CAIRO: Egypt’s High Administrative Court postponed on Thursday a ruling on a land sale to a Talaat Moustafa Group (TMG) unit until Aug. 10, saying it needed to consider the case further.
A lower court ruled in June that the New Urban Communities Authority (NUCA), a body under the ministry, broke the law and sold the land directly to a TMG unit instead of opening it up to bidding, and the contract should be scrapped.
NUCA and TMG separately appealed against the first ruling and the court said on Sunday it would merge the two appeals and issue one verdict on both of them on Aug. 5.
"The court decided to transfer the two appeals to the (investigation department) and set the session of Aug. 10 to look into them," Judge Moustafa Hanafy said.
Traders said it was unlikely the outcome of the case would lead to a cancellation of Madinaty, TMG’s main flagship project that will include homes, schools, shops, hotels and a golf course on 8,000 feddans (8,304 acres) of land on Cairo’s outskirts.
"Withdrawing the whole land seems very unlikely and consequences would be drastic on the real estate market and even the EGX as a whole," said Karim Yehia, real estate analyst at Pharos.
"The most likely outcome is a revised contract with an additional fee for the remaining land, or a penalty could be imposed," he added.
Asked about the effect that a contract revision verdict would have on the country’s real estate industry, Yehia said; "No doubt it will have a negative impact on foreign and local confidence … and the Egyptian legal system."
TMG has a 6.5 percent weighting in Egypt’s main EGX30 index, according to the bourse website.