Urban Real Estate Management Law of the People's Republic of China (English and Chinese Text)

The following translation was retrieved from the PRC Supreme People's Court Web site on October 21, 2004. The Chinese text was retrieved from the same source. Urban Real Estate Management Law of the People's Republic of China Chapter I General Provisions Chapter II Land for Real Estate Development Section I Grant of the Land-use Right Section II Allocation of the Land-use Right Chapter III Real Estate Development Chapter IV Real Estate Businesses Section I General Rules Section II Real Estate Transfer Section III Real Estate Mortgage Section IV Premises Lease Section V Intermediary and Service Agency Chapter V Real Estate Ownership Registration and Administration Chapter VI Legal Responsibility Chapter VII Supplementary Provisions Chapter I General Provisions Article 1 For the purposes of strengthening the urban real estate management, maintaining real estate market order, safeguarding the legitimate rights and interests of real estate right holders and promoting the healthy development of the real estate industry, this Law is enacted. Article 2 Within the confines of the State-owned land in urban planning zones in the People's Republic of China (hereinafter referred to as "the State-owned land"), obtaining of the right to the use of the land for real estate development, conducting of real estate development and real estate business and carrying out of real estate administration shall be in compliance with this Law. "Premises" as the term is used in this Law means such buildings as houses, structures and constructions on land. "Real estate development" as the term is used in this Law means an act by which infrastructures and premises are built on the State-owned land to which the land-use right is acquired according to this Law. "Real estate business" as the term is used in this Law includes real estate transfer, real estate mortgage and premises lease. Article 3 The State implements according to law a system of paid use of the state-owned land within a limited term. However, the use of the State-owned land by means of State allocation in conformity with this Law is excluded. Article 4 The State, based on the social and economic development, supports and develops the construction of residential houses, and gradually improves its residents' living conditions. Article 5 A real estate right holder shall abide by laws and administrative regulations and pay taxes according to law. The legitimate rights and interest of real estate right holders are protected by laws and may not be infringed upon by any unit or individual. Article 6 The competent administrative departments of the State Council for construction and for the land administration are divided in accordance with the functions and powers defined by the State Council, perform their respective duties, closely co-operate and administer the national real estate work. The organizational structures, functions and powers of real estate administration departments and land administration departments of local people's governments at or above the county level are defined by people's governments of provinces, autonomous regions and municipalities directly under the Central Government. Chapter II Land for Real Estate Development Section I Grant of the Land-use Right Article 7 "Grant of the land-use right" means an act by which the State grants the State-owned land-use right (hereinafter referred to as "the land-use right") to a land user for a certain number of years and the land user pays to the State a land-use grant fees. Article 8 Only after a piece of collectively-owned land within an urban planning zone is requisitioned and transformed into the State-owned land according to law, the land-use right to this piece of land may be granted in a paid way. Article 9 The grant of the land-use right must be in conformity with the overall plan of land utilization, the city plan and the annual land-use plan for construction purposes. Article 10 Local people's governments at or above the county level shall, in case of granting the land-use right for real estate development, prepare annual draft plans on the total land area for granting the land-use right according to the control quota assigned by people's governments at or above the provincial level, and submit, in accordance with the regulations of the State Council, such plans for approval to the State Council or people's governments at the provincial level. Article 11 The grant of the land-use right shall be undertaken by city or county people's governments in a planned and step-by-step way. Land administration departments of city or county people's governments shall, jointly with city planning, construction and housing administration departments, prepare draft plans with respect to the piece of land to be granted, the purpose for use, the time limits and other conditions, and submit, in accordance with the regulations of the State Council, such plans for approval by people's governments having approval authorities, and upon approval, implement the plans. The limits in performing the powers as provided for in the preceding paragraph by county people's governments and their relevant departments under municipalities directly under the Central Government shall be defined by people's governments of municipalities directly under the Central Government. Article 12 The land-use right may be granted in a manner of auction, invitation to bid or bilateral negotiations. The land for the commercial, tourism, entertainment and luxurious residence purposes must adopt the manner of auctioning and bidding if the conditions permit. Where there are no conditions and auction or bidding is impossible, the manner of bilateral negotiations may be adopted. The fee for granting the land-use right in the manner of bilateral negotiations may not be lower than the minimum price fixed in accordance with the State's regulations. Article 13 The maximum granting number of years for the land-use right shall be laid down by the State Council. Article 14 In granting the land-use right, a grant contract in writing shall be entered into. A land-use right grant contract shall be signed by the land administration department of the city or county people's government