Many apartment owners are members of an Owners’ Association ( VvE). Within the VvE, members have rights and obligations to each other and to the VvE. On 1 January 2018, the Improvement of the Functioning of Owners’ Associations Act came into force. With this Act, the legislator aims not only to improve the functioning of Owners’ Associations, but also to make the apartment building more sustainable. Within three years of the Act coming into force, all of the UvEs concerned must comply with the new legal requirements.
The amended law has a number of important consequences.
Minimum annual reservation for the reserve fund
Despite the fact that, since 1 May 2008, there has been an obligation to maintain a reserve fund, research shows that VvEs often do not have sufficient resources to carry out necessary maintenance on apartment buildings. Therefore, from 1 January onwards, an annual reserve fund applies to EoEs of buildings. There are two ways in which reservations can be made. Firstly, this can be done on the basis of at least 0.5 percent of the rebuilding value of the apartment complex. Secondly, this can be done on the basis of a building-specific long-term maintenance plan. For each building, the choice depends on the maintenance required.
Explicit power to borrow
Research shows that there is a high demand among the CoEs for external funding in order to maintain buildings properly and take energy-saving measures. With the introduction of the new law, it will be possible for the UfEs to enter into a money loan agreement within the framework of management, unless the unbundling regulations deviate from this.
Liability for money loans
Under the old circumstances, banks were not eager to lend to an UfE. When a loan was granted, this was often on the basis of joint and several liability. Each member of the UfE could therefore be held individually liable for the bank’s entire loan. As regards liability for loans, the new law stipulates that an individual member of the EEU can never be held liable for the entire loan of the EEU. This can only be done for his share in the community.
And it is stipulated that the liability of an individual member of the UfE for service and maintenance costs to be paid and money loans from the UfE, in the event of the sale of his apartment, shall pass to the new owner. Until 1 January 2018, it was stipulated that this liability did not pass directly to the transferee in the event of transfer of the apartment. The creditor had to agree to this. If he did not, the seller also remained jointly and severally liable.