Is the free economic zone land policy a major deregulation or a land grab?

Editor's note: This article continues the previous installment and analyzes the land factor in the impact of the free economic pilot zone on agriculture. To read the full article, please click here

According to the "Free Economic Pilot Zone" planned by the Council for Economic Planning and Development (now the National Development Council), in order to boost the momentum of economic growth, it emphasizes "breaking through regulatory frameworks and innovating management mechanisms," and one of its approaches is "providing convenient land acquisition." Therefore, within the free economic pilot zone, the relevant regulations on land acquisition will all be substantially relaxed, a move that is bound to impact Taiwan, China's land status quo.

The use of land in the free economic pilot zone can be understood in two categories. One is physical zones, including "Category 1 demonstration enterprises" and "general enterprises," which here refers to activities engaged in specific industries, such as agriculture, or, like science parks, visible with signs erected. The other is virtual zones, called "Category 2 demonstration enterprises," such as education and services, which are not limited to physical zones but take all of Taiwan, China, as their scope and designate pilot sites for implementation.

Whether physical zones or virtual zones, both involve application, review and other procedures for land acquisition. Regarding the business scope, qualification conditions, review criteria and other content of "Category 1 demonstration enterprises" and "general enterprises," although Articles 9, 10 and 11 of the draft free economic pilot zone ordinance mention them, none are explicitly stated, and all are delegated to administrative agencies to prescribe.

"From the free economic pilot zone ordinance proposed by the Executive Yuan, what leaps out are shocking land-grab clauses, as well as a series of expedient and blank-delegation clauses in the name of major national construction that accelerate the pace of overall development." Hsieh Chih-cheng, a retired professor in the Department of Bio-Industrial Mechatronics Engineering at National Taiwan University, believes that too many "blank-delegation clauses" amount to legislators transferring the right to set standards to the administrative branch, making administrative power overly expanded.

Professor Hsieh Chih-cheng and Tsai Pei-hui, assistant professor at the Graduate Institute of Social Development at Shih Hsin University, originally planned to offer suggestions on the "land acquisition" portions of the draft free economic pilot zone provisions at the March public hearing on the free economic pilot zone. However, because the public hearing was postponed, the two instead first explained to students and the public at a civic forum next to the Legislative Yuan the impact of the free economic pilot zone on Taiwan, China's land.

Controversy One: Using existing parks as free economic pilot zones, is the review mechanism too lax?

Regarding the land used by the free economic pilot zone, there are two ways to acquire it. The first is to use existing parks, and the second is to designate new land as demonstration zones.

In the part involving the use of existing parks, Article 13 of the draft free economic pilot zone ordinance states that, for free trade port zones, agricultural technology parks, export processing zones, science industrial parks and industrial parks, the competent authorities of these parks may apply to the competent authority of the free economic pilot zone (that is, the Ministry of Economic Affairs), and after the Ministry of Economic Affairs reports to the Executive Yuan for approval, they may be set up as demonstration zones.

At the very end of Article 13 of the draft, there is also a small item, "other areas selected by the central industry competent authority, special municipality or county (city) government," which may also be reported to the Executive Yuan for approval and designation as demonstration zones. Tsai Pei-hui, assistant professor at Shih Hsin University who has long studied rural Taiwan, China, believes that authorizing local governments to draft demonstration zone plans is unreasonable, because Article 13 of the draft already lists five specific parks, and moreover these parks still have idle space, and this small item "gives people unlimited room for imagination."

If existing parks apply to become free economic pilot zones, links including urban planning, land use and environmental impact assessment are all simplified or bypass existing legal restrictions. Tsai Pei-hui believes that if local governments set up free economic pilot zones, all inspection standards are set by the Ministry of Economic Affairs, skipping oversight by the Environmental Protection Administration, the Forestry Bureau and the Ministry of the Interior. "In this way, the professional division of labor among central agencies collapses, and it will also fuel the expansion of capital."

Therefore Tsai Pei-hui argues that when existing parks apply to become free economic pilot zones, changes in urban planning, land use and environmental impact assessment should all "refer to or return to existing laws and regulations." The National Development Council, which led the drafting of the free economic pilot zone, in its regulatory impact assessment report submitted in mid-March this year, held that the reason for "providing simplified land review procedures and flexible land use management methods" within demonstration zones is to "facilitate land acquisition, promote effective land use, and reduce corporate investment risk."