Bye- Laws on Code of Business Conduct
Wednesday, 3 December 2008
REHAB recently approved a Code of Business Conduct for all of its members to follow. The FE is publishing the code of conduct from last week. This is the second part of the code
REHAB is committed towards the enhancement and growth of the Real Estate Sector of Bangladesh. REHAB members recognise that for sustainable long term growth of this sector, they must conduct their business with a high degree of professionalism, fairness, integrity and ethics.
(Continuation of Code of Business Conduct with Customers)
13. In the event that the REHAB member is forced to abandon a project due to circumstances beyond his control e.g. natural disaster act of GOD, political turmoil or other force majeure, the REHAB member will inform the customer about this in writing and will then refund the amount paid by the customer within 6(six) months of such notice.
14. In case the REHAB member fails to complete the project and handover the allotted apartment/ plot of land to the customer within one year of the schedule time of completion (barring circumstance beyond the control of the REHAB member like force majeure), the customer will be entitled to a full refund of the amount paid by him/her to the REHAB member along with interest at the prevailing interest rate for fixed deposit. The REHAB member will make this refund along with the said interest to the customer within six months of the demand being made by the customer in writing.
15. In order to avoid cash flow problems, the REHAB member may mortgage the apartment/ plot of land allotted to the customer to a government approved bank or financial institution. However, the REHAB member must handover the apartment/ plot of land to the customer absolutely on unencumbered basis clearing all loans and vacating all charges on the said property.
16. The REHAB member will assist the customer in availing loan from any bank or financial institution by providing the necessary documents etc. However, the decision to grant the loan to the customer rests with the concerned bank or financial institution and irrespective of the loan being approved, the customer shall remain obliged to pay his dues on time to the REHAB member.
17. Pursuant to receiving all payments and handing over of the apartment/ plot of land to the customer, the REHAB member shall send notice to the customer for making registration of sale deed in favour of the customer. REHAB member shall assist the customer for the registration of the said property. For lease hold land, the REHAB member shall assist the customer to get approval for transfer from the competent government authority e.g. RAJUK, CDA, KDA, RDA, NHA etc. The customer will bear all costs in this regard.
18. After handing over the apartment to the customer, REHAB member shall give the customer free services for a maximum period of one year for defect liability of construction work. A list of items for which the REHAB member will provide such services for one year is attached as Annexure 1.
19. Upon completion of an apartment, the REHAB member shall hand over a set of all " as built" design and drawings of the structure to the said project's "Apartment Owners Association".
B. Code of Business Conduct with Land Owners:
01. In case of outright purchase of a piece and parcel of land for development of an apartment complex or land development project, REHAB members shall conduct due diligence to ensure that the land is dispute free, unencumbered and the seller has clear title to the land. The REHAB member shall make payment to the landowner against sale of the land as per the deed of agreement for sale with the Land Owner.
02. In case of joint venture development with the Land Owner of a piece and parcel of land for an apartment building, the REHAB member will ensure that a deed of agreement is made with the Land Owner clearly specifying the percentage share of the Land Owner and the percentage share of the REHAB member in the completed building. The apartments to be allotted to the Land Owner must be identified showing the approximate size of the apartment. A schematic diagram should be attached to the deed of agreement for the sake of clarity. The deed of agreement with the Land Owner must also state the number of car parking spaces (if any) to be retained by the REHAB member and the Land Owner. The cash amount (if any) payable to the Land Owner must be specified along with the schedule time of payment. The said agreement must clarify who will pay the utility connection charges (and the apartment owners association reserve fund) for the apartments allotted to the Land Owners. The deed of agreement must state who will bear the cost of mutation of the flats in the name of the Land Owner. Detail specifications of the materials to be used in the building should be mentioned as Annexure to the deed of agreement between the Land Owner and REHAB member. The time frame for completion of the building must be specified in the deed of agreement and the consequence of delay in the handover of the apartments to the Land Owner and the consequence of the project being abandoned by the REHAB member must be detailed in the deed of agreement. The said deed of agreement must stipulate the procedure for settlement of dispute between the Land Owner/ REHAB member.
03. The approximate gross area of the flats as mentioned in the deed of agreement shall mean the area of the apartment measured from outside perimeter of the apartment plus the proportionate share of the common area meaning stair area, reception area, committee room area, mosque etc.
04. In case the Land Owner is handed over less than his due percentage of the total built up area, the deed of agreement between the REHAB member/ Land Owner will specify at what rate per sft the Land Owner will receive compensation. However, if it is seen after completion of the building that the apartments allotted to the Land Owner constitute a higher percentage of the total built up area than as envisaged in the original deed of agreement, then the REHAB member may ask the Land Owner to pay the REHAB member the extra amount (at the rate specified in the deed of agreement) or failing which, the REHAB member may recover the said amount through sale of one or more of the apartments allotted to the Land Owner.
05. REHAB member shall not mortgage or encumber in any way the apartments allotted to the Land Owner without the written consent of the Land Owner.
06. REHAB member shall not change or substitute the apartment originally allotted to the Land Owner without the Land Owner's consent.
07. REHAB member shall deliver the apartments allotted to the Land Owner as per the schedule date of handover mentioned in the deed of agreement. In case of delay in the handover of the allotted apartment/ plot of land, the Land Owner will be entitled to rental compensation as per mutual agreement which must be written in the deed of agreement and should be paid on a monthly basis. The rental compensation amount must be mentioned in the deed of agreement. Provided however that such delay in handover of the apartment is not due to circumstances beyond the control of the REHAB member such as natural disasters, political turmoil, unusual rise in the prices of the building material, delay in getting utility connection from the concerned authority or other force majeure.
