Circular regulates collection of service fees in apartments

Laws - The Ministry of Construction has issued a circular to regulate service fees collected from residents in apartment buildings.

The move has been to try and end simmering disputes about overcharging that have arisen between residents and property managers in recent months.

Deputy Minister of Construction, Tran Van Son, said service fees would be based on collecting sufficient revenue for building managers to run all the services, such as parking, security, garbage collection and water supply for fire services and gardens around the building.

Calculating fees would be based on a specific formula, taking in service costs and the incomes from any small businesses operating within the building area, such as food stalls and public parking - and charging according to the size of each apartment.

Son said that the charges had to be approved by more than 50 per cent of households in a building.

He said that if service fees had already been agreed in contracts between building managers and apartment buyers, these would still apply.

Every household would be informed annually on the level of service fees collected and how they were spent.

Fees for the maintenance of residential buildings will not be included in service fees.

Luxury services, such as swimming pools, tennis courts and saunas, will be charged according to usage.

The construction ministry’s new regulation should solve many ugly disputes.

Le Thuy Dung, a resident in Trung Hoa - Nhan Chinh residential building in Ha Noi, said households had to raise their voice against unacceptable service fees of VND1 million (US$54) set by the building manager. The fees had been charged three times in one year.

Nguyen Tuan Anh, a resident in a high-class apartment building in Nam Thang Long Area, said he had to pay tens of millions of dong a year in service fees.

Dung said the disputes wasted a lot of residents’ time and effort and made them feel uncomfortable in the very place they owned.

Dung and Anh agreed that the new regulations would enable local Departments of Construction to step in if there were any violations.