The Legislative Council has passed the Fabric Renewal Bill, which will take effect on the 5th of next month. For general fabric use contracts, including residential, commercial, and industrial purposes, unless there are significant public interest concerns, these contracts will typically be renewed for 50 years. The renewal itself does not require additional land premiums but will require an annual rent equivalent to 3% of the assessed rental value of the fabric at the time of lease evaluation. The government will regularly publish announcements for fabric contract renewals in the gazette to replace the individual signing of new contracts with property owners.
The Secretary for Development, Ning Hanhao, stated that the bill provides certainty to society and helps maintain confidence among property owners and investors. The Director of Lands will publish renewal announcements in the gazette at least six years before each batch of fabric contracts expires. She mentioned that although it is rare for property owners to choose not to renew, the bill also specifies arrangements for handling such situations.
Ning Hanhao emphasized that the bill only changes the general renewal method for fabric contracts and does not alter the land policy of July 1997. It also does not affect the government's absolute discretion over lease renewals as the landowner. She stressed that the provision of no additional land premium in the bill is for clarity and to enhance certainty. If future governments, after thorough discussion, deem it necessary to adjust, they should propose amendments at that time to avoid sending misleading signals that could impact social stability and economic development.
