New CSOS Practice Directive: What Community Schemes Need to Know

The Community Schemes Ombud Service (CSOS) has issued a new Practice Directive that directly affects the way bodies corporate and homeowners’ associations (HOAs) must operate. The directive introduces stricter compliance standards and clarifies the rights and obligations of stakeholders in community schemes across South Africa.

Why This Matters

Community schemes – from sectional title complexes to estates – manage the shared property and common interests of thousands of South Africans. Disputes in these schemes are often complex, and the CSOS plays a central role in providing accessible dispute resolution and ensuring compliance with legislation.

In practice, this means CSOS can now intervene earlier and more decisively in governance matters, compelling bodies corporate and HOAs to comply with legislation and scheme rules before disputes escalate.

Key Areas of Focus

The directive addresses:

• Improved governance: Trustees and directors must follow stricter procedural requirements when making decisions affecting owners and residents.
• Transparency and record-keeping: Schemes are expected to maintain clearer records and ensure members are properly informed of their rights and obligations. Financial management must be transparent, with timely submission of audited financial statements and budgets.
• Regulation of scheme practices: Issues such as alterations to common property, exclusive use areas, and community conduct are more tightly regulated.
• Enforcement: CSOS has reaffirmed its power to investigate and enforce compliance where schemes fall short. This includes the ability to issue compliance directives, impose penalties, and even refer serious cases to court.

Practical Implications

For trustees, directors, and managing agents, the directive means greater accountability. Non-compliance could expose schemes to disputes, adverse orders, or even financial penalties. For owners and residents, the directive strengthens protections and provides clearer recourse if governance structures are not followed.

The directive emphasises that CSOS is prepared to utilise enforcement tools – including compliance directives, penalties, and cost orders – to ensure schemes fulfil their governance obligations. This represents a stronger interventionist role for CSOS, with significant implications for trustees and managing agents who fail to comply.

Final Thoughts

The CSOS’s new directive reflects a broader policy push toward professionalising community scheme governance. While the changes may require adjustment, they should ultimately lead to more transparent, accountable, and legally compliant schemes.

Community schemes should take this opportunity to review their governance practices, update rules and policies, and seek legal guidance where necessary to ensure compliance.

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Johlene Wasserman

VDM Attorneys