56.— (1) A housing authority shall, within 6 months of designating an apartment complex under section 55, by written notice given to each tenant of an apartment in the apartment complex, invite him or her to submit to the authority an application to purchase the apartment.

(2) Apartments in a designated apartment complex shall be available for sale under this Part to the tenants thereof during the period (in this Part referred to as the “initial selling period”) beginning on the date specified in subsection (3) and ending on the later of the following—

(a) 3 years from the date on which the initial selling period begins, or

(b) 5 years from the date on which the initial selling period begins in a case where the housing authority, before the expiry of the period specified in paragraph (a), extends that period for a further period of 2 years where it is satisfied that the sales of at least the minimum number of apartments available for sale in the designated apartment complex, calculated in accordance with section 64 (4), will proceed during any such extended period.

(3) The specified date for the purposes of subsection (2) is the date of the first occasion following designation of the apartment complex under section 55 on which the housing authority, pursuant to an application referred to in subsection (1), provides to a tenant the necessary information, documentation, particulars of title and terms and conditions of sale relating to the apartment concerned together with information and documentation relating to the management company.

(4) The extension of the initial selling period for the purposes of subsection (2) (b) is a reserved function.

(5) The F52[chief executive] shall arrange for the establishment of a management company under section 57 where the F52[chief executive] is satisfied that—

(a) the sales are ready to proceed, during the initial selling period, of at least the minimum number of apartments available for sale in the designated apartment complex calculated in accordance with subsection (6), and

(b) in relation to those sales that are ready to proceed as referred to in paragraph (a), the number of tenants of the apartments concerned that have indicated their willingness to serve as directors of the management company equals or exceeds half of the minimum number of apartments calculated in accordance with subsection (6).

(6) The minimum number of apartments for the purposes of subsection (5) (a) is calculated as the greater of—

(a) the minimum number of apartments specified in column (2) of the Table to this subsection opposite the entry in column (1) of the class of apartment complex corresponding to the class of the designated apartment complex concerned, and

(b) the minimum number (rounded up to the nearest higher whole number) of tenants represented by the minimum proportion of all apartments in the designated apartment complex concerned specified in column (3) of the said Table opposite the said entry in column (1).

TABLE

(7) For the purposes of subsection (5) and section 64 (3), a sale is ready to proceed where, in accordance with the terms and conditions of sale, the tenant has—

(a) signed the apartment assignment order,

(b) paid such deposit as is payable to the housing authority in respect of the purchase concerned, and

(c) provided to the housing authority written notice of loan approval or otherwise established, to the satisfaction of the housing authority, his or her capacity to pay the balance of the purchase money on the completion of the sale to him or her.