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On December 12, 2022, the General Office of the Xiamen Municipal People's Government issued the "Opinions on Promoting Housing Voucher Compensation for the Expropriation of Residential Houses on Collective Land (Trial)" (Xiamen Municipal Government Office Regulation [2022] No. 13, hereinafter referred to as the "Opinions on Housing Voucher Compensation"). It is clearly stipulated that housing voucher compensation shall be implemented for the expropriation of residential houses with legal property rights on collective land in Jimei District, Haicang District, Tong 'an District and Xiang 'an District of Xiamen City.

This article will specifically introduce the basic contents and operational matters of the current housing voucher system in Xiamen City, analyze the legal risks that real estate development enterprises should pay attention to when home buyers purchase houses with housing vouchers, and put forward specific prevention suggestions for the above legal risk matters.

I. Introduction to the Housing Voucher System in Xiamen City

The definition and scope of application of room voucher compensation

Housing voucher compensation refers to the method of including the monetary compensation amount for the expropriation of residential houses on collective land in the face value of the housing voucher and distributing it to the expropriated persons. The expropriated persons purchase houses with the housing voucher to achieve compensation and resettlement. It is a supplementary form of monetary compensation.

Housing voucher compensation is only applicable to the compensation for the expropriation of residential houses with legal property rights on collective land in Jimei District, Haicang District, Tong 'an District and Xiang 'an District.

2. Basic rules for room tickets

The housing vouchers are issued by the designated department of the district government. They are subject to real-name registration, carry a unique identification code, and contain information such as the holder, face value, and validity period. The issuance, use, transfer and settlement of housing vouchers are all signed on the voucher surface and incorporated into the housing voucher system for closed-loop management.

The face value of the housing voucher consists of the amount of monetary compensation, the amount of monetary compensation for the resettlement area of households without housing, and the policy-based reward of the housing voucher. It does not include the reward for purchasing a house with the housing voucher.

The validity period of the room voucher shall not exceed 24 months from the date of issuance. If it is not used within the time limit, it can be exchanged for cash. Housing vouchers must not be used as collateral for financing or illegally cashed out. Under the premise that the per capita living area of each household is no less than 35 square meters, the person whose property is being expropriated is allowed to transfer the housing voucher to a third party for use, and the amount can be divided and transferred to multiple people. The housing voucher that has been transferred cannot be transferred again.

Housing vouchers can be used to purchase both newly-built and existing commercial housing within the jurisdiction. The housing information is incorporated into the housing voucher system for unified management. Where the housing supply in this jurisdiction is insufficient, with the consent of the municipal government, the existing housing supply can be coordinated across regions outside the island.

3. The process of purchasing newly-built commercial housing with a housing voucher

The purchase contract is drafted through the online signing system, a contract number is generated, and the holder of the housing voucher signs the purchase contract

► Transfer (payment) of room tickets

It can be conducted either online or offline.

Youdaoplaceholder0 Online: The voucher holder initiates the payment process on the voucher mini-program, entering the transfer amount, receiving account number and purchase contract number. The real estate development enterprise confirms the receipt of the housing voucher, and the corresponding amount of the housing voucher is transferred to the name of the real estate development enterprise

Youdaoplaceholder0 Offline: The ticket holder and the agent of the real estate developer shall go to the designated bank to make the payment of the ticket. Paper ticket and other prescribed materials are required. Bank window staff initiate housing voucher purchase transactions in the housing voucher system. After the system verification is passed, the corresponding amount paid for the housing voucher will be transferred to the name of the real estate development enterprise

► Room voucher redemption

Youdaoplaceholder0 The holder (real estate developer) initiates the application for redemption of the real estate bill on the real estate bill mini-program and submits the application for redemption through the system or at the designated window of the bank

Youdaoplaceholder0 The staff of the competent department of the special account for housing voucher reserve fund confirm the redemption of housing vouchers and the application for rewards, and the system sends payment instructions to CCB for payment

► Contract Filing

After confirming the receipt of the payment amount, the real estate development enterprise shall apply for the filing of the "Commodity Housing Purchase Contract"

4. The contract termination process for purchasing newly built commercial housing with a housing voucher

The contract is terminated before the completion of the filing

If a real estate development enterprise and a home buyer reach a consensus and need to return the house or the ticket, the real estate development enterprise shall initiate the cancellation of the online contract signing and the return of the corresponding house ticket. If the housing voucher has been paid off, the developer needs to refund it to the special account for the housing voucher reserve fund as required by the financial department. After the special account management department confirms the receipt of the refund, it will return the housing ticket from the developer to the original ticket holder in the system.

