The regulation of estate agents : a proposal

Abstract

As matters currently stand real estate agents are not subject to any specific regulation in Malta. The aims of this study are to examine such a lacuna in Maltese legislation and to look through the approach taken by the local courts. Due to this legal pitfall, any person may claim to be an estate agent since there is no legal framework regulating estate agency work. The contribution of Estate Agents to the Gross Value Added in the years 2010-3 was about 5.9% per annum, which is substantial enough to warrant the need to regulate estate agents. The recent publication of a White Paper issued by the former Parliamentary Secretary for Competitiveness And Economic Growth, in a bid to regulate the estate agents, highlights the importance of establishing a comprehensive legal framework in this field, thus regulating estate agents. However, in areas where it has been felt that the White Paper is not envisaging a foolproof legal framework, the present author analyses foreign jurisprudence so as to propose better solutions. This study has incorporated some elements found in jurisprudences abroad, particularly in the France, Ireland, Italy, New South Wales and Victoria in Australia, New Zealand and United Kingdom. This research study suggests that the regulation of estate agents requires the enactment of a Real Estate Agents Act. This necessitates a clear definition of who would be regulated by the proposed Act; what are the required licensing requirements; the responsible administrative body; and the consideration of statutory rights and obligations. Thus, such rules would provide guidance on the day-to-day work of estate agents. This study shows that mandatory registration with a regulatory authority is the way forward, since this would safeguard the accountability of estate agents as well as provide effective and active supervision, which in turn promotes consumer protection.