OC / DMC Prohibition on Alterations?
Compliance Pathway Analysis for Landlords Facing OC Restrictions

Some landlords discover an overlooked issue when initiating BHU compliance: the building's Deed of Mutual Covenant (DMC), administered by the Owners' Corporation (OC), expressly prohibits internal structural alterations within individual units, or restricts units from being used for subdivided letting.

This issue surfaced after legislation took effect in 2026, since compliance renovation typically involves partition adjustments, separate utility metering, and fire door installation — all of which may engage DMC provisions.

The real question facing landlords is: the BHU Regulation requires compliance, but the building's DMC does not permit renovation — what do I do?

This article sets out the legal framework governing this conflict and the three response pathways available to landlords.

Legal Relationship Between the DMC and the BHU Regulation

The DMC Is Not Automatically Overridden by the BHU Regulation

Many landlords hold a misconception: "The government has legislated that I must comply, so I can disregard the building's DMC."

This is incorrect.

The Code of Practice on Minimum Living Space Standards for BHU Regulation expressly states: "BHU certification does not affect the right of other government departments to take enforcement or regulatory action, nor does it exempt or affect any contract, covenant or deed of mutual covenant relating to the BHU or the unit or building in which it is situated. The owner/operator must ensure that the BHU and the unit or building in which it is situated comply with all applicable laws, statutory plans, land grant conditions and deeds of mutual covenant."

In other words, the BHU Regulation is public law (governing the relationship between the government and landlords), while the DMC is private law (governing contractual relationships between owners). Obtaining BHU certification does not exempt you from liability for breaching the DMC.

Two Types of Legal Consequences May Arise Simultaneously

If a landlord carries out compliance renovation in breach of the DMC, two sets of consequences may arise concurrently:

Civil Consequences (From Other Owners or the OC)

• Other owners may apply to the Lands Tribunal to enforce the DMC
• The OC may issue a notice to the landlord to cease alteration works
• The landlord may be required to restore the unit to its original condition and bear legal costs
• In serious cases, the Lands Tribunal may order closure of the unauthorised alteration

Public Law Consequences (From the Government)

• Even if compliance renovation is completed and BHU certification obtained, the validity of the certification is not affected by DMC disputes per se
• However, if the Lands Tribunal orders restoration of the unit, the landlord will be forced to undo the renovation and the certification will automatically lapse

This means: obtaining BHU certification alone does not resolve the DMC problem. Landlords must address both dimensions.

Which DMC Provisions Most Commonly Create Obstacles

DMC provisions vary considerably across Hong Kong residential buildings, but the following three categories are the most frequently encountered in compliance renovation:

Clause Type 1: Prohibition on Structural Alterations

A DMC may directly prohibit "altering the internal structure of a unit without OC consent", "removing or constructing non-load-bearing walls", or "relocating plumbing or electrical installations".

Compliance works affected by such provisions include:

• Repartitioning (to meet minimum floor area requirements)
• Fire door installation (which may require structural adjustments)
• Mechanical ventilation ductwork (involving ceilings or walls)

Clause Type 2: Restrictions on Unit Use

Some DMCs provide that "units may only be used for residential purposes and not for commercial use or multi-unit letting".

Such provisions affect:

• Units subdivided into multiple independent letting units (even where all tenants use them residentially)
• Subdivided designs with independent kitchens and bathrooms (treated as "multi-household" use)

Clause Type 3: Prohibition on External Installations

Some DMCs prohibit "installing any fixtures on external walls" or "altering the external appearance of the building".

Such provisions affect:

• Mechanical ventilation external wall exhaust openings
• External enclosures for separate water or electricity meters
• External connections for fire escape equipment

Three Pathways for Landlords Facing OC Restrictions

Pathway 1: Apply for OC Consent (Most Common)

The vast majority of DMCs include provisions allowing exemption "with the written consent of the OC". Landlords may submit a renovation plan to the OC to apply for special approval.

