MOC’s draft not allowing apartment building developers to keep maintenance fee

New draft of MOC regulating 2%-apartment-maintenance-fee

The Ministry of Construction is drafting a Decree amending and supplementing some articles of Decree No. 99/2015/ND-CP dated 20 October 2015 detailing and guiding the implementation of a number of articles of the Law on Housing 2014 (“Decree 99“).

According to Article 36.1 of Decree 99, developer must set up an account for apartment buyers and tenants to pay 2%-for-apartment-maintenance fee. Article 36.2 of Decree 99 regulated that apartment buyers pay maintenance fee in 2 following forms: (1) paying directly to the account stated in the apartment sale and purchase contract; or (2) paying to developers for them to transfer into the maintenance budget account.

However, the regulation of the 2 forms of payment as mentioned above has led to the fact that developers used this budget before handing over to the management board of the apartment building. Since then, there has been a difficult situation in the settlement and recovery of budget to hand over to the management board of the apartment building. Therefore, Ministry of Construction deems it necessary to remove regulation on the form of direct payment to developers to mitigate the above situation.

In the draft, the Ministry of Construction proposed to amend the regulation on 2%-for-apartment-maintenance fee as follows:

Buyers, tenants, and developers must pay 2%-for-apartment-maintenance fee for shared portions of apartment buildings pursuant to Article 108 of the Law on Housing. This fee is calculated before paying tax (the State does not collect tax on this fee).

Developer must open a specific capital account at a credit institution operating in Vietnam to receive maintenance fee from buyers, tenants and developers according to regulations.

Developer must consistently record the account opened under this provision in the apartment sale and purchase agreements, lease-purchase agreements for apartments or other areas in a building, that to be signed with customers (including account number, account name and credit institution where this account is opened).

Before receiving the handover of apartments, buyers or lease-purchasers must pay 2%-for-apartment-maintenance fee into the account specified in this agreement. If developer does not collect this fee but still hands over apartment or other areas in the building to buyers, lease-purchasers, such developers must pay this fee.

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