(Xinhua)
Updated: 2008-01-08 23:29

"No work units and individuals are allowed to sign contracts with villages or farmers in private to develop farmland or unused land in rural areas," the circular said.

Illegal development of large areas of arable land will be subject to criminal charges, it said.

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The circular also noted that each rural household is allowed to have only one patch of housing land, and the land can not be distributed to farmers out of the local village.

"Farmers who sell or rent out their village houses will be rejected if applying for a new patch of housing land," it said.

The circular came immediately after Monday's notice by the State Council, which called on land conservation and higher efficiency of land use.

"If land approved for development remains unused for more than two years, it should be recovered by the government according to laws and regulations. If the land remains idle for more than one year and less than two years, land developers should pay a 20 percent non-usage fee," the previous notice said.

China is facing a sharp conflict between land supply and demand, and the area of arable land, which had shrunk by 4.6 million mu from the end of last year to 1.827 billion mu, was only slightly above the minimum of 1.8 billion mu (120 million hectares) set by the government.

The government has quintupled tax on the use of arable land for non-farming purposes and is charging foreign-invested companies as much as their domestic peers to protect farm land and better control land supply.

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