Housing Development (Control and Licensing) Act 1966
An act to provide for the control and licensing of the business of housing development in Peninsular Malaysia, the protection of the interest of purchasers and for matters connected therewith.

SECTION 3
INTERPRETATION

In this Act unless the context otherwise requires- 
  • "body of persons" means a group of persons, not being an incorporated body or group; 
  • "certificate of completion and compliance" means certificate of completion and compliance given or granted under the Street, Drainage and Building Act 1974 and any by-laws made under the Act certifying that the housing accommodation has been completed and is safe and fit for occupation but does not include partial certificate of completion and compliance;
  • "bank" means any bank licensed under the Banking and Financial Institutions Act 1989 or under the Islamic Banking Act 1983;
  • "company" means any company incorporated, formed or registered under any written law for the time being in force in Malaysia relating to companies, and includes any body corporate established under any written law in force in Malaysia; 
  • "Controller" means the Controller of Housing appointed under section 4; 
  • "Deputy Controller" means the Deputy Controller of Housing appointed under section 4;
  • "finance company" means any finance company licensed under the Banking and Financial Institutions Act 1989;
  • "firm" means an incorporated body of persons (whether consisting of individuals or of corporations or partly of individuals and partly of corporations) associated together for the purpose of carrying on business;
  • "housing accommodation" includes any building, tenement or messuage which is wholly or principally constructed, adapted or intended for human habitation or partly for human habitation and partly for business premises and such other type of accommodation as may be prescribed by the Minister from time to time to be a housing accommodation pursuant to section 3A; 
  • "housing developer" means any person, body of persons, company, firm or society (by whatever name described), who or which engages in or carries on or undertakes or causes to be undertaken a housing development; 
  • "housing development" means to develop or construct or cause to be constructed in any manner whatsoever more than four units of housing accommodation and includes the collection of moneys or the carrying on of any building operations for the purpose of erecting housing accommodation in, on, over or under any land, or the sale of more than four lots of land or building lots with the view of constructing more than four units of housing accommodation; 
  • "Housing Development Account" means an account opened and maintained by a licensed housing developer pursuant to section 7A;
  • "housing lot" means any piece of land surveyed or otherwise, to which a lot number has been assigned to it and which is subject to the category "building" in accordance with National Land Code 1965; 
  • "Inspector" means an inspector appointed under section 4;
  • "license" means a license granted under section 5;
  • "licensed housing developer" means any housing developer licensed under Section 5 to engage in or carry on or undertake a housing development and includes the holder of any power of attorney of such housing developer duly created under the Powers of Attorney Act 1949;
  • "local authority" includes any person or body of persons appointed or authorized under any written law to exercise and perform the powers and duties which are conferred and imposed on a local Authority under any written law;
  • "prescribed" means prescribed by regulations made under this Act, and where no mode is mentioned means prescribed from time to time by order published in the Gazette;  
  • "purchaser" means any person who purchases housing accommodation or who has any dealing with a licensed housing developer in respect of the acquisition of housing accommodation;
  • "stakeholder" means any solicitor holding moneys as stakeholder for payment to a housing developer pursuant to sale and purchase agreements in respect of a housing development which the housing developer is engaged in, carries on or undertakes or causes to be undertaken;
  • "tribunal" means the Tribunal for Homebuyer Claims established under section 16B


SECTION 3A
POWERS OF THE MINISTER TO DETERMINE HOUSING ACCOMMODATION

(1) The Minister may, from time to time, by order published in the Gazette, prescribe any type of accommodation to be  housing accommodation.
(2) In the event of any doubt as to whether a housing accommodation falls within the meaning of this Act, the Minister's decision shall be final and shall not be questioned in any court.  


SECTION 4
APPOINTMENT OF CONTROLLER, DEPUTY CONTROLLERS, INSPECTORS AND OTHER OFFICERS AND SERVANTS
 
(1) For the purpose of this Act, the Minister may appoint a Controller of Housing and such number of Deputy Controllers of Housing, Inspectors of Housing and other officers and servants as the Minister may deem fit from amongst members of the public service.

(2) The Controller and Deputy Controllers shall have any may exercise any of the powers conferred on an Inspector by or under this Act.

(3) The Controller may, in writing, delegate all or any of his powers of functions under this Act, except his power of delegation, to any Deputy Controller, Inspector, officer or servant appointed under subsection (1).