The contract is terminated after the filing is completed

After the real estate development enterprise has completed the refund procedures as required by the financial department (directly refunding to the home buyer without the need for further ticket refunds), the original ticket holder and the real estate development enterprise, together with the proof issued by the bank that the full amount of the ticket has been returned through the original channel, shall jointly apply to the real estate registration authority for the cancellation of the contract filing.

Ii. Disclosure and Prevention of Legal Risks

During the use of housing vouchers, real estate development enterprises should pay attention to preventing the following legal risks:

The risk that home buyers fail to initiate the process of transferring (paying) the housing ticket in a timely manner

When the purchase contract stipulates that part of the purchase price shall be paid in the form of a housing voucher, if the home buyer fails to handle or delays the handling of the transfer (payment) procedures of the housing voucher, the real estate development enterprise will not be able to obtain the housing voucher in a timely manner, handle the payment of the housing voucher, and cannot receive the purchase price in a timely manner.

In this regard, real estate development enterprises can stipulate in the purchase contract the performance period for the buyer to handle the relevant procedures for the transfer (payment) of the housing invoice and the liability for breach of contract for overdue handling. If the home buyer fails to handle the transfer procedures of the housing voucher on time and transfers it to the real estate development enterprise, it will be regarded as overdue payment, and the home buyer shall bear the penalty for breach of contract. If the contract is seriously overdue, the real estate development enterprise has the right to terminate the contract and demand that the home buyer pay a penalty.

2. The risk of delay in the payment of housing vouchers

According to the "Opinions on Housing Voucher Compensation" and the "Operating Process of Xiamen Digital Housing Voucher Application System", the settlement funds for housing vouchers shall be guaranteed through the current funding channels, and the designated departments of the district finance shall open special accounts for housing voucher reserve funds at the Construction Bank. After the application for housing voucher reward and redemption is generated, the staff of the district housing voucher reserve fund special account management department need to confirm the application for housing voucher redemption and reward in the housing voucher system. After confirmation, the housing voucher system will send the payment application instruction to the Construction Bank for payment. If there is a situation where the balance of the district housing voucher reserve fund special account is insufficient, the finance department should promptly allocate funds to the district housing voucher reserve fund special account. After the corresponding amount paid by the housing voucher holder using the housing voucher is transferred to the name of the real estate development enterprise, the real estate development enterprise can initiate an application for housing voucher redemption through online or offline means. After the staff of the district housing voucher reserve fund special account management department confirm the housing voucher redemption and the reward application, the housing voucher system sends a payment instruction to the Construction Bank to complete the payment.

If the staff of the district housing voucher reserve fund special account department delay confirming the payment of housing vouchers, the system malfunctions and fails to confirm or send payment instructions in a timely manner, or the balance in the district housing voucher reserve fund special account is insufficient and the finance department fails to disburse the corresponding funds in a timely manner, it may result in real estate development enterprises being unable to receive the corresponding purchase funds within the agreed time.

Real estate development enterprises may stipulate in advance in the purchase contract that if the real estate development enterprise fails to receive the full amount of the purchase price on time due to the government's delay in payment, the home buyer shall bear the liability for breach of contract for overdue payment. However, if disputes arise over this clause, judicial authorities may determine it invalid on the grounds that the real estate development enterprise's transfer of the risk of the government's delayed payment of the housing voucher to the home buyer constitutes an "unreasonably increased liability of the other party" standard clause.

3. Risk of claim for losses when the contract is terminated due to the buyer's reasons

According to the "Operation Guidelines for the Implementation of Housing Voucher Compensation in the Expropriation of Residential Houses on Collective Land in Xiamen City" and the "Operation Process of Xiamen Digital Housing Voucher Application System", when a real estate development enterprise issues a housing voucher and a commercial housing sales contract is terminated, if the commercial housing sales contract has not yet been filed, the real estate development enterprise needs to return the corresponding amount of the housing voucher payment to the special account for the housing voucher reserve fund. After the personnel of the special account management department confirm the receipt of the refund, they will return the housing ticket from the real estate development enterprise to the original ticket holder. If a commercial housing purchase contract has been filed, the real estate development enterprise needs to return the corresponding amount paid for the housing ticket to the original ticket holder and complete the refund procedures before the filing can be cancelled.

