URA to tighten licence rules for non-resident developers
Developers will be required to open and maintain a bank account solely for the project.
The Urban Redevelopment Authority (URA) is looking to amend the Sale of Commercial Properties Act (SCPA) and Sale of Commercial Properties Rules (SCPR).
According to an announcement, URA will require non-residential developers to obtain sale licence before they can sell the units.
Developers will be required to apply for a licence if they are developing and selling units in uncompleted non-residential projects with more than four strata units.
Moreover, non-residential developers will be required to open and maintain a project account, where instalments of the purchase price received from purchasers up to the issue of temporary occupation permit and construction loans for the project must be deposited into the project account.
Withdrawals will only be allowed for purposes related to the development of the project.
The developers will also be required to provide basic and accurate information on the project in advertisements, like the tenure and the expected date of vacant possession.
Non-residential developers will also be required to provide additional key information on the project before accepting a booking fee from a prospective purchaser.
The payment schedule will also be amended to set aside 4% of the purchase price for defects rectification so that purchasers can claim the cost of rectification works if the non-residential developer fails to carry out the works.
Meanwhile, URA also proposed to add rules for anti-money laundering (AML) and combating terrorist financing (CFT). New rules will be implemented to impose the AML and CFT requirements on all residential and non-residential developers
Developers will be required conduct customer due diligence (CDD) checks to verify customer’s identity, maintain transaction documents, and CDD checks for a specified time period following termination or completion of a transaction.
The consultation period is from 12 February to 12 March 2018.