CRI听力:Controversial Online Auction for Land Use Rights

The auction began at 10 am on March 29th on Taobao.com, a Chinese website for online shopping operated by the Alibaba Group. The online auction lasted for a period of 24 hours, ending at 10 am the next day.

The auction items include a 117,000-square-meter plot, a 62,000-square-meter plant building and the attached facilities of a bankrupt state-owned enterprise in the city of Haining in east China's Zhejiang Province.

Liu Chengxiong, a Certified Public Accountant says the land auctioned belonged to a leather enterprise based in Haining, Zhejiang province.

"The land auctioned belonged to a leather enterprise, which was forced to apply for bankruptcy on May 22, 2012 due to unpaid debts. The auction subjects include a plant building and attached facilities. The plot is very large, more than 170 mu, equivalent to about 110,000 square meters."

The land's appraisal price stands at 158.7 million yuan, and the starting price of the auction was 155 million yuan.

After four rounds of bidding between two buyers, the land was sold at 4 million yuan higher than the starting price.

According to the auction rules, any enterprise planning to be involved in the bidding needs to register on the Taobao website first and put down a bidding deposit of 8 million yuan. And the bid price should be raised by at least one million yuan each time.

The online auction for land use rights has triggered controversy over whether land can be purchased online.

Yan Jinming, deputy head of the academic council of the China Land Institute gives his opinion.

"This auction falls within the category of the tier-2 or tier-3 land market, where land transfers can take place in diverse ways."

Other industry insiders, however, have raised doubts over the legality of such auctions. Ou Shuying, deputy secretary-general of the China Association of Auctioneers, supports the move online but says the way it is being done in Zhejiang is questionable, because courts can only supervise. They are not allowed to deal with sales directly.

Mao Yidong, leader of the discipline inspection group of the Haining People's Court, says the law entitles the people's court the right of asset disposal and judicial auction, and Taobao.com just provides a platform for the auction.

"According to clause 244 in the Civil Procedure Law, if the party subjected to execution can't fulfill its obligations, which are outlined in legal documents, the People's Court is entitled to seize, detain, freeze, auction or sell off its part of relevant properties. The law entitles the people's court the right of asset disposal and judicial auction, and Taobao.com just provides a platform for the auction."

In China, land use rights are the rights of what are referred to in law as natural persons, legal persons or other organizations which will use the land for a fixed period of time. More specifically, the term of rights to use state land include: 70 years for residential use, 50 years for industrial use, 50 years for educational, scientific and technological, health, and athletic use, 40 years for business, tourist, and recreational use, and 50 years for multiple purpose use or other uses.

For CRI, I am Zhang Wan.