Equity Construction Compensation Fund. Compensation Fund for the Protection of the Rights of Citizens Participating in Shared Construction What payments are made to participants in shared construction from the Fund for the Protection of Citizens' Rights
In addition, the public law company "Fund for the Protection of the Rights of Citizens of Participants in Shared Construction" has other important advantages:
- The mechanism of payments to equity holders has become much simpler in comparison with the previously existing liability insurance.
- The government structure manages the collected financial resources, which in itself increases the reliability of the compensation fund.
- Compensation fund funds are held in designated accounts, which guarantees the transparency of the money distribution mechanism.
Main tasks and functions The main task of the created structure is to protect the rights of participants in shared construction. In case of bankruptcy, losses are reimbursed from contributions previously transferred by the developer.
A fund for the protection of the rights of citizens - participants in shared construction was created
In fact, this unified fund of developers will work by analogy with the Deposit Insurance Agency (DIA), which guarantees refunds to people who have placed their money in bank deposits. In general, we can say that equity holders who entered into a pre-employment institution after January 2017 have a new mechanism to protect their investments.
True, there is one nuance here, which we will talk about a little below. The procedure for the return of personal income tax when buying an apartment. 2 ways.
List of documents. The compensation fund for shared construction was created on the basis of amendments to the federal law FZ-214, which provide for additional protection of the rights and interests of participants in shared construction (article 23.2 of the law FZ-214).
The Fund for the Protection of Shareholders Started Its Work
The funds accumulated in this fund will be used exclusively to pay compensation to defrauded equity holders in the event of the Developer's bankruptcy, or to finance the completion of construction. In the latter case, it can be financial assistance or a loan to a new Developer, who will assume obligations to complete the construction of the problem object.
It is prohibited to spend the funds of the fund for other purposes. For new equity holders, this means a significant reduction in the risk of investments in the purchase of apartments in new buildings.
First, there is a real chance to finish building the house, even when the Developer goes bankrupt. Secondly, the mechanism of compensation payments to equity holders itself has become much simpler and clearer (in comparison with liability insurance).
Thirdly, these funds will be managed not by private insurance companies, but by the state structure.
Fund for the Protection of the Rights of Citizens - Participants of Shared Construction
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In order for the shareholder to have the opportunity to defend himself in the event of the developer's bankruptcy or other unforeseen circumstances, the legislation on participation in shared construction provides for the mandatory registration of a preschool institution with a state body. Requirements for developers Very serious conditions for developers are enshrined in Federal Law No. 218.
Because of this approach, only those developers who have been tested by time will be able to work on the market. The requirements reflected in the law will start in July 2018.
The official name of the developer must contain the name “specialized developer”. Any commercial activity for specialized construction organizations engaged in the construction of residential and non-residential real estate under the DDU is prohibited.
Compensation Fund for the Protection of the Rights of Shareholders
On July 21, 2017, the State Duma adopted a law on the state fund for the protection of the rights of equity holders. Construction companies are faced with stringent requirements.
But will this help the families of equity holders to become owners of new apartments? In Russia, the construction of residential buildings with the help of investments from the population has been legally regulated since 2004. Entering into an equity participation agreement (DAS) gives families the chance to get housing at less than market value. However, they risk losing hope for housing and being left without savings if the builders fail to fulfill their obligations. In 2014, the state intervened for the first time in the equity construction business to protect the interests of citizens - investors in housing construction. Prior to the registration of the DDU in Rosreestr, the construction company was obliged to insure liability from the insurer or take a guarantee from the bank.
Fund for the protection of the rights of citizens of participants in shared construction
This point has caused amicable misunderstanding of both builders and experts, since any construction begins with these costs.
- All funds of the construction company of equity participation must be in one bank, which checks for each financial cost.
- Those who manage a construction company should not have:
- convictions for economic crimes;
- be bankrupt;
- be disqualified.
Reimbursement of losses Losses to equity holders in the event of bankruptcy of a construction company are reimbursed from the compensation fund for shared construction in a specific manner.
- First, the arbitration court establishes the fact of bankruptcy.
- Then the board of the compensation fund decides which option is more profitable: paying losses to equity holders or completing a residential building.
Equity Construction Compensation Fund
Attention
Content
- 1 Essence
- 2 Main tasks and functions
- 3 How an equity holder can protect his rights
- 4 Some nuances
- 5 Requirements for developers
Support for defrauded real estate investors is very often raised at the highest levels. To support this category of citizens, a compensation fund was officially created in 2017 to protect the rights of citizens of participants in shared construction.
