Gated and Guarded Community in Malaysia: The Legality of This Scheme in Non- Stratified Properties

Application Process To Convert Neighbourhood To A Gated And Guarded Community

In 2019, the state governments and local authorities have issued guidelines– Guideline for Guarded Neighbourhood Scheme.

The conditions to be fulfilled for the aforementioned application amongst others that include:-

1. Application is made through the Residents’ Associations (“RA”) registered under the Registry of Societies;
2. The residential premises must have received the Certificate of Fitness of Occupation (CFO) or Certificate of Completion and Compliance (CCC); 
3. The application must obtain consent at least by 85% of the residents subject to no coercion;
4. Monthly maintenance fees to be imposed must be appropriate and agreed by the residents who participated in the scheme; and
5. Residents who do not participate in this scheme cannot be prevented from entering the neighbourhood. 

Who is The Residents’ Association (RA)?

In Malaysia, the RA governs the guarded community and undertake to manage the non-stratified properties. It is a basic term for a guarded neighbourhood to establish an association of people to manage their own neighbourhood affairs. Apart from signing the Sale and Purchase Agreement, the DMC is also commonly entered by purchasers and developers, which sets out the contractual rights and obligations of both purchasers and the developer including matters concerning maintenance charges imposed to the residents of the properties. In most of the DMC, there exists a clause which prescribes the formation of the RA to manage the neighbourhood and further, empowers the RA to carry out its obligations as agreed to in the DMC.

Issue pertaining to maintenance charges under DMC

As for non-stratified properties implementing Gated and Guarded Community, the RA has the obligation to collect maintenance fees for the security services provided to the neighbourhood. It is subject to the number of residents consented to the implementation of the scheme. In other words, RA is empowered by the law to collect the fees from the residents who agreed to participate in the scheme only. As for residents who refuse to participate in the scheme, they cannot be prevented from entering into the neighbourhood. 

Source: https://hhq.com.my/posts/gated-and-guarded-community-in-malaysia-the-legality-of-this-scheme-in-non-stratified-properties/