The CCAC has released the “Investigation Report about 74 Land Concession Leasehold Case Files Where the Provisional Concession Leaseholds were Declared Expired”, where it pointed out that the concessionaires involved in all of the case files did not fulfil the terms set out in the respective provisional concession leasehold contracts as they failed to implement the land use plans originally made or the modified ones which were already approved. After obtaining the provisional concessions, they requested for change of land purpose and increase of building scale and height for various reasons and even attempted to seek the possibility to maximise their interests. Such acts have gone against the principle of good faith in a contractual relationship. The CCAC believed that regarding whether the Public Administration declared the expiry of the provisional concession leaseholds of the relevant lots due to reasons attributable to the concessionaires or merely due to incomplete land use by the expiry of the leasehold periods, there was no administrative illegalities or maladministration. The accusation that the DSSOPT allegedly delayed or impeded the concessionaires’ completion of land use is groundless. It is even impossible for such saying to be the reason for amendment to the new Land Law. Nevertheless, the DSSOPT neither did its duty to actively carry out supervision and follow-up on whether the concessionaires had fulfilled the respective provisional concession leasehold contracts nor timely implemented the system of declaring expiry of land concession, causing misunderstanding that the government would never recover the land parcels and making the issue of idle land become one of the social issues.

Starting from March 2010, the Public Administration, case by case, reviewed all cases where the land use was not completed within the land use period or by the expiry of the land leasehold period set out in the respective provisional concession leasehold contract. Starting from 2015, the Public Administration successively announced the expiry of provisional concession leaseholds of many plots of land. Later, some people repeatedly told the media that the stipulation that the concession would expire if the land use was not completed by the expiry of the leasehold period prescribed in the new Land Law was unreasonable and requested for amendment to the new Land Law. At the request of the then Chief Executive, the CCAC commenced an investigation, where it carried out a comprehensive analysis of the 74 land concession vetting processes in which the provisional concession leasehold was declared expired. In particular, it has reviewed over 1,000 land concession vetting case files, building proposals and construction case files, taken statements from relevant personnel as well as made a comparison with the legal regimes of neighbouring regions in order to verify whether there are administrative illegality or maladministration existing in the decisions to declare expiry of the relevant land concessions.

In the report, the CCAC classified and comprehensively analysed the land use periods and land leasehold periods of the land parcels involved in the 74 case files and discovered that the use periods and leasehold periods of all of the land parcels expired before or after entry into force of the new Land Law while the land uses were not completed within the periods provided for in the contracts. In comparison between the old Land Law and the new Land Law, the CCAC considered that the stipulations of handling of land parcels on concession leasehold prescribed in the old Land Law and the new Land Law are basically the same. The stipulations that incomplete land use by the expiry of the leasehold period instantly leads to expiry of concession for reasons attributable to the concessionaire prescribed in the new Land Law have been existing for a long time. The difference only lies in the law enforcement efforts.

The CCAC considered that all of the concessionaires involved in the cases did not comply with the terms set out in the respective provisional concession leasehold contracts. Some of them requested for change of the land use or did not submit the building proposals to the authority, while some did not take the initiative to follow up the building proposals they had submitted. They have one thing in common, that is, they failed to implement the land use plans. After obtaining the provisional concession of the relevant lots, the concessionaires made one or more than one requests for change of land use or land purpose for various reasons. In fact, the first building proposals submitted by almost all of them did not accord with the respective concession contracts. Such acts of non-compliance with the contract terms went against the principle of good faith in a contractual relationship. Some of the concessionaires’ acts even show that they did not intend to comply with the duties set out in the provisional concession leasehold contracts. Instead, they only attempted to seek the possibility to maximise their interests through repeated requests to the Public Administration for change of land purpose and increase of building scale and height.

Concerning the suspicion that the DSSOPT delayed or impeded the concessionaires’ completion of land use within the land leasehold period, the CCAC considered that such accusation is groundless. The CCAC pointed out that the failures in all of the cases were due to the fact that the concessionaires did not timely submit the building proposals which accorded with the terms set out in the contracts or the fact that they did not follow up the building proposals timely following the approval of the DSSOPT. In addition, if the building proposal submitted by the concessionaire obviously goes against the requirements, then the DSSOPT will need to review the urban planning. In this sense, the bureau will inevitably spend more time to deal with the relevant applications and consult other competent authorities. Therefore, it did not mean that the DSSOPT delayed the vetting. Instead, the delay was caused by the concessionaires’ violation of the terms set out in the provisional concession contracts.

