Macao's 'land grab' stirs up a hornet's nest

Updated: 2017-01-25 07:23

By Deng Yanzi in Hong Kong(HK Edition)

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 Macao's 'land grab' stirs up a hornet's nest

The plot of land in Macao's Seac Pai Van area that was granted to Hong Kong builder Asia Standard International Group Ltd is now being reclaimed by the government. Twelve other plots in the same area have already been, or will be, taken back by the authorities. Provided to China Daily

A controversial move by the Macao SAR government to reclaim plots of land granted to builders, but had not been utilized on expiry of their leases, has triggered outrage among Hong Kong developers.

Hong Kong property developers and investors alike have closed ranks, slamming Macao's new Land Law and its implementation as unjust and unfair, and even a breach of the city's Basic Law, as the undeveloped plots are being taken back after their leases expired.

Land concessionaires have pointed the finger squarely at the Macao government, alleging it's wholly responsible for their inability to develop the land that had been lying idle for years. The argued that the government's failure to follow through on its urban development plans or build the basic infrastructure had caused their projects to be stalled until the land leases ran out.

Supporters of Macao's move insisted that the 25 years stipulated was sufficient enough for land development, saying Macao could not have violated the Basic Law since the new land law had already been submitted to the Standing Committee of the National People's Congress Standing (NPC) - the country's top legislative body - for record.

The Macao SAR's new Land Law, which was passed in 2013 and enacted a year later, stipulates that the government is entitled to reclaiming lands that concessionaires have failed to develop when the 25-year concessionary period is up, with no extension to be granted.

The new legislation replaces an earlier one adopted in 1980. Under the old law, expired land concessions might be extended if the holders are found not liable for any delay in developing their land.

Macao's Land, Public Works and Transport Bureau identified 115 plots as "idle" in 2011 and which have to be reclaimed. However, it also specified that for 65 of these plots, the concessionaires were not liable for failing to develop them prior to the expiration of the leases.

An 185,000-square-foot lot on Coloane Island's Seac Pai Van area that was granted to Hong Kong builder Asia Standard International Group Ltd is among those that have been identified by the Macao authorities as undeveloped for reasons not attributable to the concessionaires.

Asia Standard's plot is currently in the process of being reclaimed. Twelve other plots in the Seac Pai Van area have already been, or will be taken back, by the government.

Phileas Kwan Po-lam, executive director of Asia Standard, called the new land law a "farce" that would be detrimental to Macao's reputation as a foreign investment destination. "There will no longer be foreign investors flocking to Macao, and this will affect the city's economy and its banking system."

"This is utter injustice as we'll have nowhere to turn to," he lamented.

Kwan said Asia Standard might resort to taking legal action against the Macao government, hoping it would extend the company's land concession as allowed under the previous land law.

Yang Lixin, a law professor at the Renmin University of China, is on the same page, saying the Macao government has no legal basis to reclaim the lands.

Reclaiming the lands in question unreasonably and forcefully from the holders is an administrative violation that not only violates Macao's Basic Law but also the government's legal obligations, he was quoted as having said.

However, Macao officials rallied to the government's defense, saying the new Land Law draft had been submitted to the NPC Standing Committee and, as such, it would not contradict the Basic Law.

"If the new Land Law is seen to have violated the Basic Law, we would never have been allowed to submit the draft to the NPCSC for record. Our laws have never been rejected," Lam Heong-sang, vice-president of Macao's Legislative Council, was quoted as saying in July last year.

Macao legislator Antonio Ng Kuok-cheong believed that the new law has made the land disposal procedure more transparent, and will be valuable to the general public. He insisted that, in accordance with the new law, the expired land concessions should not be extended.

"If the property developers believe the government has acted unreasonably, they should take the case to the administrative court," Ng said.

Feliks Cheang contributed to the story.

'It all boils down to mismanagement on the part of the government'

Land concessionaires have no qualms about blaming the Macao government's "maladministration", saying it had led to failure to meet the deadline to develop their land.

They refuted claims by Macao officials and members of the public that the 25-year concessionary period granted should suffice.

According to Phileas Kwan Po-lam, executive director of Hong Kong property developer Asia Standard, the company had won a temporary land concession for a plot in the Seac Pai Van area on Coloane Island in 1989 for industrial use for 25 years.

But, he claimed that Asia Standard was unable to use the land forthwith due to the lack of essential infrastructure, such as water and electricity in the area, until 1993 when the Macao government decided to develop Seac Pai Van into a residential area.

Agreeing to the change, land holders were required to wait for the government's urban development in the area to commence, but the government still has yet to complete the plan, said Kwan.

Asia Standard had raised the matter numerous times with the Macao authorities since 1993 and still drew a blank by the time the land concession expired in 2015.

"It was the Macao government's maladministration that had kept us from developing the plot," said Kwan.

He also pointed out under the company's initial agreement with the government when the land was granted in 1989, it was stipulated that the concessionary period could be extended, but this is not allowed under the new Land Law. "The new law should apply only to new concessions rather than previous ones. The enforcement of the new law (in 2014) completely disregarded our contract with the government," Kwan said.

A Hong Kong investor, who preferred to remain anonymous, blamed the Macao government's inefficiency, which caused them to lose their development project in the Nam Van lake area.

Having started construction work on the plot in 2006, the development was halted by the government in 2007 in order to give way to a United Nations Educational, Scientific and Cultural Organization project in the area. It dragged on until last year when the concessionary period ran out and the development remained uncompleted.

"The reason I had invested in Macao in the first place was the promising prospects it offered. But, as it has turned out in the past few years, its weaknesses are starting to show up," the investor told China Daily.

(HK Edition 01/25/2017 page8)