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Contents Foreword 1 Chapter 1 Building Management Ordinance 3 Chapter 2 Owners’

Contents Foreword 1 Chapter 1 Building Management Ordinance 3 Chapter 2 Owners’ Corporation 5 Chapter 3 Formation of an Owners’ Corporation 9 Chapter 4 Appointment of Members of a Management Committee 16 Chapter 5 Management Committee 25 Chapter 6 Meetings of Management Committee 32 Chapter 7 Filling Vacancies of a Management Committee 36 Chapter 8 General Meetings of Owners’ Corporation 46 Chapter 9 Financial Arrangements for Owners’ Corporation 56 Chapter 10 Procurement Arrangements for Owners’ Corporation 65 Chapter 11 Responsibilities and Rights of Owners 72 Chapter 12 Duties of Manager 80 Chapter 13 Mandatory Building Management 94 Appendix 1 Application for Registration of Owners as a Corporation 97 (provided by the Land Registry— L.R. 164) Appendix 2 Personal Information Collection Statement 98 (Applicable to the forms provided by the Land Registry) Appendix 3 Declaration of Eligibility (provided by the Land Registry — L.R. 169) 99 Appendix 4 Notice of Change of Particulars / Notice of Policy of Insurance 100 (provided by the Land Registry — L.R. 124) Appendix 5 Declaration of Change of Particulars 101 (provided by the Land Registry — L.R. 170) Appendix 6 Statutory Format of the Instrument of Proxy 102 for Meetings of Corporation Disclaimer This Guide, which is prepared by the Home Affairs Department (HAD), seeks to outline in layman’s terms the main provisions of the Building Management Ordinance. The legal provisions referred to in this Guide shall be construed in accordance with the Building Management Ordinance. This Guide is for general reference only. Users of this Guide should not rely on the information as professional legal advice and are strongly advised to seek assistance from lawyers should there be doubts about the application of the Building Management Ordinance in individual circumstances. Whilst every effort has been made to ensure the accuracy of the Guide, HAD shall not be responsible for any liability howsoever caused to any person by the use of or reliance on this Guide. Appendix 7 Statement of Purposes in respect of 103 Collection of Personal Data (Sample) Appendix 8 Acknowledgement Receipt of the Instrument of Proxy (Sample) 104 Appendix 9 List of Flats with Instruments of Proxy lodged (Sample) 105 Appendix 10 Enquiries 106 Contents 1 A comfortable home is desired by all Hong Kong people. Most people want to have their own properties, if they can afford it. However, many owners of private buildings may not be aware that the properties they own include not only the ﬂ ats they live in. When a person purchases a ﬂ at in a building, he purchases also the common parts of the building. Take the Chan’s family as an example. The Chan’s is a family of three who lives in a 600 square feet-ﬂ at on 38th ﬂ oor, Block C of Happy Garden. The favourite pastime of Mr. and Mrs. Chan is to use the sauna and ﬁ tness facilities of the club of the estate, while their son is a basketball lover who plays the game with his friends every day in the open basketball court of the estate. The water the family consumes every day is provided through the water supply system and water pipes of the estate. Every day when they go out, they use the lift of the building. Furthermore, the estate has external walls, ground foundation, pillars, beams, etc. All these facilities, ﬁ xtures and structures form the common parts of the building, which are jointly owned by all owners of the estate. Hence, even though the Chan’s family may not be aware of what the “common parts” of their building are, they are enjoying and using these common facilities every day. “Rights and responsibility go hand in hand” – an owner is thus not only responsible for maintaining his own ﬂ at but also has to share with other owners the responsibility of properly managing and maintaining the common parts. All owners of a building may be held jointly and severally liable for the liabilities arising from any accidents caused by the improper management or lack of maintenance of the common parts of the building. Hong Kong is a small place with a large population. Most people live in private multi-storey buildings or private residential estates with individual blocks of buildings. A residential estate is no different from a small community. The participation of all owners and occupants is required in order to achieve harmony in the community. Owners and occupants should join hands to resolve building management matters, which is a huge step towards the goal of achieving a comfortable home. The Home Affairs Department (HAD) has always encouraged and assisted owners in forming owners’ corporations (OCs) to facilitate coordination among owners and effective building management. We provide a legal framework through the Building Management Ordinance (Cap. 344) (BMO) for the formation and operation of OCs. Foreword 2 This Guide outlines in layman’s terms the main provisions of the BMO for better understanding by the public. The legal provisions referred to in this Guide shall be construed in accordance with the BMO. For any enquiry about the BMO, please see Appendix 10 for the services provided by HAD. 3 Objective The Building Management Ordinance (Cap. 344) (BMO) was enacted to provide a legal framework for the formation of Owners’ Corporations (OC) to facilitate effective building management. It also sets out the powers and duties of an OC and its meeting procedures so as to facilitate the day-to-day operation of the OC and compliance by owners. Commonly used terms in the BMO Building In the BMO, “building” refers to any building which contains any number of ﬂ ats comprising two or more levels, including basements or underground parking areas. Any land upon which that building is erected is part of the building. Undivided shares Ownership in a multi-storey building is generally expressed in terms of undivided shares. When an owner purchases a ﬂ at in a multi-storey building, he is not only entitled to the exclusive possession of his ﬂ at, but also jointly owns the common parts of the building with other owners of the same building. As the common parts are co-owned by all owners, the shares of the building are undivided. The undivided shares of each ﬂ at are set out clearly in the deed of mutual covenant (DMC) of the building. Under most circumstances, the maintenance and management fees as well as the voting right of owners at a meeting of owners are determined on the basis of the undivided shares owned by him. Chapter 1 Building Management Ordinance 4 Deed of Mutual Covenant A DMC is a private contractual agreement among all the co-owners, the manager and also the developer of a building. It deﬁ nes the rights, interests and obligations of the parties concerned. In general, a DMC comes into effect on the date of execution by the developer and the purchaser of the ﬁ rst unit of the building and is binding on other subsequent purchasers. As with other private contracts, the terms of a DMC cannot be amended unilaterally without the consent of all parties to the contract. A DMC is a very important document in the management of building. Not only does it specify the common parts of the building, the parts for the exclusive use of individual owners and the undivided shares of each ﬂ at, but it also sets out clearly the requirements and guidelines on various building management matters. Hence, before purchasing a unit, owners should read the DMC or consult legal professionals on the terms of the DMC so as to have a full understanding of their rights and obligations associated with the purchase of the ﬂ at. Owners may obtain a copy of the DMC at the Land Registry Search Ofﬁ ces or through the online services of the Land Registry (www.iris.gov.hk). Common parts Apart from the parts speciﬁ ed for the exclusive use, occupation or enjoyment of an owner, all other parts of the building and those parts speciﬁ ed in Schedule 1 to the BMO, e.g. structural parts such as foundations, columns and beams, and lifts, gardens and clubhouses, are the common parts of the building. Owners may refer to the DMC to ascertain the common parts of their building. Flat In the BMO, “ﬂ at” means any premises in a building which are referred to in a DMC (whether described therein as a ﬂ at or by any other name and whether used as a dwelling, shop, factory, ofﬁ ce or for any other purpose) of which the owner, as between himself and owners or occupiers of other parts of the same building, is entitled to the exclusive possession. 5 What is an Owners’ Corporation? An owners’ corporation (OC) is a body corporate set up under the BMO. It has the legal status to represent all owners in managing the common parts of the building. Why do we have to form an OC? Hong Kong is a small place with a large population. Most people live in private multi-storey uploads/Management/ guide-cap344.pdf