Abstract
The Owners’ Committee in China, ever since its creation in the late 21st century, has been unpopular and unknown to most private property owners in China. Ideally, a well-functioning Owners’ Committee should benefit the property owners and serve to be the entity acting in the best interests of the owners. However due to political, cultural, as well as legal factors, the establishment of Owners’ Committees in China has yet to become a typical practice, and Owners’ Committees have yet to become entities that effectively safeguard property owners’ interest. There is scarce scholarly research in both Chinese and English regarding how the law can facilitate the formation and operation of the Owners’ Committees. This Article utilizes previous research findings on this topic and addresses various problems of the Owners’ Committee, and proposes several solutions on how the reconstruction of the current legal mechanism can facilitate a well-functioning Owner’s Committee in China.

I. Introduction

Currently, the problem of private apartment and home owners being unable to participate in the management of their living environments has caused many problems in Mainland China. Many private property owners in Mainland China are not satisfied with the services provided by their designated realty management companies. As early as 1998, the owners at Liwan Square in Guangzhou, a luxurious apartment at that time, successfully initiated an election of their Owners’ Committee. However, such a success was not without a struggle, since the entire process was interfered by the realty management companies and also by government officials whom the owners believed to be sided with realty management companies. The successful election of the Owners’ Committee is nevertheless another step toward the self-autonomy of the property owners of their own properties.

Theoretically, according to the Regulation on Realty Management, private property owners can form an ‘Owner’s Committee’ which in turn should act in the best interest of the owners by supervising the service quality of the realty management companies as well as acting on the owners’ behalf in dealing with with any disputes that might arise between the owners and the realty managements. In reality however, this mechanism often does not prove to be useful, and the rights of the owners are often infringed upon without any remedy. Such a phenomenon correlates with the Chinese political culture in that the government often takes a dominant approach towards civil matters and asserts control to almost every civil activity. While such a problem might be particularly conspicuous in a state like China in which the government is often overkeen in the involvement of civil affairs, and thus impedes the development of self-autonomy of organizations like the Owners’ Committee, similar problems also exist in market oriented countries such as the U.S., only in these regions, self-autonomous organizations perish not mainly because of third party interference, but due to inadequate funding. As a result, the emergence of Owners’ Committees to a certain degree is a challenge to the existing political institutions. With the rising of private property prices in China, more property owners are troubled by this problem and are quite helpless about it. Expensive property owners who have spent their lifetime savings on their property are usually unhappy with ‘management arrangements that are imposed upon them by developers and the state.’

This Article addresses the issue by exploring ways to incentivize the owners to form and maintain functional Owners’ Committees. The private properties (shang pin fang) referred in this Article are apartments, or flats, or a number of houses collectively developed by a single developer. These properties are ‘horizontally’ subdivided as well as ‘vertically’ subdivided, meaning that land titles are linked with a part of defined space or ‘cubic area,’ and ‘which is not grounded on the surface layer of the earth.’ Such properties are governed by Chapter VI of the Property Law of China regarding ‘Owners’ Partitioned Ownership of Building Areas.’