Original Title: Notice on Issuing the "Measures for Adjusting the Cost-Sharing Mechanism for Industrial Land Acquisition and Reserve in Baoshan District"

Pursuant to the "Measures for the Administration of Land Reserves" (Guotu Guizi [2017] No. 17), the "Shanghai Municipal Land Reserve Measures" (Shanghai Municipal People’s Government Decree No. 25), the "Implementing Rules for the Shanghai Municipal Land Reserve Measures" (Hufu Fa [2004] No. 41),the “Opinions on Standardizing the Management of Revenues and Expenditures from the Grant of State-Owned Land Use Rights” (Shanghai Municipal Government Office Document No. 52 [2008]), the “Notice on Several Opinions Regarding Further Standardizing the Approval of Land Reserve Projects in the Municipality” (Shanghai Municipal Government Office Document No. 79 [2017]), and the “Several Provisions on Strengthening the Management of Industrial Land Grants in Shanghai” (Shanghai Planning and Natural Resources Bureau Document No. 6 [2021]), this mechanism is formulated in light of the actual conditions of our district.

I. Implementation of the District-Level Land Reserve Project Approval and Assessment System

In accordance with the annual industrial land acquisition and reserve plan, the District Land Reserve Center shall organize the preparation of a project feasibility study report (investment estimate) and, in conjunction with the District Development and Reform Commission, the District Planning and Resources Bureau, the District Finance Bureau,the District Economic Commission, the District Science and Technology Innovation Commission, the District Construction Management Commission, the District Housing Security and Housing Administration Bureau, and the relevant sub-districts (towns) and industrial parks to analyze and evaluate the project’s land scope, cost investment, allocation of various land indicators, and funding arrangements. Upon approval of the evaluation, an application for project approval shall be submitted. Notably, funding for water, electricity, and gas expenses shall be explicitly allocated in advance by the district finance department.After the project is approved by the District Development and Reform Commission, the District Land Reserve Center will initiate the specific procedures for the land reserve project. The project approval notice will serve as a reference for the preparation of the land transfer revenue and expenditure budget and the arrangement of the land reserve fund expenditure plan.

II. Adoption of a District-Level Advance Allocation and Shortfall-Sharing Mechanism

Land reserve costs are initially funded on a 50% district-level and 50% town-level basis (with the district-level portion disbursed in two installments: 20% as an advance upon project approval and 30% after cost verification). Final settlement occurs following land disposal. Any shortfall where disposal revenue fails to cover audited costs is jointly borne by the district and town levels on a 50:50 basis. The specific process (see Appendix for details) is as follows:

(1) Initial Disbursement

After the project is approved by the District Development and Reform Commission, the District Land Reserve Center applies to the District Finance Bureau for an advance payment of initial reserve funds (20% of the approved project amount) to serve as project startup capital, which is promptly disbursed to the sub-district, town (industrial park), or relevant unit.

(2) Second Disbursement

After the project costs have been assessed and verified by the District Land Reserve Cost Verification Working Group, the District Land Reserve Center shall sign relevant land acquisition and reserve agreements with the sub-districts, towns (or industrial parks) and disburse the second tranche of funds;The District Land Reserve Center applies to the District Finance Bureau for the disbursement of 30% of the total assessed cost, which is then transferred to the sub-district, town, or industrial park, or relevant units (if the estimated project amount differs from the assessed cost, the proportion of the second disbursement will be adjusted accordingly; the total amount disbursed in the first two installments shall not exceed 50% of the total assessed cost); the sub-district, town, or industrial park completes specific matters such as land acquisition and compensation in accordance with the terms of the agreement, ensuring that the relevant funds are promptly in place.

(3) Fund Settlement

After land is supplied and the audit is completed, the District Land Reserve Center, in conjunction with the District Finance Bureau, shall settle funds in accordance with the audit findings. For projects where the transfer revenue fails to cover the audited costs, the cost shortfall shall be shared by the District and the sub-district/town (industrial park) in a 50:50 ratio.

III. Incentive Mechanism

For projects that complete land supply within one year of approval, the proportion of the shortfall—where land transfer revenue fails to cover audit costs—to be borne by the district-level finance department shall be increased from 50% to 60%. If a particularly significant industrial project is subsequently introduced and approved by the District Party Committee and District Government, the proportion borne by the district-level finance department shall be increased to 70%. Specific implementation rules shall be separately formulated by the relevant departments.

IV. Supplementary Provisions

This document shall take effect upon issuance and remain valid until December 31, 2024.

The Baoshan District Land Reserve Center is responsible for interpreting this mechanism.

