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Knowing China's New Property Law

C. Division 3: Protection of Property Rights

Division 3 provides for the standard civil set of legal measures for protection of property rights. These are:

1. Claim for recognition of right.

2. Claim for return of the original property.

3. Claim to eliminate or mitigate danger/damage to property.

4. Claim to repair, rebuild, exchange or restore property to its original condition.

5. Claim for damages due to injury to property.

These claims are all made through arbitration or through the people's courts. The claim for the right to return of the original property can be used by the state itself to require the return of property illegally taken for private purposes by local government officials. Since this is a major concern of the Property Law, such claims should be anticipated. It is not clear how this will affect transactions in land and buildings entered into by innocent third parties such as foreign investors. Since the government itself estimates 50% to 70% of transfers of land use rights are illegal, this provision has the potential to cause significant uncertainty.

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