Steps

1. Obtain a professional assessment report: First commission an Authorized Person to produce a renovation plan detailing the specific works, scope of impact, and structural safety certification
2. Prepare OC application documents: Including the renovation plan, a statement explaining the necessity for compliance, and a mitigation plan addressing the impact on other occupiers during construction
3. Convene an OC meeting: Depending on the DMC, some alterations require a simple majority while others require 75% or higher approval
4. Obtain a written consent letter: To serve as a legal record for future reference

Time allowance: 1–3 months, depending on OC meeting frequency.

Success rate: When the OC understands the renovation is a regulatory necessity rather than the landlord's personal preference, most OCs will consent. However, some older building OCs with internal tensions may delay or refuse.

Pathway 2: DMC Amendment (Highest Cost)

Where the OC consent mechanism cannot resolve the underlying problem (e.g. the DMC itself expressly prohibits subdivided letting), landlords may initiate a DMC amendment process.

Steps

1. Engage a solicitor to review the DMC terms and assess the feasibility of amendment
2. Convene a general meeting of all owners to deliberate on the proposed amendment
3. Obtain the required majority as specified in the DMC (typically 75% or higher)
4. Register the amended DMC at the Land Registry

Time allowance: 6–12 months or longer.

Cost: Legal fees typically HKD 50,000–200,000+, depending on building size and DMC complexity.

When viable: Where multiple owners in the building are seeking subdivided flat compliance (not just yourself), sharing costs makes this more feasible.

Pathway 3: Abandon Renovation — Whole-Unit Letting or Sale

Where pathways 1 and 2 are not practicable, landlords must face the reality: this unit may not be suitable for subdivided letting.

Options include:

Option A: Whole-Unit Letting (No Subdivision)

• Monthly rental income typically 50–70% of the aggregate subdivided flat income
• Fully compliant; no BHU certification required
• Suitable for landlords not intending to continue operating as a subdivided flat landlord

Option B: Sell the Property

• Accept market price (which may be affected by DMC restrictions)
• Exit the issue entirely
• Suitable for landlords no longer wishing to retain the property

Option C: Wait for a Change in OC Policy

• Where multiple owners in the building face compliance pressure simultaneously, the OC's position may soften
• However, the risk of waiting is high — the grace period registration deadline may be missed

Three Facts Landlords Often Overlook

Fact 1: The OC Itself Faces Legal Pressure

After BHU enforcement begins, if a landlord in the building is prosecuted for illegal subdivided letting, the OC may be challenged over why it permitted such use to exist. Some proactive OCs will respond by establishing in-house guidelines on BHU compliance for the building, rather than simply prohibiting all works.

When applying for OC consent, landlords can proactively point out: "I am seeking BHU certification precisely because it reduces the OC's legal risk."

Fact 2: DMC "Prohibitions" Are Not Always Absolute

Older DMCs in Hong Kong are often drafted in imprecise language, and many provisions are open to considerable legal interpretation. Before taking any action, it is advisable to have a solicitor review the specific provisions and confirm the scope of prohibition.

For example, "no structural alterations" may not extend to "installing a door frame within an existing wall"; "residential use only" may not preclude "subdivided residential use". The precise interpretation depends on the facts of each case.

Fact 3: There Is a Limitation Period on Liability for DMC Breaches

Even if you have been subletting in breach of the DMC for many years, if the OC or other owners have not raised objections over an extended period (typically 6 years or more), this may constitute "acquiescence", reducing the future risk of enforcement action.

This is not, however, a recommendation to rely on acquiescence — proactive resolution always carries lower risk than passive exposure to litigation.

Conclusion: Assess First, Then Decide

The complexity of OC and DMC issues often exceeds what landlords can assess on their own. This article provides a general framework; specific cases must be evaluated jointly by a solicitor and an Authorized Person.

Our recommended sequence:

1. First obtain a compliance assessment report for the unit (to understand what renovation is required)
2. Simultaneously review the building's DMC (to identify which works may engage restrictions)
3. If there is a conflict, consult a solicitor to confirm the response pathway
4. Choose between OC consent, DMC amendment, or market exit based on the specific circumstances

This process may take longer than landlords expect, but no step can be skipped. BHU compliance is not purely a construction matter — it is a combined legal and construction issue.

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