Monday, July 01, 2013

Different within CF (Certification Fitness for Occupation) and CCC (Certified of Completion and Compliance)



FAQ : Certificate of Completion and Compliance (CCC) 


1. When do the new laws enabling professional Architects/ Engineers to issue CCC come into force?
The CCC system came into force effective 12th April 2007.

2. What does this mean?
The CCC replaces the Certificate of Fitness for Occupation (CFO) previously issued by the local authority (PBT). The CCC is issued by the project’s Principal Submitting Person (PSP) who is a Professional Architect, Professional Engineer or a Registered Building Draughtsman.

3. What is the reason for the government to implement this change?
It is the government’s view that CCC will cut down on red-tape and ensure that house buyers and building owners get to move in as quickly as possible without compromising their safety. This is consistent with the government’s desire to encourage self-regulation, which was introduced in the National Economy Growth Planning strategy to continuously enhance the delivery system. Previously, a CFO is issued by the local authority after it has received Form E (UKBS) which is an application for the issuance of the CFO. This system posed many problems, such as delay in certification by technical agencies, additional conditions imposed by PBT at the time of CFO application and lack of technical officers to process the CFO. It is to be noted that CCC will only address technical aspects and so far as these are complied with and there is no apparent threat to health and safety issues, then CCC can be issued.

4. What then is the role of PBT?
The PBT will receive, process and approve planning permission and building plans (under a more efficient and expeditious regime of OSC that was launched on the same date by the Hon. Prime Minister). PBT can also authorize site inspection on their own initiative or act on complaints to check the works in progress, issue a notice (in writing and through the OSC) to the PSP not to issue the CCC if breaches and divergence are not rectified, take action to rectify any continuous breach or divergence including reporting to Professional Boards. The PSP can rectify changes or variations either by complying on site or in the form of as-built drawings.

5. Can CCC be issued for projects with Building Plan approved before the 12th April 2007?
No, CCC can only be issued for projects that have obtained their Building Plan approvals after 12th April 2007. This is because under the new CCC system, a responsibility process matrix is introduced. Each construction process needs to be verified by professionals and contractors or trade contractors. Twenty-one stage certification forms need to be endorsed along the entire process. These are included as new schedules (Form Gs) under the revised UKBS 1984 (Amendment) 2007 (Uniform Building By-Laws).

6. What must be done for a project that has already obtained building plan approval to come under CCC?
The building plan must be resubmitted for approval under the new (CCC) system. Projects where works have commenced on site will not be able to use the new CCC system.

7. Can a CCC be issued if any or several of these Forms Gs are not certified by the stated parties?
No. The PSP must ensure that all Form Gs are duly filled and certified and all the conditions have been fulfilled before CCC can be issued. Failure to comply is a serious offence. It is advisable to ensure that CIDB registered contractors and licensed tradesmen (e.g. Electrician and Plumber) are informed of their obligations as early as possible from the time of tender and award of works, and their respective certification is obtained immediately upon satisfactory completion of their respective scope of works. It is not prudent to leave all such certification to the end of the project or just when the PSP is about ready to issue the CCC.

8. So what are the conditions, certification, or clearances required before a PSP can issue the CCC?
The project works need to be completed in accordance with the approved Building Plans (or subsequent revised approved building plans or as-built plans) and the PSP has supervised the works accordingly. All Form Gs are duly filled and certified, clearances and or confirmation of supply/connection to six essential services department – TNB (confirmation of electricity supply), water authorities (confirmation of water supply), JPP (confirmation of connection to sewage treatment plant or mains), JKKP (clearance from factories and machinery department for lifts – if applicable), Bomba (clearance for active fire fighting systems – except for residential buildings not more than 18 m height), and Roads & Drainage department. With these clearances in place, the PSP can then issue the CCC.

