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Beijing Yingtong Law Firm has focused on the protection of the rights and interests of private enterprises for many years. It has represented many corporate rights protection cases in the legal practice of rights protection in natural resources, mining, land, waters, territorial space, corporate equity, criminal defense, factory demolition, environmental protection shutdown, prohibition and vacation, etc., including large-scale real estate...

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Six common compensation items for enterprise (factory) demolition

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Article author:Yingting Lawyers Group | Update time:2019-04-24 | Reading times:459

First of all, we need to talk about an overall principle.DemolitionCompensation refers to physical goods and part of the expected loss of benefits. It is different from the normal business and business of enterprises. The compensation is relatively narrow and the final compensation price is low. This issue is a matter of academic mutual discussion. in businessDemolitionIn general, small and medium-sized enterprises can obtain six parts of compensation items.
1. Regional compensation price for land use rights
The regional compensation price for the land you occupy must be calculated based on the nature of the occupation and the number of years of use. In simple terms, it is compensation for land use rights. So how should land use rights be compensated? There are several situations:

(1) Land contract operation rights. The land contracting and operation rights derived from the villagers of the village contracting the relevant land on the village's land.

(2) The right to use collective construction land. That is to obtain the collective construction land use rights certificate, which may be obtained through auction, one-time buyout, etc.

(3) Methods of transferring and allocating state-owned land use rights. The qualifications of industrial land obtained through the transfer of state-owned land, or obtained through allocation, are included in the scope of land use rights compensation. However, the lease right is still within the scope of debt and has no form of property rights, so the lease right is not compensated by land use rights.


2. Replacement of factory buildings to new prices
The price of replacing a factory building to its new value is how much it costs to build it again after it is reset.DemolitionhouseDemolitionEven when it is new, there is also the problem of resetting it to new one. The objective conditions presented in practice include buildings, structures, and equipment. As long as they meet the fixed shape of a regular factory building, they should be calculated according to the house. In practice, because the structure, width, and height of the houses are different, the compensation prices are also different. Some factories are temporarily built using brick and wood structures, which may not meet the requirement of having walls on all sides. However, if they are used for normal production operations, in principle, they should be calculated according to the replacement price of the building. Basically, there is an external solid property of the factory building, which can be compensated by replacing the factory building with a new price.


3. Loss fees due to suspension of production and business operations
BecauseDemolitionCosts incurred due to the suspension of production and closure of the enterprise. Under normal circumstances, a business license, tax registration, tax payment record, actual operating behavior, etc. must be met to meet the conditions for production and operation of a normal enterprise factory, so as to obtain a one-time suspension of production and business loss compensation. Another issue that needs to be reminded is that in practice, there are many companies where the registered address is inconsistent with the actual operating address. This is not acceptable. Only the registered address and the actual operating address must be consistent to satisfy the legal operating entity.

What kind of compensation should be met for losses caused by suspension of production and business operations?
(1) Expected profit loss, the expected profit that can occur in one year is one million,DemolitionIt will cause interruption of operations and cause three years of production and business closure losses, which may require compensation for three years of losses.
(2) Loss of breach of contract, the company and the customer signed a contract worth one million, becauseDemolitionIf the goods cannot be supplied on time, the default cost of one million yuan is 50,000 yuan, which must be compensated for the company's default losses.
(3) Financial capital, borrow one million from the bank, and pay interest on the financial capital every year. Now that the operation is interrupted, the financial cost has increased cumulatively, so the financial cost will also be included in the losses due to the suspension of production and business operations.
These are possible losses. There are also many people who will ask about personnel placement and severance pay. We need to correct that personnel placement and severance pay only appear in state-owned enterprises and collectively owned enterprises. Generally, they are not available in small and medium-sized enterprises and private enterprises. They are basically included in the losses due to suspension of production and business operations.

4. Decorative accessories
Attachments to existing buildings cannot be moved and are subject to replacement costs. In practice, a water pump, transformer, and mechanical equipment are all included in the scope of decorative accessories.

5. Machinery and equipment
Equipment is divided into movable and immovable. Immovable equipment, like a house, must be replaced with a new price. Movable equipment is compensated for moving expenses.

6. Moving expenses
It is the moving cost to be paid for all movable ancillary equipment and equipment.
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