Laws of the Guangdong Province

Regulations of Shenzhen Special Economic

Zone on Assignment of Land-Use Right

 (Originally adopted at the Twenty-third Meeting of the Standing Committee of the First Shenzhen Municipal People's Congress on. June 18, 1994. As revised for the first time in accordance with the Decision on Revising of Regulations of Shenzhen Special Economic Zone on Assignment of Land-use Right of the Second Meeting of the Standing Committee of the Second Shenzhen Municipal People' s Congress on September 15, 1995. As revised for the second time in accordance with the Decision on Revising of Regulations of Shenzhen Special Economic Zone on Assignment of Land-use Right of the Second Meeting of the Standing Committee of the Second Shenzhen Municipal People' s Congress on February 13, 1998.)

Chapter I General Provisions

Article 1 In order to strengthen the administration of assignment of land-use right of Shenzhen Special Economic Zone (hereinafter referred to as the "Special Zone"), standardize the acts of assignment of land-use right, make appropriate use of land resources and protect the lawful rights and interests of the parties concerned, these regulations are hereby formulated in accordance with the specific conditions of the Special Zone.

Article 2 Transfer of land-use right in these regulations refers to the acts that the Shenzhen Municipal People's Government (hereinafter referred to as the " Municipal Government") assigns the state-owned land-use right to the land user for a certain number of years by means of auction, invitation to bid or reaching an agreement through consultations while the land user pays the fees for assignment of land-use right to the Municipal Government.

The land user shall pay the fees for land development and municipal accessory facilities to the Municipal Government.

The fees for assignment of land-use right, land development and municipal accessory facilities shall be paid in lump-sum.

Article 3 The Shenzhen Municipal Land Administration Department (hereinafter referred to as the "Land Administration Department") is the department in charge of the assignment of land-use right in the Special Zone, which assigns the land-use right in a uniform way and administers the land assigned. Other units shall not assign the land-use right.

The contract of assignment of land-use right (hereinafter referred to as the "Contract of Assignment") shall be concluded between the Land Administration Department and the land user.

In the case of conclusion or modification of the Contract of Assignment with the Land Administration Department, the land user must pay the fees of land development and municipal accessory facilities to the department.

Article 4 These regulations shall be applicable to the assignment of state-owned land-use right in the Special Zone. The underground natural resources and other treasure trove belong to the state and shall be excluded from the scope of assignment of land-use right.

Collectively-owned lands shall not be assigned unless having been requisitioned to be state-owned land according to law.

Article 5 Any company, enterprise, other organization and individual within or outside the People's Republic of China may, unless otherwise provided by law, acquire the land-use right in accordance with the provisions of these regulations.

Article 6 The land-use right acquired in accordance with these regulations may, within the tenure of use, be legally utilized, transferred, leased, mortgaged or used for other economic purpose by the land user, whose lawful rights and interests shall be protected by law.

Article 7 The land user shall abide by provisions of laws and regulations to develop, utilize and manage the land and shall not engage in any activities detrimental to the social public interests.

Article 8 The yearly plan of land development and supply, which drafted by the Land Administration Department together with other pertinent administrative departments of the Municipal Government in accordance with the city planning of the Special Zone, the social economic development planning and the industrial policies, shall be uniformly organized and implemented by the Land Administration Department after being approved by the Municipal Government.

Article 9 The assignment of land-use right shall persist in the principle of combining it with the construction projects. Where there is not any construction project, the land shall not be supplied except for the assignment of land-use right by means of auction or invitation of bid in accordance with these regulations.

Article 10 The Municipal Government shall establish land development funds, which shall be collected by the Land Administration Department.

The land development funds are composed by land development and municipal accessory facilities fee, land use fee, increment fee of land value and other profits on the land.

Where the Municipal Government approves the fees for transfer of land-use right, fees for land development and municipal accessory facilities that are to be paid by the land user to be state-owned capital, or approves the Land Administration Department to invest with the land-use right, the investments shall be converted to share capital and their profit shall be reckoned in the land development funds.

Article 11 The Shenzhen Municipal Land Investment and Development Center (hereinafter referred to as "Development Center"), which established by the Municipal Government, shall utilize the land development funds to organize land development and municipal infrastructure construction in accordance with the utilization plan of the land development funds.

Article 12 The transfer fees of land-use right and land development funds shall be used for land development and municipal infrastructure construction and shall not be used for other purse.

