Government announces risk-based enforcement arrangements against lease breaches in industrial buildings

The Secretary for Development, Mr Paul Chan, said today (July 15) that after reviewing the situation of change of use in breach of the lease involving industrial buildings, the Lands Department (LandsD) will implement risk-based enforcement arrangements to facilitate systematic enforcement and safeguard public safety.

At present, it is specified in the lease of most industrial buildings that the lot shall only be for "industrial and/or godown" use(s). Under such circumstances, if an industrial building is used for other purposes, it may be in breach of the lease conditions unless the owner has applied and obtained approval from the LandsD for modification or waiver of the user clause.

Mr Chan said that, after consulting the Fire Services Department (FSD), the first round of the LandsD's enforcement action will be targeted at cases in which members of the public are attracted by the uses in breach of the lease to an industrial building unit to use its facilities or services (such as learning centres, religious gathering places, shops, restaurants and places of entertainment/recreation), while other premises in the same industrial building have been issued with Licences for Manufacture and/or Storage of Dangerous Goods (DGLs) by the FSD.

To be specific, starting from August 29, 2016, for cases in breach of the lease matching the above two considerations, the District Lands Office (DLO) concerned will issue a warning letter to the land owner in question, requiring rectification of the breach of uses within 14 days. Should the land owner fail to rectify the breach upon expiry of the warning period, the DLO will commence the procedures to re-enter the unit concerned.

"According to the advice of the FSD, with regard to the uses and facilities of conventional industrial buildings, the co-existence of industrial or storage activities and flow of people is not expected. If the use in breach of the lease attracts members of the public such as students and customers who are not familiar with the environment of an industrial building to visit or gather in the building, this may pose a risk to them.

"The risk will even be more apparent if, in addition to flow of people attracted, dangerous goods are stored in the industrial building. Therefore, after consulting the FSD, the LandsD is of the view that cases matching the above two considerations should be prioritised and handled in a strict manner," Mr Chan said.

A spokesman for the Development Bureau said that having considered this kind of use in breach of the lease, which poses a greater potential risk to safety, enforcement actions will not be put on hold even if the owner concerned has applied for modification or waiver of the lease conditions in respect of the use. According to the existing outline zoning plans and the relevant fire services ordinances and standards, this kind of use in breach of the lease can hardly be given approval.

"The enforcement strategies are announced in advance so that the owners, the operators or the public patronising shops in industrial buildings will be well-informed of the specific arrangements and have ample time to prepare for rectification. Such arrangements are discretionary. The LandsD will also, in the coming weeks, step up publicity efforts in industrial buildings with known breaches of the lease in the first round," the spokesman added.

"Starting from August 29, 2016, all DLOs will take the aforesaid action against those breaches. In the days ahead, LandsD will, for the sake of public safety, redeploy some of its internal resources in order to give priority to the risk-based enforcement work mentioned above. Depending on the number of cases, non-urgent work will probably be affected during the period. Understanding from the public will be appreciated."

According to the breaches of use known to DLOs, cases matching the two considerations of "flow of people" and "involving dangerous goods licences" spread across the following industrial buildings: 

In other words, the first round of enforcement action will at least cover units with breaches of uses and frequented by the public in these industrial buildings.

For enquiries about which industrial building has premises which have been issued with DGLs by the FSD, please refer to the information uploaded on the websites of the FSD and the LandsD.

As for other categories of lease breaches in industrial buildings (including industrial building premises to which the public are attracted but without DGLs issued by the FSD at other premises in the same industrial building, and cases with breaches of uses involving a smaller flow of people, such as offices and cultural/creative workshops), the LandsD will continue with the current arrangement. In general, DLOs will issue a warning letter to the owners requiring them to rectify the breach of uses within 28 days. If the breach is not rectified upon expiry of the warning period, DLOs will register the warning letter at the Land Registry, and reserve the right to take further lease enforcement actions in the next round of action.

The spokesman for the Development Bureau reminded members of the public that the information on the premises issued with DGLs by the FSD is updated from time to time. If the use in breach of the lease falls within the category which attracts flow of people, while other premises in the same industrial building are issued with DGLs, the LandsD will escalate its enforcement action, put the unit with a breach into the priority category and deal with the case strictly.

An FSD spokesman said the department is in full support of the LandsD in enforcing the risk-based enforcement arrangements to protect public safety.

A LandsD spokesman called on those who had used facilities or services of industrial building units which are in breach of the lease conditions to avoid patronising the premises again for their own safety and that of their family members.

The LandsD will also enhance communication with licensing authorities such as the Education Bureau, the Leisure and Cultural Services Department, the Home Affairs Department and the Food and Environmental Hygiene Department, so that they may take appropriate action under their regimes on relevant cases as appropriate.

A land lease is a private contract signed between the Government and a land owner. The land owner is required to ensure that the use of the land is in compliance with the lease conditions and that breaches are rectified. The LandsD spokesman also reminded the users of industrial building units that they should note the user restrictions stipulated in the land lease.
Ends/Friday, July 15, 2016
Issued at HKT 16:40