Land valuers and estate agents will come under scrutiny after reports of kickbacks and violations in the sector.

Sources from the Ministry of Land and Resources say their campaign will aim to improve professional standards within the industry.

Illegal agencies carrying out business in the sector will be ruled out and land valuers suspected of breaking rules will be given penalties, the source said.

The inspection, starting this month, will be completed before the end of this year.

The ministry urged land and resources departments at various levels to reform and consolidate agencies to meet the demands of the industry.

Those found to charge in error for services will be outlawed, according to a document issued by the ministry Monday.

Land assessment has become particularly important in view of China's extensive land reforms over the past 20 years or so, said land and resources minister Sun Wensheng.

"It has played a significant role in promoting rational utilization of land resources and pushing for a bigger land market," he said.

Statistics from the ministry indicate that the nation boasts more than 1,700 land assessment agencies and 21,000 land valuers. Twenty-nine provinces, municipalities and autonomous regions have set up land valuers' associations.

Some problems have surfaced in the rapid development of the sector, the ministry's document said.

Assessment agencies were found to have violated technical regulations and make false assessments in favor of trustors, while others offer kickbacks to win more business, according to the document.

Some pay-offs were as much as 40 to 50 percent, or even 80 percent of the service charge, reported Huading Finance magazine.

Some government departments designate assessment companies to do the business for the projects they are responsible for in return for kickbacks, according to an insider who gave his name as Wang.

In some cases, trustors made a deal with assessment agencies to set advance prices before valuers could verify the actual value of a project, Wang said.

Industry regulations say appraisers should be general managers of the assessment companies. "But as far as I know, many appraisers just appear in name and there is always a boss behind the scenes who has a huge network of communications," Wang said.

Some have close relationships with officials in land and resources departments and bank credit departments, according to Wang.

"The assessment industry is facing a crisis of honesty," he added.

(China Daily August 10, 2004)