Overview

Under the Act 2021, a strata property is defined as a separate multi-level apartment complex consisting of separate individual units or apartments and common property within a single infrastructure, of which the separate individual units or apartments can be separately owned and the common property is jointly shared between the individual owners. Each individual owner or a strata title holder of a strata unit holds a separate strata title to the individual unit or apartment owned within the strata property. The overall property or the apartment complex is managed by a Management Corporation formed which represents all individual strata title holders.

Subdivision of units and the Strata Plan

Under the act, the individual units or apartments within the complex are to be subdivided based on the Strata Plan of the property. The Strata Plan consists of how individual units or apartments are to be subdivided within a strata property including the apportionment and proportion within the property which shall be allotted to each individual strata title holder as well as the areas within the property (such as hallways, staircases etc.) which shall be allotted as common property.

The Strata Plan must be approved prior to registration of any strata title and the plan must be submitted to the Ministry for approval under the designated form prepared by the Ministry. The Section 31 of the Act sets out the basic four requirements which a proposed property must meet for the Ministry to approve its Strata Plan. These four requirements are:

1. The property or the building in concern must consist of at least more than one or more levels or floors which is either built, or proposed to be built, in such manner which separates individual strata units or apartments from the common property.
2. Each individual strata unit or apartment must have separate access to basic utility services (i.e. Electricity, Water, Sanitation etc.).
3. Each individual strata unit must have separate entrances which is affected or obstructed by any adjoining strata unit.
4. The strata property must be built in compliance with in the Construction Act, the Land Act, the Building Code as well as other planning regulations and, approved by relevant regulatory bodies.

In addition to the above, strata property must be classified based on the purpose of its occupancy under any of the three categories which namely are: (a) a property developed solely for residential use; (b) a property developed solely for commercial use; and (c) a property developed for mixed residential and commercial use.

The following details and information are also required to be included in the strata plan:

1. Whether the plot or land which the building is built on is a state property or a private property;
2. Registration Number of the land and building;
3. Name of the property as provided in the title or, in case of a property to be developed under stage development, the name of the project;
4. Details of individual units to be included and the common property including measurements and size;
5. The proportion shared by each unit out of the entire property and the total proportion shared by all units combined;
6. Any other additional information required to be included under a Regulation formed under the Act;

Approval process of the Strata Plan

All applications for approval of the Strata Plan must be made by the owner of the entire property or such person designated by him. It is not a requirement that a construction of the strata property, for which approval is sought, be fully completed at the time of filing the application. An application to approve strata plan maybe filed for a buildings which are currently under development or proposed to be developed as well as buildings which are developed over different stages. The documents listed under Section 37 are required to be submitted along with the proposed strata plan in an application for approval.

The Ministry will issue approvals to strata plans for all complete applications while applications deemed incomplete will be given a window period to complete the application which shall be set out in the regulation formed under the act. The Ministry will also maintain an official register of all approved strata plans. Once a strata plan is approved by the Ministry, any changes made to the approved strata plan must first be endorsed and approved by the Ministry.

The Strata Scheme

Under the Act, once a strata plan is approved by the Ministry, the Strata Scheme must subsequently be filed for the approval of the Ministry. The Strata Scheme basically sets out the manner in which individual units or apartments are to be owned and acquired by strata title holders and share ownership of common property with other unit owners as well as the rules governing the overall management of the strata property including the common property.

An application for the approval of strata scheme maybe submitted for strata properties the construction of which is fully complete or that which is partially complete. However, for a strata property the construction of which is partially complete, the strata scheme shall be only be approved by the Ministry if at least a minimum of 2 (two) units out of the strata property are fully completed including availability of all basic services and for which permit is issued for its use.

For strata properties under stage development, the strata scheme shall only be approved if the project is approved by the Ministry and an agreement to that effect is signed between the developer and the Ministry. Additionally, it is also a condition that at least 20% (twenty percent) of the development work of the property is completed and all units completed including availability of all basic services and for which permit is issued for its use.

Stage Development of Strata Properties

Under the Act, the stage development of a strata property means carrying out a strata scheme for a land on which a strata property is proposed to be developed and the development of which is carried out under an approved strata plan in a number of stages. All strata properties to be developed as stage developments must be approved by the Ministry.

The Section 60 of the Act outlines the general requirements relating to stage developments which are:

1. A Strata Property developed under stage development must have at least 4 (four) individual units;
2. A stage development may only be carried out by a 100% (one hundred percent) locally owned company or a partnership or a corporative society. The shares of any such company, partnership or a corporative society may not be sold to a non-Maldivian at any stage after the acquisition of such a property.
3. Where an application or a proposal of a stage development of a strata property is made not by any of the above legal entities, the procedures of persons to carry out the stage development are to be set out in a regulation formed under the Act.

Approved stage developments will include (1) the proposal submitted by the owner of the premises or the developer for the development of the strata property and (2) the stage development agreement signed between the Ministry and the party proposing the stage development of the strata property.

The Strata Properties Act 2021 was passed by the People’s Majlis on 29th November 2021 and ratified by the President and published on the Government Gazette on 20th December 2021. The Act came into force on 20th March 2022.