CHINA Law and Practice Contributed by: Nancy Zhang, Xiaoying Tian, Qian Gu and Liangqian Ying, JunHe LLP
Compensation The compensation must be fair and reason - able in the case of expropriation and temporary requisition. Where the land to be expropriated is collectively owned by farmers, they shall be compensated according to the principle that their living standard is not negatively affected; while the land user, in respect of land under a land grant contract to be taken back by the government for public interest, shall be compen - sated, considering the actual elapsed term of the land use and the status and condition of the developments made on the land. In the case of requisition, compensation shall be made for any damage to or destruction of the requisitioned real estate. 2.10 Taxes Applicable to a Transaction In respect of the purchase and sale of real estate, taxes payable may differ depending on the dif - ferent transaction structures. Asset Deal In an asset deal, taxes payable include: • enterprise income tax/individual income tax; • VAT and surcharges; and • land appreciation tax, stamp duty and deed tax. Of these: • the seller is obliged to pay enterprise income tax/individual income tax, value added tax and surcharges, land appreciation tax, and stamp duty; and • the buyer is obliged to pay deed tax and stamp duty.
soil pollution it caused. However, if the causing person cannot be identified, the land use right owner (eventually the buyer, unfortunately) is responsible for managing the soil pollution risks and remediation of the same, even if the land use right owner did not cause the pollution or contamination. 2.8 Permitted Uses of Real Estate Under Zoning or Planning Law A buyer can ascertain the permitted use of a parcel of real estate by viewing the construc - tion land planning permit ( 建设用地规划许可证 in Chinese), land grant contract ( 土地出让合同 in Chi- nese), the construction works planning permit ( 建 设工程规划许可证 in Chinese), other relevant zoning documents and the title certificate. In addition, a buyer may make further verification by access - ing, with the authorisation of the seller, the rel - evant files of the real estate at the competent planning and natural resources authority (the Planning and Natural Resources Commission or PNRC) or the competent local urban construc - tion archives. 2.9 Condemnation, Expropriation or Compulsory Purchase The state may, in the public interest: • expropriate real estate, including land col - lectively owned by farmers and buildings or other real estate owned by any entities or individuals, with appropriate compensation; or • temporarily requisition the real estate of any entities and individuals which will be returned to the said entities and individuals after such use. The power of expropriation and temporary requi - sition must be exercised with due authority and legitimate process.
282 CHAMBERS.COM
Powered by FlippingBook