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Q&A Regarding China's " Urban Real Estate Administration Law of the People's Republic of China"(3)

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Q: What are the conditions for establishing a real estate development enterprise?
A:
  1. It has its own name and organizational structure;
  2. Have a fixed business location;
  3. It has a registered capital in compliance with the provisions of The State Council;
  4. There are sufficient professional and technical personnel;
  5. Other conditions as prescribed by laws and administrative regulations.
To establish a real estate development enterprise, an application for establishment registration shall be made to the administrative department for industry and commerce. The administrative department for industry and commerce shall register and issue business licenses to those that meet the conditions stipulated in this Law. Those that do not meet the conditions stipulated in this Law shall not be registered.

Q: How is the time limit for the start of real estate development stipulated?
A: Where land use rights are obtained through transfer for real estate development, the land must be developed in accordance with the land use purpose and the period for commencing development as stipulated in the land use right transfer contract. If development has not started within one year after the agreed commencement date in the land transfer contract, a land idleness fee equivalent to up to 20% of the land use right transfer fee may be levied. If no development has started within two years, the land use right may be reclaimed free of charge. However, this does not apply if the delay in the commencement of development is caused by force majeure, the actions of the government or relevant government departments, or the necessary preparatory work for the commencement of development.

Q: What principles should be followed in real estate price assessment?
A: Real estate price assessment should follow the principles of justice, fairness and transparency. It should be conducted in accordance with the technical standards and assessment procedures prescribed by the state, based on the benchmark land price, the standard land price and the replacement cost of various types of houses, and with reference to the local market price.

Q: What does real estate transfer refer to?
A: Real estate transfer refers to the act of a real estate right holder transferring their real estate to others through sale, gift or other legal means.

Q: When land ownership is obtained through transfer, what conditions should be met when transferring real estate?
A:
  1. All the land use right transfer fees have been paid as stipulated in the transfer contract and the land use right certificate has been obtained;
  2. Investment and development shall be carried out in accordance with the terms of the land transfer contract. If it is a housing construction project, more than 25% of the total development investment shall be completed. If it is a large-scale land development, the conditions for industrial land or other construction land shall be formed.
When transferring real estate, if the house has already been completed, the house ownership certificate should also be held.


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