With little warning, Fiji's government has passed a law that heavily restricts the rights of foreigners to sell or develop freehold land in the country.
Transcript
With little warning, Fiji's government has passed a law that heavily restricts the rights of foreigners to sell or develop freehold land in the country.
Parliament yesterday amended the Land Sales Act to prevent any residential land within town boundaries from being sold to foreigners for residential purposes.
It will also require foreigners who already own undeveloped land to build a house of at least a 126,000 US dollar value within two years of purchase, or face heavy fines.
A freehold land owner and real estate agent in Savusavu, Aren Nunnink, told Jamie Tahana the bill is a heavily revised version of what was proposed until Thursday, but it still has many worried.
AREN NUNNINK: Bill 28 has addressed a lot of the concerns that we had raised and that a lot of people had raised in their lobbying and emails and letters to the government and also the lawyers in their meeting with the Solicitor General. So they've backed away from applying those provisions wholesale across the entire country and have limited the application of the provision regarding purchase of residential freehold properties by non-citizens to only the town boundary. So those provisions will now apply only to freehold residential properties within the town boundaries. However this bill has now introduced a completely new provision. There was again no forewarning of this, this did not form part of the previous Bill 13, and this provision is what we call the compulsory construction provision. And this provision applies to all freehold properties in Fiji, not just in the town boundaries. And that compulsory construction provision covers the purchase of those state land or freehold properties for residential purpose. The purchase of those by anyone who is not a Fiji citizen, so any new purchases, they are required to commence and complete the construction of a new residential dwelling within 24 months within the date of the purchase. And the definition of construction of a new dwelling, it must incur a building cost of not less than 250,000 dollars. So any non-citizen buying a vacant piece of residential freehold or state land must within two years complete the construction of a new dwelling at a cost of not less than 250,000 dollars.
JAMIE TAHANA: That's a hefty sum, I mean how workable is that in your view?
AN: What that will result in, is it will actually create a huge disincentive for people to buy properties in rural areas. It's going to not have probably that much impact on those purchases you're looking at buying in some of the higher end residential estates and subdivisions, but where a local wants to sell off a piece of his farm of plantation or a vacant block of land just to raise some money for his family, you know, maybe he was looking for a price of say only 60, 70, 80 thousand Fiji dollars, that buyer is going to think twice knowing that as soon as he has bought that land he's got two years in which he must build. This imposes an immediate obligation to start the construction and to finish it within two years. And that's another problem because in some of these areas we don't have that many builders, it's not easy to get building materials and even the permit process can take as long as four, five, six months to get all the permits in place. So this is going to cause a lot of potential investors and property buyers to really think twice about about whether they want to buy a vacant section of freehold or state land.
JT: Isn't that the Finance Minister Aiyaz Sayed-Khaiyum's intention though with this?
AN: We can't get our head around that because in his town, our town, Savusavu, is very dependent on foreign investment. I mean it's the foreign investors who have come in here to buy properties, to build homes, who employ locals in construction, they've bought goods and services, motor vehicles, boats, it's those foreign investors who are driving the economy of our town. And it's going to dampen that mood of investment.
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