A call for funds is not an invoice: it is an advance intended to fund the condominium’s cash position, so that the building’s invoices are paid when they fall due. The syndic (the managing agent) does not advance the condominium’s money out of its own pocket; it calls for what the budget you voted provides.
What the syndic may require, and within what limits
Article 25 of the Grand Ducal Regulation of 13 June 1975, as amended by the Grand Ducal Regulation of 30 June 2022, sets precise limits on these calls. The syndic may require payment of:
- the permanent cash advance provided for in the règlement de copropriété (the condominium regulations), often referred to as the working-capital fund;
- at the start of each financial year, an advance which, subject to the provisions of the condominium regulations or, failing that, to the decisions of the general meeting, may not exceed one quarter of the forecast budget voted for the year in question — or one half of that budget where the regulations make no provision for a permanent cash advance;
- during the financial year, either a sum corresponding to the reimbursement of expenditure duly committed and actually paid, or quarterly advances, none of which may exceed one quarter of the forecast budget;
- special advances intended to enable decisions of the general meeting to be carried out, in particular the execution of works;
- contributions to the fonds de travaux (the statutory works fund) provided for in article 11 bis of the Law.
It all starts from the budget you voted
The syndic prepares the forecast budget, which is voted by the general meeting (article 24 of the Grand Ducal Regulation). The amounts of your calls for funds therefore follow from a budget approved in general meeting, and the forecast budget is served on you no later than at the same time as the agenda where the meeting is to vote the appropriations for the coming year (article 5). If a call takes you by surprise, the first thing to do is to reopen the minutes and the budget as voted.
The case of urgent works
By way of exception, where the syndic has works carried out as a matter of urgency to safeguard the building, it may, in order to open the site and make the first supply of materials, request — without any prior deliberation of the general meeting but after seeking the opinion of the conseil syndical (the co-owners’ supervisory board), if one exists — an advance which may not exceed one third of the estimated cost of the works (article 27 of the Grand Ducal Regulation). It must also inform the co-owners and immediately convene a general meeting.
Where the money called for goes
This is an essential point of control, and the rule is clear: all sums or assets received in the name and on behalf of the syndicat de copropriété [the co-owners’ association] must be paid without delay into a bank or post office account opened in the name of the association (article 28 of the Grand Ducal Regulation). The condominium regulations, or a decision of the general meeting, may set — subject to such safeguards as they determine — the maximum amount of funds that the syndic is authorised not to pay into that account.
The syndic must also keep, for each association, separate accounts capable of showing the accounting position of each co-owner vis-à-vis the association (article 24). The general meeting decides, where appropriate, how the funds collected are to be invested (article 25).
Advances on charges fund the condominium’s cash position and will be settled in the annual statement. The permanent cash advance is working capital, and stays to the credit of your co-owner account. The contribution to the fonds de travaux is compulsory saving attached to your unit, and is not refunded to you when you sell. Do not confuse them: they are different in nature and meet different fates.
A question about a call for funds
If an amount looks wrong to you, write to us stating your building, your unit and the reference of the call: we will go back through the calculation with you, line by line. An error in the basis of apportionment or in a share is corrected; a catch-up arising from a budget that was voted can be explained.
General information on Luxembourg condominium law (the amended Law of 16 May 1975 and the Grand Ducal Regulation of 13 June 1975, in their consolidated version applicable as at 1 August 2023). Your own règlement de copropriété may lay down specific rules, which prevail within the limits set by the law. This content is not legal advice.