Published by ChinaMNC · Qushui

Xuzhou's New Rules on Compensation for Demolition of Houses on Collective Land: What Foreign Founders Need to Know

A practical guide for foreign founders operating in Xuzhou, summarizing the city's 2026 measures for compensating owners of houses on collective land slated for expropriation, covering scope, procedures, valuation, and dispute resolution.

Xuzhou Issues New Rules for Compensation on Collective Land

Foreign founders with operations in Xuzhou should be aware of new municipal rules governing compensation when houses on collective land are expropriated. The Measures for Compensation for Expropriation of Houses on Collective Land in Xuzhou Urban Area (徐政规〔2026〕1号) were adopted by the municipal government's executive meeting and published on February 3, 2026. The measures aim to standardize compensation, protect property owners' rights, and align with national and provincial land laws.

Scope and Key Definitions

The measures apply to compensation and resettlement for expropriation of houses on collective land within Xuzhou's urban area, excluding Tongshan District and Jiawang District. The term “expropriated person” refers to the owner of the house on collective land. For foreign founders, this matters if your company owns or leases property on collective land, or if your operations are affected by land acquisition.

Governing Authorities and Responsibilities

The Municipal Natural Resources and Planning Department oversees collective land expropriation, while the Municipal Housing and Urban-Rural Development Department supervises house expropriation on such land. District governments bear primary responsibility for compensation and resettlement within their jurisdictions. They establish or designate expropriation departments to implement the work, with support from other district departments, sub-district offices, and village committees.

Core Principles: Compensation Before Relocation

Expropriation must follow the principle of compensation before relocation, with lawful compensation and resettlement provided. Compensation funds must be fully in place, deposited in a dedicated account, and used exclusively for that purpose. After a pre-expropriation announcement, relevant departments suspend processing new construction, reconstruction, or expansion of houses, as well as changes to house or land use.

Compensation and Resettlement Plan

District governments must draft a land expropriation compensation and resettlement plan based on land status surveys and social stability risk assessments. If houses are involved, the plan must include: the scope and implementation timeline; compensation and resettlement methods; standards for various compensations, subsidies, and rewards; signing period, transition method and period, relocation period, and early relocation reward period; location and settlement standards for resettlement housing; and other necessary items.

The draft plan must be publicly announced for at least 30 days in the affected sub-district (town), community (village), and village group, as well as on the district government website. The announcement must specify how to submit opinions, and authorities must listen to views from the rural collective economic organization, its members, village committees, and other stakeholders.

Hearing Mechanism

If more than half of the members of the expropriated rural collective economic organization believe the plan violates laws or regulations, the district government must convene a hearing. Even if less than half hold such views, the district government may convene a hearing if it deems necessary. The plan may be modified based on laws and hearing feedback, and any modifications must be announced.

Eligibility for Compensation

Individuals who move their household registration into the area due to birth, marriage, military service (active or veteran), retirement, enrollment in higher education, or release from prison, and who meet household registration rules, may receive compensation and resettlement on the same terms as members of the rural collective economic organization.

Determining Lawful Building Area

Compensation is based on the lawful building area as recorded in the house ownership certificate or real estate ownership certificate. If the owner only has a homestead certificate or a village (resident) building land permit but no ownership certificate, the lawful area is determined as follows:

• If the actual house area is less than 1.4 times the area stated in the homestead certificate or building permit, the actual area is recognized.
• If the actual house area equals or exceeds 1.4 times the stated area, the area is recognized as 1.4 times the stated area; any excess is not recognized.

If neither a homestead certificate nor a building permit nor an ownership certificate exists, the district government must first confirm the homestead ownership and area with relevant departments, then apply the above rules.

Exclusions from Compensation

No compensation or resettlement is provided for illegal construction, temporary structures that exceed the approved period, or any new construction, reconstruction, or expansion of houses and attachments carried out without authorization after the pre-expropriation announcement.

Compensation Methods

Expropriated persons may choose monetary compensation or property exchange resettlement. For monetary compensation, an appraisal agency assesses the value of the house, and compensation is based on that appraised value. Following the state-owned land “home purchase card” policy, those choosing monetary compensation may use the card to purchase new commercial housing.

For property exchange, the resettlement area is based on the lawfully recognized building area, and settlement follows the rules for expropriation of houses on state-owned land.

Valuation and Appraisal

The value of the expropriated house is determined by a qualified real estate appraisal agency. The expropriated person may select the agency through negotiation; if no agreement is reached within the specified period, the expropriation department will organize selection by on-site drawing lots, supervised by a notary public.

Non-Residential Houses and Business Losses

If expropriation of non-residential houses causes suspension of production or business, the expropriated person is entitled to compensation for such losses, with standards referring to those for state-owned land non-residential houses. For residential houses converted to non-residential use, standards for “residential-to-non-residential” on state-owned land apply. However, if a residential house is rented or lent to others for non-residential use, it is still deemed residential, and no resettlement or compensation is provided to the renter or borrower.

Transition, Moving, and Dispute Resolution

The expropriation department must specify in the compensation agreement the transition period for both immediate and future housing resettlement. If the expropriated person arranges their own transitional housing, a temporary resettlement subsidy is provided, along with a moving fee based on the lawful building area.

If no compensation and resettlement agreement can be reached within the expropriation period specified in the land expropriation announcement, the district government may make a compensation decision for individual cases. If the expropriated person neither applies for administrative reconsideration nor files an administrative lawsuit within the statutory period, and fails to relocate within the period specified in the compensation decision, the district government that made the decision may apply to the people's court for enforcement.

Practical Takeaways for Foreign Founders

• Verify land status: Before leasing or purchasing property, confirm whether the land is collective land and whether expropriation is planned.
• Understand compensation basis: Compensation hinges on lawful building area as documented; ensure all certificates are in order.
• Engage early: Participate in the public announcement period and submit opinions if affected.
• Seek local counsel: Procedures and documentation are detailed; legal advice is recommended for specific cases.

This summary is based on information published by the relevant Chinese government website and is general information, not legal or tax advice.