It became clear, after the massive building construction which strongly influenced the economy in the Macau Special Administrative Region of the People’s Republic of China during the past few decades, that the regulations governing condominium management had to be reviewed to meet the specific issues arising in the Macau SAR from the elevated concentration of condominiums, from the complexity of the inherent ownership relations and to maintain or increase the standards of the provision of condominium management services.
In the Macau SAR, condominium management services tend normally to be provided by the so-called developers (meaning the entities that construct the buildings) or arranged by the unit owners themselves, and thus the law should seek to improve such services and to ensure that the entities providing the same are subject to proper supervision.
In a government-initiated bill, and after a great deal of effort from the Macau SAR Legislative Assembly, the latter approved a diploma regulating the condominium management services, which was promulgated in the Macau SAR Official Gazette on the 21 August 2017 and is slated to come into effect exactly one year after.
In a nutshell, the legislation focuses on (i) regulating the access and provision of condominium management services in the Macau SAR, (ii) improving the overall management of the common areas of the condominiums, and (iii) tackling the condominium management-related disputes between the condominium management committees and condominium management companies.
The major aspect of this new law is evidently the fact that the provision of condominium management services now becomes subject to licensing by the Housing Bureau, which is valid for a period of 3 years and cannot be transferred to another entity. Among the requirements to obtain a license, the company must have its registered address in the Macau SAR, its business scope must include condominium management services, its registered capital must be a minimum of MOP 250,000, at least one specialized manager, the directors must be in good standing and the entity proposing to conduct such business cannot have any debts to the Macau SAR Treasury.
Moreover, in order to provide condominium management services, the entity must effect a deposit with the Macau SAR Government as well as comply with several obligations in the provision of such services (such as preparing the annual accounts of the previous year and the budget for the upcoming one).
Finally, licensed entities are obliged to notify the Housing Bureau within 30 days of the occurrence of the situations provided in the law, such as the commencement of bankruptcy proceedings or the change of the firm, registered office or directorship. Evidently, non-compliance with the said obligations can subject the entities to fines, suspension of the license or even its revocation and most notably to criminal liability (which, in some circumstances, can be imputable to the directors and others that exercise de facto senior management positions although not formally appointed as such).
Considering its practical and wide application, we recommend a careful analysis of the implications of the new law. Moreover, our dedicated team of property practitioners shall be glad to assist in any enquiries concerning this very important matter.