§ 3603. — Definitions.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 15USC3603]
TITLE 15--COMMERCE AND TRADE
CHAPTER 62--CONDOMINIUM AND COOPERATIVE CONVERSION PROTECTION AND ABUSE
RELIEF
Sec. 3603. Definitions
For the purpose of this chapter--
(1) ``affiliate of a developer'' means any person who controls,
is controlled by, or is under common control with a developer. A
person ``controls'' a developer if the person (A) is a general
partner, officer, director, or employer of the developer, (B)
directly or indirectly or acting in concert with one or more other
persons, or through one or more subsidiaries, owns, controls, holds
with power to vote, or holds proxies representing, more then 20 per
centum of the voting interests of the developer, (C) controls in any
manner the election of a majority of the directors of the developer,
or (D) has contributed more than 20 per centum of the capital of the
developer. A person ``is controlled by'' a developer if the
developer (i) is a general partner, officer, director or employer of
the person, (ii) directly or indirectly or acting in concert with
one or more other persons, or through one or more subsidiaries,
owns, controls, holds with power to vote, or holds proxies
representing, more than 20 per centum of the voting interests of the
person, (iii) controls in any manner the election of a majority of
the directors, or (iv) has contributed more than 20 per centum of
the capital of the person;
(2) ``automatic rent increase clause'' means a provision in a
lease permitting periodic increases in the fee under the lease which
is effective automatically or at the sole option of the lessor, and
which provides that the fee shall increase at the rate of an
economic, commodity, or consumer price index or at a percentage rate
such that the actual increases in the rental payment over the lease
term cannot be established with specificity at the time the lease is
entered into;
(3) ``common elements'' means all portions of the cooperative or
condominium project, other than the units designated for separate
ownership or for exclusive possession or use;
(4) ``condominium association'' means the organization, whose
membership consists exclusively of all the unit owners in the
condominium project, which is, or will be responsible for the
operation, administration, and management of the condominium
project;
(5) ``condominium project'' means real estate (A) which has five
or more residential condominium units, in each residential
structure, and the remaining portions of the real estate are
designated for common ownership solely by the owners of those units,
each owner having an undivided interest in the common elements, and
(B) where such units are or have been offered for sale or sold,
directly or indirectly, through the use of any means or instruments
of transportation or communication of interstate commerce, or the
mails;
(6) ``condominium unit'' means a portion of a condominium
project designated for separate ownership;
(7) ``conversion project'' means a project, which has five or
more residential units, which was used primarily for residential
rental purposes immediately prior to being converted to a
condominium or cooperative project;
(8) ``convey or conveyance'' means (A) a transfer to a purchaser
of legal title in a unit at settlement, other than as security for
an obligation, or (B) the acquisition by a purchaser of a leasehold
interest for more than five years;
(9) ``cooperative association'' means an organization that owns
the record interest in the residential cooperative property; or a
leasehold of the residential property of a cooperative project and
that is responsible for the operation of the cooperative project;
(10) ``cooperative project'' means real estate (A) which has
five or more residential cooperative units, in each residential
structure, subject to separate use and possession by one or more
individual cooperative unit owners whose interest in such units and
in the undivided assets of the cooperative association which are
appurtenant to the unit are evidenced by a membership or share
interest in a cooperative association and a lease or other muniment
of title or possession granted by the cooperative association as the
owner of all the cooperative property, and (B) an interest in which
is or has been offered for sale or lease or sold, or leased directly
or indirectly, through use of any means or instruments of
transportation or communication in interstate commerce or of the
mails;
(11) ``cooperative property'' means the real estate and personal
property subject to cooperative ownership and all other property
owned by the cooperative association;
(12) ``cooperative unit'' means a part of the cooperative
property which is subject to exclusive use and possession by a
cooperative unit owner. A unit may be improvements, land, or land
and improvements together, as specified in the cooperative
documents;
(13) ``cooperative unit owner'' means the person having a
membership or share interest in the cooperative association and
holding a lease, or other muniment of title or possession, of a
cooperative unit that is granted by the cooperative association as
the owner of the cooperative property;
(14) ``developer'' means (A) any person who offers to sell or
sells his interest in a cooperative or condominium unit not
previously conveyed, or (B) any successor of such person who offers
to sell or sells his interests in units in a cooperative or
condominium project and who has the authority to exercise special
developer control in the project including the right to: add,
convert, or withdraw real estate from the cooperative or condominium
project, and maintain sales offices, management offices and rental
units; exercise easements through common elements for the purpose of
making improvements within the cooperative or condominium; or
exercise control of the owners' association;
(15) ``interstate commerce'' means trade, traffic,
transportation, communication, or exchange among the States, or
between any foreign country and a State, or any transaction which
affects such trade, traffic, transportation, communication, or
exchange;
(16) ``lease'' includes any agreement or arrangement containing
a condominium or cooperative unit owner's obligation, individually,
collectively, or through an association to make payments for a
leasehold interest or for other rights to use or possess real
estate, or personal property (which rights may include the right to
receive services with respect to such real estate or personal
property), except a lease does not include mortgages or other such
agreements for the purchase of real estate;
(17) ``person'' means a natural person, corporation,
partnership, association, trust or other entity, or any combination
thereof;
(18) ``purchaser'' means any person, other than a developer, who
by means of a voluntary transfer acquires a legal or equitable
interest in a unit other than (A) a leasehold interest (including
renewal options) of less than five years, or (B) as security for an
obligation;
(19) ``real estate'' means any leasehold or other estate or
interest in, over or under land, including structures, fixtures, and
other improvements and interests which by custom, usage, or law pass
with a conveyance of land though not described in the contract of
sale or instrument of conveyance. ``Real estate'' includes parcels
with or without upper or lower boundaries, and spaces that may be
filled with air or water;
(20) ``residential'' means used as a dwelling;
(21) ``sale'', ``sale of a cooperative unit'' or ``sale of a
condominium unit'' means any obligation or arrangement for
consideration for conveyance to a purchaser of a cooperative or
condominium unit, excluding options or reservations not binding on
the purchaser;
(22) ``special developer control'' means any right arising under
State law, cooperative or condominium instruments, the association's
bylaws, charter or articles of association or incorporation, or
power of attorney or similar agreement, through which the developer
may control or direct the unit owners' association or its executive
board. A developer's right to exercise the voting share allocated to
any condominium or cooperative unit which he owns is not deemed a
right of special developer control if the voting share allocated to
that condominium or cooperative unit is the same voting share as
would be allocated to the same condominium or cooperative unit were
that unit owned by any other unit owner at that time;
(23) ``State'' includes the several States, the District of
Columbia, the Commonwealth of Puerto Rico, and the territories and
possessions of the United States; and
(24) ``tenants' organization'' means a bona fide organization of
tenants who represent a majority of the occupied rental units in a
rental housing project.
(Pub. L. 96-399, title VI, Sec. 604, Oct. 8, 1980, 94 Stat. 1673.)
Section Referred to in Other Sections
This section is referred to in title 12 sections 1441a, 1831q.
