Core Policy at a Glance
The Third Plenary Session of the 18th CPC Central Committee (November 2013) issued the Decision on Major Issues Concerning Deepening the Comprehensively Reform (《中共中央关于全面深化改革若干重大问题的决定》), which for the first time proposed at the national policy level that collectively-owned construction land could enter the market on equal terms with state-owned land. This landmark decision removed the long-standing legal barrier that restricted the direct transfer of rural collective land to the market, establishing the framework for "collective construction land entering the market under equal conditions" (集体建设用地入市). The reform aimed to create a unified land market, protect farmers' property rights, and unlock rural land value.
Background: China's Dual Land Ownership System
China operates a dual land ownership system defined in the Constitution (Article 10) and the Land Administration Law. Urban land is owned by the state; rural and suburban land is owned by peasant collectives, with exceptions where the law specifies state ownership. Under the pre-2013 regime, when rural collective construction land needed to be used for industrial or commercial purposes, the government would expropriate (征收) the collective land, convert it to state-owned land, and then grant or sell land use rights. Farmers received only a fraction of the land's market value. This "expropriation–grant–transfer" model (征地—出让—转让) was the standard pathway, and direct market transactions between collective landowners and enterprises were legally prohibited.
Key Reforms Announced at the 18th Third Plenum
The 2013 Decision articulated several core principles for land reform:
1. Equal market entry for collective and state land. Collective construction land meeting planning requirements could be transferred, leased,or have land use rights assigned directly to market participants中国土地改革 十八届三中全会 集体土地交易 英文, on par with state-owned land.
2. Voluntary, lawful, and paid expropriation. The scope of compulsory expropriation was to be narrowed; expropriation could only occur for public-interest projects, with fair and reasonable compensation to landowners and farmers.
3. Protection of farmers' rights. Farmers' participation in land transfers, sharing of增值收益 (appreciation benefits), and protection of their homestead (宅基地) rights were to be explicitly safeguarded.
4. Unified land market. The reform aimed to eliminate the structural separation between urban state land markets and rural collective land, creating a single, transparent, and competitive land allocation mechanism.
The Decision did not itself amend the Land Administration Law. The legislative implementation followed over the subsequent years, culminating in the 2019 revision of the Land Administration Law, which codified the right of rural collective construction land to enter the market directly (Article 63, revised), and the 2021 regulation on implementation.
How Collective Land Trading Works Under the New Framework
Under the post-reform system,the process generally involves:
Eligibility: The land must be collectively-owned construction land (not agricultural land or homestead land中国土地改革 十八届三中全会 集体土地交易 英文,which remain subject to separate rules). The parcel must comply with local land-use plans and urban-rural planning.
Decision-making: The village collective (villagers' assembly or villagers' representatives' meeting) must approve the transaction by a supermajority (typically two-thirds) vote.
Public listing: Transfers are conducted through local government-established land trading platforms大城新闻网, ensuring transparency and market-based pricing.
Contract and registration: The parties sign a written contract; the transaction is registered with the local natural resources authority. The transferee obtains a land use right certificate valid for up to 20 years (renewable).
Revenue distribution: Proceeds are shared between the village collective, individual land contributors, and the local government (as applicable), with specific local regulations determining the split.
Impact and Ongoing Development (2024–2025 Updates)
Since the 2019 legal revision, over 30 provinces and municipalities have issued detailed implementation rules. Pilot programs in Shenzhen (a national-level pilot since 2017), Beijing, Shanghai, and Guangdong have produced thousands of collective land transactions. Total transaction value in pilot areas exceeded ¥100 billion by 2023. The reform has contributed to:
Reducing compulsory expropriation disputes and social friction.
Increasing rural households' share of land appreciation revenue.
Providing enterprises, especially small and medium manufacturers, with lower-cost industrial land.
Strengthening rural collective economies and village-level public finances.
Ongoing challenges include: uneven local enforcement, ambiguity in expropriation compensation standards, and the unresolved status of homestead (residential land) circulation, which the central government has cautioned must be handled with due process to prevent urban capital from encroaching on rural housing.
Frequently Asked Points
Can foreigners purchase collective land use rights? No. Foreign entities and individuals remain restricted to state-owned land use rights in China; collective land transactions are reserved for Chinese domestic entities and individuals under current regulations.
Is agricultural land included in this reform? No. The 2013 reform specifically addressed collective construction land. Agricultural land reform (承包地, 经营权流转) operates under a separate legal track (Rural Land Contracting Law, revised 2018).
What is the legal status of "land property rights" (土地产权)? China does not recognize private land ownership. What is transferred is a time-limited land use right (使用权), not ownership. Collective ownership remains with the village or township collective throughout.
Authoritative Sources for Verification
Decision of the Third Plenary Session of the 18th Central Committee, November 12, 2013 (official Xinhua release).
Land Administration Law of the PRC, revised December 28, 2019, effective July 1, 2020.
Implementation Regulations of the Land Administration Law, revised 2021.
National Development and Reform Commission and Ministry of Natural Resources public notices on pilot programs (2017–present).
