Top politicians and industry officials want regulators to tighten rules on disclosure relating to takeovers in the wake of Aabar Investments' purchase of Arabtec Holding stock.
The call came as Arabtec revealed yesterday Aabar was continuing to build a stake in the company by degrees.
The Financial Services Association (UAE), a trade body representing financial firms, has called on regulators to re-examine market rules that allowed Aabar Investments to become the largest single holder of the construction giant Arabtec's stock without alerting markets until Monday.
Meanwhile, a Federal National Council member has said widespread trading rumours ahead of the announcement should be investigated by regulators.
On Sunday, the newspaper Alrroya reported Khadem Al Qubaisi as saying Aabar had taken a controlling stake of 53 per cent in Arabtec. Mr Al Qubaisi is chairman of both companies.
But within 24 hours, Arabtec had notified markets that the article contained "incorrect information", saying the stake held by Aabar and its funds was 20.76 per cent as of last Thursday.
Aabar has not commented.
Arabtec said yesterday Aabar's holding had increased to 20.93 per cent as of Monday.
Arabtec's shares rose 128.3 per cent during the first two months of the year as speculation began to circulate on trading floors.
Exchange officials had a duty to investigate those rumours concerning Aabar's presence in the market, which had spread among trading floors preceding the announcement, said Ali Al Nuaimi, the secretary of the Federal National Council's finance committee.
"If there's a strong rumour, it has to be brought to the attention of the authorities, and the authorities could investigate," he said.
While there is no suggestion either Aabar or Arabtec had broken any laws on disclosure, the trades may have revealed a "grey area" in market regulation that should be examined, said Arwa Hamdieh, the co-founder of the Financial Services Association (UAE).
"If there is a disagreement that the conduct is different from the spirit of the law, it's an occasion for the regulator or the exchange to provide guidance on how they wish this issue to be addressed," she said.
The builder's shares fell 5.7 per cent in trading after the initial reports on Sunday, before rallying 4.6 per cent the next day - during the period when Aabar was purchasing more stock.
The Financial Services Association (UAE) is a newly established trade body representing 20 financial services companies, including UBS, National Bank of Abu Dhabi and ING Investment Management.
A Dubai Financial Market spokesman declined to comment on why the exchange had not asked Arabtec to disclose Aabar's shareholdings sooner.
Representatives of the Securities and Commodities Authority, the UAE regulator, did not respond to requests for comment.
Aabar announced a previous attempt to acquire 70 per cent of Arabtec's shares in January 2010, in a deal worth Dh6.4 billion (US$1.74bn).
However, a few months later both parties walked away from the deal and said they would focus on a "strategic partnership in Abu Dhabi" instead.
Although Arabtec's shares have fallen since peaking in February, the stock has contributed about half of the gains on the Dubai Financial Market General Index so far this year.
This month, it was announced Arabtec was part of a consortium that is the preferred bidder for the expansion of Abu Dhabi International Airport.
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