Laws of the People's Republic of China

State Council

Interim Regulations of the People's Republic of China concerning the Assignment and Transfer of the Use Right of the State-owned Land in Cities and Towns

No.55 Order of the State Council

May 19,1990

Chapter I General Provisions

Article 1 .

These Regulations are formulated in order to reform the system of using the State-owned land in the cities and towns, rationally develop, utilize and manage the land, strengthen the land administration and promote the urban construction and economic development.

Article 2 .

The State, in accordance with the principle of separating the ownership right and the use right, , implements the system of assignment and transfer the use right of the State-owned land in the cities and towns,, but the underground resources, the objects buried underground, and the municipal public facilities shall be excluded .

The term "State-owned land in the cities and towns as used in preceding paragraph refers to the land owned by the whole people (hereinafter referred to as the land) within the boundaries of cities, county towns, towns/bases operated under an organizational system and industrial and mining districts .

Article 3 .

Any company, enterprise, other organization and individual of the People's Republic of China within or outside the territory may, unless otherwise provided by law, obtain the land use right and engage in land development, utilization and management in accordance with the provisions of these Regulations.

Article 4 .

Users of the land who have obtained the land use right in accordance with these Regulations may, within the term of land use, transfer, lease, or mortgage the land use right or use it for other economic activities, and their lawful rights and interests shall be protected by the laws of the State.

Article 5 .

Users of the land shall, in their activities to develop, utilize and manage the land, abide by the laws and regulations of the state and may not jeopardize the interests of the society and the public.

Article 6 .

The land administrative departments under the people's governments at or above the county level shall conduct supervision and inspection, according to law, over the assignment, transfer, lease, mortgage and termination of the land use right.

Article 7 .

The registration of the assignment, transfer, lease, mortgage and termination of the use right and the registration of the relevant above-ground buildings and other attached objects shall be handled by the land administration department and house property administration departments of the government in accordance with the law and pertinent regulations of the State Council.

THE registration documents shall be made available for public reference.

Chapter II The Assignment of the Land Use Right

Article 8 .

The assignment of the land use right refers to the action that the State as the owner of the land , within the term of a certain number of years, assigns the land use right to the land users, and the land user pay the assignment fees for the land use right to the State.

An assignment contract shall be signed for assigning the land use right.

Article 9 .

People's governments at the municipal and county levels shall be in charge of assignment for the land use right , which shall be effected in a planned, step-by-step way.

Article 10 .

The land administration departments under the people's governments at the municipal and county levels shall, in conjunction with the administrative departments for urban planning and construction and the housing property administration departments, draw up a plan concerning the size and location, the purposes, the term, and other conditions with respect to the assigning the land use right . After the plan is approved in accordance with the limits of approval authority stipulated by the State Council the land administration departments shall be responsible for the implementation. .

Article 11 .

The contract for assigning the land use right shall be signed between the land administration departments under the people's governments at the municipal and county levels (hereinafter referred to as "the assigning party~) and the land users in accordance with the principle of equality, voluntariness and compensation for use.

Article 12 .

The maximum term with respect to the assigned land use right shall be determined respectively in the light of the purposes listed below:

(1)

70 years for residential purposes;

(2)

50 years for industrial purposes;

(3)

50 years for the purposes of education, science, culture, public health and physical education;

(4)

40 years for commercial, tourist and recreational purposes; and

(5)

50 years for comprehensive utilization or other purposes.

Article 13 .

The assignment of the land use right may be carried out by the following means:

(1)

by reaching an agreement through consultations;

(2)

by invitation to bid; or

(3)

by auction.

(4)

The specific procedures and steps for assigning the land use right by the means stipulated in preceding paragraphs shall be formulated by the people's government of relevant province, autonomous region, or municipality directly under the Central Government.

Article 14 .

The land user shall, within 60 days after signing the contract for the assignment of the land use right , pay the total amount of the assignment fee thereof, failing to pay the total amount exceed the time limit, the assigning party shall have the right to terminate the contract and may claim compensation for breach of contract.

Article 15 .

The assigning party shall, in compliance with the stipulations of the contract, provide the assigned land use right , failing to provide the land use right according to contract , the land user shall have the right to terminate the contract and may claim compensation for breach of contract.

Article 16 .

After paying the total amount of the assignment fee for the land use right , the land user shall, in accordance with the relevant provisions, go through the registration thereof, obtain the certificate for land use and accordingly get the land use right .

Article 17 .

The land user shall, in conformity with the stipulations of the contract for the assignment of the land use right and the requirements of city planning, develop, utilize and manage the land.

Should any land user fail to develop and utilize the land in accordance with the period of time specified in the contract and the conditions therein, the land administration departments under the people's governments at the municipal and county levels shall make corrections and, in light of the seriousness of the case, give such penalties as a warning, a fine or, in an extreme case, with drawing the land use right without compensation.

