MDT report | Critics claim Land Law being unreasonably enforced

Lawmaker Leonel Alves

The recent Land Law and its enforcement has been fueling criticism by those who think the government is acting in an “unfair” way. The actions performed by the Secretariat for Transport and Public Works to reclaim the so-called “idle lands” have been controversial.
Developers, investors, law- makers, lawyers and real estate professionals consider the method of the current law enforcement is “harming the image of Macau” as well as the interests of those investing in the development of the territory.
Gonçalo Mendes da Maia, a lawyer and partner of MdME Lawyers firm, which represents several interests in this dispute, told the Times that there are many exemplifiers of how several government departments are to blame for the current conflicting situation between the government and the land concessionaires.
The lawyer claims that the Land Law from 2013 is “absurd, deeply unfair and that doesn’t create a difference between those who breached the rules and those who didn’t, treating everybody in the same way without distinction between the ones that are to blame and the ones that are not to [blame].”
“One of the most extreme examples may be the lands located in the Seac Pai Van area of Coloane were the majority of the land concessions in this area were granted back in 1990 for the industrial purpose of having a Quarry. The idea was then retracted in 1993 when due to the lack of success of the previous idea, the government asked all land owners if they wanted to change the purpose of the land to residential, which they accepted. However, the change was subjected to one condition: ‘you can only develop the lands after we [the government] finish the urban planning for Seac Pai Van, which we are still working on,’ this was said in 1993 and remains until today,” the lawyer said.
According to Mendes da Maia, during this period, “hundreds of meetings” were held with several government departments and officials that included the Land, Public Works and Transport Bureau’s (DSSOPT) secretaries, and even consecutive chief executives. During these meetings, the promise was made that “sooner or later this [the planning] will happen,” and that the land concessionaires “shouldn’t be worried about [the problem].”
The lawyer mentioned that his clients’ hopes were once again raised when in 2013 the ‘Urban Planning Law’ was released. “But nothing happened and now, 25 years after [the initial grant], the government comes to say: ‘we know we were responsible but still you must give back the land,’ and these are the facts,” he concluded.
In juridical terms, the same source says, “both the old and the new [land] law allow the extension of the usage period for cause not imputable to the concessionaire,” what generally means that in case the concessionaire cannot use the land by a reason that he is not the one to blame because “it’s possible to request a renewal or an extension of that time to the Chief Executive.”
Referring to the specific case of the lands in Seac Pai Van area, the lawyer added: “We didn’t even put this [request of a development time extension] as an option because there wasn’t even a possibility to develop since there was no change on the land usage purpose to residential, and no other deadline was established for the development,” he remarked.
Mendes da Maia says that what “makes it worse” is that “in 2010 the government itself, by the hand of the Secretary Lau Si Io, decided that was necessary to investigate the case, ordering DSSOPT to study the so-called ‘case of the 113 lands’ whose development period had expired.”
“After an in-depth analysis by a committee of specialists created by the DSSOPT, it was concluded that in 48 cases there was responsibility attributed  to the concessionaires and those lands were to be reclaimed promptly. But there were another 65 lands the committee considered that the concessionaires were not responsible for the non-development. This means that in 2010, the government acknowledged that there is a difference and that these people need to be treated in a different way,” he said, concluding: “This is what makes sense. […] This is the base of our Roman legal system.”
The lawyer states that in the origin of all the conflicts is the article in the law that states “temporary concessions cannot be renewed.” This does not recognize any kind of distinctions, attributing responsibility for this problem to both “the government that allows this to happen and of the Legislative Assembly (AL) which approved this law.”
The issue was last addressed on December 10, 2015 during the Policy Address debate at the AL, when two of the lawmakers who voted in favor of the approval of the law, Gabriel Tong and Leonel Alves expressed  their concerns, with Alves stating clearly: “I have been fooled, so I have to apologize to the people.”
“I voted for the current Land Law because I understood that common sense would prevail in cases where projects and loans for the development of the concessions had already been approved,” he said, recalling a talk with the former secretary Lau Si Io in the AL committee where he was told that solutions to previous concessions would be found. Mr Alves at that time said, “I asked what would be the solution. [Lau Si Io] said that a solution would be found at the time.”
Gregory Ku, managing-director for Macau of the Real Estate consultancy company Jones Lang LaSalle (JLL), commented on the Land Law, saying: “This is the most difficult topic to address in Macau, no one has a good answer to this, not even the government.”
The realtor stated that from the government side, the position is quite clear at the moment with the “Secretary for Transport and Public Works, Raimundo do Rosário saying that everything will be conducted according to the new Land Law, and he can make no decision aside from claiming the [land involved in] expired concessions. In the case of any objections the case has to go to the courts.”
“There isn’t any new idea [from government side] regarding that because ‘law is law’ that’s what he said,” Mr Ku recalled. In his opinion as a real estate expert, the current law is “too strict because there are many different cases; in some of them there is obviously a problem from the government, as there are others where the problem is from the concessionaire.” Due to this disparity, it is unnecessary to simply say that “once a land concession is expired the government has to claim [the land]. I don’t think this should be applicable to all cases.”
Gregory Ku thinks that a reasonable and easy way to amend the current law would be to pass a mechanism of evaluation of the responsibility on the non-development of the land. “In cases where the government is to blame, maybe they could give an extension lets say of five years or so to repair the problem,” he suggested, adding that “if the government really doesn’t want to change the law, then it is necessary to have a more creative solution rather than go to the courts and drag the process out another 10 or 20 years. Maybe an arbitration procedure could work also as long as its decisions would have legal effects.” He concluded by saying: “Whatever is chosen, there should be a way of making it fast and fair because the current solution is really not good for the government as it is creating a bad image and scaring away international and even local investors that are hesitant and scared to invest in Macau as the Macau government is showing itself as a non-negotiable entity.”