The Land Administration Department shall make the yearly utilization plan of the transfer fees of land-use right and land development funds and submit them to the Municipal Government for approval.

The use of the transfer fees of land-use right shall be arranged by the Land Administration Department according to the plan, and the land development funds shall be used by the Development Center. The administrative department of finance of the Municipal Government shall take charge of supervision and verification, and the audit department of the Municipal Government shall carry out audit regularly.

The Municipal Government shall formulate the measures on the revenue and expenditure and administration of the transfer fees of land-use right and land development funds, and shall strengthen the administration of the transfer fees of land-use right and land development funds.

Article 13 The Land Administration Department shall report the revenue and expenditure and the utilization of the transfer fees of land-use right and land development funds to the Standing Committee of the Shenzhen Municipal People's Congress (hereinafter referred to as "Municipal Standing Committee of the People' s Congress" ) every year.

The Municipal Administrative Department of finance and audit shall report the verification and audit of the transfer fees of land-use right and land development funds to the Municipal Standing Committee of the People' s Congress at the same time.

Article 14 The maximum term with respect to the transfer of 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 15 The land user shall handle the registration according to the Regulations of Shenzhen Special Economic Zone on Real Estate Registration (hereinafter referred to as "Regulations on Registration") and acquire the Real Estate Certificate after concluding the Contract of Assignment and paying off the transfer fees of land-use right and the land development and municipal accessory facilities fees in accordance with these regulations.

After concluding the Contract of Assignment but before obtaining the Real Estate Certificate of the land-use right of the land, the land user may occupy and use the land but may not dispose of it.

Chapter II Contract of Land-use Right Transfer

Article 16 The Contract of Assignment in written form shall be concluded by the land user and the Land Administration Department according to these regulations. Where the land user entrusts an agent to conclude the Contract of Assignment, the agent shall submit the authorized letter of attorney made by the consigner to the Land Administration Department. The authorized letter of attorney made by the corporations, organizations or individuals of Hong Kong, Macao, Taiwan or other countries shall be notarized or certified according to relevant rules.

Article 17 The Contract of Assignment shall contain the following principal clauses:

(1) names or titles and addresses of the parties;

(2) lot number and area of the land whose land-use right is to be transferred;

(3) year limits of the land-use right and its time of starting and ending;

(4) amount, currency, time and means of payment of the transfer fees of land-use right;

(5) time of delivery of the land;

(6) outline of the city planning and municipal design;

(7) time of check for acceptance upon completion of the project;

(8) projects of constructing the municipal accessory facilities and corresponding obligations of construction;

(9) the restrictions on the use of adjacent land and roads;

(10) projects of construction of associated and attached accessory facilities and the corresponding obligation of construction;

(11) liability for breach of contract; and

(12) other clauses that the parties consider to be necessary.

The map of the land shall be enclosed in the Contract of Assignment as part of the contract.

Article 18 Where the land user has any objection to the ownership, development and accessory facilities of the land to be transferred, he shall lodge such objection 10 days before the Land Administration Department notifying him of conclusion of the Contract of Assignment. But the aforesaid provision shall not be applicable to the land-use right transferred through auction or invitation of bid.

Since the date of conclusion of the Contract of Assignment, the land is regarded as delivered.

Article 19 The Contract of Assignment shall be legally binding once concluded according to law and the parties shall fulfill their respective obligations thoroughly in accordance with the terms of the contract. Neither party may unilaterally modify or rescind the contract.

Article 20 Where the land user does not pay the transfer fees of land-use right within time limit specified by the Contract of Assignment, each day since the date of overdue, he shall be charged of an overdue fine of 0.05% of the land-use right fees that is overdue. The Land Administration Department may rescind the Contract of Assignment and take the land-use right in case the overdue land-use right fees are still unpaid off after 60 days from the payable date.

Where the land user only pays earnest money or caution money, such money shall not be returned.

Where the land user serves the earnest money or caution money as the land-use right fees, such money shall not be returned. The Land Administration Department shall deduct 20% of the total amount of the land development and municipal accessory facilities fees as breach of contract damages and return the balance. The buildings and attachment already built on the land shall be taken back to the state by the government without compensation.

Article 21 The land user shall develop and utilize the land in accordance with the purpose to use the land, term and conditions according to the terms of the Contract of Assignment.

