Primer Minister Mostafa Madbouly has mandated the swift finalization of a draft law to establish the “Egyptian Federation for Real Estate Developers,” which aims to regulate property development, ahead of its presentation to the cabinet for approval, Invest-Gate reports.
Executives are required to settle the contentious points in the proposed law soon, Madbouly said during a meeting held on September 10, in the attendance of Minister of Housing, Utilities, and Urban Communities Assem El Gazzar, alongside representatives from the real estate sector, operating with various residential, administrative, commercial, industrial, and tourism developments nationwide, according to a recent official statement.
Under the 84-article bill, the state-sanctioned federation will be the primary licensing body, hence entitled to create effective methods of real estate development, together with a code of ethics to guarantee the protection of consumer rights, while introducing new permit terms for property developers. It is also authorized to form provisions governing the inventory, organize and classify members of the union, pursuant to their specialties and qualifications to serve the profession.
Additionally, it will study the economic and technical issues related to real estate companies, along with offering results and solutions to these matters and setting up a fund to hedge against sector-related risks. Besides, an optional arbitration system will be established to ensure the speedy settlement of disputes between members. It will also cooperate with Arab and foreign property organizations, aiming to strengthen ties with them and exchange experiences in the area of competence.
Back in January, Tarek Shoukri, head of the Real Estate Development Chamber affiliated to the Federation of Egyptian Industries (FEI), told Invest-Gate that the draft law was submitted by the chamber, noting that the article related to the prohibition of announcing booking or reserving real estate units or contract to sell units before obtaining the building permits was originally submitted by FEI’s members.
In the case of any project faltering or suspension, the fund intervenes and guarantees the clients’ funds and the right of the state, Shoukri noted, elaborating that the penalty imposed on developers by the new law, even in cases of delays in units delivery or announcing off-plan projects without obtaining licenses, is not much; however, it will help in preventing violations and frauds within the sector.
