Transfer of rural land use rights can be a double-edged sword.

Well-regulated deals can achieve the intended target of modern agriculture, which will hopefully put arable land to more efficient use and create more profits for farmers. But profit-seeking ones with no consideration for sustainable use of land or even using arable land for non-agricultural purpose will undermine the country's food security.

Following the decision on this issue by the Central Committee of the Communist Party of China at its session early last month, some local governments have started to set up markets for the land use rights deals.

Yet, there are variables and possibly irregularities or even violations against the three "no"s - no use of arable land for non-agricultural purposes, no change of the collective ownership nature of transferred land and no infringement on the rights and interests of farmers.

Controversy surrounds the legitimacy of the latest auction of about 667 hectares of mountainous rural land in suburban Beijing. Several villagers signed a contract with the village committee in 2003 for the use of the land for 60 years.

Now they will soon auction the land use rights for 5 million yuan, and the auctioned land will be used for developing tourism.

Reports say the deal will bring profit for the village committee and several contractors. Yet, the committee has no plan for all villagers to share the interest.

As a result, some villagers question whether the deal should obtain consent from all villagers rather than from just the 18 village representatives.

The contractors do have the right to ink such a deal in accordance with the policy. But the variables after the rights transfer may prove the seemingly justifiable deal problematic.

Whether the 10 percent farmland of the total area will be used for non-agricultural purposes is in question. If it will, the deal is definitely against the three-no principle.

In addition, the definition of developing tourism is too vague. What the person or company who would purchase the rights will do with the land is also in question.

What if the land is used to construction buildings?

If so, the construction may possibly cause damage or pollution to local environment.

It is understandable that both contractor-villagers and would-be buyers would care only about the profit the land use rights will bring them.

There must be a third party to make sure that the policy or relevant legal specifications are abided by in the transaction. Undoubtedly, the local government should act as the third party.

But it has so far not been notified about the auction.

The outcome of this auction should set an example of how rural land use rights will be transferred to benefit both agricultural development and rural villagers.

(China Daily November 25, 2008)