Article 22 Where it is necessary for the land user to change the purposes of land use as stipulated in the in the Contract of Assignment, he shall he shall obtain the consent of the Land Administration Department. The Land Administration Department and the land user shall modify the Contract of Assignment in writing, readjust the standard of land-use right fees thereof, and register the modification in accordance with relevant rules.

Chapter III Transfer of Land-use Right Through Auction

Article 23 Transfer of land-use right through auction means that at the scheduled date and in public, the auctioneer authorized by the Land Administration Department (hereinafter referred to as the "auctioneer") chairs the auction while the bidders make bids in specified means and the one made the highest bid shall get the land-use right.

Article 24 The Land Administration Department shall publish the relevant matters of the auction of the land-use right on Shenzhen Special Zone Daily or Shenzhen Economic Daily 30 days before the auction.

Article 25 The following documents shall be printed by the Land Administration Department and be provided to the bidders since the date of publication:

(1) detail information on the auction of the land-use right; and

(2) stylebook of Contract of Assignment.

Article 26 The transfer of land-use right through auction shall be carried out according to the following procedure:

(1) the Land Administration Department publishes the auction of the transfer of land-use right;

(2) the bidders takes out relevant documents; and

(3) the auctioneer chairs the auction at the scheduled time and place specified in the publication in accordance with the following process:

1. the auctioneer briefly introduces the location, area, purpose of land use, term of use, planning requirements and other relevant matters of the land whose land-use right is to be auctioned;

2. he auctioneer announces the bottom price of the auction and the amount added for each bid;

3. the bidders make bids by the means specified; and

4. in case the auctioneer continuously declares the last bid for two times and no one offering a new bid, the last bidder shall be the winner; and

(4) The winner shall pay off the land development and municipal auxiliary fee in lump-sum to the Land Administration Department, conclude the Contract of Assignment with the Land Administration Department, and pay a earnest money of 20% of the total amount of the transfer fees of land-use right, the balance of which shall be paid within 5 days since the effective date of the Contract of Assignment. As for the land for industrial purposes, when approved by the Land Administration Department and noted in the Contract of Assignment, the payment of the balance may be deferred, not exceeding 1 year at the most. When the payment is overdue, the Land Administration Department may dispose of it in accordance with Article 20 herein.

Article 27 The bottom price is not the same as the upset price for transferring the land-use right of the land. When the last bid is lower than the upset price, the auctioneer shall be entitled to end the auction.

Article 28 Where the winner cannot pay the down payment or refuses to conclude the Contract of Assignment, he shall compensate for all the expenditure of the auction. The Land Administration Department may auction the land again, and if the transfer fees of land-use right is lower than that of the first auction, the margin shall be paid by the aforementioned winner who has breached the contract.

Chapter IV Transfer of Land-use Right Through Inviting Public Bidding

Article 29 Transfer of land-use right by invitation of bid refers to that the Land Administration Department invites invitation of bid publicly or invite the invitation of biders that fulfill the requirements for invitation of bid, and, after the assessment of invitation of bids, the winner shall get the land-use right.

Article 30 Transfer of land-use right by invitation of bid may be carried out by the following two means:

(1) Open invitation of bid: the Land Administration Department announcing the invitation to invitation of bid; and

(2) Invited invitation of bid: the Land Administration Department delivering the invitation of bid invitation to the specified persons.

The invitation of bid announcement shall be publicized on Shenzhen Special Zone Daily or Shenzhen Economic Daily 30 days before the closing date of invitation of bid. The invitation of bid invitation shall be delivered to the invited invitation of biders 30 days before the closing date of invitation of bid.

Article 31 The qualifications, contents and means of invitation of bid of the transfer of land-use right by invitation of bid shall be decided by the Land Administration Department according to these regulations, the yearly plan of land supply and the specific conditions of the land.

Article 32 The following documents of invitation of bid shall be printed by the Land Administration Department and be provided to the invitation of biders:

(1) Notice on the invitation of bid;

(2) Invitation of bid document of the land-use right; and

(3) Contract of Assignment model.

