New Express
March 23, 2009

China's current Land Administration Law, modified in 1988 and 1998, will undergo a third round of revisions by the National People's Congress this year. Today's newspapers reported that 49 new changes have been made since the previous draft was released last year.

According to a 1990 law governing matters related to urban land use and transfer, Chinese homeowners are granted a 70-year right to the land on which their homes are built. Since privately-owned houses are still a relatively new phenomena in China, the 70-year expiry has not yet become a pressing issue, although owners may naturally wonder what will happen to their houses when the term expires and they no longer have the right to use the land.

The previous draft of the law, initiated by the Ministry of Land and Resources, addressed the question by stipulating that the land use right will be "renewed automatically without additional fees" after expiration.

However, in the latest version, the wording has been replaced by "renewed according to related state laws and regulations." Observers have pointed out that the change of wording enables the government to slap a renewal fee on land usage rights in the future.

Beijing-based China Business reported today that the rights renewal fee is rumored to be 1,300 yuan per square meter for property in Beijing. However, a precise prediction of something that not take place for decades deserves to be taken with a large grain of salt.