Published by ChinaMNC · Huicheng

Huizhou Island Land-Rights Reform Named Among China's First Batch of Pilot Innovations: What Foreign Founders Should Know

A Huizhou reform that resolves unclear land and housing rights on inhabited islands has been included in China's first batch of market-based factor allocation pilot innovations. Here is what the case shows about property-rights bottlenecks and how foreign founders can read such policy signals.

Huizhou Case Selected in First National Batch of Pilot Innovations

China's National Development and Reform Commission has published its first batch of innovation measures and experience from comprehensive pilot reforms on market-based allocation of production factors. The list contains 56 measures deemed worth promoting, and nine of them come from Guangdong. Among the Guangdong entries is Huizhou's reform based on the principle of "state ownership, collective use, integrated rights confirmation," which addresses the difficulty of confirming land and housing rights on inhabited islands.

For foreign founders building a China entity or operating assets in China, the case is a useful signal of how local governments are resolving legacy property-rights problems that can otherwise block investment, financing and licensing.

The Problem: Unclear Title Blocks Development

Dongsheng Village is a traditional fishing village on an island in Aotou Subdistrict, Daya Bay Development Zone, Huizhou. Generations of fishermen lived on boats before the government, starting in the 1950s, encouraged them to settle on Dongsheng Island to improve living conditions and safety. The village now has more than 1,100 registered residents, most of whom depend on fishing. In recent years the village has developed tourism businesses such as fishermen's restaurants and leisure fishing boats, and in 2024 it was selected in the fourth batch of Guangdong cultural and tourism characteristic villages. Tourist traffic concentrates between the May Day holiday and the National Day golden week.

Village party secretary Xu Weibin explained that the village wanted to strengthen tourism, improve infrastructure, build homestays and develop popular attractions, but unclear land title repeatedly constrained planning. Villagers' houses lacked lawful ownership certificates, creating problems for new construction or renovation, mortgage financing and compliant operation. The collective could not effectively coordinate land for public facilities, and quality cultural tourism resources sat idle.

The Daya Bay natural resources bureau noted that while villagers had long lived and worked on the island, existing laws and regulations did not clearly define the nature of land rights where fishermen settled on islands after coming ashore. That bottleneck limited the island's economic potential.

The Solution: State Ownership, Collective Use, Integrated Confirmation

Municipal and district departments pursued a pilot approach. A research team traced the village's history through county records and land archives from different periods to establish the historical fact of state ownership. Experts who had participated in drafting the Civil Code were invited to form a research group, providing theoretical support for institutional design. Based on that work and local conditions, authorities formulated a plan for confirming and using land rights on inhabited islands and proposed the "state ownership, collective use, integrated rights confirmation" path.

Under the reform, while maintaining the baseline of public land ownership, land-use rights were confirmed as a whole to the village collective economic organization, based on historical evolution and actual use. The collective received a central role in managing land-use rights: it reviews villagers' residential land needs and coordinates land for commercial and public-interest construction according to development needs. This protects villagers' basic rights while reserving space and providing a basis for the collective's future development and overall island development.

Practical Steps for Implementation

• Household-by-household service: departments conducted cadastral surveys and policy briefings for each household and developed individualized solutions.
• Certificate issuance: 83 rural housing units in the village have completed rights confirmation and certification, resolving incomplete housing and land rights and making assets visible with legal protection.
• Removing operational limits: certification lifts restrictions on house renovation, homestay business approvals and participation in cultural tourism development.

Villager Xu Zaoteng said receiving the certificate gave him confidence: previously he did not dare invest in renovating an old house for homestay use without complete documents, but with clear title he can mortgage the property to expand his business. He plans to upgrade homestays and campsites in the off-season ahead of next year's peak.

Outcomes and Lessons

According to Huizhou's development and reform bureau, the reform produced a new path for resolving unclear housing property rights and land title for residents of inhabited islands, forming a referable "Dongsheng model" that can be replicated in similar areas.

First, it moves resources from idle to activated. Before the reform, unclear title made island resource development difficult and limited the economy, with villagers relying mainly on traditional fishing. After the reform, the village can plan land use more rationally, integrate island resources, develop distinctive fishing and tourism, attract visitors and drive catering and accommodation.

Second, it produced experience in confirming land rights on inhabited islands. Breaking from conventional thinking while maintaining public land ownership, it created a new path for resolving villagers' housing property rights and historical land-title issues, offering an institutional sample for similar islands across the province and the country.

What This Means for Foreign Founders

Foreign founders should read this as a policy-direction signal rather than a template for their own structures. The case shows that Chinese authorities are willing to resolve historical property-rights ambiguities when they obstruct investment, and that local pilots can later be promoted nationally. For foreign-invested enterprises, the practical points are:

• Verify title early: before leasing or investing in land, buildings or tourism assets, confirm land-use rights, building ownership certificates and whether the site sits on collective or state-owned land.
• Check local pilot rules: reforms like this one change what certificates and approvals are available; local natural resources and development and reform bureaus are the relevant contacts.
• Watch for promoted pilots: measures included in national lists may spread to other regions, affecting due diligence and financing options.
• Do not assume certificates solve everything: certification removes some restrictions, but sector-specific approvals, environmental rules and foreign investment rules still apply.

This summary is based on information published by the relevant Chinese government website and is general information, not legal or tax advice.