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On July 15 2009 His Majesty Sultan Haji Hassanal Bolkiah, the Sultan and Yang Di-Pertuan of Brunei Darussalam announced the approval of the Land Code (Strata) Act Chapter 189, which hereby:
- Allows developments with 2 or more principal units to be issued strata titles
- Applies to registered land only (Land Code Cap 40)
- Applies to completed buildings i.e. where occupation permits have been given
- Applies to both new and existing buildings
- Allows Brunei citizens, permanent residents and foreigners to buy strata
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What is Strata Title?
Strata title is a form of ownership devised for units in multi-storey buildings, which may include flats, shops and offices. The title allows Brunei citizens, permanent residents and foreigners to purchase flats and apartment spaces in the Sultanate. Under the act holders of strata grants can sell, give or bequeath the units they own to anyone they wish.
Strata titled properties can be used as collaterals to loans as they are legal ownership compared to the current practice of buying units through sub-leases which only gives equitable ownership.
Strata titles are issued on a maximum 99-year lease for land with perpetuity leases. For term leases, the residual term must be at least 20 years, and the strata title must expire on the same date as the expiry of the original land lease. |
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Why Strata Titles?
- Secure form of property ownership as separate titles are issued for each unit
- Previous practice was selling units in buildings without titles, which gave only equitable rights to the purchaser
- Permanent residents and foreigners can own strata title outright
- Promotes community living
- Can enjoy facilities not normally available in individual residential development such as swimming pools, landscaped gardens, gyms etc
- More affordable
- Transfer process is relatively faster than land transfer with titles expected to be registered within 14 working days after the subdivision of building is approved and certified
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What does this mean for the Brunei economy?
The passing of the Land Code (Strata) Act and the eligibility of permanent residents and foreigners to purchase homes will boost the country’s economy in a number of ways, including:
- Stimulating Brunei’s property market through increased prices of land and buildings
- By attracting investment, both local and foreign, into the nation’s growing real estate sector – particularly into commercial and industrial buildings
- Contributing to the growth of property related businesses such as valuation practices, estate agencies, property development and property investment
- Further developing the construction industry through the growing demand for high rise apartments
- Supporting the growing tourism industry via increased availability of short-term properties
- Creating employment opportunities for citizens, for example in the various Strata Management Corporations that will be set up to manage multi-storey buildings
- Supporting Brunei’s 40,000 over Permanent Residents to have their own homes
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PROCESSES OF ISSUING STRATA TITLES
All submissions for the issuance of Strata Titles must be done by registered valuers and estate agents under the Valuers and Estate Agents Order. |
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STAGE ONE – SUBDIVISION OF A BUILDING
Where to apply? Survey Department
Buildings must already have occupation permits
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Annual rent on land has been paid
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| Unit entitlement has been determined by a registered valuer |
Application Process
Submit an application form with the following documents to the Surveyor General:
- Occupation Permit
- Confirmation of conditions from the Land Commissioner
- Estimation of buildings to be determined by the Land Department’s land assessor/ valuation officer
- Payment receipt for yearly land tax for original land
- Completed application form (2 copies)
- Revised strata plan from licensed land surveyor and diagram for Strata Title
Once approved by the Surveyor General, the strata plan will be returned to the applicant for submission to the Land Commissioner. |
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STAGE TWO – ISSUANCE OF STRATA TITLE
Where to apply? Land Department
| Commissioner of Land will certify the strata plan. |
Once strata plan is approved, annual rent for the original land stops and new rent is charged.
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| Register the strata titles in the District Strata Register. |
Application Process
Submit application form to Land Department for certification of strata plan (Form1 from 1st schedule), with the following documents:
- Occupation Permit
- Confirmation of conditions from the Land Commissioner
- Estimation of buildings to be determined by the Land Department’s land assessor/ valuation officer
- Payment receipt for yearly land tax for original land
- Completed application form (2 copies)
Once the strata plan is certified and the Strata Titles registered by the Land Commissioner, the applicant may pay for the registration at the Land Department before collecting the registered Strata Titles.
The original Land Title will be returned to the land owner. |
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STAGE THREE – TRANSFER OF STRATA TITLE (CONVEYANCING)
Where to apply? Land Department
| Only requires the approval of the Minister of Development (subject to fulfilling certain conditions). |
| Register the strata titles in the District Strata Register. |
Application Process
Buyers looking to purchase a unit in a multi-storey building may apply from the respective licensed agents authorised to grant their applications.
The estate agent will then, on your behalf, place a mortgage application with a bank, who will then present a listing of legal panels to advise.
The buyer will then sign a Power of Attorney agreement, which authorises the bank to buy the strata title on their behalf, pending the settlement of their mortgage.
Once the bank approves the mortgage the buyer will have the property. |
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KEY FACTS ON STRATA
- Open to foreigners, permanent residents and Brunei citizens
- Maximum 99 year lease
- There is an estimated 6-10% rental return
- No property tax, no income tax
- A stratum estate may devolve or be transferred, leased, charged or settled with the same effect as if it were an estate under the Land Code
- Strata may be bought in a company’s name
- Upon cancellation or expiry of the strata plan, the original land owner shall become entitled to all buildings or other improvements on the land
- The proprietors of the units registered shall not be entitled to any compensation from the land owner arising directly or indirectly from the expiry of the strata plan.
- A strata corporation will be formed to manage the maintenance of the building and safeguard the rights of all the owners
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STRATA CORPORATION
- Upon certification of the strata plan by the Land Commissioner, a strata corporation is automatically formed
- The strata corporation consists of the original land owner and all unit owners comprised in the strata plan
- Its objective is to safeguard the rights of the unit owners and administer the general maintenance of the building
- The strata corporation can sue and be sued
THE BOARD OF VALUERS AND ESTATE AGENTS
- Established 1 July 2009 under the Valuers and Estate Agents Order and is chaired by the Commissioner of Land
- The Board’s objective is to monitor professional conduct and the ethics of valuers and estate agents
- Valuers and estate agents conducting business in Brunei Darussalam must register with the Board to obtain a license
- Only registered valuers and estate agents can make any application or conduct any business related to land, including making applications for the subdivision of buildings, valuation of unit entitlements for the strata units, and acting on behalf of strata corporations
Key responsibilities of the Board include:
- To accept and reject applications by valuers and estate agents for registration to the Board
- To hold disciplinary proceedings
- To hold assessments or examinations
- To resolve disputes regarding the professional conducts of the valuers and estate agents
- To fix fees for valuation services and estate agents
Please visit the Attorney Generals Chambers website at http://www.agc.gov.bn/LAWS/index.htm for more information on the Land Code (Strata) Act Cap 189 and other relevant legislation.
For forms (in Malay) on Land Application and Development, please visit The Ministry of Development’s website at http://www.mod.gov.bn/Landforms.htm
For any further information on strata issues please contact:
Strata Title Section,
Land Department,
Ministry of Development,
Brunei Darussalam.
Tel : (+673) 2381181 |
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