Article 18 .

If the land user needs to alter the use purposes of the land as stipulated in the contract for assigning the land use right , he shall obtain the consent of the assigning party and the approval of the land administration department and the urban planning department and shall, in accordance with the relevant provisions in this Chapter, sign a new contract for assigning the land use right , readjust amount of the assignment fee thereof, and undertake registration anew.

Chapter III The Transfer of the Land Use Right

Article 19 .

The transfer of the land use right refers to the land user's action of re-assigning the land use rights , including the sale, exchange, and donation thereof.

If the land has not been developed and utilized in accordance with the period of time specified in the assignment contract and the conditions therein, the land use right thereof may not be transferred.

Article 20 .

A transfer contract shall be sighed for the transfer of the land use right .

Article 21 .

With the transfer of the land use right , the rights and obligations specified in the contract for assigning the land use right and in the registration documents shall be transferred accordingly.

Article 22 .

The land user who has acquired the land use right by means of the transfer thereof shall have a term of use which is the remainder of the term specified in the contract for assigning the land use right minus the number of the years in which the original land user has used the land.

Article 23 .

With the transfer of the land use right , the ownership of the above-ground buildings and other attached objects shall be transferred accordingly.

Article 24 .

The owners or joint owners of the above-ground buildings and other attached objects shall have the land use right within use scope of the said buildings and objects.

With the transfer of the ownership of the above-ground buildings and other attached objects by the land users, the land use right within use scope of the said buildings and objects shall be transferred accordingly, but except the transfer of the above-ground buildings and other attached objects as the chattel. .

Article 25 .

With respect to the transfer of the land use right and the ownership of the above-ground buildings and other attached objects, registration for the transfer shall be undertaken in accordance with the relevant provisions.

Divided transfer of the land use right and the ownership of the above-ground buildings and other attached objects shall be subject to the approval of the land administration department and the housing property administration departments under the people's governments at the municipal and country levels, and registration for the divided transfer shall be undertaken in accordance with the relevant provisions.

Article 26 .

When the price for transfer of the land use right is obviously lower than the prevailing market price, the people's governments at the municipal and county levels shall have the priority of the purchase right thereof.

When the market price for the transfer of the land use right rises to an unreasonable extent, the people's governments at the municipal and county levels may take necessary measures to cope with it.

Article 27 .

If, after the transfer of the land use right , necessity arises for altering the use purposes of the land as stipulated in the contract for assigning the land use right , it shall be handled in accordance with the provisions in Article 18 of these Regulations.

Chapter IV The Lease of the Land Use Right

Article 28 .

The lease of the land use right refers to the action of the land user as the lessor to lease the land use right together with the above-ground buildings and other attached objects to the lessee for use who shall in turn pay lease rentals to the lessor.

If the land has not been developed and utilized in accordance with the period of time specified in the assignment contract and the conditions therein, the land use right may not be leased.

Article 29 .

A lease contract shall be signed for leasing the land use right between the lessor and the lessee.

The lease contract shall not run counter to the laws and regulations of the State and the stipulations of the contract for assigning the land use right .

Article 30 .

After leasing the land use right , the lessor must continue to perform the contract for assigning the land use right .

Article 31 .

With respect to the lease of the land use right together with the above-ground buildings and other attached objects, the lessor shall undertake registration in accordance with the relevant provisions.

Chapter V The Mortgage of the Land Use Right

Article 32 .

The land use right may be mortgaged.

Article 33 .

With the mortgage of the land use right , the above-ground buildings and other attached objects thereon shall be mortgaged accordingly.

With the mortgage of above-ground buildings and other attached objects, the land use right within the use scope s shall be mortgaged accordingly.

Article 34 .

A mortgage contract shall be signed for mortgaging the land use right between the mortgagor and the mortgagee.

The mortgage contract shall not run counter to the laws and regulations of the State and the stipulations of the contract for assigning the land use right .

Article 35 .

With respect to the mortgage of the land use right together with the above-ground buildings and other attached objects, registration for the mortgage shall be undertaken in accordance with the relevant provisions.

Article 36 .

If the mortgagor fails to fulfil the liabilities within the prescribed period of time or declares dissolution or bankruptcy within the term of the mortgage contract, the mortgagee shall have the right to dispose the mortgaged property in accordance with the laws and regulations of the State and the stipulations of the mortgage contract.

With respect to the land use right and the ownership of the above-ground buildings and other attached objects acquired as a result of the dispose the mortgaged property, the transfer registration shall be undertaken in accordance with the relevant provisions.

Article 37 .

The mortgagee shall have the priority right of compensation with respect to the receipts resulting from the disposal of the mortgaged property.

Article 38 .

