Because legal effect was given to the new statutes on 7 October 2016 it is now necessary to comply with various provisions of the:

  • Sectional Titles Schemes Management Act 8 of 2011 (STSMA); and
  • Community Schemes Ombud Service Act 9 of 2011 (CSOSA).

CSOSA applies to all community schemes, such as:

  • sectional titles development schemes;
  • share block companies;
  • associations of homeowners or property owners;
  • housing schemes for retired persons; and
  • housing co-operatives.

See also: Sectional titles: New laws from next month

Action required now

  • Community schemes must insure against the risk of loss of money of the scheme, or for which it is responsible, resulting from fraud or dishonesty by any insurable person.
  • Body corporates must establish and maintain a reserve fund reasonably sufficient to cover the cost of future maintenance and repair of common property, but not less than an amount prescribed by the Minister. Regulations 2 of the STSMA and Rule 24 of the prescribed Management Rules, attached as Annexure 1 to the Regulations of the STSMA, provide details of how the fund will operate.
  • Body corporates must prepare a maintenance, repair and replacement plan for the common property. See Rule 22 of the prescribed Management Rules.
  • Body corporates must use Form A, of the regulations of the STSMA, to notify their service addresses to:
    • chief ombud;
    • local municipality; and
    • Registrar of Deeds.

On or before:

  • 7 November 2016 register community schemes with the Community Schemes Ombud Service (Ombud Service). It is a crime not to file CS1.
  • 6 January 2017 lodge an existing community scheme’s governance documents with the Ombud Service.

General

  • Within 4 months after the community scheme’s financial year lodge with the Ombud Service an annual return (CS2) and a copy of the annual financial statements.
  • As from 6 January 2017 all community schemes must pay quarterly levies referred to in the Community Schemes Ombud Service Regulation: Levies and Fees.

The Western Cape office is situated on the 8th Floor, Constitution House, Adderley Street, Cape Town. The prescribed forms are available at www.csos.org.za.

Thanks are due to attorneys Cluver Markotter of Stellenbosch for alerting us to these matters.