New Procedures for Challenging EFSA
New Procedures for Challenging EFSA's Decisions on Mortgage Finance
The Prime Minister has issued a decree amending the procedures for challenging the decisions of the Egyptian Financial Supervisory Authority ("EFSA") on mortgage finance (the "Decree").[1] Before dealing with the details of the recent decision, it may be useful to set out the general procedures for challenging administrative decisions.
Since the mid-Twentieth Century, the procedures for challenging administrative decisions under Egyptian Law have required a challenge to be submitted before the various levels of administrative courts, up to the Supreme Administrative Court (State Council). Based on this system, a dearth of administrative verdicts has been passed which have influenced both Egyptian Law and the laws of other Arab nations.
Despite this, in various special cases, specific laws have stipulated the need to offer different solutions for those challenging administrative decision-making. Particularly, some laws have stipulated a requirement to challenge decisions before a review committee within the relevant administrative authority itself as a step to be taken before the challenger takes the case to the administrative courts. If both the administrative body and the party challenging its decisions agree with the decision of the committee charged with reviewing the challenge, the review committee’s decision shall be considered final. If the two parties do not agree with the decision, the case may be submitted by any of the parties before the administrative courts. This means that while administrative courts retain judicial supremacy, in cases where the respective law requires administrative review at the level of the administrative body, this must be undertaken as a preliminary step.
One of the most important implementations of this concept is found in Article 32 of the Capital Market Law No 92/1992, which stipulates that it is necessary for a challenging party to present its challenge before the relevant review committee within the administrative body before taking the case on to the relevant administrative court. This has become general practice in the capital market sector in Egypt.
Likewise, the Mortgage Finance Law No. 148 of 2001 states in Article 42 (bis) that it is necessary to bring forth challenges before the review committee, whether the challenge originates from mortgage finance companies, real estate agents or mortgage finance experts and intermediaries. Cases brought before the administrative courts will not be accepted unless the challenging party has undertaken this initial step beforehand.
It should be noted that with regards to the Mortgage Finance Law, not all administrative decisions must be challenged before the relevant administrative challenges committee; only those concerning mortgage finance companies, real estate agents, experts in the field, or mortgage finance intermediaries, will be subject to such process. This is significantly different from the provisions of the Capital Market Law, which requires all decisions passed by EFSA to be challenged before the administrative body’s review committee.
In this respect, the recent Decree comprises several amendments, the most important of which are as follows:
- The rescission of a license of a mortgage finance company, or the expulsion of an agent, expert, or mortgage finance intermediary, does not take effect before the expiry of the period in which that party may challenge such decision, or unless the challenges committee issues a decision. This offers a very important protection for mortgage finance companies; no company will be forced to cease operations or have its license rescinded without having the right to challenge that decision.
- The various documents required for the submission of a challenge, so that the process for challenging is set out clearly.
- The fees to be submitted for a challenge; these being EGP 20,000 for mortgage finance companies and EGP 10,000 for agents, experts, or mortgage finance intermediaries.
- In the event that the challenger’s case is accepted, EFSA will refund the fees.
- In cases of challenges brought by mortgage finance companies, a representative of the (yet to be established) Egyptian Mortgage Finance Union will be present at the hearings.
The Prime Minister has issued a decree amending the procedures for challenging the decisions of the Egyptian Financial Supervisory Authority ("EFSA") on mortgage finance (the "Decree").[1] Before dealing with the details of the recent decision, it may be useful to set out the general procedures for challenging administrative decisions.
Since the mid-Twentieth Century, the procedures for challenging administrative decisions under Egyptian Law have required a challenge to be submitted before the various levels of administrative courts, up to the Supreme Administrative Court (State Council). Based on this system, a dearth of administrative verdicts has been passed which have influenced both Egyptian Law and the laws of other Arab nations.
Despite this, in various special cases, specific laws have stipulated the need to offer different solutions for those challenging administrative decision-making. Particularly, some laws have stipulated a requirement to challenge decisions before a review committee within the relevant administrative authority itself as a step to be taken before the challenger takes the case to the administrative courts. If both the administrative body and the party challenging its decisions agree with the decision of the committee charged with reviewing the challenge, the review committee’s decision shall be considered final. If the two parties do not agree with the decision, the case may be submitted by any of the parties before the administrative courts. This means that while administrative courts retain judicial supremacy, in cases where the respective law requires administrative review at the level of the administrative body, this must be undertaken as a preliminary step.
One of the most important implementations of this concept is found in Article 32 of the Capital Market Law No 92/1992, which stipulates that it is necessary for a challenging party to present its challenge before the relevant review committee within the administrative body before taking the case on to the relevant administrative court. This has become general practice in the capital market sector in Egypt.
Likewise, the Mortgage Finance Law No. 148 of 2001 states in Article 42 (bis) that it is necessary to bring forth challenges before the review committee, whether the challenge originates from mortgage finance companies, real estate agents or mortgage finance experts and intermediaries. Cases brought before the administrative courts will not be accepted unless the challenging party has undertaken this initial step beforehand.
It should be noted that with regards to the Mortgage Finance Law, not all administrative decisions must be challenged before the relevant administrative challenges committee; only those concerning mortgage finance companies, real estate agents, experts in the field, or mortgage finance intermediaries, will be subject to such process. This is significantly different from the provisions of the Capital Market Law, which requires all decisions passed by EFSA to be challenged before the administrative body’s review committee.
In this respect, the recent Decree comprises several amendments, the most important of which are as follows:
- The rescission of a license of a mortgage finance company, or the expulsion of an agent, expert, or mortgage finance intermediary, does not take effect before the expiry of the period in which that party may challenge such decision, or unless the challenges committee issues a decision. This offers a very important protection for mortgage finance companies; no company will be forced to cease operations or have its license rescinded without having the right to challenge that decision.
- The various documents required for the submission of a challenge, so that the process for challenging is set out clearly.
- The fees to be submitted for a challenge; these being EGP 20,000 for mortgage finance companies and EGP 10,000 for agents, experts, or mortgage finance intermediaries.
- In the event that the challenger’s case is accepted, EFSA will refund the fees.
- In cases of challenges brought by mortgage finance companies, a representative of the (yet to be established) Egyptian Mortgage Finance Union will be present at the hearings.