Unfortunately, the regulatory part was not developed in parallel. As a result, the fund for protecting the rights of equity holders could not fully function. After the adoption of Federal Law No. 218 in July last year, the mechanism was finally formed according to which the public-law company "Fund for the Protection of the Rights of Citizens of Participants in Shared Construction", reporting directly to the President of the Russian Federation, should work.
Fund for the Protection of the Rights of Citizens - Participants in Shared Construction Official Site
- The area of \u200b\u200bhousing for which money is returned from the compensation fund of real estate investors should not exceed 120 m2. State fund - for those who give their last savings to buy an apartment. Buyers of large apartments and luxury housing, according to legislators, can stand up for themselves.
- The amount of compensation depends on the cost of housing, which is determined by the Ministry of Construction - it corresponds to the minimum market value, which differs by 30-40% from the actual value. Having received compensation at such rates, the equity holders lose part of their funds. Analyzing the law, experts find many nuances and make various predictions. So, restrictive measures in relation to business will force small companies to leave the market of shared construction. Large companies will have to create subsidiaries to start new construction, and this will lead to additional costs.
Fund for the protection of the rights of citizens of participants in shared construction official website
Did you know that ... Since January 2017, a state compensation fund for shared construction has been created in Russia. It is also popularly called the developers' compensation fund or the fund for protecting the rights of equity holders.
What it is? Whom should this please? Legislators argue that this should please the equity holders - i.e. participants in shared housing construction in apartment buildings. After all, the main task of the construction compensation fund is to pay compensation to equity holders under Equity Participation Agreements (DAC) in the event of the Developer's bankruptcy.
But what about the developer's insurance? Do you mean the developer's civil liability insurance that has been in effect until now? This insurance (for more details about it, see the specified link), was launched in 2014, and has shown its insolvency in several years. More precisely, the inconvenience and complexity of implementation.
The Fund for the Protection of the Rights of Citizens - Participants in Shared Construction is registered in the form of a public law company and is starting its work, the AHML reported. The registration of the fund in the form of a public company was completed on October 20. At the expense of the fund, compensation will be paid to participants in shared construction or construction of unfinished real estate objects will be financed. The fund will be financed by contributions from developers in the amount of 1.2 percent of each equity agreement after the date of state registration of the fund.
Non-payment by the developer of the contribution to the fund of equity holders is the basis for the suspension of state registration of the contract for participation in shared construction. Detailed information on the procedure and peculiarities of the developers making contributions and registering the DDU is posted on the fund's website.
Fund for the protection of the rights of citizens of participants in shared construction official
The Office of Rosreestr in the Kursk Region informs about the creation of the Fund for the Protection of the Rights of Citizens - Participants in Shared Construction. On October 20, 2017, the Fund for the Protection of the Rights of Citizens - Participants of Shared Construction began work. The creation and operation of this Fund is regulated by the Federal Law of July 29, 2017 No. 218-FZ "On a public company for the protection of the rights of citizens - participants in shared construction in the event of insolvency (bankruptcy) of developers and on amendments to certain legislative acts of the Russian Federation." In pursuance of the provisions of the Law, the Government of the Russian Federation issued a number of resolutions on the work of the Fund.
Responsibility of construction companies The regulation of the new legislation on the compensation fund for shared construction defines strict requirements for the responsibility of developers. From July 2018 they will begin to operate:
- now companies will be more limited in their activities, they will only have to deal with construction, and not related business;
- investors' funds can be attracted by those developers who have more than 3 years of experience, who have erected about 10 sq. m. residential buildings;
- the company must have a significant authorized capital of about 10% of the cost of the house;
- developers will be allowed to build only one object;
- the company's finances must be kept in a single account with a banking institution that controls all financial costs.
Also, the requirements relate to the moral side of officials.
The Fund for the Protection of Shareholders Started Its Work
The law assumes that from January 2017, upon registration of each new Contract of Equity Participation, Rosreestr will send to the fund a request for payment or non-payment of mandatory contributions under this contract. Thus, Developers will be encouraged to pay contributions to the compensation fund on time, and real estate investors will be provided with real financial protection of their rights.
Attention
But there is one caveat. The Developer's obligation to transfer a contribution to the compensation fund arises only if the first Equity Participation Agreement (DSA) for the construction of a new house is registered after January 1, 2017 (see the link above on the website of the Government of the Russian Federation). This is precisely the first contract for a construction project.
That is, the legislators allowed not to pay deductions to the fund for those Developers who, at the time of January 1, 2017, already had registered sales of apartments under the DDU for any project.