If the mortgage right is eliminated as a result of the liquidation of liabilities or for other reasons, the procedures shall be undertaken to cancel the mortgage registration.

Chapter VI The Termination of the Land Use Right

Article 39 .

The land use right shall be terminated for such reasons as the expiration of the term of the land use right as stipulated in the contract for assigning the land use right , the withdrawal of the right before the expiration, or the loss of the land.

Article 40 .

Upon expiration of the term of the land use right, the land use right and the ownership of the above-ground buildings and other attached objects thereon shall be acquired by the State without compensation. The land user shall surrender the certificate for land use and undertake procedures to nullify the registration.

Article 41 .

Upon expiration of the term of the land use right, the land user may apply for its renewal of term. Where such a renewal is necessary, a new contract shall be signed in accordance with the provisions in Chapter II of these Regulations and the land user shall pay the assignment fee for the land use right and undertake the formalities of registration.

Article 42 .

The State shall not, before the expiration of the term, withdraw the land use right which the land user acquired in accordance with the law. Under special circumstances, the State may, based on the requirements of social public interests, withdraw the land use right before the expiration of the term according to the relevant legal procedures and shall based on the number of years in which the land user has used the land and the actual state of affairs with respect to the development and utilization of the land, offer corresponding compensation.

Chapter VII The Allocated Land Use Right

Article 43 .

The allocated land use right refers to the land use right which the land user acquires in accordance with the law, by various means, and without compensation.

The land user referred to in the preceding paragraph shall pay the land use tax in accordance with the provisions of the Interim Regulations of the People's Republic of China Concerning the Land Use Tax in the Cities and Towns.

Article 44 .

The allocated land use right may not be transferred, leased, or mortgaged, with the exception of cases as specified in Article 45 of these Regulations.

Article 45 .

On condition that the following requirements are satisfied, the allocated land use right and the ownership of the above-ground buildings and other attached objects may, subject to the approval of the land administration departments and the housing property administration departments under the people's governments at the municipal and county levels, be transferred, leased or mortgaged:

(1)

The land users are companies, enterprises, or other economic organizations, or individuals;

(2)

A certificate for the use of state-owned land had been obtained;

(3)

Possessing legitimate certificates of property rights to the above-ground buildings and other attached objects; and

(4)

A contract for assigning the land use right is signed in accordance with the provisions in Chapter II of these Regulations and the land user makes up for the payment of the assignment fee to the local municipal or county people's government or uses the proceeds resulting from the transfer, lease or mortgage to pay the assignment fee.

The transfer, lease or mortgage of the allocated land use right referred to in preceding paragraphs shall be handled respectively in accordance with the provisions in Chapters III, IV and V of these Regulations.

Article 46 .

Any units or individuals that transfer, lease or mortgage the allocated land use right without authorization shall have their illegal incomes thus secured confiscated by the land administration departments under the people's governments at the municipal and county levels and shall be fined in accordance with the seriousness of the case.

Article 47 .

If the land user who has acquired the allocated land use right without compensation stops the use thereof as a result of moving to another site, dissolution, disbandment, or bankruptcy or for other reasons, the municipal or county people's government shall withdraw the allocated land use right without compensation and may assign it in accordance with the relevant provisions of these Regulations.

The municipal or county people's government may, based on the needs of urban construction and development and the requirements of urban planning, withdraw the allocated land use right without compensation and may assign it in accordance with the relevant provisions of these Regulations.

When the allocated land use right is withdrawn without compensation, the municipal or county people's government shall, in the light of the actual state of affairs, give proper compensation for the above-ground buildings and other attached objects thereon.

Chapter VIII Supplementary Provisions

Article 48 .

The land use right may be inherited if it is acquired by individuals in accordance with the provisions of these Regulations.

Article 49 .

The land user shall pay tax in accordance with the provisions of the taxation laws and regulations of the State.

Article 50 .

Fees collected by assigning the land use right in accordance with these Regulations shall be included in the fiscal budget and managed as a special fund, which shall be used mainly for urban construction and land development. The specific measures for the use and management of the fund shall be separately prescribed by the Ministry of Finance.

Article 51 .

The people's governments of various provinces, autonomous regions and municipalities directly under the Central Government shall, in accordance with the Provisions of these Regulations and with the actual state of affairs in their respective localities, select some cities or towns where the conditions are relatively ripe as their pilot testing grounds.

Article 52 .

With respect to foreign investors engaging in developing and managing tracts of land, the administration of the land use right shall be effected in accordance with the relevant provisions of the State Council.

Article 53 .

The State Administration for Land Uses shall be responsible for the interpretation of these Regulations; the measures for the implementation thereof shall be formulated by the people's governments of the provinces, autonomous regions and municipalities directly under the Central Government.

Article 54 .

These Regulations shall be implemented as of the date of promulgation.