Article 33 The transfer of land-use right by invitation of bid shall be carried out according to the following procedure:

(1) The Land Administration Department announces or delivers the invitation of bid invitation;

(2) The invitation of biders get relevant documents;

(3) The invitation of biders put the sealed invitation of bid documents into the invitation of bid box at the designated place before the closing date of invitation of biding and submit the guaranty bond for invitation of bid according to the requirements of the Land Administration Department;

(4) The Land Administration Department organizes the meeting of invitation of bid opening, opening and checking the invitation of bids on site and declaring the invitation of bid documents that are against the invitation of biding regulations to be void;

(5) The Land Administration Department shall organize the invitation of bid inviting agencies to assess and determine the invitation of bid based on the principle of equality and fairness, and deliver the notice of winning the invitation of bid to the winning invitation of bider; and

(6) On receiving the notice of winning the invitation of bid, the winner shall pay off the land development and municipal auxiliary fee in a lump sum to the Land Administration Department, and conclude the Contract of Assignment with the Land Administration Department in the provided time limit.

Article 34 Where the documents of invitation of bid inviting only require the invitation of bid price, the invitation of bider with the highest invitation of bid price shall win; where both the invitation of bid price and the designing plan are necessary, the invitation of bids shall be assessed comprehensively and the invitation of bid with the highest comprehensive score shall win.

If the Land Administration Department deems that none of the invitation of bid document has reached the base conditions of the invitation of bid, it may reject all the invitation of bid documents and invite new invitation of bids again.

Article 35 Where the invitation of bid-winner does not conclude the Contract of Assignment with the Land Administration Department in the provided time limit, its qualification as the winner shall be cancelled and the guaranty bond for invitation of bid shall not be returned, while a new invitation for invitation of bid shall be organized. If it causes economic losses of the Land Administration Department, the invitation of bid-winner shall bear the liability of damages.

Article 36 The invitation of bid-winner shall pay off the transfer fees of land-use right within 5 days since the effective date of the Contract of Assignment. As for the land for industrial purposes, when approved by the Land Administration Department and noted in the Contract of Assignment, the payment may be deferred, but not exceeding 1 year at the most. When the payment is overdue, the Land Administration Department may dispose of it in accordance with Article 20 herein.

Article 37 The guaranty bond for invitation of bid submitted by the invitation of bid-winner may be converted into the transfer fees of land-use right. The guaranty bond for invitation of bid submitted by the losers shall be returned without interest by the Land Administration Department within 30 days since the date of deciding on the winning invitation of bid.

Chapter V Transfer of Land-use Right Through Agreement

Article 38 Transfer of land-use right through agreement herein refers to

The term "transfer of land-use right by agreement" refers to that the Land Administration Department, on behalf of the Municipal Government, consults with the land user and decides on the land price on the basis of the announced market price of the land, and finally assigns the land-use right to the land user.

The term "announced market price" refers to the price announced regularly by the Land Administration Department after evaluating the land in accordance with such factors as the land grade, land use, real estate market, etc.

Article 39 The land-use right of the land within the following range may be transferred by agreement:

(1) Land for hi-tech projects;

(2) Land for commercial housing with very small profit constructed by the municipal or district government;

(3) Land for welfare commercial housing constructed by the municipal or district government; and

(4) Land for public welfare or non-profit undertakings such as state organs, culture, education, health, sports, science and technology, municipal facilities, etc. that are wholly invested by the municipal or district finance;

The land-use right of the land other than the items listed in the previous paragraph shall be transferred by agreement in general. The land-use right of the following land, approved by the Municipal Government, may also be transferred by agreement, but the transferring price must be the same as the announced market price:

(1) Land for the projects that are in urgent need of the Special Zone or whose development is specially encouraged;

(2) Land for cluster development zone;

(3) Land for the projects in which the Municipal Government invests the land as share capital; and

(4) Land for the reconstruction of old urban areas.

The Municipal Government shall report to the Municipal Standing Committee of the People' s Congress every year of the situation of transfer of land-use right by agreement.

Article 40 The transfer of land-use right by agreement shall be carried out according to the following procedure:

(1) The applicant shall submit the following documents of application to the Land Administration Department:

1. Certificate of the legal representative;

2. Land use application report;

3. "Application form for transfer of land-use right by agreement" (the standardized form provided by the Land Administration Department) and the preliminary arrangement plan of the project;

4. Documents of approval issued by the Municipal Government or the authorized departments of establishing corporations or institutions in the Special Zone and documents of industrial and commercial registration.

