn't end at settlement. What's different here is the scale of the gap: a standard resale might settle in six weeks, so a stale file is unlikely. An off-the-plan contract can leave a file untouched for years, which is exactly the setting where "verified once at signing" quietly turns into "not actually current."

What a defensible record looks like for a long settlement

For a file that has to stay good over a multi-year gap, the record needs three things:

1. A timestamp for when initial CDD was completed, tied to the point your agency started brokering the deal, not the settlement date.
2. A record of any re-checks performed during the gap, including periodic sanctions re-screening and any structure or transaction changes picked up along the way.
3. A clear point of completion, so there's evidence the file was current going into settlement, not just current at signing.

If your agency runs several off-the-plan projects at once, this is also where a spreadsheet starts to break down, not because the individual checks are hard, but because nobody is tracking which of forty buyer files from a 2027 contract still need a re-screen before a 2029 settlement.

Doing it yourself

If you're not using a tool for this, the same principles still apply manually:

• Record the date your agency began acting as broker on each off-the-plan contract, and treat that as the CDD start date, not the eventual settlement date
• Re-screen buyers against DFAT sanctions and PEP lists periodically through the settlement period, and whenever the sanctions list updates, not only once at exchange
• Update the buyer's file if the purchasing structure changes between signing and settlement (individual to company or trust, for example)
• Keep every record for 7 years from when it's made, per the general record-keeping obligation in AML/CTF Act 2006 s 107, which for a long-settling off-the-plan file can mean retaining records that started years before settlement even occurred

Penalties for non-compliance can reach up to A$36,400,000 per contravention for a body corporate, or up to A$7,280,000 per contravention for an individual, under AML/CTF Act 2006 s 175.

The point that matters

A signature on an off-the-plan contract starts the clock. Settlement doesn't reset it, and a multi-year gap in between is exactly where a file quietly goes stale if nobody's watching it. Get started free and have a record that stays current for as long as the contract does.