Lease Modification

Government leases, under which all private land in Hong Kong is held, usually contain restrictions on the uses which the land or buildings may be put or the permissible structures that may be erected on the land. Under normal circumstances, leaseholder must comply with all the terms and conditions as stipulated under the lease. Where a leaseholder wishes to carry out activities or erect structures for a temporary period which do not comply with lease conditions, the leaseholder should apply for a waiver from the Lands Department to temporarily relax the restriction(s) under the lease.

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In general, waivers may be granted

• for land (e.g. to permit relaxation of the user restriction or the erection of structures in respect of agricultural land)

• for buildings (e.g. to allow commercial activities in industrial buildings).

Temporary Waiver relax restrictions under Government Leases

Waivers are temporary permissions granted by Lands Department to relax restrictions under Government leases or land grants.Government leases, under which all private property in Hong Kong is held, usually contain restrictions as to the uses which the land or buildings may be put. Where a leaseholder wishes to carry out activities for a temporary period which do not comply with his lease conditions, he should apply for a waiver from the Lands Department to temporarily relax the restriction(s) under the lease. If the waiver application is approved, the Government, as landlord, will require the leaseholder to pay a fee reflecting the enhanced value of the property for the period of the waiver. Additional relevant conditions related to the new use of the property may also be imposed.Waivers are normally granted for a term of one year and thereafter quarterly until terminated by either Government or the leaseholder by giving three months' notice.Occasionally, waivers may be granted up to a maximum of three years with further extension subject to approval.

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Industrial unit limited to industrial use is converted to commercial use

• If an industrial unit limited to industrial use is converted to commercial use, it is a violation of the leasehold use.

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• If the Lands Department finds that the owners have violated the regulations during the on-site inspection, the Lands Department will issue a warning letter to the owners concerned, requesting the owners to correct the violation of the land lease use within 28 days.

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• If the violation is rectified within 28 days, the government will not charge any fees to the owners, otherwise the government will "fix" the property and charge the owners a provisional permit fee.

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• If the owner chooses to ignore or not to respond, the relevant premises may eventually be repossessed by the government.