CCAC unveils investigation report about not proclaiming forfeiture of concessions of 16 plots of land

On 25th June, the Chief Executive sent a letter to the Commissioner Against Corruption to request for an investigation into the process of making the decisions not to proclaim forfeiture of the concessions of 16 plots of land. The CCAC has already completed the investigation and did not find that those decisions had violated the current law. However, the 25-year temporary concessions of three of the plots have already expired, but they have not yet been declared forfeit, which will lead to infringement upon public interest and pecuniary interests of the Macao SAR. Therefore, the CCAC suggests the Public Administration proclaiming forfeiture of the relevant concessions as soon as possible under the Land Law. The investigation report points out that the Land, Public works and Transport Bureau (DSSOPT) started to follow up the cases of “idle land” in 2010 and subsequently sifted out 113 cases based on the criterion of “use of land not completed by the expiry of the term of use”, of which 48 cases were considered attributable to the respective concessionaires based on a preliminary analysis. Following a further technical and legal analysis on the 48 cases, the Public Administration proclaimed forfeiture of concessions of 22 plots of land, while the responsibility over concessions of 16 plots of land whose uses were not completed within the stipulated periods could not be solely attributed to the concessionaires were not declared forfeit. As to the remaining 10 cases, the final decisions have not yet been made. The CCAC believes that according to the Land Law, when the use of the land which is not completed within the stipulated period is attributable to the concessionaire, the Public Administration may deal with it in the two following ways: 1) imposing fines on the concessionaire and extending the term of land use; 2) declaring forfeiture of the concession and recovering the land. Therefore, declaring forfeiture of the concession is not the only legal solution to deal with the not using of the land within a stipulated period. Furthermore, if the failure of using the land on schedule by the concessionaire is caused by the own reasons of the public service itself, which means that the delay in the use of the land is “not solely attributable” to the concessionaire, the Public Administration may not initiate the procedure of declaring forfeiture of the concession. The Land Law does not expressly define under what circumstances the declaration of forfeiture of a concession should be made and the fines should be imposed, nor does it establish any concrete criteria for deciding the conditions or degree of the “attributability”. Therefore, the Public Administration has the power to decide, according to the technical and legal analyses conducted by the relevant services, whether or not to declare forfeiture of the concessions of the plots whose uses are not completed within the stipulated periods. As to the grounds or concerns for not declaring forfeiture of every single case of the 16 land concessions, the CCAC, based on its study, believes that it is at the Public Administration’s discretion not to declare forfeiture of the concessions. Therefore, the CCAC does not have the legal competence, resources and techniques to judge whether or not the decisions are the most appropriate for the public interest. In fact, the Public Administration must be accountable for the relevant decisions. However, upon investigation, the CCAC found that when the Public Administration made the decision not to proclaim forfeiture of the concessions of the 16 plots of land, the periods of the temporary concessions of all of them have not expired yet. Even when the terms of 25-year concessions of three other plots of land have subsequently expired, the Public Administration has not taken any immediate action to handle the issues. Out of the three plots of land, two are located at Estrada Marginal da Ilha Verde and Q2 Lot of Pac-On Reclamation Area respectively, which are granted to Transportes Urbanos de Macau, S.A.R.L (Transmac) to build stations and car parks. The other one is situated opposite to the Cultural Centre in ZAPE, which is granted to Sociedade Macau – Obras de Aterro, Lda. and Companhia de Desenvolvimento Fomento Predial Sei Pou Limitada (Sei Pou Real Estate Development Limited) to build hotels and residential properties. According to the findings of a site inspection carried out by CCAC staff, the construction projects at the three plots of land mentioned above according to the relevant concession contracts have not yet started. The two plots of land granted to Transmac have been found being used to park buses. As to the plot granted to Sociedade Macau – Obras de Aterro, Lda. and Sei Pou Real Estate Development Limited, there are only some construction equipment and materials found at the site. The CCAC considers that the Public Administration’s failure to timely declare forfeiture of the expired temporary land concessions is an administrative omission which will open a loophole in the government’s management of land resources, causing infringement upon the public interest and pecuniary interests of the Macao SAR and delay of effective use of land. Moreover, unclear legal status of land will lead to a risk of breaching the right and interest of the third party with goodwill. The report points out the shortcomings of the current legal regime for solving the problem concerning “idle land”. First of all, there is no clear stipulation about the “attributability” in a case of land use which is not completed within the stipulated period and the punishment, causing doubts about the discretion to be exercised by the Public Administration. Secondly, there is also no stipulation which requires that the Public Administration shall disclose the decision of extension of the term of use and the grounds through appropriate means, reflecting insufficient transparence of land management. Thirdly, the amount of the fine for delay of use is too small, which fails to produce a deterrent effect. The report believes that in the process of dealing with the “idle land” by the Public Administration, especially when it comes to the decision of not declaring forfeiture of the 16 land concessions, the relevant information was not released promptly, completely and accurately, which fuelled public speculation and doubts regarding the legality and rationality of the made decisions. Apart from responding to the intensive inquiries from the legislators and the media, the Public Administration seldom took the initiative to release the related information in the recent five years. Not until this June did it announce the earlier decision of not declaring forfeiture of the concessions of 16 of the 48 plots of land. It is, therefore, not unusual that its lack of proactiveness in releasing information has provoked worries and concerns of the public. Moreover, the land management of the public works departments should have been more proactive, systematic, and scientific. At last, the CCAC recommended in the report that the Public Administration should declare forfeiture of land concessions that have exceeded the 25-year term as soon as possible. It also suggests that, to increase the transparency of decision making and strengthen the supervision of the public and the press, the legal regime on the handling of the “idle land” problem should be reviewed when possible and the relevant information should be released to the public in a timely, complete and accurate manner. The public works departments should also strive to increase their motivation and proactiveness in land management, in order to scientifically and effectively manage the valuable land resources of the Macao SAR.