Article 10.Mandatory contributions (contributions) of developers to the compensation fund
Moreover, the guarantees are not given by a private bank or insurer, but by the PPK - part of the state structure. The official website of the shared construction fund Information transparency is a necessary condition for the operation of the new compensation fund, prescribed by law. Information on shared construction will be posted on the official website of the Unified Institute for Housing Development, along with the AHML resource.
It should reflect:
- the condition of all objects erected with equity participation: their project documentation, all financial statements, the number of preschool institutions, photos of the stages of housing construction;
- data on civil servants who control the work of developers, the results of their inspections;
- facts of violation of the law and bringing the perpetrators to justice, etc.
Equity Construction Compensation Fund
This point has caused amicable misunderstanding of both builders and experts, since any construction begins with these costs.
- All funds of the construction company of equity participation must be in one bank, which checks for each financial cost.
- Those who manage a construction company should not have:
- convictions for economic crimes;
- be bankrupt;
- be disqualified.
Reimbursement of losses Losses to equity holders in the event of bankruptcy of a construction company are reimbursed from the compensation fund for shared construction in a specific manner.
- First, the arbitration court establishes the fact of bankruptcy.
- Then the board of the compensation fund decides which option is more profitable: paying losses to equity holders or completing a residential building.
The action is not quick, it may take six months. The accepted verdict will be posted on the website of the investor fund. It also indicates the address data, where the documentation is accepted, the schedule of reception by employees.
Info
Investors will receive information about the decree within 14 days after its approval. A package of documentation, a passport, an application is provided to the banking institution that accompanied the work of the construction company.
After providing all the necessary papers, compensation is expected for 10 days. For some category of citizens, the payment of funds may occur a little earlier.
Important
The fund undertakes to pay losses to investors in accordance with the established rules. Equity houses under construction signed according to the old scheme, in the event of ruin, are not protected by the compensation fund.
The new legislation does not provide for the payment of losses for previously concluded preschool educational institutions.
Compensation Fund for the Protection of the Rights of Shareholders
The amount of contributions of 18-25 billion in the first years of the fund's existence is quite sufficient to cover the future problems of one or two regional contractors. The law does not prescribe where to get money from in case of a shortage of funds, it is possible that from the budget.
Compensation under contracts of previous years is not provided for by the new law. If the object under construction has at least one equity participation agreement signed according to the old scheme, it will not be included in the scope of the compensation fund. Requirements for the developer The central provision of the new law on the compensation fund of equity holders is to impose strict requirements on builders, which may leave very few developers on the shared construction market. The presentation of these requirements will begin at the conclusion of the DDU from 1.07.
2018.
Equity construction compensation fund official website
In the event of the bankruptcy of a construction company, the cost of the insurance policy or interest for the surety in the bank could not cover the losses of all owners of shared construction contracts, all the more, they were not enough to complete the problem object. The number of unfinished objects and defrauded equity holders continued to grow.
- The new mechanism is convenient, first of all, for developers.
They do not need to insure every contract of shared construction; they do not need to look for a suitable insurance company. It is enough to transfer a certain percentage of the transaction to the compensation fund of equity holders and obtain permission to register it.
- The money received from developers is the reserve from which the losses of equity holders will be paid when their construction company is ruined.
The same reserve will finance the company that will complete the problem object.
Fund for the Protection of the Rights of Citizens - Participants in Shared Construction Official Site
The funds accumulated in this fund will be used exclusively to pay compensation to defrauded equity holders in the event of the Developer's bankruptcy, or to finance the completion of construction. In the latter case, it can be financial assistance or a loan to a new Developer, who will assume the obligations to complete the construction of the problem object.
It is prohibited to spend the funds of the fund for other purposes. For new equity holders, this means a significant reduction in the risk of investments in the purchase of apartments in new buildings.
First, there is a real chance to finish building the house, even when the Developer goes bankrupt. Secondly, the mechanism of compensation payments to equity holders itself has become much simpler and clearer (in comparison with liability insurance).
Thirdly, these funds will be managed not by private insurance companies, but by the state structure.
Basic Functions The Equity Construction Fund has two main tasks - to help equity holders in the event of bankruptcy of developers and to bring problem construction to an end. Its functions are related to these tasks.
- Maintain records and control of contributions from developers.
- Organize bankruptcy arbitration for construction companies that have made contributions to the fund.
- Compensation for losses to equity holders.
- Financing and lending to a company that has committed to complete the problem object.
- Placement of free funds in assets and on bank deposits, in mortgage securities and government bonds.
The mechanism of work of the compensation fund The mechanism of liability insurance for developers, which has existed since 2014, was recognized as ineffective by both independent experts and government agencies.
