Enterprise demolition

With the rapid development of our country's economy, many people have opened factories. The emergence of factories not only makes the economic development more complete, but also makes product production faster and more standard. However, in order to support the policy needs, many factories will face the problem of demolition, so how to compensate the government for expropriating factory buildings has become a concern for factory owners. The lawyer in this article will explain it to you in detail.

How to compensate the government for expropriating factory buildings

(1) Asset compensation for factory demolition

1. Land compensation

As a lessee, an enterprise generally obtains its business premises through leasing. There are two types of leased land: leasing state-owned land and leasing collective land. The demolition of an enterprise will inevitably lead to the termination of this lease relationship, so how to protect the expected interests of the enterprise in the lease contract? According to the demolition regulations, the objects of demolition compensation are buildings and attachments on state-owned land. The demolition regulations do not provide unified provisions for compensation for vacant land or clean land. In the "Implementation Rules for the Assessment and Compensation of Non-Residential Housing Demolition at the China 2010 Shanghai World Expo Site", it is clarified that "the basic price of compensation for land use rights is determined in accordance with the principles of market evaluation, overall balance, and government pricing: 1.1-1.3 million yuan/mu in Pudong area, and 1.2-1.4 million yuan/mu in Puxi area." This is the first time that Shanghai has clarified the compensation method for land use rights in the form of a policy document.

Compensation for land demolition in other places is often calculated together with compensation for houses and buildings. There are a lot of unclear and opaque situations, making it impossible for the rights holders to obtain corresponding reasonable compensation. At the same time, this is also an area that our legislative and administrative agencies should protect when formulating laws, regulations and policy documents. We hope that relevant departments can pay attention to it.

2. Compensation for houses and buildings

Compensation for houses and buildings shall be calculated based on the building area registered in the relevant property certificate. If it is impossible to apply for real estate certificate and land certificate due to historical reasons, it can be determined through actual measurement. The value of houses and buildings should generally be jointly entrusted by the demolishers and the demolished persons to an appraisal company. The appraisal company will determine the actual value of the houses and buildings based on relevant appraisal technical standards. If it is lower than the minimum compensation unit price standard for urban house demolition in Shanghai, the minimum compensation unit price standard will be used for calculation. And in accordance with Shanghai's relevant compensation standards, the actual compensation fees for houses and buildings will be calculated.

3. Reset the equipment to the new price

The "Regulations on the Management of Urban House Demolition" stipulates that equipment relocation and installation costs should be calculated based on the goods transportation price and equipment installation price stipulated by the local government. Machinery and equipment are divided into two categories: one is removable equipment; the other is non-removable equipment; losses caused by relocation of removable equipment can be divided into physical loss fees and functional loss fees. Physical damage costs include disassembly costs, transportation costs, installation costs, debugging costs, etc. Functional loss costs include the decrease in machine accuracy caused by relocation and the increase in substandard products. For non-removable equipment, demolition will lead to the abandonment of the equipment, so the new price and replacement price should be combined to calculate the replacement price of the equipment and compensate the owner.

In the actual operation of demolition, when non-residential houses are demolished, the equipment relocation and installation costs are calculated based on the construction area of the demolished official house at 25 yuan per square meter; equipment that cannot be restored to use will be compensated based on the replacement price of the equipment.

(2) Compensation for factory demolition costs

1. Losses due to suspension of production and business

Article 33 of the "Urban House Demolition Management Regulations" stipulates that if the demolition of non-residential houses results in the suspension of production and business, the demolisher may provide appropriate compensation. Regarding the "appropriate" standard, what is "appropriate", its calculation basis and calculation method, under what circumstances is "can" be compensated, under what circumstances is "cannot" be compensated, this regulation does not provide unified provisions, and other laws and administrative regulations do not provide for it. In legal practice, the standards and basis for compensation are often stipulated in policy documents by local governments at the municipal level. Compensation standards vary from place to place, and calculation methods are also different. This is a pity in terms of legislation. It is hoped that the relevant departments will pay attention and make more clear and clear regulations on the losses caused by suspension of production and business, so as to promote fairness and justice in the demolition process.

Shanghai has adopted the "calculation based on house area" method, which is calculated based on the standard of 300-400 yuan per square meter for the construction area of demolished urban houses and 150-350 yuan per square meter for houses on collective land. The specific amount is determined by the parties involved in the demolition through negotiation. Although this calculation method is simple, easy to implement and clear, it does not distinguish between the operating status of the company, its business operations, and the geographical location of the factory. Simply limiting the scope of losses from production and business suspension to a range of 300-400 yuan is also a calculation method that lacks fairness and justice. We believe that losses due to production and business suspension should be assessed and determined by an assessment agency. Only by conducting case-by-case evaluations based on the company's operating nature, business operations, operating conditions, and profitability can we ensure the realization of fairness.

2. Equipment relocation and installation fees

For equipment that can be relocated, it should be relocated and installed in a different location based on the principle of continued use and continued to be put into use. The equipment relocation and installation costs incurred accordingly are inevitable losses caused by the demolition, and the demolition party shall compensate them. The "Implementation Rules for Assessment and Compensation of Non-residential Houses Demolition at the China 2010 Shanghai World Expo Site" also clarifies the compensation method: "When non-residential houses are demolished, the demolisher shall also compensate the demolished persons or house lessees for the following expenses: (1) Equipment relocation and installation costs calculated according to the goods transportation price and equipment installation price stipulated by this city." Specifically, the amount of compensation for equipment relocation and installation costs shall be negotiated and determined by the demolisher, the person being demolished or the lessee in accordance with the goods transportation price and equipment installation price determined by the Shanghai Municipal Guide Price. If negotiation fails, you can also entrust a professional appraisal company to conduct an appraisal and determination.

3. Resettlement compensation costs for dismissed employees.

The resettlement compensation costs for employees laid off due to demolition are not specified in detail in laws, regulations and policy documents, and are items that the parties involved in the demolition negotiate with each other. If demolition results in the dismissal of employees, compensation should be provided according to the specific labor contracts with the employees and the relevant provisions of the labor law.

(3) Incentive expenses based on demolition policies

In the process of demolition, in order to speed up the progress of demolition, demolishers often use prompt relocation incentives to encourage the demolished persons and lessees to sign the demolition resettlement compensation agreement as soon as possible and move out of the demolition scope. The amount of the incentive fee shall be determined by the demolisher based on the actual demolition, or may be determined through negotiation among the demolisher, the person being demolished, and the actual lessee. It should be noted that if the owner and user of the demolished factory building are separated, the incentive fee should be paid to the lessee who actually uses the demolished factory building. This has been stipulated in policy documents and is a reasonable approach.

In our real life, if the factory owner faces the expropriation of the factory, then the land, houses, buildings, equipment replacement, as well as the shutdown of the factory, the relocation and installation of equipment, etc. will all become the content of the government's compensation for the expropriation of the factory. Therefore, if the government expropriates factories, factory owners should provide support for government construction, and we should also use relevant legal knowledge to obtain legal compensation.