Zhang Ping, a lawyer who has worked in the service of housing demolition and relocation, holds that the old statute confuses two key concepts: housing demolition in the public interest and that for commercial purposes. The local governments issue permits in both cases. His legal practice shows that 80 percent of housing demolition is for commercial purposes, leaving only 20 percent conducted in the public interests. This means that if a clear line of demarcation is drawn, most development projects that demand housing demolition would fail to obtain the necessary permit. This also goes against the financial interests of local governments.

Busting the Confederacy

Zhang Ping points out that local governments are more than willing to expropriate land on behalf of real estate developers; handsome profits attend cheap expropriation of land from farmers and urban relocatees, turning it over for inflated sums. Many government functionaries were in fact directly involved in granting demolition permits and ignoring coercive demolition cases. Both the official and commercial sides win at the cost of the relocatees. The lawyer stresses that the new statute must dismantle this official-commercial confederacy, which is, in fact, the very point that has met strongest resistance from local governments.

He suggests that this can be achieved by removing the stipulation that a developer must obtain a demolition permit from the government in jurisdiction. Instead, the government that expropriates land on behalf of public interests should negotiate directly with relocatees. If the negotiation fails to reach agreement, both sides can go to the court for a final verdict. The court has the right to judge whether the expropriation is in the public interests and if the standards of relocation compensation are fair. Before the final verdict, the government cannot take coercive demolition measures. In cases of commercial real estate projects, developers should negotiate directly with relocatees. Only after an agreement is reached, can they obtain demolition permits from the government. They cannot carry out coercive demolition relying on administrative power.

What's the legal difference? The five professors hold that, according to the Constitution and the Law on Urban Real Estate Administration, that in the case of the public interest, the state can expropriate any individual's dwelling or any other entity's real estate if said building stands on state-owned land, provided that the state compensates them according to law. Therefore, the relation between expropriation and compensation is regulated by administrative law, and must comply with the requirements for "administration by the rule of law."