9. What are the tasks required of the professional as the PSP?
The PSP’s task is to :
  • prepare and present planning and building plans to the PBT for approval
  • inform PBT of the commencement of construction works on site
  • supervise construction works at site and ensure that laws and technical conditions of the PBT are followed,
  • report any building breaches, explain reasons of breach and perform recovery action in the event of breach during construction
  • present work-resumption notice to the PBT
  • ensure Form Gs are duly certified at the various stages of works
  • issue CCC to the owner upon satisfactory completion of the works and obtaining clearances or confirmation from the six essential service departments
  • present a copy of the CCC (together with all Form Gs) to the PBT and the Professional Board within 14 days of its issuance

10. There seems to be a lot more things that the PSP has to do. Is there any change to the level of responsibility required of the PSP?
There is no change to the responsibility or liability on the PSP as under the old system the PSP was already fully liable and responsible for the entire project even though the PBT approved it and issued the CFO for it. There could be an increase in the tasks involved such as the need to compile the 21 Form Gs under the matrix of responsibility. However this process helps to identify and call to attention the various parties responsible in the complex delivery process of buildings today. The CIDB registered contractor and licensed specialist trade contractors will now be called upon to take responsibility for their respective portion of works. There is however, possible time saved from previously having to attend to the submitting of Form E and applying for the CFO.

11. What other changes will CCC bring?
The CCC system also ensures that Vacant Possession (VP) can be issued together with CCC. This will overcome problems previously associated with CFO where homebuyers receive the house keys (upon submission of Form E) but cannot move into the houses because the CFO has not been issued.
With the introduction of the matrix of responsibility (Form Gs), there will also be an improvement in the accountability and responsibility aspect as action can be taken on the responsible party in the event of failure or flaws in the building. Thus, work quality can improve.

12. Are there any changes to the regulation of the PSPs?
All professionals are reminded of their responsibility and role to protect the community and the profession. There is no reason for any professional to succumb to pressure by any party to flaunt the independent certifying role that has been entrusted to the profession. Professionals must carry out their duties with due care and diligence and together with the other parties including fellow professionals and the registered contractors, ensure that CCC works for the good of all.
As there is great need to strengthen the professional’s ability to supervise works on site, the professional boards are working with the Ministry of Works and the CIDB to upgrade and regulate the important role of site staff / Clerk of Works.
There are increased penalties for offences. Under the amendment to the Street, Drainage and Building Act 1974 (Act 133), the penalty for the offence of not abiding by the orders of PBT is increased for general penalty and includes imprisonment for term not exceeding three years and a fine of up to RM10,000. Under the Uniform Building By-Laws, the parties that issue Form Gs and CCC without complying with the provision of the Acts can be sued and reported to the controlling professional bodies. Both the Architects Act 1967 (Act 117), Registration of Engineers Act 1967 (Act 138) have been revised to provide for stricter disciplinary action on professionals by increasing fines, extending the duration of membership suspension and cancellation of membership.

13. What is the implication if a PSP passes away or is not contactable after issuance of CCC?
The responsibility and liability for the safety of the building whether it is during construction or after it is completed, lies with the submitting person as per section 71 of the Street, Drainage and Building Act, and this remains unchanged for both the old CFO or the new CCC system. Under the CCC system, a matrix of responsibility is put in place by means of stage certification (Form Gs), by the respective parties to ensure responsibility and accountability of all parties involved. The matrix of responsibility is also to introduce check and balance and to minimize risk. The situation is similar to the old CFO system which allows another PSP to be appointed to take over the project with the approval of the PBT. The owner or developer will need to appoint a new PSP and the new PSP who takes over shall resume all liability and responsibility.

14. Does PBT owe a duty of care to ensure that the building constructed is safe and suitable to be occupied?
The PBT still has a duty of care under common law to ensure that the building constructed is safe and suitable for occupation. Under the new CCC system, the PBT still has a role and responsibility in the process of issuance of CCC as per subsection 70 (23) and (24) of Street, Drainage and Building Act. The PBT is also empowered under section 85A of the Act to direct inspection to be carried out on the building by the owner 10 years after CCC has been issued for the said building.

15. Can civil action be taken against PBT?
Aggrieved parties can take any civil actions against the PBT. However, the PBT is given immunity under section 95(2) of Street, Drainage and Building Act.

