Government and Policy

China issues new regulations on house expropriation

Updated: 2011-01-22 19:12
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BEIJING - China has issued new rules to put an end to forced demolitions in cities without due process and fair compensation, amid an increasing number of deadly property disputes occurring due to the country's fast urbanization process.

China's State Council, or Cabinet, published the regulation on expropriation and compensation of houses on state-owned lands on Friday. The new regulation took effect upon its being issued.

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The regulation targets disputes over house expropriation and demolition and strives to give equal consideration to both public interests and property owners' individual rights, according to a statement jointly issued by the Legislative Affairs Office of the State Council and the Ministry of Housing and Urban-Rural Development on Saturday.

No violence or coercion could be employed to force the homeowners to leave. Nor could measures, such as illegally cutting water and power supplies, be used in the relocation work, the regulation said.

Last October, demolition workers broke into a house slated for demolition that belonged to a 54-year-old man in Shanxi Province. The owner, who had earlier refused to leave, was pulled from the house and beaten to death.

The regulation has further ruled out land developers' involvement in the demolition and relocation procedures.

Links between the progress in demolition and the developers' business interests had long been an important element fueling the tension over land disputes, the joint statement said.

According to the regulation, local government is to be in charge of the work of land expropriation and compensation, or they have the option to authorize other non-profit organizations to conduct the work.

"By minimizing business interests in the expropriation procedure, the new regulation could effectively reduce the incidents of forced or violent demolitions which, in many cases, were driven by commercial concerns," said Shen Kui, a law professor at Peking University.

Further, if the government could not reach agreement about the expropriation or compensation with the homeowners, demolition could only be carried out after the court's review and approval, the regulation said.

The previous regulation on home demolition on urban lands, which went into effect in 2001 and had been replaced by the new regulation, had authorized local governments to enforce demolition at their own will.

"It is not saying that there will be no forced demolitions any more, because there might be cases where homeowners abuse their rights to profiteers," Shen said.

However, when the local government has a stake in the process, such as when it is in charge of the expropriation, a check and balance from the judicial authorities would well reduce the government's arbitrary decisions, he said.

The new regulation had also promised fair prices for homeowners.

The new regulation also states that compensation for expropriated homes should be no lower than the sum of the market price of similar properties at the time of the expropriation.

Compensation is a major concern during public submissions and surveys during the drafting of the new regulation, and a principle for the new regulation is that expropriation of homes should help to improve, not impair, the living standards of the owners, the joint statement said.

The previous regulation provided that compensation for a demolished home should be determined through government-led price appraisal procedures.

However, last March two farmers in Jiangsu Province set themselves on fire, killing one and injuring the other, to protest the compensation plan which they perceived to be severely under-priced.

Less than six months later, a similar case took place in Jiangxi Province, and it ended up with one homeowner being killed and two badly burned.

The new regulation has included use of market prices as being a much more reasonable gauge to determine compensation, and it is also in line with the provisions of the Property Law, which took effect in 2007, said Wang Liming, professor of Renmin University of China.

Moreover, fair and reasonable compensation could also be guaranteed with better transparency and public participation spelled out in the new regulation, Peking University Prof. Shen Kui said.

The homeowners will have more say in the negotiations during the expropriation procedures and they could challenge the government's compensation plan through public hearings or bringing law suits for higher payments, he said.

Shen said more public participation in expropriation procedures would also help to better define the "public interests" in specific cases.

The new regulation has stipulated that government-involved expropriations should only be carried out for "public interests" and has provided a general list of the "public interests", including, among others, land used for national defense, energy and transportation infrastructure, public causes of education and health, as well as construction of homes for low-income people.

Some local governments tend to back land developers' forced demolitions simply out of consideration that land development projects could bring more fiscal revenue to the government.

It is difficult to clearly define what is of "public interest" and what is not, but public opinions and homeowners' voices are crucial to determine whether the expropriation project is justified, Shen said.

Shen said courts and local people's congresses should independently and effectively exercise their authority to review and supervise local governments' expropriation practices.

A draft of the regulation was first reviewed at a State Council executive meeting in December 2007. Later, public opinion was twice sought in 2010 and revisions were made to the draft regulation.