Legislation
   
 

Transitional Arrangement regarding Management Committees of Owners' Corporations appointed in accordance with Deeds of Mutual Covenant

The Building Management (Amendment) Ordinance 2007 (Amendment Ordinance) provides that owners shall appoint a management committee (MC) of the owners' corporation (OC) in accordance with the requirements set out in the Building Management Ordinance (BMO), instead of those provided in the deed of mutual covenant (DMC) of the building. For example, all the members of the MC (other than the tenants' representative) of the OC shall be the owners of the building.

Based on the records from the Land Registry, majority of the OCs are formed in accordance with provisions in the BMO. Only around 60 OCs (the list) had their MCs been appointed in accordance with the provisions of their respective DMCs. Their composition may differ, for example, some OCs allow non-owners such as the spouses or the adult children of the owners to be the MC members. The composition and procedure of such MCs, which were previously appointed in accordance with the DMC, are therefore inconsistent with the amended Schedule 2 to the BMO.

To allow sufficient time for such OCs to appoint their MCs in accordance with the amended BMO, the Amendment Ordinance includes a transitional provision. It provides that during the transitional period of four years (from 1 August 2007 to 31 July 2011), those MCs appointed under the provisions of the DMC can continue to adopt the provisions under the pre-amended Schedule 2 to the BMO. However, they shall take either one of the steps as set out below before the expiration of the transitional period to ensure the compliance with the amended Schedule 2 to the BMO in respect of the composition and procedure of the MC. Otherwise, it will be subject to query in respect of the validity of the MC (including the validity of the appointment of certain members of MC). Such steps are:

1. to pass a resolution at a general meeting of the corporation to comply with the amended Schedule 2 to the BMO and take follow-up action as appropriate (e.g. appointment of an owner to replace a non-owner member of the MC); or
   
2. at a general meeting of the OC at which members of the MC retire from office, to pass a resolution to comply with the amended Schedule 2 to the BMO regarding the composition and procedure of the MC, and appoint members of a new MC pursuant to the relevant provisions.

Our District Offices sent a letter to each of those OCs in late July 2007 asking them to take note of the transitional provisions in the Amendment Ordinance, and take either one of the above steps to comply with the amended Schedule 2 to the BMO in respect of the composition and procedure of the MCs.

Your attention is drawn that the list as mentioned above was compiled by this department based on the records submitted by the MC and kept by the Land Registry for registration of owners as a corporation. This department does not guarantee that the list as prepared is exhaustive and covers all the OCs where the MCs were appointed in accordance with the DMC. If owners are doubtful of whether their OCs are formed in accordance with the DMC, they may check the registration records at the Land Registry. It is also advisable for them to pass a resolution at a general meeting of the corporation to comply with the amended Schedule 2 to the BMO. For enquiries, please contact the District Building Management Liaison Team of respective District Office.