Taiwan’s urban renewal system is seriously flawed. This state of affairs was highlighted by the violent clashes in Taipei’s Shilin District (士林) over an urban renewal project on Thursday last week. Here are a few points to be considered in that context:
First, this project is a forced joint construction undertaking initiated by the developer.
Urban renewal in Taiwan has almost nothing in common with the US or European system. The Taiwanese system places urban renewal in the hands of developers. The developer is in control of defining key components of such projects, such as the “renewal unit” mentioned in articles 10 and 11 of the Urban Renewal Act (都市更新條例) and the creation of an “urban renewal project plan” and a “rights transformation plan,” mentioned in articles 19 and 29 respectively of the same act. Although the act also stipulates procedures for organizing related public exhibitions and public hearings, the developer controls the system and holds the power, and not many people are able to stand up to that.
Second, this is a land expropriation project initiated by the developer.
Although the term “land expropriation” is nowhere to be found in the Urban Renewal Act, the act essentially allows land expropriation that deprives individuals of their property rights. It is particularly frightening because land expropriation for the purpose of urban renewal does not follow the stringent requirements otherwise required, and this lies at the heart of the current urban renewal controversy. Only the government can initiate land expropriation and the law does not allow the private sector to do so. However, the government created a loophole in the Urban Renewal Act by stating in Article 22 and Article 25, clause 1, that if a certain proportion of the owners of private land or buildings in an area designated for urban renewal agree to the project, those who oppose it can be forced to join, thus depriving people of a constitutionally protected right.
Land expropriation offers the state a legal procedure for depriving people of their constitutionally protected right to property for a public cause. However, land expropriation affects not only the rights of someone whose land rights have been invaded, but also their rights to subsistence and work. As such, land expropriation requires that five important conditions be met: public interest, necessity, proportionality, a last resort and full compensation. All these five conditions must be met, without exception.
In Taiwan, however, an “agreement ratio” has been invented to replace these five crucial conditions in the case of urban renewal, wrongfully legitimizing it by relying on the decision by a majority. This is in all likelihood unconstitutional.
Third, Taiwan’s Urban Renewal Act is the product of neo-liberalism and privatization ideas. In systemic terms, the government on the one hand gives free rein to developers, while on the other hand uses its public authority to assist them.
Article 36 of the act says that the developer may request that the municipal, county or city authorities tear down buildings or evict tenants that have not been removed or left within a stipulated period, and that local authorities must comply with the request. This means the government has to tear down buildings or remove tenants, thus becoming an accomplice in promoting the interests of the developer.