ABU DHABI // A federal property sector watchdog that co-ordinates the work of local regulatory bodies could be introduced UAE-wide under plans being considered by the Government, the Minister of State for Financial Affairs said yesterday. The scheme was one of several topics discussed at the session of the Federal National Council (FNC). Legislation to grant Emirati women married to non-UAE nationals access to housing assistance was passed, while the Government's reaction to companies that produced medication containing harmful bacteria was discussed.
The session was dominated by plans to better regulate the UAE property sector, which has this year experienced job losses, the cancellation of numerous projects and a substantial decline in house prices. The Government does not have a federal body with powers to monitor the sector. Instead, local governments, including those of Dubai and Sharjah, have established their own regulators, such as Dubai's Real Estate Regulatory Agency. Ajman and Abu Dhabi are considering similar schemes.
"We're looking into the possibility of carrying out a federal role to regulate this monitoring and co-ordinate among the [local] institutions," said Obaid Humaid al Tayer, the Minister of State for Financial Affairs. Mr al Tayer was answering a question by Amer Abdul Jaleel al Faheem, a member of the FNC, about the Government's efforts to control local banks' "overfunding" of property projects owned by foreign investors.
Mr al Faheem said several foreign property developers have fled the country with their real estate projects unfinished. "A number of developers have started their business here without having any capital," he said. "They formed alliances to develop a number of real estate projects and then secured 100 per cent funding. After the [financial] crisis a number of them left the market and left their projects unfinished."
A Central Bank resolution limits the lending for real estate projects to 20 per cent of the deposits that a bank has available for loans. Mr al Faheem claimed some banks did not abide by these rules. Although insisting that the Government should monitor the real estate sector more closely, Mr al Tayer said no further restrictions should be levied on foreign investors. "We should protect the real estate sector in these difficult times, he said. "We shouldn't impose any further restrictions at this difficult time on banks or on the movement of capital. We should deal with the circumstances calmly and wisely.
"We're in touch with the national and foreign banks constantly, therefore we see no need for imposing new rules unless there is a need for that in the future. Meanwhile, Emirati women married to non-nationals will be permitted to apply for government housing assistance under a law passed during the FNC session. The Sheikh Zayed Housing Program, a body formed to provide loans and grants to build homes, previously exempted Emirati women who were not married to their countrymen.
The law reversing this condition will come into effect once it is approved by the UAE Supreme Council, the country's top executive body. Limits on the size of the loans will be left open for the cabinet to decide. According to the FNC, the size of the loans will depend on economic conditions and general commodity prices. Also in the FNC session, the UAE Minister of Health Humaid Mohammed al Qutami, was questioned on government measures to punish companies whose medication was found to contain bacteria.
In November, the Ministry of Health ordered a recall of a locally produced antacid after it was found to contain a harmful bacteria. The non-prescription antacid, called Carelox, is manufactured by Pharmacare Fze at the company's plant in Jebel Ali Free Zone. Inspectors determined during a recent inspection of the plant that the company had not conducted mandatory microbiological tests on the drug, which comes in chewable tablets and suspension form, and had falsified safety data.
The ministry ordered that the product be removed from pharmacy shelves, as well as from all public and private medical establishments, including hospitals. mhabboush@thenational.ae
