Problems relating to Trade and Investment on China

21. Restrictions on land ownership
Issue	Issue details	Requests	Reference

(1) Nebulous and Delayed Acquisition Procedures for Right of Use on Afforestation Lot

- The applicant may secure the land use right for afforestation by acquisition of the forestry right certificate (FRC) issued by the Province. In some Provinces it takes a few years before the FRC is issued. Due to the shortage of fund and human resources, some Provinces face difficulties in improving the situation. On the other hand, the demand for effective use of idle land will grow, requiring more complicated and sophisticated information handling. It should be managed on block by higher body (for example, at the Municipal or Provincial level). It is requested that GOC takes steps in promoting FRC transactions through expedited issuance of FRC for the sake of local economic development and more efficient use of the land property.

- It is requested that GOC simplifies and expedites the procedure for issuance of the land use rights.

- The Forest Law
- Law on the Contracting of Rural Land

(2) Restricted Land Ownership	- No landownership is allowed for fully foreign funded enterprises (FFFEs). (PRC being a communist country, landownership is granted to PRC nationals as well.) - MFS's factory location, being contracted under the 50-years lease of the land utility right, MFS faces big problems for continuation of production on a permanent basis, with the accompanying investment risk.	- It is requested that GOC grants landownership to, FFFEs for the sake of a stable business operation.	- PRC Legislation
	(Action) - Since 1 October 2007, Property Law of PRC has been enforced. It comprises of 5 Chapters, 19 Sections and 247 Articles. It classifies immovable and movable property right into state-owned, group-owned and private-owned properties and defines the title to each of them in detail. The Law protects "state-owned, group-owned and private-owned" property rights, which may not be encroached upon by any organisations or individuals. The Law clarifies the compensation principle in the event of expropriation, transfer or removal of privately owned buildings for the public interests. In concrete terms, it stipulates, among others; (1)equal protection of privately owned property, (2)possibility for extension of land-use right for agricultural and housing after expiry of the term, and (3)mandatory requirement for payment of security bond for expropriation of farming land.

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