According to the above regulations, if the commercial housing purchase contract has not been filed, when the commercial housing purchase contract is terminated, the real estate development enterprise must fully refund the payment of the housing voucher. It cannot directly deduct the liquidated damages or damages that the home buyer should bear from the housing voucher price, but can only claim compensation from the home buyer separately. If the contract for the sale and purchase of commercial housing has been filed, the real estate development enterprise may agree in advance with the home buyer to directly deduct the liquidated damages or damages that the home buyer should bear from the ticket price that should be refunded. However, since the subsequent application to the real estate registration authority for the cancellation of the contract filing requires the original ticket holder and the real estate development enterprise to handle the refund procedures through the original channel with the full amount of the house ticket price issued by the bank, the direct deduction of the penalty or damage compensation from the house ticket price depends on the active cooperation of the home buyer. If the home buyers do not cooperate, the demands of real estate development enterprises to directly deduct the liquidated damages or damages that the home buyers should bear from the property ticket price may also be difficult to fulfill.

4. Risk of claim for loss due to delayed use of room tickets

In accordance with the "Opinions on Housing Voucher Compensation" and the "Notice on Adjusting the Financial Settlement Standards for Residential Houses on Collective Land Expropriation in Jimei, Haicang, Tong 'an and Xiang 'an Districts" (Xiamen Resources Planning [2022] No. 464) issued by the Xiamen Natural Resources and Planning Bureau and the Xiamen Finance Bureau, housing vouchers should be used within different periods. The policy-based rewards and purchase rewards that the holders of housing vouchers can obtain are different. The specific details are as follows:

However, the relevant policy documents do not clearly stipulate the criteria for determining the actual usage time of the housing vouchers. From the perspective of the process of using room vouchers, there are the following five possible standards for determining the usage period of room vouchers:

The first type: Draft the online signing contract (the contract should specify the time for the payment of the housing invoice) to form the contract number.

The second type: The time when the holder of the housing voucher initiates the online housing voucher purchase transaction. When a housing voucher holder initiates a housing voucher purchase transaction online through the Xiamen Digital Housing Voucher Application System or the housing voucher mini-program, the time of initiating the transaction is the usage time of the housing voucher.

The third type: The time when the housing voucher holder makes the online payment (transfer) of the housing voucher. When the holder of a housing ticket pays for the ticket through the Xiamen Digital Housing Ticket Application System or the housing ticket mini-program, the time of payment for the ticket is the usage time of the ticket.

The fourth type: The time for handling the payment of the housing voucher at the bank window. For those who choose to handle it offline, the time when the housing voucher holder and the agent of the real estate development enterprise go to the designated bank window to handle the payment of the housing voucher shall be regarded as the usage period of the housing voucher.

The fifth type: The time when real estate development enterprises apply for payment online.

We believe that for those who use room tickets online, the second criterion mentioned above is the most reasonable. For the use of room vouchers in an offline manner, the fourth method should be adopted for determination, that is, the payment time of the room voucher processed at the bank window should be taken as the standard. After consulting with the relevant departments, the reply stated that the determination of the usage period of the housing voucher should follow the principles of "what is most beneficial to the person whose property is being expropriated" and "case-by-case discussion".

Real estate development enterprises should actively guide and urge home buyers to use the housing vouchers in a timely manner to avoid losses to home buyers caused by the failure to use the housing vouchers in a timely manner. Real estate development enterprises should particularly avoid situations where the use of housing vouchers is delayed due to their own reasons for not handling relevant procedures in a timely manner. Otherwise, they may need to compensate home buyers for the losses incurred due to the delayed use of housing vouchers. Specifically, if the home buyer intends to use the housing voucher online, the real estate development enterprise should pay attention to urging the home buyer to promptly initiate the housing voucher purchase transaction and handle the housing voucher payment online, and handle the housing voucher redemption in a timely manner. If the home buyer uses the housing voucher offline, the real estate development enterprise shall promptly go together with the home buyer to the designated bank window to handle the payment of the housing voucher.

5. Suspected of assisting property ticket holders in illegally cashing out risks

According to the "Opinions on Compensation for Housing Vouchers", housing vouchers are not allowed to be used as collateral for financing or illegally cashed out. When a housing voucher holder purchases a commercial property from a real estate development enterprise with a housing voucher, and the housing voucher is paid off and the contract is filed, if both parties terminate the commercial property purchase contract, the real estate development enterprise should refund the full house price to the housing voucher holder. At this time, the housing voucher holder may have already received the housing voucher purchase price reward.

