Vietnam: What is the apartment maintenance fee? Regulations on apartment maintenance fees

Vietnam: What is the apartment maintenance fee? Regulations on apartment maintenance fees

1. What is the apartment maintenance fee?

According to Clause 1, Article 107 of Vietnam's Law on Housing 2014, the maintenance of an apartment building includes the maintenance of private areas and maintenance of common areas. The homeowner of the apartment building must maintain the private areas and provide funding for maintenance of common areas in the apartment building.

Thus, the apartment maintenance fee is understood as the money contributed by the apartment building owner to carry out the maintenance of the shared part of the apartment building.

In particular, the private areas and common areas in apartment buildings are specified in Article 100 of Vietnam's Law on Housing 2014 as follows:

* The private areas in an apartment building include:

- The interior of apartments including balconies, loggias attached to those apartments;

- Other areas in the apartment building which are under private ownership of the homeowner of the apartment building;

- System of private technical equipment attached to the apartments and other areas under private ownership.

* The common areas in an apartment building include:

- The remaining area of the apartment building except for the private areas mentioned in Clause 1 of this Article; the community center of the apartment building;

- Shared areas and supporting structure systems, technical equipment in the apartment building including frames, columns, load-bearing walls, enclosing walls, apartment-dividing walls, floors, roofs, terraces, corridors, stairways, elevators, emergency exits, garbage chute;

Systems of electricity supply, water supply, gas supply, communication system, radio, television, drainage, septic tanks, lightning conductors, fire fighting and other parts not under private ownership of the apartment building’s homeowners;

- Exterior technical infrastructure but connected to the apartment building, except for technical infrastructure system which is used for public purposes or required to transfer to the State or the investor in charge of the approved project;

- Public constructions in the apartment building area which are not built for commercial purposes or required to transfer to the State according to the approved project include public yards, flower gardens and other constructions mentioned in the approved residential construction project.

2. Regulations on maintenance fees for apartments with shared ownership

Maintenance fees for apartments with shared ownership are specified in Article 108 of Vietnam's Law on Housing 2014 as follows:

(1) Funding for maintenance of common areas in the multi-owner building shall comply with regulations below:

- Regarding apartments or other areas in the apartment building which are sold, or leased and sold by the investor, the investor must pay 2% of value of the apartments or other areas;

This amount of money shall be included in the selling price or lease purchase price paid by the buyer or lessee when transfer the apartments or other area, which is stated in the agreement;

- Regarding apartments or other areas in the apartment building which are not sold, or lease and sold by the investor or have been not sold, or leased and sold up to the date on which the apartment building is put into operation,

Except for the common areas, the investor must paid 2% of value of the remaining apartments or areas; this value shall be determined according to the highest selling price of apartments in the apartment building.

(2)  In case the maintained funding prescribed in Item (1) is not enough for the maintenance of common areas in the apartment building, the homeowner must provide additional funding in proportion to the areas under private ownership of every homeowner.

(3) In case the investor concludes agreements on sale or lease purchase of apartments or other areas in the apartment building before July 1, 2006 but he/she has not collected contribution towards maintenance of common areas, the homeowners of apartment building shall hold an Apartment building meeting to determine the contribution;

That contribution may be paid monthly into the deposit account in deposit account a credit institution operating in Vietnam made by the Management board or collected when the apartment building required maintenance.

(4) In case the investor concludes agreements on sale or lease purchase of apartments or other areas in the apartment building after July 1, 2006, but the maintenance funding is not agreed in the housing sale and lease purchase agreement, the investor shall make this contribution;

In case the selling prices or lease purchase prices in the agreement are not included the maintenance funding, the investor shall make the contribution relating to funding for common areas as prescribed in Item (3)

(5)  In case the apartment building for residential and commercial use is divided into separate areas in the same building including

- Apartment areas;

- Business areas

Each area has common areas which are separated from the common areas of the entire building which is independently managed, the investor and the buyer or lessee of apartments or other areas in the apartment building shall agree to divide the funding for the maintenance of common areas into smaller parts in order to manage and use in accordance with the regulations.

3. Management and use of funding for maintenance of common areas in the multi-owner building

The management and use of funding for maintenance of common areas in the multi-owner building according to Article 109 of Vietnam's Law on Housing 2014 are as follows:

- Regarding the funding for maintenance prescribed in Item (1), Section 2, within 07 days, from the day on which the service fees are collected from the buyers for apartments or other areas in the apartment building,

The investor shall send it to the savings account opened in a credit institution operating in Vietnam for management and notify the housing authority of province.

Within 07 days, from the day on which the Management board of the apartment building is established, the investor shall transfer the maintenance funding including interests to the Management board in order to manage and use as prescribed in this Law and notify the housing authority of province;

If the investor fails to transfer that funding, the Management board of apartment building entitled to request the People’s Committee of the province where the apartment building is located to enforce the transfer as prescribed in regulations of the Government.

- Maintenance funds can only be used for maintenance of common areas of the apartment building, not for the management and operation of the apartment building and other purposes;

In case the apartment building has to be demolished but the maintenance funding has not been used up, it may be used to support resettlement or put into the maintenance fund of the common area of ​​the new apartment building after it is rebuilt.

- The maintenance funding is only used for maintenance of the common areas of the apartment building, neither used for management of apartment building nor other purposes;

In case the apartment building is subject to the demolition and the maintenance funding still remains, the remaining funding shall be used for the relocation or transferred to the new maintenance funding for the common areas of the new apartment building.

- The Management board of apartment building shall manage and use the maintenance funding for proper purposes or works according to the plan for maintenance approved the Apartment building meeting annually.

The use of the funding for maintenance of common areas is required invoices with payment and settlement as prescribed in law on finance and reported to the Apartment building meeting.

The members of the Management board of apartment building using the funding in contravention of Clause 2 of this Article and this Clause shall take legal responsibility and pay compensation against damage.

- The management and use of the portion of maintenance funding prescribed in Item (5), Section 3 as follows:

+ The portion of maintenance funding for the common areas of the apartment building and the apartments shall be transferred into the account opened by the Management board of apartment building for management and use as prescribed in this Article;

+ The portion of maintenance funding for the common areas of the business area, the owners of that business area shall manage and use it themselves.

Quoc Dat

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