and the land user. Article 15 A land user must pay the land-use right grant fee in accordance with the stipulations of the grant contract; if the land user fails to make such payment in accordance with the grant contract, the land administration department has the power to rescind the contract and may claim for liquidated damages. Article 16 Where a land user pays the land-use right grant fee in accordance with the stipulations of the grant contract, the land administration department of the city or county people's government must, in accordance with the stipulations of the grant contract, provide the granted land; if it fails to provide such land in accordance with the stipulations of the grant contract, the land user has the right to rescind the contract, the land administration department shall refund the land-use right grant fee, and the land user may claim for liquidated damages. Article 17 If a land user needs to change the purpose of land use as stipulated in the land-use right grant contract, he must seek the consents of the grantor and the competent city planning administrative department of the city or county people's government, sign an agreement to modify the land-use right grant contract or a renewal land-use right grant contract, and the land-use right grant fee shall be readjusted accordingly. Article 18 The land-use right grant fees collected shall be handed over to the Treasury in totality, included in the budget, and used for urban infrastructure construction and land development. The concrete measures for the handing-over and utilizing of the land-use right grant fees shall be prescribed by the State Council. Article 19 The State, prior to the expiration of the term of use stipulated in the grant contract, is not to recover the land-use right acquired by a land user according to law; the State may, under special circumstances and in light of the need of social and public interests, recover ahead of schedule the land-use right in accordance with legal procedures, and is to compensate accordingly on the basis of the actual number of years for which the land user has used the land and the actual situation the land has been developed. Article 20 The land-use right terminates due to loss of the land. Article 21 In case a land user needs to continue using the land after the term of use as stipulated in the land-use right grant contract expires, the land user shall apply to extend the term no later than one year before the term ends. Unless otherwise the piece of land needs to be recovered in light of social and public interests, such an application shall be approved. After the application to extend the term is approved, a renewal grant contract of the land-use right shall be entered into and the land-use right grant fee shall be paid according to the stipulations. Upon expiration of the term of use as stipulated in the land-use right grant contract, the State shall, without compensation, recover the land-use right in case that a land user fails to file an application to extend the term or that the application, if any, is denied in accordance with the provisions of the preceding paragraph. Section II Allocation of the Land-use Right Article 22 "Allocation of the land-use right" means an act of, upon approval of the people's government at or above the county level according to law, providing a land user a piece of land to use after the land user pays such fees as compensation and resettlement, or providing without compensation a land user the land-use right. The land-use right acquired by means of allocation in accordance with the provisions of this Law shall not have a limit with regard to the term of use, unless otherwise provided in laws and administrative regulations. Article 23 People's governments at or above the county level may, according to law, approve and allocate the land-use right, if necessary, for the following construction lands: 1. land used by the State organs and the military; 2. land used for urban infrastructure construction and public installations; 3. land used for such projects as energy, communications and water enjoying priority support by the State; and 4. other lands as provided for by laws and administrative regulations. Chapter III Real Estate Development Article 24 Real estate development must adopt with a policy of overall planning, rational distribution, comprehensive development and supplementary construction in strict compliance with the city plan and in accordance with the principle of balancing economic, social and environmental results. Article 25 A land where the land-use right is acquired by means of grant for real estate development must be developed in accordance with the purposes and the deadline to start the development as stipulated in the land-use right grant contract. An idle land charge equivalent to less than 20 per cent of the land-use right grant fee may be collected for not starting the development more than one year from the date of starting the development stipulated in the grant contract; The land-use right may be recovered without compensation if the land remains undeveloped more than two years after the date passes; but the penalty will not be applied to a project delayed because of irresistible forces, because of the acts of governments and relevant departments of governments or because of the undertaking of the preliminary works necessary for starting the development. Article 26 The designing and construction of a real estate development project must be in conformity to the relevant standards and guidelines of the State. Upon completion, a real estate development project may be put into use only after passing inspection. Article 27 The land-use right acquired according to law may be converted into shares based on negotiated prices to launch joint ventures or co-operative ventures for developing and managing real estate in accordance with the provisions of this Law, other relevant laws and administrative regulations. Article 28 The State adopts preferential measures such as taxes to encourage and support real estate development enterprises to develop and build residential houses. Article 29 A real estate development enterprise is an enterprise engaging in the development and business of real estate for the purpose of making profit. The