After four years, 207 non-bumiputra homeowners in USJ One Park can finally obtain their strata titles following the Selangor government’s RM15.32mil waiver of penalty fees for their unwitting purchase of bumiputra quota units.
A responsible government should ensure its citizens have a roof over their heads. Recognising this, the government has implemented several policies to assist the rakyat in acquiring homes, one of which is the Bumiputra Housing Policy.
Introduced as part of the New Economic Policy in the 1970s, this policy aimed to reduce the income disparity between bumiputras and non-bumiputras. Essentially, it requires property developers to reserve a certain percentage of their units for exclusive sale to bumiputras at a discount.
As land matters fall under the purview of individual state governments, this policy varies across states, with bumiputra quotas ranging from 30% to 50% and discounts from 7% to 10%.
Many, including the National House Buyers Association (HBA), have credited the bumiputra quota with enabling less affluent bumiputras to acquire properties, particularly in urban and suburban areas, thereby helping avoid neighbourhood polarisation.
Perhaps the government should reconsider the relevance of such a blanket policy after more than 50 years. As it stands, affluent bumiputras are also eligible for these discounts even when buying multiple high-end, million-ringgit properties. Shouldn’t the policy be updated to reflect the current social demography?
In Selangor, the Selangor Housing and Property Board (LPHS) and the Selangor Land and Mines Office are responsible for monitoring sales under the bumiputra quota (typically a 40% imposition in Selangor) with a 7% bumiputra discount on the sale and purchase agreement price for all residential properties, whether landed or stratified.
These quotas may only be released to non-bumiputra buyers through a stringent release mechanism that housing developers must adhere to. In Selangor, this mechanism is outlined in the LPHS-issued Selangor Bumiputra Quota Maintenance Mechanism 2.0 circular.
However, this could be improved. As previously highlighted, the Perak Housing and Property Board adopts proactive measures for a timely release mechanism of bumiputra lots.
Bad apples in the basket
In Selangor, there have been several cases where errant housing developers conveniently oversell these bumiputra lots to non-bumiputras without following the established processes for the periodical release of unsold bumiputra units.
Somehow, the gatekeepers, namely LPHS, have been caught unaware, resulting in a large percentage of bumiputra quota units being sold undetected. Some of these housing developers even dared to confirm in writing to the affected buyers and their financiers/banks that the units they purchased were not bumiputra units.
The USJ One Park case study
After four years of uncertainty, 207 non-bumiputra homeowners in USJ One Park, Subang Jaya, can finally breathe a sigh of relief. The Selangor government has agreed to waive a staggering RM15.32mil in penalty fees that had burdened them.
These homeowners had unwittingly purchased units designated for bumiputra quota and, consequently, were saddled with these fees and unable to obtain their strata titles. However, following a persistent appeal to the state government via LPHS, the hefty penalty was subsequently waived. This precedent could pave the way for other owners caught in similar situations across Selangor.
Star Metro recently quoted USJ One Park’s joint management body chairman Gwee Chee Seng, who expressed the homeowners’ profound relief.
“The homeowners felt a sense of relief and joy upon receiving notice of the waiver approval from LPHS in January this year. It has been a long four years as we tried to fight to have this issue sorted. It was not right that owners were being held liable for something that was not their fault,” he stated.
“With the penalty lifted, we can now move forward with the long-delayed strata title process. Utmost appreciation is accorded to our YB Michelle Ng, assemblyman in our Subang Jaya constituency, and the team from the HBA for their persistence to set a precedent,” Gwee added.
A letter dated Jan 27, 2025, from LPHS to the land proprietor’s liquidator, confirmed that the appeal to waive all bumiputra discount payments and quota violation charges for 207 residential units in USJ One Park had been approved by the Selangor State Executive Council.
The letter also stated that the state had granted permission for ownership transfers to the buyers who had been awaiting their titles and the transfer process must now be completed at a reasonable fee.
Additionally, the directors of the company responsible for the property development have been blacklisted from future projects in Selangor.
Blacklisting: A mere deterrent?
The efficacy of merely blacklisting company directors from future projects in Selangor warrants scrutiny. Do authorities not realise that every property developer typically establishes separate subsidiaries or associate companies for each project in Malaysia?
This practice, known as risk spreading, is a sound administrative and tactical move; if one project fails, the parent and other associated companies remain unaffected due to their status as separate legal entities. Problematic developers will undoubtedly establish new, separate companies to circumvent such blacklisting.
What, then, prevents these individuals from forming other entities using proxies? Does LPHS possess records of their family trees to link them to defunct companies?
Beyond blacklisting company directors, further, more stringent action must be taken. The state government has the prerogative to prosecute these directors, lodge police reports and impose significant fines, advocating for lifting the corporate veil to hold every director personally liable as an officer of the corporation.
Civil proceedings should also be considered to recover the millions in waived penalties, arguing that the developer unfairly benefited from the sale of these properties and obtained unlawful enrichment.
If the government fails to take decisive action, it risks opening the floodgates for others who deliberately avoid completing title transfers and then liquidating their companies while pocketing the proceeds.
Finally, it is the duty of the Housing and Local Government Ministry to ensure all property titles are timely issued and transferred to buyers before the taking of vacant possession.
Datuk Chang Kim Loong is the honorary secretary-general of the National House Buyers Association (HBA).
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