By Staff writer
Measures designed to address any potential conflicts of interest
A new policy has been launched in Dubai to regulate jointly-owned properties in the emirate.
The Conflict of Interest & Party Transactions policy has been launched by Dubai Land Department (DLD) through the Real Estate Regulatory Agency (RERA).
It sets out the roles and responsibilities of parties involved, how to identify and manage conflicts and to avoid exploiting private interests between management companies, owners committees, and service providers.
Marwan bin Ghalita, CEO of RERA, said: “Based on the recent policy that we launched, an existent relationship among related parties must be disclosed or otherwise risk compromising the transactions of jointly owned property managers with other parties.
“Within the same framework, decisions regarding operations and decision-making must be taken free from the direct influence of related parties; and transactions should be carried out in accordance with the usual market terms and conditions, based on the principle of independent decision-making.”
Mohammed Khalifa bin Hammad, senior director of RERA at DLD, said the measures had been introduced in light of the growing spread of freehold areas in Dubai and the increase in freehold projects.
“Managers of jointly owned properties are to put in place a Conflict of Interest and Related-Party Transaction policy that must be applied in order to ensure transparency, fairness, and equality,” he said.
All related party transactions are to be disclosed in an annual report, which will be inspected by auditors.
Failing to abide by the policy could see contracts terminated and fines slapped on managers of jointly owned properties as well as other potential financial penalties.