5. Document of approval of the projects of the year issued by the municipal planning department;

6. Certificate of capability of paying the transfer fees of land-use right;

7. Document of verification issued by the Municipal Administrative Department of science and technology for the hi-tech projects; and

8. Document of environmental assessment and inspection issued by the Municipal Administrative Department of environmental protection for the projects that pollute or affect the environment.

(2) The Land Administration Department shall consult with the applicant on the matters concerning the use of land within 30 days after receiving the documents of application, raise an inspection plan and report it to the Municipal Government for verification and approval. When the Municipal Government has verified and approved the plan, the Land Administration Department shall notify the applicant of it in writing.

(3) The applicant shall, after the issuance of the notice on the transfer fees of land-use right by the Land Administration Department and before concluding the Contract of Assignment with the Land Administration Department, pay a down payment as much as 20% of the transfer fees of land-use right to the Land Administration Department and at the same time pay off the land development and municipal accessory facilities fee in a lump sum.

(4) The applicant shall, within 100 days since the date of issuance of the land use plan by the Land Administration Department, conclude the Contract of Assignment with the Land Administration Department. If the contract is not concluded within the time limit, the applicant shall be regarded as voluntarily giving up the application, and the notice of approval on transferring the land issued by the Land Administration Department shall automatically become void. Under such circumstances, the down payment shall not be returned to the applicant, and the land development and municipal accessory facilities fee shall be returned without interest after being deducted 10% as damages by the Land Administration Department.

(5) The applicant shall, with the receipt of the transfer fees of land-use right issued by the Land Administration Department, register the land-use right in accordance with the Regulations on Registration and then obtain the Real Estate Certificate.

Article 41 Where the land-use right is transferred by agreement for the following projects, the Land Administration Department shall reduce or exempt the transfer fees of land-use right and the land development and municipal accessory facilities fee as follows:

(1) For the land provided in Article 39 Paragraph 1 Item (1), the transfer fees of land-use right shall be reduced by 40% to 70%;

(2) For the land provided in Article 39 Paragraph 1 Item (2), the transfer fees of land-use right shall be exempted;

(3) For the land provided in Article 39 Paragraph 1 Item (3), the transfer fees of land-use right shall be exempted, and the standard for the amount of the land development and municipal accessory facilities fee shall be provided by the Municipal Government separately.

No other transferring of land-use right by agreement shall be reduced or exempted of the transfer fees of land-use right.

Article 42 For the land provided in Paragraph 1 Item (1) Article 39, the land user shall pay 30% of the transfer fees of land-use right as the initial payment on the effective date of the Contract of Assignment, and the balance shall be paid within 30 days since the effective date of the Contract of Assignment. Approved by the Land Administration Department and noted in the Contract of Assignment, the payment of the balance may be deferred, not exceeding 1 year at the most. When the payment is overdue, the Land Administration Department may dispose of it in accordance with Article 20 herein.

For the land provided in Item (2) and (3) Paragraph 1 Article 39 the payment of the transfer fees of land-use right shall be made in accordance with the time limit and means provided in the Contract of Assignment.

For the land provided in Item (4) Paragraph 1 Article 39, the payment of the transfer fees of land-use right shall be made in accordance with the regulations of the Municipal Government.

Article 43 The Land Administration Department shall, by 31st December every year, report the projects of which the transfer feess of land-use right have been reduced or exempted and the amount reduced or exempted to the Municipal Government.

Article 44 Where the land-use right is obtained with reduced or exempted transfer fees of land-use right in accordance with Article 39 Paragraph 1 Item (1) herein, if the land user lets or transfer the land, or invests the land-use right to joint ventures or cooperate enterprises, he shall report to the Land Administration Department for approval and conclude a Contract of Assignment again. If the use of the land is to be changed, the land user shall report to the Land Administration Department for approval, making up the deficiency of the transfer fees of land-use right and the land development and municipal accessory facilities fee according to the announced market price, and then register the modification in accordance with the Regulations on Registration before the change of the land use may be effectuated.

Where the land user has to make up the deficiency of the transfer fees of land-use right and the land development and municipal accessory facilities fee, he shall register the modification with the receipt of the fully paid deficiency of the transfer fees of land-use right and the land development and municipal accessory facilities fee issued by the Land Administration Department and the re-concluded Contract of Assignment.