Equity construction fund official website
The full title of the law: "On a public law company to protect the rights of citizens participating in shared construction in the event of insolvency (bankruptcy) of developers and on amendments to certain legislative acts of the Russian Federation." included in the area of \u200b\u200baction of the state "Agency for Housing Mortgage Insurance" (AHML). The Ministry of Construction became the founder, it owns a number of important amendments to change the status of the compensation fund of equity holders. The Duma approved the status of a public law company (PPK) for the "Fund for the Protection of the Rights of Citizens - Participants in Shared Construction" with functions and powers characteristic of state power. The company is accountable to the President of Russia, control over financial activities is exercised by representatives of both chambers of parliament and the Accounts Chamber of the Russian Federation.
Shared construction fund official website vacancies
The resolution of the issue may take 6 months.
- The decision on payment is posted on the website of the compensation fund of equity holders. The address where documents will be accepted and the working hours of employees are also indicated there.
All information comes to the equity holders within 2 weeks after the decision is made.
- List of documents for compensation: application; the passport. Most often, they are provided to the bank, which accompanied the activities of the developer.
- The money is paid to the equity holders within 10 days after the submission of the necessary papers.
- Military servicemen, seriously ill people, and people who are away are entitled to earlier payments.
The fund undertakes to pay the losses of equity holders in full.
Nuances The size of payments to equity holders is determined by multiplying the cost of one square meter of housing by its area.
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The Fund for the Protection of the Rights of Citizens - Participants of Shared Construction was registered as a public company on October 20 and began its work.
The State Equity Construction Fund replaced the liability insurance mechanism for developers and is designed to protect the rights of equity holders in new housing projects. Unlike the insurance system for preschool educational institutions (equity participation agreements), the fund's activities will be aimed, among other things, at financing the completion of the facility. The Ministry of Construction of Russia was the founder of the Fund for the Protection of the Rights of Citizens Participating in Shared Construction; Alexander Plutnik, the head of AHML, was appointed general director.
In case of bankruptcy of the developer, at the expense of the compensation fund, compensation will be paid to citizens - participants in shared construction or financing of measures to complete the construction of construction in progress.
According to part 5 of Article 25 of Law No. 218-FZ, the developer's obligation to pay mandatory contributions (contributions) to the compensation fund arises in relation to an apartment building and (or) a residential building of a blocked development, consisting of three or more blocks, if the contract for participation in shared construction with the first participant in the shared construction of such a property was submitted for state registration after the date of state registration of the Fund. From the date of the state registration of the Fund, it is not allowed to register the first contract for participation in shared construction without payment of mandatory contributions (contributions) to the Fund.
According to part 1 of article 10 of Law No. 218-FZ, the amount of compulsory contributions (contributions) of developers to the compensation fund is 1.2 percent of the price agreed by the parties for each contract for participation in shared construction, providing for the transfer of residential premises. In this case, the obligation to pay contributions to the Fund arises in relation to contracts for participation in shared construction, providing for the transfer of residential premises, regardless of whether the participant in shared construction is an individual or a legal entity.
According to part 3 of article 10 of Law No. 218-FZ, compulsory deductions (contributions) of developers are made to the nominal account of the Fund, which is owned by the Fund, at least three working days before the date of submission of documents for state registration of the contract to the Federal Service for State Registration, Cadastre and cartography (hereinafter - Rosreestr).
In accordance with part 1 of Article 11 of Law No. 218-FZ, upon state registration of an agreement for participation in shared construction, which provides for the transfer of residential premises, Rosreestr sends to the Fund a request for payment or non-payment by the developer of mandatory contributions (contributions) under the agreement for participation in shared construction. The Foundation, no later than one business day from the date of receipt of such a request, provides the information specified in the request.
According to part 1 of article 16 of the Federal Law of July 13, 2015 No. 218-FZ "On state registration of real estate", the period for state registration of an agreement for participation in shared construction is set from 7 to 9 working days, depending on the method of submitting documents for state registration.
Detailed information is available on the Fund's website on the Internet at www.fond214.rf. Questions about the Foundation's work and other requests, please send by e-mail: [email protected] ... The specialized contact center phone number is 8 800-7007-214 or 8-495-685-94-41.
Payment of compulsory deductions (contributions) of the developer to the compensation fund must be carried out according to the details published on the Official website of the Fund in the section "Developers".
Recall that the law on the Shared Construction Fund - 218-FZ - was signed by Russian President Vladimir Putin on July 31, 2017. By mid-October, a resolution was adopted by the Government of Russia on the establishment of a public-law company "Fund for the Protection of the Rights of Citizens - Participants in Shared Construction". Now, when registering agreements on equity participation in housing projects under the newly issued permits, the developer is required to make a contribution to the compensation fund.
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