(4) Without prejudice to subsection (2), the Controller may, in writing, delegate any of his powers and functions under this Act in respect of the investigation of offences under this Act and the enforcement of this Act to any public officer a officer of a local authority.

(5) Any delegation under subsection (3) or (4) may be revoked at any time by the Controller and does not prohibit the Controller from himself exercising the powers of performing the functions so delegated.


SECTION 5
LICENSING OF HOUSING DEVELOPERS

PROHIBITION AGAINST HOUSING DEVELOPMENT EXCEPT BY VIRTUE OF A LICENSE AND PROVISIONS RELATING TO THE GRANT OF A LICENSE. 
 

(1) No housing development shall be engaged in, carried on, undertaken or caused to be undertaken except by a housing developer in possession of a license issued under this Act.

(2) Except with the written consent of the Controller no housing developer other than a licensed housing developer shall assume or use in relation to his business or any part of his business the words "housing developer" or any of its derivatives or any other word or words indicating the carrying on of the business of housing development.

(3) A housing developer who desires to engage in or carry out or undertake or cause to be undertaken a housing development shall apply to the Controller for a license and any such application shall be made in the prescribed form and in the case of any applicant listed in column (1) of the Schedule the application shall be accompanied by the documents listed against him in column (2), every such document being verified by means of a statutory declaration made by the person listed in column (3) of the said schedule.

(4) Upon receiving an application for a license under this section, the Controller may, grant the license applied for or refuse to grant such a license and in granting such a license the Controller may impose thereon such conditions (including the period during which the license shall be valid) as he may deem fit and proper.

(4a) No application for a license under this section shall be considered unless the prescribed fees have been paid to the Controller.

(4b) There shall be charged and paid to the Controller on the grant of the license and at such intervals after such grant during the period of validity of the license such fees as may be prescribed.

(5) Subject to section 14, the Controller may at any time vary, cancel or alter the conditions imposed under subsection (4) or impose any new or additional conditions; or where the license is not subject to any condition, impose thereon such conditions as the Controller may deem fit for carrying out the provisions of this Act.   
  
 
SECTION 6
CONDITIONS OR RESTRICTIONS FOR THE GRANT OF A LICENSE 
 
(1) Subject to the exercise of power of waiver by the Minister under subsection (2), the license applied for under section 5 shall not be granted - 
 
(a) unless the applicant has a capital issued and paid up in cash of not less than two hundred and fifty thousand ringgit and makes a deposit with the controller of not less than two hundred thousand ringgit in cash or in such other form as the Minister may determine, if the application is made by a company; or
 
(b) unless the applicant makes a deposit with the Controller of not less than two hundred thousand ringgit in cash or in such other form as the Minister may determine, if the application is made by a person or body of persons;
 
(c) unless the applicant is not himself nor is any member or partner thereof a person convicted of an offence involving fraud or dishonesty or an undischarged bankrupt, if the application is made respectively by a personor a body of persons or a firm;
 
(d) unless no one is convicted of an offence involving fraud or dishonesty or who is an undischarged bankrupt is holding office as director, manager or secretary of the applicant or other similar office or position, if the application is made by a company, or is holding office as president, secretary or treasurer of the applicant or other similar office or position, if the application is made by a society;
 
(e) unless, at the time of the application is made, the applicant or any member or partner of the applicant, if the applicant is a body of persons or firm, or a director, manager or secretary of the applicant, if the applicant is a company, has not, due to a conviction for an offence under this Act, been sentenced to a fine exceeding ten thousand ringgit or to imprisonment (other than imprisonment in default of a fine not exceeding ten thousand ringgit);
 
(f) unless, at the time the application is made, a person who had been a director of or had been directly concerned in the management of the business of a licensed housing developer which has been wound up by a court is not a director or is not directly concerned in the management of the business of the applicant; and 

(g) if the registration of the applicant's architect or engineer has been cancelled and has not been reinstated under the Architects Act 1967 or the Registration of Engineers Act 1967 at the time the application is made.   


(1A) For the purposes of paragraphs (1)(d), (e) and (f), if the applicant is a company, the expression "applicant" shall include the holding company of the applicant, or a subsidiary of the applicant or a subsidairy of the holding company of the applicant.

(2) The Minister may in his absolute discretion waive any or all of the conditions set out in subsection (1)(a), (b) or (d) or substitute any or all of the said conditions for such other conditions as he may consider fit and proper. 
 

