DUBAI // The Real Estate Regulatory Authority (Rera) announced this month that it will establish a code of corporate governance for the real estate market, part of a series of steps it is taking to try to rebuild investor confidence.
"Our outlook is to have a real estate market that is up to the best international standards," Rera chief executive Marwan bin Ghalaita said in a statement.
The authority's partner in the effort, the corporate governance institute Hawkamah, plans to draft the code within two months, at which point Rera will decide how to implement it.
"It needs to be made mandatory for it to be really effective," said the Hawkamah director Nick Nadal.
The code may require firms to increase transparency through internal and external audits and disclosures to the authorities, which Rera can then publicise.
It may also spell out the firm's code of ethics and responsibilities to investors and shareholders.
The new code will not affect the many disputes that Rera is already handling, Mr Nadal said.
"Addressing the corporate governance front is trying to address the future ... so that these kinds of things don't happen anymore."
At the same time Rera is working to strengthen its overall regulations for the industry, he added. The rules are "being updated", Mr Nadal said, "in light of some of the lessons learnt, identifying the loopholes and trying to close the loopholes".
Tom O'Grady, head of real estate at the law firm DLA Piper, said that the property laws were understandably tested by the volume of disputes in recent years. He said it was "a little bit unreasonable to expect the government to have solved everything in the few years in which they have had to do it".
