Joanna Tuffy (Labour)

I move amendment No. 12:

In page 20, between lines 35 and 36, to insert the following:

12.—(1) (a) It shall be a condition of any planning permission for an apartment development that the applicant will form a management company and arrange for the issue of shares in the company to purchasers of apartments in the development.

(b) Where a permission has been granted prior to the commencement of this section for an apartment development, the developer shall form a management company (if not already formed) and arrange for the issue of shares in the company to purchasers of apartments in the development (if not already issued) within 12 months of the commencement of this section.

(2) Section 34(4)(f) of the Act of 2000 is amended by the addition after "houses" of "or apartments".

(3) On demand made by a majority of the purchasers of apartments in an apartment development, or on completion of the development, whichever first occurs, or in the case of developments completed prior to the commencement of this section, on the date which is 12 months from the commencement of this section, the developer shall transfer ownership and management of all common areas to the management company referred to in subsection (1).

(4) A purchaser may apply in a summary manner to the court in the event of a failure to comply with this section and the court may require the applicant or developer to take such steps as the court directs to comply with the section and to pay compensation to the purchaser in such amount as the court thinks fit.".

It is essential the Government address the issue raised in the amendment, although this legislation may not be the most appropriate place to do so. A recent report by the National Consumer Agency noted the need to regulate management companies, with which many people have problems. In some areas, councils are wrongly establishing management companies for mixed developments that include housing. While I accept the need to have management companies for apartment developments, they should be regulated. Legislation should be introduced specifying that such companies must be non-profit making and their membership must consist of residents of the apartments in question who should determine which persons may be employed by the management company to provide various services.

This detailed amendment addresses some of the problems arising from the use of management companies and is similar to provisions contained in legislation on apartment owners introduced in the United Kingdom. That legislation should be examined in light of the increasing number of apartments being built which is, incidentally, not a good idea.