SECTION 6A
CONTROLLER TO KEEP DEPOSIT

Subject to any direction of the Minister, the Controller shall keep the deposit made under paragraphs 6(1)(a) and (b) until the expiry of the defect liability period of the housing development.
 

SECTION 6B
CONTROLLER MAY FORFEIT DEPOSIT

If any licensed housing developer - 
 
(a) is carrying on his business, in the opinion of the Controller, in a manner detrimental to the interest of the purchasers or to any member of the public;
(b) has sufficient assets to cover his liabilities; 
(c) is contravening any of the provisions of this Act; or 
(d) has ceased to carry on the housing development in West Malaysia,
the Controller may, after having given the licensed developer an opportunity to submit reasons within a specified time on why the deposit under paragraph 6(1)(a) or (b) should not be forfeited, forfeit the whole or a part of the deposit.

SECTION 7
DUTIES OF A LICENSED HOUSING DEVELOPER

In addition to the liabilities and duties imposed in sections 8 and 9, a licensed housing developer shall- 
 
(a) within four weeks of the making of any alterations in or to any of the documents submitted to the Controller under section 5(3) furnish to the Controller written particulars of the alterations; 
 
(b) exhibit at all times in a conspicuous position in any office and branch office of the licensed housing developer and at any other place where a sale of housing accomodation is conducted, a copy of his license, advertisement and sale permit and a copy of his last audited balance sheet as soon as the same is available and such information as the present or former full name, usual residential address,nationality of origin (where the present nationality is not that of origin), business or occupation (if any) of each person who has the control and management of the business of the licensed housing developer and particulars of any other directorship held by that person;
 
(c) keep or cause to be kept in his office in West Malaysia such accounting and other records as will sufficiently explain the transactions and the financial position of the licensed housing developer and enable true and fair profit and loss accounts and balance-sheets and any documents required to be attached thereto to be prepared from time to time, and shall cause these records to be kept in such manner as to enable them to be conveniently and properly audited;
 
(d) every year appoint an auditor or auditors in the manner required under section 9; 
 
(e) within six months after the close of the financial year of the licensed housing developer in question send to the Controller and also publish in the Gazette a copy of the report of the auditor prepared under section 9 together with a copy of his balance-sheet and profit and loss account;
 
(f) not later than the 21st day of January and the 21st day of July of each year or at such frequency as may be determined by the Controller from time to time (Borang 7f) or upon the request of the Controller, send to the Controller a correct and complete statement in writing made on oath or affirmation, in such form and containing such information as the Controller may from time to time determine, on the progress of the housing development which the housing developer is engaged in , carries on or undertakes or causes to be undertaken until certificate of completion and compliance have been issued for all the housing accomodation in that housing development;
 
(g) where he considers that he is likely to become unable to meet his obligations to the purchasers at any stage of the housing development before the issuance of the certificate of completion and compliance, forthwith inform the Controller of such fact; 
(h) undertake the following-  
 
(i) within twenty-one days from the date of receipt by the housing developer of the certificate of completion and compliance, submit such certificate to the Controller; and 
 
(ii) within twenty-one days after the date of handing over of vacant possession to the first purchaser of the housing accomodation in the housing development, inform the Controller in writing of handing over; 
 
(i) inform the Controller of any refusal in the issuance of Certificate of completion and compliance;
 
(j) ensure that the development of the housing accomodation has been carried out in accordance with any requirements prescribed under any law regulating buildings and has exercised all such diligence as may be required for the issuance of certificate of completion and compliance and for the issuance and transfer of the titles to the housing accomodation to the purchasers; and 
 
(k) inform the Controller of the progress in the issuance of separate or strata titles for the housing accomodation and the transfer of such titles to the purchasers at such frequency as may be determined by the Controller beginning from the date of the handing over of vacant possession to the first purchaser of the housing accomodation in the housing development until separate or strata titles for all the housing accomodation have been issued. 
 
SECTION 7A
LICENSED HOUSING DEVELOPER TO OPEN AND MAINTAIN HOUSING DEVELOPMENT ACCOUNT
(1) Every licensed housing developer shall open and maintain a Housing Development Account with a bank or finance company for each housing development undertaken by the licensed housing developer.
 
(2) Where a housing development is to be developed in phases, the licensed housing developer shall open and keep a Housing  Development Account under subsection (1) for each phase of such housing development. 
 