16. Does the PSP need to submit Form G1 to G4 in stages to the PBT for their information or should these be submitted only when the PSP issues Form F (CCC) together with all the Forms G1 to 21?
Based on provision of the UBBL, there is no requirement to submit Form G1-G4 to the PBT earlier or separately as all the 21 Form Gs are only required to be attached with Form F/F1. However, at a recent meeting with Ministry of Housing and Local Government and as per their last published guide book, the ministry has requested for the PSP to notify the PBT upon certification of Form G1-G4 as an interim measure (so that the PBT can decide whether they would wish to inspect the site at those stages of completion). The PSP only needs to notify the PBT and there is no need to submit Forms G1-G4 earlier.

17. Should the relevant Form Gs be endorsed by the main contractor or the building contractor who happens to be a sub to the main contractor of a project?
The main contractor who enters into the contract to construct the building should be the party to sign the Form Gs. Please take note that the board has since published a Guide to Filling Up Forms F/F1 and Form Gs where the signing parties are clearly identified.

18. In a Turkey project/Design and Build project where the contractor is not the building contractor, who should endorse the Form Gs - the main contractor or the building contractor as both are CIDB registered contractors?
The "Turnkey contractor' who enters into the Design and Build contract, regardless of whether the PSP is engaged by him or by the owner, shall be the party signing the Form Gs. He can choose to employ any sub-contractor to carry out the various parts of the building construction but he will remain the party accountable.

Written by Ir. Chen Thiam Leong   16 August 2007

Sunday, November 18, 2012

Property Bulk Purchasing ..Good or Bad? Part 2


POTENTIAL ISSUES: In Part 2, we look at several reasons why joint purchases may not be everyone’s cup of tea