REHAB is committed towards the enhancement and growth of the Real Estate Sector of Bangladesh. REHAB members recognise that for sustainable long term growth of this sector, they must conduct their business with a high degree of professionalism, fairness, integrity and ethics.
(Continuation of Code of Business Conduct with Customers)
13. In the event that the REHAB member is forced to abandon a project due to circumstances beyond his control e.g. natural disaster act of GOD, political turmoil or other force majeure, the REHAB member will inform the customer about this in writing and will then refund the amount paid by the customer within 6(six) months of such notice.
14. In case the REHAB member fails to complete the project and handover the allotted apartment/ plot of land to the customer within one year of the schedule time of completion (barring circumstance beyond the control of the REHAB member like force majeure), the customer will be entitled to a full refund of the amount paid by him/her to the REHAB member along with interest at the prevailing interest rate for fixed deposit. The REHAB member will make this refund along with the said interest to the customer within six months of the demand being made by the customer in writing.
15. In order to avoid cash flow problems, the REHAB member may mortgage the apartment/ plot of land allotted to the customer to a government approved bank or financial institution. However, the REHAB member must handover the apartment/ plot of land to the customer absolutely on unencumbered basis clearing all loans and vacating all charges on the said property.
16. The REHAB member will assist the customer in availing loan from any bank or financial institution by providing the necessary documents etc. However, the decision to grant the loan to the customer rests with the concerned bank or financial institution and irrespective of the loan being approved, the customer shall remain obliged to pay his dues on time to the REHAB member.
17. Pursuant to receiving all payments and handing over of the apartment/ plot of land to the customer, the REHAB member shall send notice to the customer for making registration of sale deed in favour of the customer. REHAB member shall assist the customer for the registration of the said property. For lease hold land, the REHAB member shall assist the customer to get approval for transfer from the competent government authority e.g. RAJUK, CDA, KDA, RDA, NHA etc. The customer will bear all costs in this regard.
18. After handing over the apartment to the customer, REHAB member shall give the customer free services for a maximum period of one year for defect liability of construction work. A list of items for which the REHAB member will provide such services for one year is attached as Annexure 1.
19. Upon completion of an apartment, the REHAB member shall hand over a set of all " as built" design and drawings of the structure to the said project's "Apartment Owners Association".
B. Code of Business Conduct with Land Owners:
01. In case of outright purchase of a piece and parcel of land for development of an apartment complex or land development project, REHAB members shall conduct due diligence to ensure that the land is dispute free, unencumbered and the seller has clear title to the land. The REHAB member shall make payment to the landowner against sale of the land as per the deed of agreement for sale with the Land Owner.
02. In case of joint venture development with the Land Owner of a piece and parcel of land for an apartment building, the REHAB member will ensure that a deed of agreement is made with the Land Owner clearly specifying the percentage share of the Land Owner and the percentage share of the REHAB member in the completed building. The apartments to be allotted to the Land Owner must be identified showing the approximate size of the apartment. A schematic diagram should be attached to the deed of agreement for the sake of clarity. The deed of agreement with the Land Owner must also state the number of car parking spaces (if any) to be retained by the REHAB member and the Land Owner. The cash amount (if any) payable to the Land Owner must be specified along with the schedule time of payment. The said agreement must clarify who will pay the utility connection charges (and the apartment owners association reserve fund) for the apartments allotted to the Land Owners. The deed of agreement must state who will bear the cost of mutation of the flats in the name of the Land Owner. Detail specifications of the materials to be used in the building should be mentioned as Annexure to the deed of agreement between the Land Owner and REHAB member. The time frame for completion of the building must be specified in the deed of agreement and the consequence of delay in the handover of the apartments to the Land Owner and the consequence of the project being abandoned by the REHAB member must be detailed in the deed of agreement. The said deed of agreement must stipulate the procedure for settlement of dispute between the Land Owner/ REHAB member.
03. The approximate gross area of the flats as mentioned in the deed of agreement shall mean the area of the apartment measured from outside perimeter of the apartment plus the proportionate share of the common area meaning stair area, reception area, committee room area, mosque etc.
04. In case the Land Owner is handed over less than his due percentage of the total built up area, the deed of agreement between the REHAB member/ Land Owner will specify at what rate per sft the Land Owner will receive compensation. However, if it is seen after completion of the building that the apartments allotted to the Land Owner constitute a higher percentage of the total built up area than as envisaged in the original deed of agreement, then the REHAB member may ask the Land Owner to pay the REHAB member the extra amount (at the rate specified in the deed of agreement) or failing which, the REHAB member may recover the said amount through sale of one or more of the apartments allotted to the Land Owner.
05. REHAB member shall not mortgage or encumber in any way the apartments allotted to the Land Owner without the written consent of the Land Owner.
06. REHAB member shall not change or substitute the apartment originally allotted to the Land Owner without the Land Owner's consent.
07. REHAB member shall deliver the apartments allotted to the Land Owner as per the schedule date of handover mentioned in the deed of agreement. In case of delay in the handover of the allotted apartment/ plot of land, the Land Owner will be entitled to rental compensation as per mutual agreement which must be written in the deed of agreement and should be paid on a monthly basis. The rental compensation amount must be mentioned in the deed of agreement. Provided however that such delay in handover of the apartment is not due to circumstances beyond the control of the REHAB member such as natural disasters, political turmoil, unusual rise in the prices of the building material, delay in getting utility connection from the concerned authority or other force majeure.