Deed of Mutual Covenant

Do you know what is a DMC when you purchase an apartment in HK?

What is Deed of Mutual Covenant?
A Deed of Mutual Covenant (“DMC”) is an agreement under seal.  It binds on all
owners of a multi-unit or multi-storey building.  It basically sets out rules to regulate
the rights and liabilities of co-owners and establishes management machinery for the
co-owned property.
Hong Kong buildings are mostly multi-unit or multi-storey.  People own multi-unit
developments in Hong Kong by holding undivided shares in the whole development
together with an exclusive right to use a particular part of the building that they
bought.  Owners are actually co-owners of the whole development.  The DMC caters
the need to regulate rights and liabilities of all owners.
The parties of a DMC include the developer and the first purchaser of a unit in the
development and the management company (if there is a management company
appointed).  Even though not all owners signed the DMC, they are bound directly by
it.  This is similar to a case where members of a trade union are bound by its rules.
DMC covenants can be enforced against the successors in title of the original parties
or their successors in title.
DMC has a binding force over all owners, incorporated owners, manager, tenants and
users of the building.  Relevant parties can take legal action against the party who
violates the DMC.  The remedies of violations include damages against losses, an
injunction order from the court and a declaration from the court concerning the
violating act.

and more: http://www.clic.org.hk/en/topics/saleAndPurchaseOfProperty/deed_of_mutual_covenant_and_owners_corporation/index.shtml

A Deed of Mutual Covenant (“DMC”) is a document containing terms that are binding on all flat owners of a multi-unit or multi-storey building. Once a DMC is signed by the owner of a flat and the developer, it binds all the subsequent owners. It basically sets out rules for the management and regulation of the building. A detailed DMC can run to over a hundred pages. Terms in a DMC may include, for example:

• residential flats cannot be used for commercial activities;
• definition of the common areas of the building;
• restrictions on the flat owners (e.g. no keeping of cats and dogs);
• how to appoint a building manager (or building management company);
• how to set up an Owners' Corporation;
• how to make resolutions on matters concerning maintenance or renovation;
• who should specify the management fees, and how.

No matter how a DMC is drafted, no provision may contravene the Building Management Ordinance (Cap. 344 of the Laws of Hong Kong).