Malaysia amends Act 118 to tackle abandoned housing projects issue
The Malaysian government is working to amend the Housing Development (Control and Licensing) Act 1966 (Act 118) to address the issue of abandoned housing projects and safeguard the interests of homebuyers. Deputy Local Government Development Minister Akmal Nasrullah Mohd Nasir explained that, under the current legislation, liquidators appointed by the court to manage the affairs of a development cannot be held accountable for not completing abandoned projects.
Nasir also mentioned that liquidators can impose a service fee based on the Companies Winding-up Rules 1972, which varies depending on the complexity of their role in managing the housing project. This has led to dissatisfaction among buyers. To tackle this issue, the ministry is holding engagement sessions with relevant agencies and bodies, such as the Malaysian Department of Insolvency, Accountant General’s Department of Malaysia, and Insolvency Practitioners Association of Malaysia.
These sessions aim to gather insights and find the best mechanisms for settling abandoned private housing projects related to liquidators, including establishing a uniform payment charge rate and liquidator’s fee.
As of April 30, a total of 112 private housing projects had been declared abandoned, with 50 of those projects being taken over by liquidators; one project under the receiver and manager, while the rest are still under the original developer.
