Egyptian real estate company Palm Hills Developments expects the country will revamp its land allocation laws by end-March in a push to contain a spate of lawsuits against state land deals, its chief said.

Palm Hills, Egypt's second biggest listed developer, is facing a legal challenge over a small portion of its land. Chief Executive Yasseen Mansour said he is confident the state will not allow a proliferation of such lawsuits.

Confidence in Egypt's real estate sector, fairly buoyant through the financial crisis, was shaken when a court ruled in June that the state land sale for one of the country's biggest projects was illegal and the contract should be scrapped.

"If we take what this court did seriously, it means that all of Sixth of October, all of New Cairo, Sharm El Sheikh, El Gouna, and Hurghada will all be returned," he told Reuters, referring to urban areas near Cairo or on the Red Sea coasts.

Egyptian citizen Hamdy Fakhrany scored a victory in September when a court upheld the June ruling that the government broke the law by selling land to developer Talaat Moustafa Group without an auction.

The government has said it will uphold that ruling and cancel the deal, adding it had the right to draw up a new contract selling the land back to the firm because it was in the public interest.

That has not stopped copycat cases. In Palm Hills' case, the legal challenge it faces follows Fakhrany filing a suit against a land deal that gave it 960,000 square metres in a Cairo suburb.

Mansour said Palm Hills would meet with lawyers and find a strategy to fight the legal case. He expected the land distribution law to change near the end of the year or within the first quarter of 2010.

"We have been told by the government and they have made it clear and public that they will amend the bigger laws. They will rewrite it to say that in some cases, it is allowed for governmental bodies to give the land by direct order," he said.

The government wanted to pass a law that could work retroactively. It would need to pass with a two-thirds majority in parliament. The ruling party is widely expected to retain enough seats in a November election to secure such a majority.

The cases hinge on conflicting laws governing state land deals. The original court ruling said a Housing Ministry body sold land to Talaat Moustafa Group in violation of a 1998 law.

The government said it was following legislation that preceded the 1998 law.-Reuters