José Manuel Alburquerque Prieto
Alburquerque Abogados Consultores, Santo Domingo
jmap@alburquerque.com.do

Gina Alexandra Hernández Vólquez
Alburquerque Abogados Consultores, Santo Domingo
ghernandez@alburquerque.com.do

Introduction

In recent years, the Dominican Republic has consolidated its position as one of the most dynamic real estate markets in the Caribbean. Sustained by the growth of tourism, foreign direct investment and an expanding domestic demand, the sector has become a focal point for developers and investors seeking legal certainty, efficiency and transparency.

Two significant developments are reshaping the structuring and execution of real estate transactions: the increasing use of trusts as vehicles for investment and the progressive digitalisation of governmental procedures which, historically, had delayed processes and diminished investor confidence in the Dominican legal system.

Trusts as investment vehicles

The enactment of Law No 189-11 on 22 July 2011 for the Development of the Mortgage Market and Trusts first introduced the trust (fideicomiso) in the Dominican Republic as a flexible and secure legal structure. Under this legal framework, the settlor (fideicomitente) transfers certain assets into a separate patrimony to be administered by a fiduciary institution (fiduciario) for the benefit of designated beneficiaries, in accordance with the terms and instructions established in the trust agreement.

Among the various applications of trusts in the Dominican Republic, one of the most prevalent is the real estate development trust, which enables a developer to transfer land and project assets into a trust managed by a fiduciary institution. This mechanism finds robust legislative support in Law 189-11, which expressly defines real estate investment and development trusts, among other categories, as independent patrimonies whose principal purpose is to invest in real estate projects at all stages – from design and construction through to formalisation, registration and subsequent sale or lease. The real estate trust structure offers several advantages:

• Transparency and security for buyers: purchasers of units in projects in development can rest assured that their investments are being managed within the trust’s terms and that the different stages of construction are being followed under the supervision of the fiduciary institution.
• Risk management: by segregating assets, the trust structure protects both investors and buyers from liabilities arising from the developer’s obligations. Article 9 of Law 189-11 further reinforces this principle by prohibiting, in general, creditors of both the settlor and the fiduciary institution from pursuing trust assets, allowing only the profits generated by the trust and payable to the debtor to be subject to claims.
• Facilitated financing: given the trustworthiness of trusts and, specifically, trust-backed real estate projects, banks and financial institutions are more willing to finance potential buyers in projects held in trust, especially since the funds and guarantees are managed under strict fiduciary oversight.
• Investment pooling: trusts allow for the participation of multiple investors – both domestic and foreign – in large-scale projects that might otherwise be beyond the reach of individual participants.

Over the past decade, trusts have rapidly become the preferred mechanism for structuring projects and channeling investment in the real estate sector. According to statistics shown by the Superintendency of Banks (SB), up until May 2023, real estate trusts comprised 79 per cent of all trusts constituted in the Dominican Republic, with 34 per cent corresponding to private real estate and 45 per cent dedicated to low-cost housing development.^[1]

Currently, residential complexes, commercial centres and tourism-related projects in Punta Cana, Santo Domingo and other hubs are frequently structured through trusts. This has fostered greater confidence in the Dominican market and has aligned local practices with international standards.

Furthermore, this growing reliance on trust structures has been reinforced by broader advances in the modernisation of the Dominican legal framework – particularly the digitalisation of governmental procedures – that together are transforming the investment landscape and enhancing the country’s overall competitiveness.

Digitalisation of procedures

Parallel to these developments – and in large measure accelerated by the global pandemic – the Dominican government has invested heavily in digital platforms and passed new legislation aimed at streamlining bureaucratic processes. For decades, investors found that one of the main challenges of carrying out real estate transactions in the Dominican Republic was the time and complexity required to obtain authorisations, register titles or process tax filings and the lack of transparency in the procedures, both regarding the titles themselves and the different stages of the tasks needed for the formalisation of a real estate development.

In recent years, however, a large number of government agencies have implemented online systems that have transformed this landscape:

• Title Registry: filings can now be submitted electronically, drastically reducing waiting times and expediting approvals for title transfers, as well as the inscription or cancellation of liens.

• General Directorate of Internal Taxes (DGII): property transfer tax payments may be made through electronic wire transfers, while tax compliance certificates and most fiscal filings are now handled through the ‘Virtual Office’, an online portal that centralises taxpayers’ obligations.
• Chamber of Commerce: the Chamber has implemented electronic services accessible through its dedicated platform, including the issuance of corporate certificates and other formal documents with qualified digital signatures, thereby accelerating company incorporation and corporate registry procedures.

A landmark innovation has also been introduced by Resolution No 50-2024 of the Supreme Court of Justice, which authorises notaries to utilise secure digital documents and signatures, in line with nationally and internationally recognised standards. This reform marks a milestone for the legal profession, as it finally recognises digital instruments with the same legal validity as their physical counterparts, something which had been put in place by earlier legislation but lacked specific regulation for notarial practice. In practical terms, deeds of sale, mortgage contracts and other contracts requiring notarisation may now be executed and circulated entirely through digital channels, eliminating the need for physical appearances and reducing the logistical costs traditionally associated with notarial services. By embracing digital notarisation, the Dominican Republic not only modernises its legal infrastructure but also signals to foreign investors its capacity to adapt to global best practices in the provision of legal services.

The impact of this transition to the online world has been significant: transactions and services that once took months can now be completed in weeks and, in some cases, even days or hours. This efficiency reduces transaction costs and enhances the overall investment climate for potential investors.

Beyond convenience, digitalisation also has a strong governance component. By moving sensitive processes such as property title transfers and tax payments online, the Dominican Republic is reducing opportunities for discretion and corruption, while at the same time creating traceable audit trails. This fosters greater legal certainty for investors and aligns with international standards of compliance.

Looking forward, the regulatory framework established by Law No 126-02 on Electronic Commerce and reinforced by Resolution 50-2024 on digital notarial practice creates a solid foundation for continued innovations. These advances should continue to position the Dominican Republic at the forefront of digital transformation in the Caribbean real estate sector.

A more attractive market

Together, these two upward trends – trust structures and the digitalisation of legal procedures – are reshaping the Dominican real estate sector in a more sustainable and strategic manner. Overall, the use of trusts is creating safer, more transparent avenues for investment, while the digitalisation agenda is cutting red tape and making the process of buying, selling and developing property more efficient for all parties involved.

For local developers particularly, this general departure from antiquated investment models and physical bureaucracy means access to more financing options and increased buyer confidence. For foreign investors, however, this modernisation process now demonstrates that the Dominican Republic is updating its legal and institutional framework to align with global best practices and is continuing to consolidate itself as an attractive new market to invest in.

As the real estate market continues to grow in conjunction with its experience and legislation, it is clear that the combination of innovative legal tools and efficient public administration will remain key drivers of success for investors across the country.

Ultimately, the convergence of these reforms demonstrates that the Dominican Republic is not only proactively responding to demands from a growing local market but also anticipating the needs and positioning themselves to be a more globalised and technology-driven investment environment. By combining legal innovation with digital efficiency, the Dominican Republic is laying the groundwork for a more trustworthy, resilient and competitive real estate sector. Should these trends continue, the Dominican Republic positions itself to become a benchmark for other Caribbean and Latin American jurisdictions seeking to modernise their real estate markets and attract long-term, sustainable investment.