The CCAC mentioned in the report that both the old Land Law and the new Land Law confers upon the concessionaire the right to make a request for change of the land use or land purpose, but they also provide restrictions. Article 107 of the old Land Law stipulates that whether or not to approve the concessionaire’s request is at the Public Administration’s discretion. Once speculative intention is found, the Public Administration shall reject the request according to the law. In addition, Articles 140 and 141 of the new Land Law provide clear stipulation of the period for making request for relevant change or amendment. Both the old Land Law and new Land Law stipulate that the concessionaire is obliged to complete the land use within the designated or extended land use period. Even if the building proposal or drawing is not approved, the land use period set in the concession leasehold contract will not be suspended or terminated, unless the concessionaire makes such request. However, not until the Public Administration enforced the stipulations of declaration of expiry of land concession under the Land Law that the concessionaires attempted to defend themselves from being blamed for the failure to follow up the concession contracts and fulfil the obligations of land use as set out in the contracts for the excuse that the Public Administration delayed the vetting procedures or failed to fulfil the responsibilities regarding urban planning or infrastructure. The CCAC considered that such accusation is not convincing.

Considering that the DSSOPT’s supervision on the implementation of the land concession contracts was not adequate, the CCAC pointed out in the report that the bureau failed to perform its duty to proactively supervise and follow up the implementation of the provisional concession contracts by the concessionaires. Neither did it promptly follow up the cases where the relevant land lots might have met the conditions of expiry of provisional concession. As a result, the relevant land had all along not been used effectively and had even been left idle for prolonged periods, which has caused the society to cast various doubts over the land management work of the government. This situation deserves profound reflection and review by the competent authorities.

The CCAC emphasised that, unlike civil contracts, the land concession leasehold contracts are essentially administrative contracts. The Public Administration has the right of supervision and the right of punishment so as to supervise the fulfilment of the obligations set out in the land concession contracts by the concessionaires. However, the CCAC found that the concessionaires in quite some land concession case files involved seemed to be playing the predominant role. It was common that when the concessionaires filed requests such as changing the land purposes and land uses, the DSSOPT would still follow them up. It seldom resolutely rejected those that did not meet the relevant requirements in the beginning. In the CCAC’s opinion, the Public Administration should reflect on how to play a predominant role in the land leasehold contracts. It should, in a timely manner, proactively carry out follow-up and supervision work on the fulfilment of obligations set out in the concession contracts by the concessionaires. To safeguard the overall interests of the Macao residents, they should take appropriate measures and maintain a clear and transparent attitude in order to improve their supervision and management of land uses. In response to requests that contravene the laws or concession contracts, they should reject them explicitly so as to ensure that the land resources of Macao will be used effectively and sufficiently according to the provisions of the new Land Law and the terms in the concession contracts.

The CCAC suggested in the report that when vetting the building proposals submitted by the concessionaires, the Public Administration should also consider the balancing of public interest and private interest. In particular, the approval should depend on whether they meet the primary objectives of making full and timely use of land resources and achieving sustainable urban development.

The CCAC added that the 74 decisions on the land concessions involved were all made by the then Portuguese Government of Macao. Some provisional land concession leaseholds were granted through exemption from public tender. Moreover, neither the relevant grounds nor the application of the relevant legal provisions could be seen in the submissions. The CCAC emphasised that public tender should be a common practice while a concession should only be directly granted under special circumstances. When carrying out a procedure of granting a provisional land concession in the future, the Public Administration must carry out a public tender before granting the provisional land concession according to the new Land Law. Only under certain circumstances may public tender be exempted. In addition, Article 166 of the new Land Law should be executed in a timely manner. When a concessionaire fails to finish the land use within the land use period, without having to prove his fault, the possibility of executing the relevant penalty system may be studied immediately, including imposing a fine and declaring expiry of the provisional concession leasehold. Upon completion of the land leasehold period, the provisional land concession leasehold must even be declared expired compulsorily. It will allow the relevant lots to be released for proper use again. This is how the law is applied correctly in a timely manner and how the interests of public resources can be safeguarded effectively.

The report of the CCAC has already been submitted to the Chief Executive. The full report may be downloaded from the CCAC’s website.