As you will have noted from a previous Newsflash dealing with The Community Schemes Ombud Services Act (the Act) this new legislation came to apply as of the 7th October 2016.

This Act applies to all community schemes which by definition includes sectional title development schemes, shareblock companies, property or homeowners associations and housing schemes for retired persons.

As we mentioned in our previous Newsflash, the office of the Community Schemes Ombud is meant to be self-supporting. This means that the office will be acquiring the funds which it needs to fund its operations from community schemes in terms of annual levies.  The proposed levies in terms of the Act are set out in the Regulations in an escalating table depending on the monthly levy payable to the community scheme by members of the scheme.  The maximum levy payable in terms of the Act is R40.00 per month per member of the scheme.  To enable the Ombud to police all community schemes, all schemes were required (this is not a matter of choice) in terms of Section 59(b)(iii) as read with Regulation 18(3) to register with the Ombud within 30 days of the 7th October 2016. There is a prescribed form for this purpose (Click here: Community Schemes Registration Form), set out in the Regulations to the Act. Failure to register is a criminal offence in terms of Section 34 of the Act and is punishable by fine and/or imprisonment not exceeding 5 years.

Community schemes are therefore advised to register immediately if they have not yet done so.

Milton Koumbatis
15 November 2016