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Must public welfare demolition be lower than commercial demolition compensation?

01 Topic import

In land acquisition and demolition, demolition is usually divided into public welfare demolition and commercial demolition. In recent years, many people have carried out commercial demolition in the name of public welfare demolition. This kind of behavior of "hanging sheep's head and selling dog meat" seriously affects the legitimate rights and interests of the demolished people, but many of the demolitions are not clear about the difference between the two, and then we will talk about the difference between public welfare demolition and commercial benefit demolition.

02 Public welfare demolition and commercial demolition

First of all, we must understand what is public welfare demolition and commercial demolition, public welfare demolition is the expropriation behavior implemented for the public interest, can also be said to be government demolition, including national defense diplomacy needs, energy and transportation, water conservancy and other infrastructure, government organizations of science and technology, education, culture, sports and other public utilities needs, affordable housing projects, dangerous houses and old houses transformation and so on. Commercial demolition refers to the developer's act of transferring the ownership of the house to the developer after negotiating with the demolished person for the purpose of making a profit, and then carrying out real estate development. Therefore, the starting point of commercial demolition is definitely for profit, not for the needs of the public interest.

Must public welfare demolition be lower than commercial demolition compensation?

03 The difference between the two types of demolition

The main difference between public welfare demolition and commercial demolition is: First of all, the main body and procedure of demolition are different, and before the government public welfare demolition obtains the demolition permit, a hearing is held to discuss the public welfare compensation plan, etc., which is generally levied according to relevant policies. The land expropriation plan shall be approved in accordance with law, and then the people's government of the city or county where the expropriated land is located shall organize and implement it, and shall make a public announcement on the approval organ, the approval document number, the purpose, scope, and area of the expropriated land, as well as the compensation standards for land requisition and the time limit for handling compensation for land requisition.

Secondly, the purpose of demolition is different from compensation, and public welfare demolition such as road construction, bridge construction, infrastructure construction, etc., all have compensation standards. Many projects are not profitable projects, but public welfare projects. Compensation is mainly in accordance with the provisions of the Regulations on the Expropriation and Compensation of Houses on State-owned Land, and for the needs of the public interest, the houses of units and individuals on state-owned land expropriated will be given fair and just compensation to the demolished persons, and the compensation standard shall not be lower than the market price of similar real estate on the date of the announcement of the decision on housing expropriation. Moreover, the market value of the expropriated houses must also be assessed and determined by the real estate price appraisal agency with corresponding qualifications in accordance with the housing expropriation appraisal method. If the evicted person has objections to the assessed value, he can also apply for review. The demolition of commercial demolition developers is to engage in real estate development, which is a commercial act, and the compensation standard is not regulated. It is characterized by voluntary and compensatory parties, and the transaction price may not be the market price, but is generally determined by the developer and the demolished person in consultation on the basis of the minimum compensation standard stipulated by law.

The scope of demolition is different, and most of the commercial demolition is the collection and demolition of several or dozens of houses, and the specificity is relatively strong. The government's expropriation and demolition is generally a village or an area, and the general scope is relatively wide, in addition to the expropriation and demolition of houses on state-owned land, but also the demolition of houses on collective land and its land. The number and scope of demolition involved are much greater than those involved in commercial demolition.

The final remedies are different, and the contracts signed for commercial demolition are generally civil and commercial contracts. If a dispute arises, it can be remedied through arbitration, civil litigation, etc. The government demolition is an administrative contract, and the means of relief are reconsideration, or administrative litigation. The laws and means of conduct on which the two are based are different, and the demolished persons must be distinguished.

04 Topic Summary

Commercial demolition mainly involves commercial transactions between general entities. And the government demolition has the nature of administrative orders, although there are strict legal constraints, but the implementation of practice will also encounter many problems, which makes the interests of the demolished people easily infringed, whether it is commercial demolition or public welfare demolition, should be given reasonable compensation to the expropriated person, in the compensation is unreasonable must not sign on the compensation agreement, but to take the initiative to negotiate with the demolition party, if the consultation can not be directly through legal channels, to protect their legitimate rights and interests, in the time prescribed by law to file a lawsuit.

(Author Zhang Ting, Trainee Lawyer)