New amendment gives SOEs authority to obtain land, further reducing council control

Regulations were amended Wednesday to allow companies in which the government holds a majority stake to be allocated land for non-residential purposes.

The regulations, first formulated on March 30, 2024, previously listed five circumstances under which land could be allocated. These included renting, selling, allocating or assigning land for temporary management, allocating land for the performance of responsibilities of government ministries and agencies, and giving land without rent.

The amendment issued Wednesday by the Infrastructure Ministry adds a sixth circumstance: land may now be allocated to companies with a government majority shareholding for non-residential purposes.

The regulations are to be administered and enforced by the Infrastructure Ministry and apply to land allocated or assigned by councils, ministries and the State for non-residential purposes.

Under the regulations, rent, sale price and land value are determined by a nine-member land valuation committee appointed by the President. When determining prices, the committee considers land availability, general economic conditions and land demand in the respective island.

Registrations made before the implementation of this regulation will not be cancelled, and a six month period has been granted to complete the land register.

The amended regulation came into force Wednesday, repealing the previous version.

It is noteworthy that the government has also proposed granting itself full authority to take over properties and land under the jurisdiction of councils and separate them from council control in order to implement government-required projects. 

Councils have already seen restrictions placed on several of their powers, including recruitment of staff for council offices and the lease of land, lagoons and lagoon areas under their jurisdiction, except under regulations set by the Finance Ministry and the Local Government Authority (LGA). 

These changes were made last year to the Decentralization of Administrative Areas Act.