establishment of a real estate development enterprise shall satisfy the following requirements: 1. having its own name and organizational structure; 2. having a permanent business site; 3. having registered capital in conformity with the regulations of the State Council; 4. having sufficient professional technical personnel; and 5. other requirements set out by laws and administrative regulations. In establishing a real estate development enterprise, an application for registration shall be filed to an industrial and commercial administrative department. For those who satisfy the requirements under this Law, the industrial and commercial administrative department shall register and issue a business license; for those failing to satisfy the requirements under this Law, the registration shall be refused. The establishment of limited liabilities or share-holding limited companies engaging in real estate development and business shall also be governed by the relevant provisions of the Company Law. A real estate development enterprise shall, within one month after receiving its business license, apply for record to a department designated by the local people's government at or above the county level in the place where the registration organ is located. Article 30 The ratio between registered capital and total investment of a real estate development enterprise shall be in conformity to the relevant regulations of the State. In case of phased development of real estate by a real estate development enterprise, investment volume for different stages shall match the scale of the project and, in accordance with the stipulations of the land-use right grant contract, the capital shall be input in time for the use by the project construction. Chapter IV Real Estate Businesses Section I General Rules Article 31 Where real estate is transferred or mortgaged, the ownership right of the premises on the land is transferred or mortgaged along with the land-use right. Article 32 The datum land price, labeled land price and re-purchase price for various types of premises shall be fixed and made public on a regular basis. Concrete measures shall be formulated by the State Council. Article 33 The State implements a real estate price evaluation system. The real estate price evaluation shall be in compliance with the principles of justice, fairness and openness, and, in accordance with the technical standards and evaluation procedures laid down by the State, the evaluation shall be carried out on the basis of the datum land price, labeled land price and re-purchase price for various types of premises while taking reference of the local market price. Article 34 The State implements a real estate transaction value declaration system. A real estate right holder shall, in transferring real estate, declare truthfully the transaction value to a department designated by the local people's government at or above the county level and refrain from hiding or making deceitful declaration. Article 35 The parties concerned in transferring or mortgaging real estate shall apply for ownership registration in accordance with the provisions of the Chapter V of this Law. Section II Real Estate Transfer Article 36 "Real estate transfer" means an act by which a real estate right holder passes on his real estate to others by means of sales, as a gift or other lawful means. Article 37 The following real estates may not be transferred: 1. where the land-use right is acquired by means of grant and failing to satisfy the requirements under Article 38 of this Law; 2. where a judicial organ or an administrative organ rules or decides, according to law, to seal up or mandate other measures to limit the real estate right; 3. where the land-use right is recovered according to law; 4. where there is no written consent by other right holders of shared real estate; 5. where there is a dispute over the ownership; 6. without registration and ownership certificate according to law; and 7. other real estates which transfers are prohibited by laws and administrative regulations. Article 38 Where the land-use right is acquired by means of grant, the transfer of real estate shall satisfy the following requirements: 1. where the total amount of the land-use right grant fee is paid in accordance with the stipulations of the grant contract and a land-use right certificate is received; and 2. in case of investment development as stipulated in the grant contract, if a project involves premises construction, 25 per cent or more of the total development investment volume has to be completed, if a project involves tract land development, the land must be ready for industries or other constructions. If the construction of premises has already been completed in the time of transferring real estate, the premises ownership certificate is required. Article 39 A transfer of real estate where the land-use right is acquired by means of allocation shall be reported, in accordance with the regulations of the State Council, to a people's government having approval authority for examination and approval. If the people's government having approval authority permits such transfer, the transferee shall go through the land-use right grant procedure and pay the land-use right grant fee according to relevant regulations of the State. In case the land-use right is acquired by means of allocation, where the report on a real estate transfer is made for approval and the people's government having approval authority decides in accordance with the regulations of the State Council that the land-use right grant procedure can not be gone through, the transferor shall, in accordance with the regulations of the State Council, hand over the land profits out of the profits for the real estate transfer to the State or manage the land profits in other ways. Article 40 In transferring real estate, a written transfer contract shall be entered into, which shall include the ways through which the land-use right is acquired in explicit terms. Article 41 In transferring real estate, the rights and obligations explicitly stipulated in a land-use right grant contract are transferred along with such real estate. Article 42 In case the land-use right is acquired by means of grant, the number of years for use of the land-use right after real estate is transferred, is the remaining period of the number of years as stipulated in the original land-use right grant contract after the deduction of the number of years for which the original land user has used the land. Article 43 In case of real estate transfer where the land-use right is acquired by means of grant, the grantee who intends to alter the purpose of the land as stipulated in the original land-use right grant contract must obtain the consent from the original grantor and the competent administrative department for urban planning of the city or county people's government, sign an agreement to alter the land-use right grant contract or a renewal land-use right grant contract, and the land-use right grant fee shall be readjusted accordingly. Article 44 Pre-sale of commodity premises shall satisfy the following requirements: 1. having paid the land-use right grant fee in totality and received a land-use right certificate; 2. having a construction project planning license; 3. the capital input for the development construction has reached at least 25 per cent of the total investment in the project construction as calculated by the commodity premises available for pre-sale, and the schedule of the construction and the date of the completion have been determined; and 4. having finished registration for pre-sale with a housing administration department of the people's government at or above the county level and received a commodity premises pre-sale license. A commodity premises pre-sale shall, in accordance with relevant state regulations, submit his or her pre-sale contract to a housing administration department and a land administration department of the people's government at or above the county level for the registration and record. Income from commodity premises pre-sale must be used in relevant project construction. Article 45 With respect to re-transferring an uncompleted pre-sale commodity premises purchased by a commodity premises pre-purchaser, the State Council shall prescribe thereon. Section III Real Estate Mortgage Article 46 "Real estate mortgage" means an act by which a mortgagor provides security to a mortgagee for the fulfillment of debt repayment by means of his lawful real estate without changing the real estate's belonging. In case that a debtor fails to fulfill the debt, a mortgagee has the right to be compensated in priority according to law by the receipts resulting from auctioning of real estate mortgaged. Article 47 The premises ownership right acquired according to law and the land-use right within the limits of use of the said premises may be mortgaged. The land-use right acquired by means of grant may be mortgaged. Article 48 The real estate mortgage shall be handled with the land-use right certificate and the premises ownership right certificate. Article 49 In mortgaging real estate, the mortgagor and the mortgagee shall enter into a written mortgage contract. Article 50 In case the land-use right acquired by means of allocation is taken as the real estate mortgage right, and after such real estate is auctioned according to law, a sum equivalent to the land-use right grant fee payable shall be paid out of the receipts resulting from the sales, and only after that, can the mortgagor enjoy the priority of compensation. Article 51 Premises newly added on the land shall not be taken as property subjecting to mortgage after a real estate mortgage contract is signed. Where there is a need to auction such real estate mortgaged, the mortgaged property and the premises newly added on the land may be auctioned according to law, however, the mortgagor has no right to enjoy the priority of compensation with regard to the receipts resulting from the sales of the newly added premises. Section IV Premises Lease Article 52 "Premises lease" means an act by which a premises right owner acting as a lessor leases his premises to a lessee for use, with the lessee paying rentals to the lessor. Article 53 In leasing premises, the lessor and the lessee shall enter into a written lease contract, which stipulates such clauses as the lease term, lease purpose, lease price and repair obligations, as well as other rights and obligations of both parties concerned and register with a housing administration department for the record. Article 54 The lease of residential premises shall comply with the lease policy laid down by the State and the urban people's government in the place where the premises is located. For premises leased for production and business operations, both parties involved in the lease shall negotiate the rental and other lease clauses. Article 55 A premises right owner who leases, for the purpose of making profits, premises erected on the State-owned land to which the land-use right is acquired by means of allocation shall hand over the land profits contained in the rentals to the State. Concrete measures shall be formulated by the State Council. Section V Intermediary and Service Agency Article 56 Real estate intermediary and service agency includes real estate consultation agency, real estate price evaluation agency, real estate brokerage agency and other agencies. Article 57 A real estate intermediary and service agency shall satisfy the following requirements: 1. having its own name and organizational structure; 2. having a permanent service site; 3. having necessary assets and funds; 4. having a sufficient number of professionals; and 5. other requirements set out by laws and administrative regulations. In setting up a real estate intermediary and service agency, an application for establishment registration shall be filed to an industrial and commercial administration department, only after receiving a business license, may the business start. Article 58 The State implements a certification system over real estate price evaluators. Chapter V Real Estate Ownership Registration and Administration Article 59 The State implements a system of registration and certificate of the land-use right and the premises ownership right. Article 60 In case of the land-use right acquired by means of grant or allocation, an application shall be filed to a land administration department of the local people's government at or above the county level for registration, upon the examination and verification by the land administration department of the local people's government at or above the county level, the people's government at the same level issues a land-use right certificate. Where completing the construction of premises on the land for real estate development acquired according to law, an application shall, by means of a land-use right certificate, be filed to a housing administration department of the local people's government at or above the county level for registration, the housing administration development of the local people's government at or above the county level makes examination and verification, if approved, issues a premises ownership right certificate. In case of transferring or altering real estate, an application shall be filed to a housing administration department of the local people's government at or above the county level for housing alteration registration, and by means of the premises ownership right certificate altered, an application shall be filed to a land administration department under the people's government at the same level for the registration of altering land-use right, upon the examination and verification of the land administration department of the people's government at the same level, if approved, the people's government at the same level replaces or alters the land-use right certificate. If it is otherwise provided by laws, the matter shall be governed by the provisions of relevant laws. Article 61 In case of real estate mortgage, mortgage registration shall be made with a department designated by the local people's government at or above the county level. Where the land-use right and premises ownership right are acquired as a result of the disposal of mortgaged real estate, transfer ownership registration shall be made pursuant to the provisions of this Chapter. Article 62 As agreed by the people's government in province, autonomous region or municipality directly under the Central Government, a department of the local people's government at or above the county level exercising unified responsibility over housing administration and land administration may produce and issue an unified real estate ownership right certificate, in which, in accordance with the provisions of Article 60 of this Law, carries respectively the confirmation and changes of the premises ownership right and the land-use right of the land occupied by such premises. Chapter VI Legal Responsibility Article 63 Where, in violation of the provisions of Articles 10 and 11 of this Law, the land-use right has been approved to grant without authorization or has been granted without approval for a real estate development purpose, relevant persons responsible shall be subjected to administrative penalties imposed by their superior organs or their units to which they belong. Article 64 Those who violate the provisions of Article 29 of this Law, conduct real estate development businesses without obtaining business licenses, shall be ordered to stop their real estate development business activities by industrial and commercial administrative departments of people's governments at or above the county level with their ill-gotten gains derived therefrom confiscated, and may be fined concurrently. Article 65 Those who violate the provisions of Paragraph 1 of Article 38 of this Law to transfer the land-use right, shall have their ill-gotten gains derived therefrom confiscated by land administration departments of people's governments at or above the county level, and may be fined concurrently. Article 66 Those who violate the provisions of Paragraph 1 of Article 39 of this Law to transfer real estate shall be ordered by land administration departments of people's governments at or above the county level to pay land-use right grant fees with their ill-gotten gains derived therefrom confiscated, and may be fined concurrently. Article 67 Those who violate the provisions of Paragraph 1 of Article 44 of this Law to pre-sell commodity premises shall be ordered to stop their pre-sales by housing administration departments of people's governments at or above the county level with their ill-gotten gains derived therefrom confiscated, and may be fined concurrently. Article 68 Those who violate the provisions of Article 57 of this Law to engage in real estate intermediary and service businesses without obtaining the business licenses shall be ordered to stop their business activities by industrial and commercial administration departments of people's governments at or above the county level, with their ill-gotten gains derived therefrom confiscated, and may be fined concurrently. Article 69 Those who collect fees from real estate development enterprises in the absence of reference of any law and regulations shall be ordered by their superior organs to return the cashes they have collected; if the case is serious, those who are directly responsible shall be subject to administrative penalties imposed by their superior organs or the units to which they belong. Article 70 Where a person of a housing administration department or land administration department neglects his duty, or abuses his power of office, criminal responsibility shall be investigated according to law if the act constitutes a crime; if the act does not constitute a crime, administrative penalties shall be imposed. Where a person of a housing administration department or land administration department takes advantages of his power privileges to ask for goods or cash from others or illegally accepts goods or cash from others to seek their benefits, if the act constitutes a crime, criminal responsibility shall be investigated in accordance with the Supplementary Provisions Concerning the Punishment of the Crimes of Embezzlement and Bribery; if the act does not constitute a crime, administrative penalties shall be imposed. Chapter VII Supplementary Provisions Article 71 Within the confines of the State-owned land in areas beyond the urban planning zones, obtaining of the land-use right for real estate development, conducting of real estate development and business, and carrying out of real estate administration shall be governed by taking reference of this Law. Article 72 This Law shall enter into force on January 1, 1995.