Article 45 Where the land-use right is obtained with the reduced transfer fees of land-use right and land development and municipal accessory facilities fee in accordance with Article 39 Paragraph 1 Item (1) herein, the land user may, approved by the Land Administration Department, mortgage the buildings and attachment on the land. If the mortgagee shall dispose of the mortgage, he should make up the deficiency of the transfer fees of land-use right and the land development and municipal accessory facilities fee first in accordance with the announced market price. The taxes and fees related to the income of the disposal of the mortgage must be paid by rule in advance.

Article 46 Where the land-use right is obtained with the reduced transfer fees of land-use right in accordance with Article 39 Paragraph 1 Item (1) herein, when the project is put into operation, the Municipal Administrative Department of science and technology shall be in charge of re-inspection. If the project does not conform to the standard for hi-tech projects, the deficiency of the transfer fees of land-use right must be made up in accordance with the announced market price.

Article 47 For the land provided in Article 39 Paragraph 1 Item (2) and (3), if the land user shall let, transfer or mortgage the land, or invest the land-use right into joint ventures or cooperate enterprises, he must comply with the regulations of the Municipal Government.

Article 48 Land for public welfare or non-profit undertakings such as state organs, culture, education, health, sports, science and technology, municipal facilities, etc. shall neither be changed into the use of profit-earning, nor be let, transferred, mortgaged or developed through cooperation.

Chapter VI Termination of Transfer of Land-use Right

Article 49 The land-use right shall be terminated under one of the following circumstances:

(1) The term fixed in the Contract of Assignment expires;

(2) The land is lost;

(3) The land user dies and there is no legitimate heir;

(4) The judgment, ruling or decision of confiscating the land-use right made by the people's court or Land Administration Department takes effect;

(5) The land using unit relocates or is nullified by law;

(6) The Municipal Government recovers the land-use right before the fixed date due to the need of public welfare and interest; or

(7) Other circumstances provided by law.

Article 50 Where the circumstances provided in Item (1), (3) and (4) of the previous article should occur, the land-use right shall be recovered by the Land Administration Department without compensation together with the buildings and attachment on the land.

Article 51 The Municipal Government shall not recover the land-use right transferred to the land users by law before the fixed date. Under special circumstances, the land may be recovered before the fixed date in due process with respect to the need of the public welfare and interest.
Where the land is recovered before the fixed date by law, the Municipal Government shall compensate the land user in accordance with the actual conditions and the term of land development and utilization.

Article 52 When the term of land-use right expires, the land user shall, within 10 days of expiration, register the nullification at the administrative department of real estate. If the land user does not register the nullification, the land-use right shall be nullified directly by the Municipal Administrative Department of real estate.

Under the circumstances provided in Article 49 Item (2), (3), (4), (5) and (6), the land-use right shall be nullified directly by the Municipal Administrative Department of real estate.

Article 53 When the term of land-use right expires, if the land user needs to go on using the land, he shall apply to the Land Administration Department 6 months in advance, and the Land Administration Department shall make a reply of approval or disapproval according to the following principle within 1 month after receiving the application:

(1) If the use of the land applied for by the land user complies with the current urban planning, approval shall be transferred for further utilization of the land;

(2) If the use of the land applied for by the land user does not comply with the current urban planning, the application of the land user shall not be approved.

Article 54 Where the land user is transferred the approval to go on using the land, he shall re-conclude the Contract of Assignment with the Land Administration Department within 15 days after receiving the document of approval, paying the transfer fees a of land-use right and the land development and municipal accessory facilities fee, and register in accordance with the Regulations on Registration.

Chapter VII Legal Liabilities

Article 55 Where the land-use right is transferred without approval, which is in violation of Article 3, the Contract of Assignment shall be void, and the Land Administration Department may punish the illegal act of transference of the party concerned in accordance with the Regulations of Shenzhen Special Economic Zone on Real Estate Transfer.

Article 56 Where the land user does not develop and utilize the land in accordance with the use and conditions provided in the Contract of Assignment, which is in violation of Article 21, the Land Administration Department shall order it to make corrections in a limited period and may impose a fine of 20% of the total amount of the transfer fees of land-use right concurrently. If the land user refuses to make corrections, the Land Administration Department shall recover the land-use right without compensation and confiscate the buildings and attachment on the land.