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Faizul RidzuanLast week, we covered the first part of my thoughts on joint purchase of properties. To recap, we are talking about the pros and cons of joint purchase between non-family members and I covered the benefits as follows:
• Greater cumulative purchasing power
• Leverage on others’ knowledge and expertise
• Shared risk or risk diversification
• Leverage on others’ financials and credit
• Future credit advantage
So this week I intend to cover what the possible risks of joint purchases are. If I could sum everything up, I feel that a joint purchase carries substantial risk primarily due to its human factor. There are just too many uncontrollable factors that will crop up when huge money is at stake. When it comes to money, siblings can fight and long-time friends can be enemies, let alone a few strangers. Mahatma Gandhi once said:
“There is sufficiency in the world for a man’s need, but not a man’s greed.”
Gandhi is absolutely spot on. There are a few reasons why I don’t fancy joint purchases such as:
1. Too many ‘human’ uncertainties — Let’s assume you shared a purchase of a commercial property with three other friends. Let me just illustrate a few scenarios how people can get stuck when they share:
• One of the partners dies shortly. What’s going to happen to his part of the commitment? Who will be forking out an additional sum every month on behalf of the deceased? What if his will is under dispute, including his share in this shared commercial property?
• One partner got sued by his ex-spouse, who then filed a caveat on this property.
• One partner ended up bankrupt.
• Or just a plain and simple issue, one partner ran out of money and needed to exit the arrangement to pursue other priorities?
• What if the property was a bad buy and the partners could not find a tenant or buyer after 1–2 years? Will all the partners have the patience to wait it out? What if some partners decide to cut their losses but some still plan to hold on? What if one or two partners refuse to pay the monthly installments anymore after months of bleeding cashflow?
I’ve always advocated that anyone who invests in properties needs to have a medium- to long-term holding period. For myself, I’ll only buy a property that I am prepared to hold for a minimum of 5–10 years. A lot of things can happen within five years’ time, and chances of any of the five scenarios above to materialise are very, very real.
2. Shared risks equal lower profit — When you diversify your risks, you are also diversifying your profit. Let’s say you form a joint purchase with three friends to buy a RM1 million shop-house, with all four of you becoming guarantors for the RM800,000 loan. Three years down the road, the shop-house was successfully sold for RM1.3 million. Once you pay the agent fees, early penalties, RPGT (Real Property Gains Tax) and other incidentals, you guys will have a net profit of RM240,000. Sounds a lot, but once you divide among four partners, that’s only RM60,000 perperson, assuming that everyone gets an equal share. Personally for me, I wouldn’t want to make a RM1 million bet just to make RM60,000 after three years.
3. Inflexible arrangement — A partnership only works if everyone sticks to the original plan. All the partners need to have the discipline to last it out. But what happens if something turns up and you yourself need to go for a premature exit? For example, you need money to pay medical fees for an ill family member? Or you saw a once-in-a-lifetime business/investment opportunity (talking about real opportunities, not the gold Ponzi scheme types). You now have to rely on other partners to share your plight and arrange a cordial exit for you. But what if they don’t care about your problems and tell you to stick around or lose everything you have paid? Yes you could make an agreement for this but more often than not, anyone who opts for early exit will normally have to pay a hefty price for causing inconvenience to the other partners.
With single ownerships, one can do as they please. If I needed the money, I can just sell the property. Or else I’ll keep it. It’s that simple. I don’t need to beg others to understand my plight, I don’t need to pay “penalties” to other partners, and more importantly, I have the full freedom to make decisions that work best for me.
4. Additional costs incurred — If you want to have a water-tight partnership, forming a private limited company (Sdn Bhd) will be inevitable. You and your partners can document and officially decide on purchase, exit, early withdrawal penalties etc. However, this means that there will be additional cost incurred such as set-up, annual maintenance and accounting fees, which can amount to thousands of ringgit every year.
5. Encouraging hasty decisions due to perceived low risk — Amongst the benefits of joint purchase are higher purchasing power and shared risks. This in my opinion is a double-edged sword. When it’s your own money and its 100 per cent your decision, you are normally a lot more cautious as a mistake can thoroughly break you. But because the risk is shared with a few others, people often loosen up a bit and get a bit careless. Thanks to the new cumulative purchasing power, they can now dare to enter a world that’s previously unknown to them. There are many instances where I see complete strangers forming a joint-venture to buy a property that they can never afford to alone, say shop-houses or prime offices. Everyone in the venture thinks somewhat that their risk is lower simply because the risk is shared. Actually the risk remains the same, it’s just that now you have company if the whole thing tanks.
6. CCRIS (Central Credit Reference Information System) disadvantage — This is true if you are lending your financial capabilities for the venture to obtain borrowing. For some lenders, they don’t care if you only have 25 per cent share of the venture, but so long as your name is being used to obtain say a RM1 million loan, they take it that you borrowed RM1 million. This could be a hindrance for you to obtain borrowing later in the future, and you could end up missing better investment opportunities coming your way.
My personal opinion
In summary, I’m mainly against joint purchases due to potential issues that could arise from this arrangement. Most of the time, it’s often not worth the hassle. The shared profits from such ventures are often small compared to the risk one has to undertake. Joint purchases are certainly not for beginners, and it should be one’s last resort once all attempts to buy the property on your own capability have failed, and you are 100 per cent sure that the property is a great buy with limited downside.
Till then, invest safely.

The above article is extracted from nst.com.my @16 November 2012



Monday, November 12, 2012

Mother Mary Appearance on a SJMC Hospital, Subang Jaya, Malaysia


Image becomes clearer, say witnesses






SUBANG JAYA: The image of what some are claiming to be that of the Blessed Virgin Mary on one of Sime Darby Medical Centre's windows here has continued to draw people from all over Malaysia.
Many eyewitnesses, some of whom had been visiting the centre for several days, said the image had “grown clearer” since Saturday.
Malacca-Johor Diocesan Pastoral Institute director Rev Deacon Dr Sherman Kuek said if the immediate result actually excited deeper faith among the Catholics, it was a good thing.
“But even so, this by no means confirms the authenticity of the image as an apparition of Mary,” said Rev Kuek, who holds a doctorate in theology.
He advised Catholics to always keep their attention on Jesus Christ.
Traffic along the medical centre was heavy yesterday, with many parking their cars along the side of the road to see the image.
Some were seen taking photographs with their various electronic gadgets while others prayed and sang hymns.

“The image was brighter and clearer than yesterday. It is certainly different,” said student Kyle Lim, 21.

Some eyewitnesses reported seeing another image forming on one of the windows below, which they claimed resembled the face of Jesus.
Special containers for people to place candles were also set up there.

Photographs of the image, believed to have appeared several days ago, have gone viral on Facebook.

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