More protection under Housing Act

The Star 28/09/2001

KUALA LUMPUR: The much-awaited amendment to the Housing Developers Act is expected to be tabled in Parliament next month to promote greater accountability from developers and protection for housebuyers.

Housing and Local Government Minister Datuk Seri Ong Ka Ting said among the things to be amended was the word “Developers” to Housing “Development” Act and a housing tribunal to be set up under the new Section 16A to accelerate claims by housebuyers.

“For claims up to RM25,000, housebuyers can either choose the housing tribunal or the courts. The cap on the amount claimable is the value of the claims and not the value of the property. This tribunal would ease the bureaucracies of the court and do not require the presence of lawyers but their decisions are binding,” he said.

Other major amendments, he said, include Section Six where there would be an increase in deposits for granting of licences to a person or body of persons from RM100,000 to RM200,000.

“As for companies, an additional RM200,000 would have to be deposited above their capital issued and paid up in cash of not less than RM250,000. This is to ascertain that the individual or company involve in the development of houses have the financial capacity to see the project through,” he said.

Section Six would also include three new sub-sections (e), (f) and (g) which states that a developer who was fined RM10,000 or directors of a construction being wound up by the court or architect and engineers being blacklisted by their respective bodies would not be issued a licence.

In conferring greater powers to housing officers, Ong said that a new Section 7B would enable the housing controller to issue directives to developers to act in the interest of housebuyers even if their licence has ended.

“There are many cases where developers refuse to renew their license because they would then fall outside the scope of the law. Legally they have no obligation towards the purchasers but with the new section they would still be responsible even if their licence is not renewed,” he said.

The new Sections 10A to J and 23A, he said, would also give the housing inspector and controller the power to enter premises and seize important documents for court proceedings and compound small offences under Housing Developers (Control and Licensing) Regulations 1989 respectively.

For categories of offences committed by developers under Sections 7A, 18, 19, 20, 21 and 22 the penalty stated in Act before the amendment would increase five-fold.

Ong said sale and purchase agreements under Section 8A gives the minister the power to terminate an agreement between the developer and purchaser if the project has not commenced after six months. However, 75% of the purchasers would have to agree to it.

He said the amendments would not be retrospective and would be enforced next year.