Mr Ku noted that there are structural problems and bureaucracies that take a long time, and that together with the “uncertainty” regarding the government’s decisions in the future, it creates unexpected problems “even in perfectly cleared lands.”
Patrick Wong, a foreign investor in Macau for more than 12 years, agrees with Mr Ku’s belief that the government is “scaring away investors.” Mr Wong is also one of those involved in the Nam Van Development Company that held the land concession of the lots C and D of Nam Van lake area. To him, the current law is “the most idling thing to Macau’s future. It is beyond comprehension by a normal person,” he said to the Times.
According to the investor, analysis is needed to assess why foreigner investors decide to invest in the territory. In his opinion, the key factor is that there is a “very clear cut Basic Law that protects interests of foreigner investors.”
“When we come to invest, we need to be blessed by good lawyers as we cannot complete an acquisition of a transaction without a legal opinion. This is very important because without a very clear legal opinion, we would never have completed the deal,” he added.
Mr Wong said that there was a procedure list starting from the Official Gazette notice and the alignment plan that would give the developers a clear idea on what could be built and where, followed by a very strict and complicated process of submissions and approvals by the DSSOPT that go all the way to different pile testing, among others.
“You need approval for anything in Macau, even to test the piles required by DSSOPT you need a license. In my case, we tested 200 different piles on the land to give an idea of the procedures. But what matters the most is as you progress in your project there is a very clear indication from the government if they have the intention to let you continue. In our case, we stopped due to ‘UNESCO,’ they said. They forced us to stop because they [the government] said that they needed a master plan for this area.”
Mr Wong continued: “What matters the most is not my case in particular but all the cases in a bundle, and a search on DSSOPT website under the information for land reveals clearly a separation between the 48 pieces of land that [in which the concessionaires] were considered guilty since the concessionaire didn’t do their job. And those 65 [lands] which are considered not guilty, and this happens for four main reasons: 1- because the general building plan has been approved; 2- because you are in the process of changing the Gazette since after you are approved and you pay land premium and them you need to adjust the Gazette; 3- because of Master planning; and 4- you are in a legal dispute. And we are talking about something that was done by [former-Secretary] Lau Si Io in between 2009 and 2011. This results from a two-year study ordered by him while, at the same time, he was the one leading in the behalf of the government to construct the new land law,” he recalled.
“This can only make me fully believe that his legislative intention was not to blame these people as these points were also discussed in the AL Committee afterwards,” Mr Wong remarked, stressing that “these people [lawmakers] who voted in favor of the Land Law were led to believe that there were also solutions for those who were not guilty.” He added that the other option is to believe that the former-Secretary Lau Si Io lied to the legislators.
“Otherwise we are forced to believe that he completely lied to the AL members and he should be trialed for treason. But lets assume that is not the case,” he concluded stating that in between the two options might be a third one in which “this government is just having a misinterpretation of what former Secretary Lau did previously.”

Gregory Ku

Lawyer Gonçalo Mendes da Maia

Land law impact to be discussed today

A “Forum on the impacts of the Land Law to the investment, economy and society of Macau” will be held this afternoon at the World Trade Center. The event is organized by the Nam Van Development Company Ltd. and will be attended by several experts. It aims to give to the public a clear idea on the status of the lands currently in process of being claimed by the government after the expiration of the concessions and namely the ones located on the lots C and D of Nam Van Lakes.

Gov’t reply: Secretary acting ‘by the book’

In a reply to the Times regarding the topic of the Land Law and the criticism arising regarding its current application, the Office of the Secretary for Transport and Public Works stated that since the law’s entry into force back in 2014, the government has been dealing with related issues in accordance with the new legal provisions. “The Secretary for Transport and Public Works has performed strictly according to that law’s stipulations. In case there are opinions from society to change some of the law articles, those opinions will be dealt with according to the procedures applied.”

tong delivers proposal to amend land law

One of the least satisfied lawmakers regarding the current situation of the Land Law is Gabriel Tong, who is also deputy director of the Law School of the University of Macau. He has stated that in his opinion “the current interpretation of the Land Law is an absurd.” According to newspaper Hoje Macau, Tong has already presented a proposal to the Legislative Assembly (AL) on making amendments to the current Land Law. This proposal aims to allow concessionaires to “require” a decision from the Chief Executive for either a suspension or extension on the concession period of a land based on the non-accountability of the concessionaire for the non development on the expected and originally assigned timeframe. “I have high expectations that the proposal gets approval. It aims to solve a very serious situation in juridical terms,” Tong said.