Legal information

1,991 The Ministry of Ecology and Environment carries out environmental rectification of water sources. In 2019, it is necessary to complete the cleanup and rectification of environmental problems in water sources at or above the county level in 20 provinces (autonomous regions and municipalities) and the Xinjiang Production and Construction Corps, involving 3,626 environmental problems in 899 water sources in 156 cities, 527 counties. Currently, 1,991 of the 3,626 problems have been rectified. However, the situation in Hebei, Shanxi, Hainan, Jilin, Liaoning and other provinces is severe. As of July 9 this year, the completion rate of problem rectification in five provinces was less than 50%.

Enterprises located in water source protection areas are faced with the problem of being closed down and vacated for renovation. These enterprises can be roughly divided into two categories. The first type is buildings that are indeed illegal buildings and are prohibited from construction. The second type is historical factory buildings or enterprises that attract investment. These are enterprises that have been "targeted for closure, vacation, and vacation due to the demarcation or upgrading of water source protection areas." In the second situation, if an enterprise is unable to operate or operate normally due to administrative actions, it should be compensated in accordance with the law. Lawyer Lu Yongqiang also explained the relevant legal basis and policy basis to business owners through case interpretation and case handling in the past.

1. What expenses are included in enterprise demolition compensation?

Enterprise demolition compensation costs are mainly divided into the following four aspects:

1. Compensation for direct losses due to demolition of fixed assets, including: land, houses, buildings and ground attachments that cannot be relocated, as well as compensation for machinery and equipment that are indeed lost due to relocation;

2. Losses due to suspension of production and business operations depend on the actual situation, and generally include both actual operating losses and expected operating losses as appropriate; including: compensation for losses caused by breach of contracts by upstream and downstream supply companies, compensation for losses of semi-finished products, compensation for the interruption period of patent licenses in special industries, compensation for breach of contract termination of employee wages and social security labor contracts during the suspension of production and business operations, etc.

3. Demolition compensation costs, including pre-relocation costs and downtime costs incurred during the relocation process, machinery and equipment debugging and repair costs, disassembly, packaging and transportation of materials, compensation for laid-off employees, etc.;

4. Incentive fees incurred based on the demolition policy, including expedited relocation fees, demolition incentive fees, etc.

2. For such enterprises, in addition to considering corporate interests, they also need to take into account the maintenance of hard-won government-enterprise relationships., because the operation of an enterprise inevitably requires communication and contact with industrial and commercial, taxation, environmental protection and other departments to establish good communication relationships. Lawyer Lu Yongqiang believes that these are also the intangible assets of the enterprise. As a legal solution for business closure and vacation, it needs to be considered together and properly resolved.

For enterprises, failure to receive reasonable compensation will affect their reconstruction and development in the future. Therefore, we must be very cautious when it comes to compensation for demolition.