(3) The licensed housing developer shall pay into the Housing Development Account of a housing development the purchase monies received by the licensed housing developer from the sale of housing accomodation in the housing development and any other sum or sums of money which are required by regulations made under this Act to be paid into the Housing Development Account. 
 
(4) The licensed housing developer shall not withdraw any money from the Housing Development Account except as authorised by regulations made under this Act.
 
(5) Subject to subsection (6)(b), all monies in the Housing Development Account and all moneys held by the stakeholder shall, notwithstanding any other written law to the contrary, be deemed not to form part of the property of the licensed housing developer in the event- 
(a) the licensed housing developer enters into any composition or arrangement with his creditors or has a receiving order or an adjudication order made against him; or
(b) the licensed housing developer, being a company, goes into voluntary or compulsory liquidation. 
 
(6) Upon the happening of any of the event referred to in the subsection (5)- 
 
(a) the monies in the Housing Development Account and moneys held by the stakeholder shall vest in the official receiver, trustee in bankruptcy or liquidator as the case may be, to be applied for all or any of the purposes for which monies in the Housing Development Account and moneys held by the stakeholder are authorised by regulations made under this Act to be withdrawn; and 
 
(b) all money remaining in the Housing Development Account and all moneys held by the stakeholder, after all payments have been made pursuant to paragraph (a) and all liabilities and obligations of the licensed housing developer under the sale and purchase agreements in respect of the housing development have been fully discharged and fulfilled, shall be held by the official receiver, trustee in bankruptcy or liquidator as the case may be, as money belonging to the licensed housing developer to be applied in accordance with the law relating to bankruptcy  of or the winding-up of a company. 
 
(7) Notwithstanding any other written law to the contrary, all monies in the Housing Development Account and all moneys held by the stakeholder shall not be ganished until all liabilities and obligations of the licensed housing developer under the sale and purchase agreements in respect of the housing development have been fully discharged and fulfilled. 
 
(8) Subject to the provision of the Banking and Financial Institutions Act 1989 and the Islamic Banking Act 1983, the Minister may, if he thinks necessary, appoint an approved company auditor to investigate the books, accounts and transactions of a Housing Development Account and the licensed housing developer shall pay all expenses incurred hereto. 
 
(9) This section shall not apply to any housing development carried on by a licensed housing developer where all the housing accommodation in the housing development will not be offered for sale and purchase before the completion of the housing development and the issuance of certificate of completion and compliance.
 
(10)Any housing developer who contravenes or fails to comply with this section shall be guilty of an offence and shall, on conviction, be liable to a fine which shall not be less than two hundred and fifty thousand ringgit but which shall not exceed five hundred thousand ringgit and shall also be liable to imprisonment for a term not exceeding three years or to both.    


SECTION 7B
LICENSED HOUSING DEVELOPER FOR THE PURPOSE OF SECTIONS 8, 8A, 11 AND 12
For the purpose of sections 8, 8A, 11 and 12, "licensed housing developer' includes any housing developer whose license has expired.


SECTION 7C
FREEZING OF THE HOUSING DEVELOPMENT ACCOUNT
(1) If the Controller has reason to believe that a licensed housing developer is carrying the on his business in a manner detrimental to the interest of the purchasers or is contravening any of the provision of this Act, the Controller may in writing order a freeze on the Housing Development Account and direct the bank or finance company, as the case may be, not to part with, deal in or otherwise permit any withdrawal of any moneys from the Housing Development Account until the order is revoked or varied or unless in accordance with any conditions as may be imposed by the Controller at his absolute discretion from time to time during the currency of the order. 
(2) No bank or finance company, or director, officer or employee of the bank or finance company, or director, officer or employee of the bank or finance company, as the case may be, shall subject to any claim or demand by or liability to any person in respect of anything done or omitted to be done in good faith in pursuance of or execution or intended execution of or in connection with the execution or intended execution of an order of the Controller under subsection (1).
(3) Any person who fails to comply with an order of the Controller under subsection (1) shall be guilty of an offence and shall be liable to a fine not exceeding one hundred thousand ringgit.  


SECTION 8
ARRANGEMENT OR AGREEMENT AFFECTING THE BUSINESS OF A LICENSED HOUSING DEVELOPER
(1) Where a licensed housing developer proposes to enter into an arrangement or agreement to sell, transfer, assign, dispose of or reconstruct his business or management relating to housing development either by amalgamation or otherwise, the licensed housing developer shall as soon as possible notify the Controller of the proposed arrangement or agreement and unless approved by the Controller under subsection (2), the licensed housing developer shall not proceed with that arrangement or agreement.
(2) Where the Controller receives the notification of the proposed arrangement under subsection (1), the Controller may approve the arrangement or agreement or refuse to give approval thereto; and in approving the same he may impose thereon such conditions as he may deem fit and proper for the purpose of carrying into effect the provisions of this Act. 


SECTION 8A
STATUTORY TERMINATION OF THE SALE AND PURCHASE AGREEMENTS
(1) Not withstanding anything contained in any agreement, a licensed housing developer or the purchasers may apply to the Minister for approval to terminate all the sale and purchase agreements entered into in respect of a housing development or any phase of a housing development which the housing developer is engaged in, carries on or undertakes or causes to be undertaken if- 

(a) such application, duly made in accordance with sub-section (2), is received by the Minister within six months after the execution of the first sale and purchase agreement in respect of that housing development or that phase of housing development; and 
(b) at least seventy-five per cent of all purchasers who have entered into sale and purchase agreements have agreed with the housing developer in writing to terminate the sale and purchase agreements.

(2) Any application made under subsection (1) shall be supported by - 
(a) the written consent of the licensed housing developer and of each of the purchasers who have agreed to terminate the sale and purchase agreements and such consent shall have been duly executed by the licensed housing developer and the purchaser, as the case may be, and witnessed by his solicitors or a Commissioner for Oaths not earlier than one month before the date of the application; and
(b) such other documents or evidence as the Minister may require or as may be determined including such evidence which may satisfy the Minister that the licensed housing developer is financially capable of refunding to the purchasers and their financiers all the moneys paid by them to the licensed housing developer if the Minister approves such application.

(2A) In the case of an application made by the purchasers under subsection(1), no licensed housing developer shall unreasonably withhold his written consent to the termination of the sale and purchase agreement.

(3) For the purpose of this section, joint purchasers irrespective of any number in a sale and purchase agreement shall be considered as one purchaser.

(4) Upon receipts of an application under subsection (1), the Minister may grant or refuse the application for approval.

(5) In granting the approval under subsection (4) the Minister may impose such conditions as he may deem fit and proper.

(6) The decision of the Minister shall be final and shall not be questioned in any court and it shall be binding on the licensed housing developer and all the purchasers and no injunction shall be granted to restrain any person from carrying out the decision of the Minister.

(7) All the sale and purchase agreements in respect of the housing development or the phase of a housing development which is the subject of an approval under subsection (4) including those of the remaining purchasers who have not agreed to the termination shall be deemed to have been duly terminated.

(8) The licensed housing developer shall, within fourteen days from the date of receipt of the Minister's approval, inform all the purchasers in writing of the Minister's decision.

(9) The licensed housing developer shall refund all moneys received by the licensed housing developer from the respective purchasers free of any interest within the period stated in the Minister's approval.

(10) Upon receipt of the refund under subsection (9), the purchasers shall immediately cause all encumbrances on the land to be removed and the cost and expenses for such removal shall be borne by and may be claimed as a civil debt from the housing developer.

(11) Any person who fails to comply with any of the provisions of this section shall be guilty of an offence and shall, on conviction, be liable to a fine which shall not be less than fifty thousand ringgit and to a further fine not exceeding five thousand ringgit for every day during which the offence continues after conviction.        


AMENDMENT IN BORANG 7 (f)

KPKT via their circulation dated 11 October 2010 has announced that they has amended the format to amend the Borang Kemajuan Projek under Section 7 (f) (Form 7F) of Act 118 by including a few new details as follows: -

(i) Financial details of the project - Account Number of Housing Development Act (HDA), HDA balances, bank name and branch, scheduled payment certificate by the architect, other expenses.

(ii) Details of home sales - the latest total value

(iii) List of buyers - upload a file using the specified format


The department has amended Form 7F of the transmission frequency of twice a year (no later than January 21 and July 21 each year) to four times a year. For more details, please refer to Tarikh Penghantaran Laporan Kemajuan Projek [Laporan 7(f)] Online and Panduan untuk mengemaskini [Borang 7(f)] Online (The forms is maintained in Bahasa Malaysia to avoid confusion)

Sample of Schedule G and Schedule H

 
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