If the holder of a housing voucher requests to terminate the commercial housing purchase contract without a valid reason, it may be suspected of illegal cash-out. If a real estate development enterprise assists the holder of a housing voucher in illegal cash-out, it may also be suspected of illegal cash-out. Therefore, real estate development enterprises should pay attention to examining whether the home buyers have legitimate reasons for requesting to terminate the commercial housing purchase contract, and strictly follow the prescribed procedures to handle the termination formalities.

Iii. Suggestions on the Terms of the housing invoice in the Commercial Housing Purchase Contract

Based on the above legal risk analysis, we suggest that real estate development enterprises can add the following contract terms related to the use of housing vouchers in the commercial housing purchase contract:

1. Arrangements for payment of housing vouchers and liability for overdue payments

Where a home buyer uses a housing voucher to pay all or part of the purchase price, the real estate development enterprise shall add the corresponding provisions for paying the purchase price with a housing voucher in the "Specific Agreement on the Pricing Method, Total Price, Payment Method and Time Limit of the Commodity Housing Price" in Annex 4 of the commodity housing purchase contract. The reference terms are as follows:

The buyer will use the property voucher to pay the purchase price/the first installment of the purchase price [] yuan. If the actual payment amount on the property voucher does not match the agreed amount, the actual payment amount shall prevail. The remaining purchase price shall be paid by bank transfer or by applying for a mortgage loan.

The buyer shall complete all the payment procedures for the housing vouchers within 3 days after the signing of the commercial housing purchase contract (with the seller obtaining the redeeming housing vouchers as the basis for the buyer to complete the payment procedures for the housing vouchers). These procedures include but are not limited to: The buyer shall initiate and complete the housing ticket purchase transaction operation online through the Xiamen Digital Housing Ticket Application System or the housing ticket mini-program on the day of signing the commercial housing purchase contract, transfer the housing ticket to the seller, and complete the online housing ticket payment within the same day after the seller confirms the receipt of the housing ticket. If the buyer uses the housing voucher offline, they should, within 3 days after signing the commercial housing purchase contract, go to the designated bank together with the seller to handle the payment procedures for the housing voucher.

If the buyer fails to complete the payment procedures for the housing voucher within three days after the signing of the commercial housing purchase contract (with the seller obtaining the redeeming housing voucher as the basis for the buyer to complete the payment procedures for the housing voucher), it shall be regarded as the buyer's overdue payment of the purchase price, and the buyer shall bear the liability for breach of contract for overdue payment in accordance with the provisions of Article [] of the commercial housing purchase contract.

If the seller fails to receive the payment of the house ticket within 10 days after applying for it due to reasons not attributable to the seller, it shall be regarded as the buyer's overdue payment of the house purchase price. The buyer shall bear the liability for breach of contract of overdue payment as stipulated in Article [] of the commercial housing purchase Contract.

It should also be noted that real estate development enterprises should pay attention to the issuance date and key nodes of the housing vouchers held by the holders, and communicate and negotiate with the holders to agree on a reasonable time for the holders to initiate the housing voucher purchase transaction through online means or handle the housing voucher payment procedures through offline means. Meanwhile, real estate development enterprises should also enhance the training of their internal staff, formulate reasonable work processes for the receipt and redemption of housing vouchers, ensure that staff receive and redeem housing vouchers in a timely manner, and avoid risks caused by delayed use of housing vouchers.

2. Handling of housing ticket payment when the contract is terminated

In the breach of contract or contract termination clauses of the supplementary agreement to the commercial housing purchase contract, additional clauses related to the handling of the housing ticket proceeds after the contract is terminated shall be added. The reference terms are as follows:

Regardless of the reason for the termination of the commercial housing purchase contract, when the seller refunds the house ticket price to the buyer (referring to the amount obtained by the seller through the redemption of the house ticket when the buyer pays the purchase price in the form of a house ticket), the seller has the right to deduct any amount that the buyer should bear under this commercial housing purchase contract, such as expenses, liquidated damages, and compensation, from the house ticket price to be refunded.

If the contract for the sale of commercial housing is terminated before it is filed due to the buyer's breach of contract, the seller has the right to demand that the buyer bear any expenses, liquidated damages, compensation or other amounts that should be borne under the contract for the sale of commercial housing in advance before returning the housing ticket. The buyer shall pay them separately or deduct them from the purchase price other than the ticket price.

If the buyer fails to use the housing voucher within the validity period (reward period) due to the termination of the commercial housing purchase contract, any losses suffered by the buyer as a result shall be borne by the buyer himself.

Note: The above 1-2 reference terms are only brief demonstrations. It is recommended that real estate development enterprises improve and refine them in combination with the existing versions of commercial housing purchase contracts.