[3] The Legal Vacuum of the "Sea Palace" — The Ultimate Revelation of the "Sea Palace" Case (Serial 6)
Part One: "Rich Tycoon" Guo XX and His "Sea Palace"
5. Legal Void
"Rule of law" is a modern concept of national governance that has been gradually developed and established over the decades of China's reform and opening-up, in response to the needs of a market economy and civil society. Its core is to use law to protect the private rights of the people, while also using law to constrain the public power of the government. The so-called rule of law means that for the people, "whatever is not prohibited by law is permissible," and for the government, "whatever is not authorized by law is not permissible." Chinese society has a tradition of rule by man and authoritarianism spanning thousands of years, and the Chinese people have long been accustomed to living under such systems. To wholeheartedly embrace and practice this modern concept of rule of law undoubtedly poses a tremendous challenge. "Under the vast heavens, every place is the king's domain; within the borders of the land, every person is the king's subject." For thousands of years, people have used these lines from the *Book of Songs* (Xiaoya, Gufeng zhi Shi, Beishan) to describe this authoritarian tradition: in the wide world, every blade of grass and every tree belongs to the state; among the masses, every move and every action must obey the state's arrangements. The extreme expansion of state power inevitably leads to the extreme suppression of individual rights and freedoms, resulting in a lack of creativity among the people and a loss of vitality in society for creating wealth.
After much experimentation and exploration, the technical challenges of constructing floating island structures at sea had been successfully resolved, and the substantial funding required was not a difficulty for Guo, a certain individual. However, one issue had persistently troubled him, casting an unshakable shadow over his mind. It should be said that as a successful entrepreneur who had grown up in China's far-from-perfect legal environment, Guo had from the very beginning placed great emphasis on the legal risks of the floating island project. Unfortunately, what he encountered was a legal gray area, much like sailing a ship into unfamiliar waters devoid of navigational markers, where shoals and hidden reefs abounded, forcing him to advance cautiously. Should a violent storm arise, he might very well run aground or sink.
As is well known, the ownership and utilization of land in China have formed a relatively comprehensive legal system centered on the "Land Administration Law of the People's Republic of China." The three pillars supporting this legal framework are: public ownership of land (including state ownership of urban land and collective ownership of rural land), the land use rights system (including state-owned land use rights and rural collective land contract management rights), and the land use control system. The fundamental principle of China's land use control system is that the state formulates comprehensive land use plans, specifies land use categories, and divides land into agricultural land, construction land, and unused land. Moreover, the conversion of agricultural land to construction land is strictly restricted, the total amount of construction land is controlled, and special protection is provided for cultivated land.
The "Law of the People's Republic of China on the Administration of Sea Area Use," which came into effect on January 1, 2002, established a legal framework for the ownership and utilization of sea areas similar to that of land, correspondingly encompassing three pillars: the system of state ownership of sea areas, the system of state-owned sea area use rights, and the system of marine functional zoning. According to this law, sea areas (including the internal waters of the People's Republic of China, the internal waters of the territorial sea, and the water surface, water body, seabed, and subsoil of the territorial sea) are owned by the state, with the State Council exercising ownership on behalf of the state. At the same time, the state manages the use of sea areas through the marine functional zoning system. Any unit or individual using a sea area must, on one hand, comply with the marine functional zoning, and on the other hand, obtain sea area use rights in accordance with the law and pay sea area use fees. The rights of sea area users to lawfully use sea areas and derive benefits therefrom are protected by law, and no unit or individual may infringe upon them. This law provides a seemingly complete legal framework for sea area use. However, because traditional human uses of offshore sea areas, apart from shipping, have primarily been fishing and aquaculture—the former being regulated mainly by the "Maritime Traffic Safety Law of the People's Republic of China" and its supporting regulations, and the latter by the "Fisheries Law of the People's Republic of China" and its supporting regulations—methods of sea area use beyond traditional forms such as shipping, fishing, and aquaculture, which are still in the exploratory and developmental stage, lack clear and specific supporting regulations. Consequently, the associated sea area use rights are far less sought after than state-owned land use rights.