Where the land user does not complete the construction on the land within the fixed time limit, the Land Administration Department shall impose a fine since the date of completion for check and delivery of the project provided in the Contract of Assignment. If the completion is overdue for less than 6 months, a fine of 5% of the total amount of the transfer fees of land-use right shall be imposed; If the completion is overdue for more than 6 months but less than 1 year, a fine of 10% of the total amount of the transfer fees of land-use right shall be imposed; If the completion is overdue for more than 1 year but less than 2 years, a fine of 15% of the total amount of the transfer fees of land-use right shall be imposed; if the completion is overdue for more than 2 years, the Land Administration Department shall recover the land-use right without compensation and confiscate the buildings and attachment on the land.

Where the land user does not develop or utilize the land in 2 years since the effective date of the Contract of Assignment, the Land Administration Department shall recover the land-use right without compensation.

The aforementioned "developing and utilizing" refers to obtaining the Construction Planning Permit and the quantity of work reaching 25% of the total investment.

Where the land-use right is recovered by the Land Administration Department without compensation, the land development and municipal accessory facilities fee shall not be returned.

Article 57 According to Article 46 herein, if the project does not conform to the standard for hi-tech projects after re-inspection, the land user shall, apart from making up the deficiency of the transfer fees of land-use right, be imposed upon a fine of 20% of the total amount of the transfer fees of land-use right by the Land Administration Department.

Article 58 Where the land user lets or mortgages the land-use right, or develops and utilizes the land through cooperation with others, which is in violation of Article 48 herein, the Land Administration Department shall order him to make corrections, confiscate his illegal gains and impose a fine of not less than 1 time but not more than 3 times of the illegal gains concurrently.

Where the land user transfers the land-use right without approval, which is in violation of Article 44 and 48 herein, the Land Administration Department shall order him to make corrections, confiscate his illegal gains and impose a fine of 10% of the transfer price concurrently. If the land user refuses to make corrections, the Land Administration Department shall recover the land-use right without compensation and confiscate the buildings and attachment on the land. Where the land-use right is recovered by the Land Administration Department without compensation, the land development and municipal accessory facilities fee shall not be returned.

The person liable shall be subject to disciplinary sanctions imposed by his unit or the organ at a higher level; if the offence constitutes a crime, the offender shall be prosecuted for his criminal liability by the judicial organizations according to law.

Article 59 When the land user is applying for the land, or concluding or performing the Contract of Assignment, if one of the following circumstances occurs, the Land Administration Department may impose sanctions such as warning, revocation of the document of approval, detaining the relevant permits or recovering the land-use right:

(1) The land user concealing important facts and providing false materials or counterfeiting documents; or

(2) The land user disposing of the land-use right without approval, violating Article 15 Paragraph 2 herein.

Article 60 During the process of transfer of land-use right, if the land user obtains the land-use right by means of falsification or bribery, the Land Administration Department shall recover the land-use right and impose a fine of 5% of the total amount of the transfer fees of land-use right; the person liable shall be subject to disciplinary sanctions imposed by his unit or the organ at a higher level; if the offence constitutes a crime, the offender shall be prosecuted for his criminal liability by the judicial organizations according to law.

Article 61 Where the staff member of the Land Administration Department takes bribes, betrays secrets, neglects his duties, or practices irregularities for personal gains, he shall be subject to disciplinary sanctions imposed by his unit or the organ at a higher level; if the offence constitutes a crime, the offender shall be prosecuted for his criminal liability by the judicial organizations according to law.

Article 62 Where a party refuses to comply with the decision on administrative sanction made by the Land Administration Department, he may, within 15 days from receipt of the notice of imposition of administrative sanction, apply for reconsideration to the municipal organ of administrative reconsideration, and the organ of administrative reconsideration shall make the decision of reconsideration within 60 days from receipt of the application for reconsideration. If the party refuses to comply with the decision of reconsideration, he may file a lawsuit in a people's court within 15 days from receipt of the decision of reconsideration.

If the party neither applies for reconsideration, nor files a lawsuit within the specified time limit, nor complies with the decision on administrative sanction of the Land Administration Department, the Land Administration Department may apply to a people's court for compulsory enforcement.

Article 63 The land user of the original allocated land-use right shall apply for making up the transferring formalities before 31st December 1999.

Chapter VIII Supplementary Provisions

Article 64 Any dispute over land-use right assignment shall be settled through consultation by the disputing parties, and if the consultation fails, the parties concerned may file a lawsuit in a people' s court.

Article 65 The Municipal Government may formulate the detailed implementing measures in accordance with these regulations.

Article 66 These regulations shall take effect as of the date of promulgation.