Property Law of the People's Republic of China

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The Property Law of the People's Republic of China (Chinese: 中华人民共和国物权法, Pinyin: Zhōnghuá Rénmín Gònghéguó Wùquán Fǎ) is a property law adopted by the National People's Congress in 2007 and went into effect on October 1, 2007. The law covers the creation, transfer, and ownership of property in the mainland of the People's Republic of China (PRC)^[1] and is part of an ongoing effort by the PRC to gradually develop a civil code. In developing civil law in the PRC mainland, the PRC government has used the German Pandectist system of classification under which the property law corresponds to the law on real rights, which is the term used in Chinese for the official name of the law.

The drafting of the law involved considerable controversy. The proposed bill caused quite a stir since it was first published in 2002, was subsequently deferred, and yet again failed in its reading at the National People's Congress (NPC) of 2006 because of disputes over its content. It finally went through its eighth reading in 2007.^[2] Many in the Chinese legal community feared that creating a single law to cover both state property and private property would facilitate privatization and asset stripping of state-owned enterprises. The draft law was subject to a constitutional challenge. Legal scholars, notably Gong Xiantian of Peking University, argued that it violated the constitutional characterization of the PRC as a socialist state. The law was originally scheduled to be adopted in 2005, but was removed from the legislative agenda following these objections. The final form of the law contains a number of additions to address these objections.

On March 8, 2007, the Property Law was formally introduced at the NPC. Vice-Chairman Wang Zhaoguo told the Congress that the law will "safeguard the fundamental interests of the people", and the law is an attempt at adapting to new "economic and social realities" in China. The law was adopted on March 16, the final day of the two-week session of congress, with the backing of 96.9% of the 2,889 legislators attending, with 2799 for, 53 against, and 37 abstentions.^[3] In his final address to the 2007 Session, NPC Chairman Wu Bangguo declared "the Private Property Law and the Corporate Taxation law are two of the most important laws in the new economic system of Socialism with Chinese characteristics, we must attempt to learn these laws fully through various methods."^[4]

Article 9 requires that creation, transfer, and destruction of immovable property rights requires registration to be effective.

The law covers all of the three property types within the People's Republic of China, which are state, collective, and private which are defined in Chapter 5 of the law. Chapter 4, Article 40 of the law divides property rights into three types: ownership rights, use rights, and security rights. The law goes into detail about the legal rights associated with any of these three types.

Some press reports have characterized this law as the first piece of legislation in the People's Republic of China to cover an individual's right to own private assets,^[5] although this is incorrect as the right to private property was written into the Constitution of the People's Republic of China in 2004. The amendment states "Citizens' lawful private property is inviolable." ^[6]. The 2007 Property Law itself is directed at defining all forms of property in the PRC.

The law does not change the system of land tenure by which the state owns all land. However, in formalizing existing practice, individuals can possess a land-use right, which is defined in Chapter 10 of the law. The law defines this land-use right in terms of the civil law concept of usufruct.

[edit] See also

• Intellectual property in the People's Republic of China
• Nail houses

[edit] References

[edit] External links

• English translation, Lehman, Lee & Xu, LLP
• Text in Chinese
• Draft text in Chinese
• China Introduces Landmark Property Law, Guardian Unlimited
• China passes new law on property, BBC, Friday, 16 March 2007, 02:51 GMT.