The detention this week of the British head of a well-known and reputable property company here is another instance of deals going very badly wrong and the industry should consider establishing an independent mediator to independently resolve disputes out of court.
Mark Tuck is being interrogated under detention for his part in a land-acquisition contract that the buyer claims resulted in neither certification nor a full return of funds. The case (if there is one) is headed for the Denpasar District Court for a panel of judges to decide who erred, if anyone. It follows a progression of recent ceases involving property companies whose principals have been jailed.
For a small island with very limited space, the large amount of property companies operating here seems inversely proportional. Yet from the accounts we hear, most appear to be faring well as foreign interest in Bali’s property sector remains strong. Realtors will be further encouraged by news this week of more surveys showing that Bali is many people’s preferred holiday destination.
To safeguard this sector all involved should enter discussions under an umbrella body much the same as the Bali Hotels Association, which represents the top-starred hotels on the island. Such an organisation could then devise an independent tribunal that would hear disputes and seek to resolve them without causing harm to property firms or their clients, as the never-ending legal cases having been doing.
A mediator body for the property sector is also required in a country where there is often little legal certainty and whose rules are frequently unclear to a mainly foreign clientele. To this end it would operate an advice service to people thinking of making property or land purchases. Staffing could be provided by funding generated by membership in the organisation. When property firms in Bali sell homes for upwards of a million dollars, an annual fee to protect their business would be money well spent.
There are too many stories of people being ripped off by alleged cowboy real-estate operators in Bali, and the growing number of court cases adds to an overall and growing sense that too much trust must be placed on the side of the prospective buyer, that they must just accept what they are told at face value.
Establishing organisations to instil a sense of security would be an early step to mitigate this. Allowing foreigners to purchase real estate outright in their own names, thus avoiding the underhand scheme that is the current shambles, is another issue. It is one that must eventually be granted. The current irresolute government in Jakarta should find the means to make this move.Filed under: Editorial