In 2003, inspired by offshore fish farming rafts, Guo Moumou decided to build an experimental small sea cabin. Initially, he did not go through any legal procedures, because at that time the waters of Dongshan Bay were used by coastal fishermen for mariculture, and the fishermen all told him that building a sea raft required no other approvals besides obtaining an aquaculture license. Throughout Guo Moumou's entire experimental construction process, indeed no marine fishery administration department intervened.
It is necessary to add a supplementary note here: in the legal terminology of the aforementioned provisions of the "Sea Area Use Management Law," the marine functional zoning of Dongshan Bay was still classified as a traditional offshore aquaculture area. According to Articles 11 and 12 of the "Fisheries Law," the people's government at or above the county level should issue aquaculture permits, giving priority to local fishermen for aquaculture production. However, the situation at that time was that, amid rapid urbanization, the coastal waters of the Shenzhen area had become polluted, and coupled with the siphon effect of nearby high-income urban jobs and business opportunities drawing fishermen away, the offshore aquaculture industry in the Shenzhen area had become unsustainable and existed in name only. Just as rapid urbanization inevitably transforms land around cities from low-output agricultural use to high-output industrial and commercial use, the marine functional zoning of Dongshan Bay was also destined to shift from an offshore aquaculture functional zone to a marine leisure and entertainment functional zone capable of meeting the growing recreational, entertainment, and tourism service demands of Shenzhen's urban population, while also generating higher value. The problem is that the improvement of laws and regulations and the advancement of government management measures always lag behind market development. Guo's innovative undertaking was both a trend of the times and ahead of its time, yet it was plagued by severely lagging laws, regulations, and government management. That he later endured hardships and even tragedy may have been a matter of fate!
In 2004, as technical issues related to floating islands at sea were gradually resolved, an ambitious plan to develop high-end tourism through the innovative model of "sea use for offshore floating construction" took shape. Guo subsequently submitted a sea use application to the Ocean Bureau of Longgang District, Shenzhen. The bureau attached great importance to his application and invited him to attend a report and review meeting at the district ocean bureau. According to Guo's recollections years later, those present included Director Luo Dingwen, the deputy director in charge of islands and sea areas, and Captain Dai Yuru, who oversaw the fisheries enforcement team, among others. At the meeting, the leaders highly praised Guo's development plan. In particular, Director Luo Dingwen's remarks deeply moved Guo: "The eastern sea areas and the residents living on the sea are impoverished, with no land, and even fishing cannot sustain their livelihoods. If you take the lead in developing the tourism industry here, I thank you on behalf of the local fishermen and villagers!" Greatly encouraged, Guo immediately submitted a feasibility development report to the district ocean bureau.
Because building offshore floating islands is a pioneering way to use sea areas, and the project requires substantial investment, the Longgang District Ocean Bureau asked Guo and his team to submit the report to the Shenzhen Municipal Ocean Bureau. After hearing Guo's project presentation in the municipal bureau's conference room, attended by more than a dozen people including Deputy Director Liang Junqian and Division Chief Pan Weiming, they also highly praised the project's concept and promised to promptly study the relevant regulations on marine projects before processing the sea-use procedures. A month later, the municipal bureau's staff replied that, due to incomplete laws and regulations on approving offshore floating structures and the lack of any precedent for issuing sea area use rights certificates for such structures, they could not yet process formal sea area use approval procedures. They suggested that Guo and his team first collaborate with Dongyu Village, which holds the local sea area use rights, for joint development.
While praise and recognition from government leaders at various levels is certainly gratifying, it cannot serve as an official legal permit, leaving Guo somewhat unsettled at heart. However, the commercial plans and artistic dreams surrounding the floating island at sea were too enticing for Guo to easily give up. He organized his subordinates to further study relevant regulations and also looked into the policies that allowed the Shenzhen municipal government to permit "short, fast, and efficient" projects in surrounding waters to drive economic development in nearby impoverished counties and regions. This ultimately strengthened his resolve, and in 2007, he invested in establishing "Shenzhen Maritime Elite Entertainment Co., Ltd." (Figure 15), and under the company's name signed a 25-year cooperation agreement with Dongyu Village in Nanao (Figures 16, 17), stipulating the use of approximately 100,000 square meters of sea area for which Dongyu Village holds usage rights, to develop recreational fishery tourism projects. The company would pay Dongyu Village an annual sea area usage fee of 80,000 yuan in the form of rent.
(To be continued)