Appendix: Flowchart of the Cost-Sharing Mechanism for Industrial Land Acquisition and Reserve

Attachment:

  Pursuant to the "Measures for the Administration of Land Reserves" (Guotuzhi [2017] No. 17), the "Shanghai Municipal Land Reserve Measures" (Shanghai Municipal People’s Government Decree No. 25), the "Implementing Rules for the Shanghai Municipal Land Reserve Measures" (Shanghai Municipal Government Document [2004] No. 41),the "Opinions on Standardizing the Management of Revenues and Expenditures from the Grant of State-Owned Land Use Rights" (Shanghai Municipal Government Office Document No. 52 [2008]), the "Notice on Several Opinions Regarding Further Standardizing the Approval of Land Reserve Projects in the Municipality" (Shanghai Municipal Government Office Document No. 79 [2017]), and the "Several Provisions on Strengthening the Management of Industrial Land Grants in Shanghai" (Shanghai Planning and Natural Resources Bureau Document No. 6 [2021]), among other documents, and in conjunction with the actual conditions of our district, this mechanism is hereby established.

  I. Implementation of the District-Level Land Reserve Project Approval and Assessment System

  In accordance with the annual industrial land acquisition and reserve plan, the District Land Reserve Center shall organize the preparation of a project feasibility study report (investment estimate) and, in conjunction with the District Development and Reform Commission, the District Planning and Resources Bureau, the District Finance Bureau,the District Economic Commission, the District Science and Technology Innovation Commission, the District Construction Management Commission, the District Housing Security and Housing Administration Bureau, and the relevant sub-districts (towns) and industrial parks to analyze and evaluate the project’s land scope, cost investment, allocation of various land indicators, and funding arrangements. Upon approval of the evaluation, an application for project approval shall be submitted. Notably, funding for water, electricity, and gas expenses shall be explicitly allocated in advance by the district finance department.After the project is approved by the District Development and Reform Commission, the District Land Reserve Center will initiate the specific procedures for the land reserve project. The project approval notice will serve as a reference for the preparation of the land transfer revenue and expenditure budget and the arrangement of the land reserve fund expenditure plan.

  II. Adoption of a District-Level Advance Allocation and Shortfall-Sharing Mechanism

  Land reserve costs are initially funded on a 50% district-level and 50% town-level basis (with the district-level portion disbursed in two installments: 20% as an advance upon project approval and 30% after cost verification). Final settlement occurs following land disposal. Any shortfall where disposal revenue fails to cover audited costs is jointly borne by the district and town levels on a 50:50 basis. The specific process (see Appendix for details) is as follows:

  (1) Initial Disbursement

  After the project is approved by the District Development and Reform Commission, the District Land Reserve Center applies to the District Finance Bureau for an advance payment of initial reserve funds (20% of the approved project amount) to serve as project startup capital, which is promptly disbursed to the sub-district, town (industrial park), or relevant unit.

  (2) Second Disbursement

  After the project costs have been assessed and verified by the District Land Reserve Cost Verification Working Group, the District Land Reserve Center shall sign relevant land acquisition and reserve agreements with the sub-districts, towns (or industrial parks) and disburse the second tranche of funds;The District Land Reserve Center applies to the District Finance Bureau for the disbursement of 30% of the total assessed cost, which is then transferred to the sub-district, town, or industrial park, or relevant units (if the estimated project amount differs from the assessed cost, the proportion of the second disbursement will be adjusted accordingly; the total amount disbursed in the first two installments shall not exceed 50% of the total assessed cost); the sub-district, town, or industrial park completes specific matters such as land acquisition and compensation in accordance with the terms of the agreement, ensuring that the relevant funds are promptly in place.

  (3) Fund Settlement

  After land is supplied and the audit is completed, the District Land Reserve Center, in conjunction with the District Finance Bureau, shall settle funds in accordance with the audit findings. For projects where the transfer revenue fails to cover the audited costs, the cost shortfall shall be shared by the District and the sub-district/town (industrial park) in a 50:50 ratio.

  III. Incentive Mechanism

  For projects that complete land supply within one year of approval, the proportion of the shortfall—where land transfer revenue fails to cover audit costs—to be borne by the district-level finance department shall be increased from 50% to 60%. If a particularly significant industrial project is subsequently introduced and approved by the District Party Committee and District Government, the proportion borne by the district-level finance department shall be increased to 70%. Specific implementation rules shall be separately formulated by the relevant departments.

  IV. Supplementary Provisions

  This document shall take effect upon issuance and remain valid until December 31, 2024.

  The Baoshan District Land Reserve Center is responsible for interpreting this mechanism.

  Appendix: Flowchart of the Cost-Sharing Mechanism for Industrial Land Acquisition and Reserve

  Appendix: