The Housing Development (Control and Licensing) (Amendment) Act 2012 was gazetted on 9 February 2012. The effective date of the Act has yet to be announced.
The Ministry of Housing and Local Government has proposed that the Housing Development (Control and Licensing) Act 1966 be amended for more protection to house buyers and to minimise the occurrence of abandoned projects. The amendments which involved eight existing provisions, one new provision and one abolished provision were passed in the Parliament in December 2011.
A new section (Section 18A) was introduced in the Housing Development (Control and Licensing) (Amendment) Act 2012 which enables house buyers to initiate criminal proceedings against any licensed housing developers who abandon or cause to be abandoned housing projects. The licensed developer who abandons or causes a housing development to be abandoned can be fined between RM250,000 and RM500,000 or jailed up to 3 years, or both.
The Act has also been amended to extend the interpretation of a ‘housing developer’ to include a person or body appointed by a court of competent jurisdiction to be the provisional liquidator or liquidator for the housing developer in a case where the housing developer is under liquidation. Hence, the liquidator is subjected to the duties imposed by the Act and may be liable for the offences of breaching such duties of a housing developer.
In view of the seriousness of the amendment to the interpretation of a “housing developer”, members who are liquidators are advised to seek legal advice before taking on any abandoned housing project. Meanwhile, the Institute is engaging with the relevant authorities to discuss the implications of the Housing Development (Control and Licensing) (Amendment) Act 2012 on insolvency practitioners. Members will be informed of the outcome in due course.
A copy of the Housing Development (Control and Licensing) (Amendment) Act 2012 is attached herewith for your attention.
Please be guided accordingly.
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