Transfer of Property Act at Malaysia
In Malaysia, the legal framework governing property transfer is not the Transfer of Property Act (which is specific to India) but is instead primarily governed by Malaysian property laws and statutes, most notably the National Land Code (NLC) 1965.
Here’s an overview of how property transfer works in Malaysia:
Key Legal Frameworks for Property Transfer in Malaysia
National Land Code (NLC) 1965:
The National Land Code (NLC) is the primary piece of legislation in Malaysia that governs land transactions, including the transfer of property, land registration, and the creation of interests in land (such as leases, charges, and mortgages).
The NLC governs land matters across Peninsular Malaysia, with separate legislation in Sabah and Sarawak.
Conveyancing Law:
In addition to the NLC, property transfers are also governed by conveyancing law, which involves the legal process of transferring property ownership from one party to another.
The process includes drafting, executing, and registering a sale and purchase agreement (SPA), among other required documents.
Steps for Property Transfer in Malaysia
Sale and Purchase Agreement (SPA):
A Sale and Purchase Agreement (SPA) is a crucial document in the property transfer process.
Once a buyer and seller agree on the terms, an SPA is signed, detailing the purchase price, payment terms, and other conditions.
The SPA must be signed by both parties in the presence of a solicitor or licensed conveyancer.
Payment and Settlement:
After the SPA is signed, the buyer typically makes a deposit (usually around 10% of the purchase price), with the balance paid upon completion.
This payment process is typically handled through the buyer’s solicitor, who will also prepare other documents needed for the registration of the property transfer.
Stamp Duty:
The transaction is subject to stamp duty, which is calculated as a percentage of the purchase price or the market value, whichever is higher. The buyer is generally responsible for paying the stamp duty.
Registration of Transfer:
The transfer of property must be registered with the Land Office (or Land and Survey Department in East Malaysia), which is the government body responsible for land administration.
The registration process includes the submission of relevant documents, such as the signed SPA, proof of payment, and identification documents.
Once registered, the buyer officially becomes the legal owner of the property.
Land Title:
After successful registration, a new land title is issued in the buyer's name, confirming the transfer of ownership.
Additional Considerations:
Leases and Charges: The NLC also governs the creation of leases, mortgages, and other legal interests in land. If there is an existing mortgage on the property, it must be cleared or transferred during the property sale.
Foreign Ownership: In Malaysia, foreign nationals are allowed to purchase property, but certain restrictions apply. For instance, foreign buyers can only purchase properties that meet a minimum value requirement (typically higher than for local citizens) and must comply with specific regulations.
Conclusion
While India’s Transfer of Property Act applies to property transactions in India, Malaysia has its own regulatory framework for property transfer, primarily governed by the National Land Code and conveyancing laws. The transfer process in Malaysia involves steps like signing an SPA, paying stamp duty, and registering the transfer with the relevant land authorities.
RELATED Blog
0 comments